EDMONDS — A MicroPlanet Ltd. invention could change the way utility companies deal with the rising demand for electricity. It also could save some homeowners and small business owners thousands on their power bills.
Which explains why the voltage regulators developed by this Edmonds business have caught the attention of energy companies around the world.
"The premise of our technology is if you improve efficiency in the system, that efficiency backs up all the way back up the grid," said Brian Reidy, MicroPlanet’s chief executive officer.
That means utilities could serve additional customers by wringing more efficiency out of their existing electrical grids rather than building new power plants to meet rising demand, he said.
The early-stage company, which incorporated three years ago, is ready to put its home voltage regulator to the test. The Portland-based Northwest Energy Efficiency Alliance is set to begin a large-scale trial of the device’s benefits in the coming months. Up to 500 of MicroPlanet’s voltage regulators, made by a California manufacturer, could be used in the test.
Jeff Harris, manager of product development for the alliance, said test of the voltage regulators has wider implications for power companies.
"The test is really about proving the benefits of voltage regulation, not just the home voltage regulator itself," Harris said.
But if the utilities are convinced that lowering the voltage they send out across neighborhood power lines is effective, it could create a market for MicroPlanet’s device, Harris said.
Oddly enough, the core technology behind MicroPlanet’s innovative device was inspired by a problem in Hollywood.
In the early 1990s, MicroPlanet founder Greg Weigand was a lighting specialist for movie and video productions. The industry used dimmers to control the high-powered lights on sets, but they created a loud hum that interfered with sensitive sound equipment. To avoid recording the hum, technicians used long cables to move the dimmers off the sets.
Looking for a more practical solution, Weigand developed a prototype of a quiet dimmer circuit for set lighting. He later discovered the technology behind his converter could have wider applications, and MicroPlanet was born.
The company ended up in Edmonds because that’s where one of his early business partners lived. For Weigand, a resident of Poulsbo, it was only a ferry ride away.
Reidy, formerly a management consultant in Chicago, first was asked to be an investor in the company. After learning more and meeting with Weigand, he joined the company as its CEO in early 2001.
Explaining how the voltage regulators work, Reidy refers to it as new technology designed for use with an electrical infrastructure that, in many cases, is more than 50 years old.
"When electricity moves from the substations, it’s like water running down a hill — it dissipates," he said.
The utilities are required to provide households with a steady stream of at least 114 volts, the voltage required to effectively run normal appliances and lights. In order to get that voltage to houses and businesses farthest from the substations, most utilities send out electricity from substations at 120 to 126 volts.
"The average consumer in the U.S. receives 122.5 volts. That means a pretty significant number are receiving more than that," Reidy said.
Those extra volts, basically unneeded, do nothing for most customers but add to their electric bills. In fact, the extra volts can create heat in electrical equipment, which can shorten its life.
MicroPlanet’s voltage regulator — metal, triangular boxes that mount next to a home’s electric meter — takes the incoming voltage and regulates it at an adjustable level. Usually, it’s set at a stable 114.5 volts. That’s the "sweet spot," the voltage at which most home appliances and electronic devices run most effectively.
The result is an estimated savings of up to 10 percent for the customer and a reduction in wasted voltage going down the power lines. In rare cases where households are receiving less than 114 volts, the regulator devices can boost it up to that level.
It isn’t just a theoretical solution, said Bob Fletcher, chairman of the Northwest Energy Efficiency Alliance’s technical advisory committee and a principal planning engineer with the Snohomish County PUD. After doing tests in the late 1980s, the PUD slightly lowered the voltage on half of its lines and is preparing to do so on the rest. With the use of a product such as MicroPlanet’s at some homes and businesses, the PUD could probably further reduce the voltage it sends from its substations, Fletcher said.
Similarly, if other utilities use regulator devices for 5 percent to 10 percent of their customers and lower their overall voltage outputs, it could result in big savings, Fletcher said.
"Hopefully, it will become clear to utilities that there’s a real, clear benefit to regulating their voltage," said Fletcher, who is involved in the upcoming test of MicroPlanet’s devices. "The alliance is trying to encourage that, but the utilities need to know there’s real savings."
In addition to its home voltage regulator, MicroPlanet also has a larger version designed for use by small businesses. The company has talked to representatives in the convenience store industry, which seems perfect for the device. After labor, electricity is the second-largest cost for most convenience stores, which tend to be open 24 hours a day and have to run large coolers to keep beverages and other products cold. Fast-food restaurants also could benefit, Reidy said.
So far, the company has a couple of dozen demonstration units operating in the United States and Britain, Reidy said. ScottishPower, which was MicroPlanet’s first official customer, will soon try out a version made for the British electrical system.
Each household regulator unit now costs more than $1,000, although Reidy said that cost will go down in the coming years. While it may never be practical to install one on all homes, MicroPlanet is hoping for that 5 percent to 10 percent threshold that Fletcher mentions, Reidy said.
During these development and testing years, MicroPlanet has stayed afloat thanks to millions from individual venture capital investors and its staff, which now includes utility industry veterans. In the next year, the company hopes to approach institutional investors for more, Reidy said.
To reach a break-even or profitable stage, the company has to start selling several thousand units, Reidy said.
Meanwhile, the company’s team already is trying to look ahead at what products might replace its voltage regulators. At a time when the first product is just getting off the ground, that admittedly is down the road quite a ways, but Reidy said it’s a necessary view.
"We’re selling to the electrical utility industry, so we need to think like the industry, which means very long-term," he said.
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
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