My Clean Break column from Friday revisits RuggedCom, the Woodbridge, Ontario-based maker of ruggedized communications equipment for the smart grid. The company celebrates its 10th anniversary this week, and is at the top of its game. Sales of routers and switches designed to operate in the harsh environment of the grid are climbing steadily, profits are also growing, and the company is on track to breaking $100 million a year in revenues, about two thirds of it coming from utility customers. In the market it plays in, the company has a commanding lead over big names such as Cisco and General Electric, and while it doesn’t get much attention from media south of the border, utility purchase managers know the company well. Investors are starting to catch on — in the past four months the company’s share price has shot up 70 per cent.

Ontario has done well with its deployment of smart meters, but it’s often forgotten that the smart grid is much more than that. Smart meters are on one edge of the grid — that is, attached to the customer, no different than a cable modem’s placement in the larger cable infrastructure. But the smart grid is about adding automation, communications and digital technologies throughout the entire grid, from generation to delivery to consumption, with the idea that the information collected and acted on can make the electricity system more efficient, adaptable, reliable and safer, while allowing for the introduction of new services and business models that ultimately benefit consumers.

RuggedCom supplies the core communications technology for transmission and distribution infrastructure. And it’s not alone in Ontario. General Electric decided back in the mid-1990s to consolidate its global operations around T&D equipment and today its facility in Markham is considered the company’s global smart grid headquarters with respect to core grid products. The equipment GE and RuggedCom are designing and manufacturing in Ontario, and exporting to countries such as China, may not be as interesting as smart meters, in-home displays, energy-management portals, or smart appliances, but they’re arguably more important to realizing the true potential of the smart grid.

And Ontario, it seems, is a hotspot for this kind of innovation. RuggedCom’s CEO, in fact, believes the company can grow to more than a billion dollars in revenues over its next 10 years. Canada’s next RIM? Wouldn’t be as as high profile, but certainly the potential for that kind of success is there.

My Clean Break column, which now appears Friday in the Toronto Star, questions whether we have the capacity as a society to invest in long-term infrastructure transitions that don’t bear fruit right away. The knee-jerk reaction by some in Ontario (and other jurisdictions) to smart meters and time-of-using pricing is unfortunate, because it reveals a state-of-mind that will also end up impeding other necessary infrastructure transitions. It’s short-sighted and ultimately self-destructive. I will be the first to accept that Ontario’s feed-in-tariff program has problems with its design and price structure, and that in some scenarios there are certainly better ways to reduce CO2 emissions and stimulate jobs. It’s a good program in principle, but delicate adjustments will be needed and much more emphasis must be placed on conservation and co-generation/CHP.  But the smart meter program is right on the money. It helps lay a  new foundation for the electricity system, the same ways digital technologies and cable modems unleashed the Internet and wireless communication services.

A story of mine published this week in MIT Technology Review takes a look at a new robotic device being designed by researchers at the Electric Power Research Institute, a non-profit research organization for the utility sector. Tens of thousands of kilometres of overhead transmission lines stretch across North American, bringing electricity from central power stations to population centres. The system we have is aging and in need of upgrade, while expansion is also on the horizon as states and provinces move to connect remotely located wind, solar and geothermal power sources. At the same time, past methods of inspecting the condition of transmission infrastructure is getting trickier. Many of the workers skilled in this area are nearing the age of retirement, threatening to create a skills gap in the coming years. It’s for this reason that robot inspectors are beginning to attract attention, with the idea being that one day we might have fleets of inspection robots moving along the nation’s power lines 365 days a year.

The folks at EPRI have designed one two-metre long prototype that looks kind of like a small solar-powered car — you know, like one of those high-tech solar cars you might see on the Discovery Channel. The robot, which is likely to be much smaller when commercialized, moves on rollers that clamp onto the shield line (there to attract lightning strikes) located just above the transmission lines. It crawls along the shield line at about 2 kilometres an hour. A high-definition camera snaps digital images of the surrounding infrastructure, making sure vegetation (trees) below isn’t interferring with lines and benchmarking the state of equipment and lines so they can be compared to future inspection runs. The robot will also have sensors that can detect electromagnetic interference, measure temperature of equipment and spot faulty line connections, among other things.

The data and images collected are transmitted back to a central office via satellite (in more remote areas) or cellular linkup. A lithium polymer battery powers the robot. In the picture above, it appears that the device is lined with solar cells, presumably to charge the battery. That was an older design. Andrew Phillips, head of transmission research at EPRI, said the latest prototype charges the battery by harvesting energy from the transmission lines below it. The transmission lines give off electromagnetic energy, and this is collected in the shield wire through induction. The robot taps into that power flow in the shield wire during the evening to recharge the battery. There’s still a small solar cell, however, for limited backup power.

