I recently interviewed Tucker Twitmyer, a managing director of EnerTech Capital (his bio can be found here). Tucker will be a part of the panel for “Early Stage Financing for Clean Tech” on Friday during the Net Impact North America Conference.
We spoke briefly about oil prices and EnerTech’s reactions to recent drops in oil prices. Many cleantech investments require oil at recent prices ($80+) in order to be competitive, but apparently EnerTech isn’t worried.
TT: “We try and anchor our portfolio on an assumption of oil at $40 a barrel. The EnerTech II portfolio was built with oil at $18-32 a barrel. So, we try quite diligently to eliminate what we refer to as unmanageable risks: commodity risk, regulatory change risk, and capital intensity risk.”
TH: “So that means you’re not sitting there watching commodity prices on a ticker on your screen. That’s gotta make your life a little easier.”
TT: “Good question. No, we’re not. What I have up on my screen is information from my CEOs about how they’re managing their cash burns and trying to creatively find ways to increase their revenues and drive bottom line results.”
I also asked Tucker about what companies he’s working with that he personally finds the “cool”est. He had two: a nano-steel company that has developed “a whole new family of metals that potentially change the strength-to-weight capabilities of steel so significantly that it would have an impact on absolutely everything that is built up into the sky, runs on wheels, gets powered by propellers or jets…” and a smartgrid company called Current.
TT: “Current is a power line carrier company, so they move data through the electrical lines at the same time you are getting electricity. This is so exciting because the utility grid is a dumb network. With the use of Current, you could improve the utility’s overall efficiency by 5-10%. That’s billions of dollars every year.”
TH: “I’m having a hard time visualizing how this would work. Are we talking about smart meters? Take me a step further…”
TT: “If you think of the utility grid, the last third of the grid is called the distribution grid. There’s little to no intelligence in that grid whatsoever. When people talk about smartgrid, they’re usually talking about smart meters. What we’re talking about is data-enabled electricity lines such that you can attach a device anywhere along the distribution grid including plugging it into a wall socket and having that device being an immediately recognized and addressable device. It opens up the opportunity to do a lot of the things that people have wanted to do for a long time but have been unable to do. Voltage monitoring, transformer monitoring, vegetation management.”
Pretty amazing. Plug ‘n’ play addressability is very complicated to achieve on a broad scale. Think of IP addresses and how your home router splits them into subdomains, making true two-way communication with the external internet cumbersome for your home computer. It seems that Current has solved this problem, as a device would be addressable regardless of where it was located in the network.
Tucker also went on to take the obvious next step, which is to say he suggested that these data-enabled electricity wires could be used in other ways than to run the grid. Think voice, video, and data delivered via standard copper electricity wires. Funny, I could swear I was just thinking about this very thing.
Tristan Handy is a first year MBA student at the Kenan-Flagler Business School and part of a team of students that is covering the Net Impact North America Conference for Triple Pundit. He is the founder of SustainableCapitalism.org.