So how are transmission lines currently inspected? Typically, crews are dispatched with helicopters that visually inspect vegetation and the basic condition of equipment, as well as collect data from sensors previously attached to transmission equipment. It costs a lot of money — both in helicopter and labour costs — to cover so many thousands of kilometres of infrastructure. EPRI figures that its robots can do the job at 70 per cent of the cost, collect better data, and do it without the safety risks that come with flying helicopters close to high-voltage wires.

Seems like a great use of technology — I can even envision these robots playing a grid security role as well, particularly as the electricity system becomes an even more strategic asset in an age of electric transportation.

It’s nice to see Ontario’s information and privacy commissioner, Ann Cavoukian, being so proactive on the issue of privacy as it relates to deployment of the smart grid. (Disclosure: Cavoukian is a good friend of mine and co-author of a book we wrote on privacy issues back in 2002).

Cavoukian’s latest annual report highlights the privacy risks involved with the rising use of smart meters and the increased collection of granular data about when and where people are using electricity. “In a future smart grid scenario that does not build in privacy, intimate details of hydro customers’ lives could be easily discerned by data automatically fed by appliances and other devices to the companies providing electric power (eg. what time you cook, shower, or go to bed — and the security issues such as whether the house has an alarm system),” Cavoukian writes in her report. “Once inferences can be drawn on granular energy consumption information flowing outside of the home, such as real-time energy use data, future consumers may have questions including: Who will have access to this sensitive data? For what purposes? What are the obligations of companies making smart appliances and smart grid systems to protect my privacy?”

Cavoukian has a new program called Privacy By Design, which places focus on the need to build privacy into new technologies and systems from the outset, rather than scrambling to make privacy/security fixes after there has been a major — and often embarrassing — information breach. The whole point of this is to learn from past mistakes during the early days of Internet, Web and e-commerce development, when companies rushed ahead to come out with services without considering the privacy implications. This got many companies, including big names like Intel and DoubleClick but also high-profile retailers, into a lot of hot water. The rise in identify theft only brought increased attention to the problem. Whether it was disgruntled employees looking to take advantage of this information from the inside, or clever hackers looking to steal information for a profit or for bragging rights, having so much detailed information about individuals in one place is — in Cavoukian’s words — a “treasure trove” that needs to be protected like Fort Knox. You can bet there are already hackers out there looking to make a name for themselves by being the first to access consumer information through smart grid infrastructure, even during these early days.

That’s why it’s crucial that utilities and their partners think of information privacy and security now, rather than as a Band-aid measure later. Not only is this a good strategy to avoid future legal challenges, it will also save them a lot of hassle and embarassment in the long run if they treat privacy/security seriously from Day 1. For that reason, I think Cavoukian’s Privacy By Design message needs to spread across the industry as we embark on what’s expected to be a massive, multibillion dollar smart grid buildout.

I got my start in mainstream journalism as a technology and telecommunications reporter for the Globe and Mail, a beat I later took on at the Toronto Star and covered for six years before switching to energy. When I first started we were still using the term “information highway” to describe the coming convergence between the telephone and cable companies. Cable companies in Canada had their own networks, their own turfs, and their own regulated monopolies, while the phone companies had the same. The turfs overlapped, but the products and services stayed largely separate. You got cable from the cable guys, and phone service from the phone guys. The information highway threatened to change that, allowing the phone and cable guys to invade each other’s turf and bust through their respective monopolies.

The commercial Internet was still in its infancy and was considered part of the information highway. It was only in the mid-1990s that the Internet emerged as the dominant disruptive force in this technological vision. Internet Protocol, the communications standard underpinning the Internet, allowed all sorts of information — text, audio, video — to be treated as packets of data that could be shipped at high speed across cable and phone networks, which were privately operated networks that had on-ramps and off-ramps to the public Internet. As networks became faster, as compression of data got better, as computing power and memory grew exponentially, it became technologically possible and economical to deliver phone, broadcast, e-commerce, Web surfing and e-mail over both the cable and phone networks. The result: network convergence. Suddenly technology was creating competition in these regulated monopolies, forcing regulators to adapt and establish rules that permitted regulatory forbearance when competition in a market was deemed acceptable. For the phone and cable companies, the gloves were off. It was game on. 

Why am I telling you this? Because I’m seeing the same thing happening in the energy sector. (more…)