A Customer Powered Grid with John Horton, CPower | Ep150

You know, I think as we look at the future, this is what we always say, as the borrower, we can like fight really hard to keep things the way they were, or we can facilitate the future and where it's going, and we're going to have more solar, and we're going to have more wind usage. And those are creating new challenges for the grid. But we're not going to stop and say,because there's new challenges,you know, we're not going to go that way. What we have to do as an industry is they so how do we meet these new challenges?

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Today on the Clean Power Hour, making the most of distributed energy resources, my guest today is John Horton, he is the CEO and founder of a company called CPower. You may have heard of them. Welcome to the show, John.

Tim, thank you very much. It's my honour to be part of your show. I look forward to it.

Yeah, really, I'm super pumped for this interview.And but we always start at the top with a little bit of background on yourself, how did you get interested in clean energy?

Yeah, so maybe, let me tell you a little bit about my background. You know, from an industry perspective, it's, it's quite diverse. For the last one,five years or so. I've been in executive management positions in various industries, including the computer industry, the automotive industry, and in retail, and in 2012, I joined a company called converge, which is actually one of the predecessor companies of CPower.And then in 2014, I became the CEO of CPower. So I've been in this industry for about 11 years now. And now I've got to tell you, it's absolutely the most fascinating industry I've, I've been involved in and you know, I still feel like a rookie,sometimes and learning so much.It's just, you know, the energy transition is creating so many market opportunities, you know,in every aspect of our business,there's technology opportunities there. The regulatory environment is one that's extremely challenging, but, but keeps it interesting. But I think, you know, the very best part of this industry is the people involved in it, because not only do they go to work to do an amazing job, but they're very passionate about, you know,the broader mission of what they're doing is to create this clean energy future and make the world a better place. So it really is a great industry to be involved in

The Clean Power Hour is brought to you by Denowatts, if you're a solar PV asset manager or performance engineer, you need better data and better business intelligence. With Denowatts,digital twin benchmarking technology, you get more accurate, efficient, and faster performance measurement results.The fourth generation Deno recently completed a technical review by DNV, you can download the report at Denowatts.com.That's D E N O W A T T S .com.Now back to the show.Yes, it is. The line that I use is we're creating a safer,healthier future for humanity.And you know, climate change is a serious risk. I don't know if it's an existential risk. It is threatening the good life,though, that that you and I enjoy. And if future generations are going to have as much stability and wellness, in the economy and in life in general,we have to see the energy transition, as we like to say here at the show. And so there's multiple ways of doing this.It's not about a single solution. We certainly have now a family of technologies, wind,solar and battery storage, and a myriad of others. And check out all of our content, because we do bring many, many technologies to the Clean Power Hour, all kinds of thermal technology,both heat and cold, clean power hour.com Give us a rating and a review and help others find this content because we the other thing that I you know often talk about on the show, John, is that human resources are a limiting factor. Yes, we need to make a lot more batteries and solar panels and winter fans. But we need to educate people and get them excited and interested in the clean energy industry because it's a tremendous economic opportunity to do good you for future generations and to do good by their pocketbook while doing that. So tell us a little more about CPower. What is it in? Who are your customers?

Sure. And let me start a little bit about CPower,it's CPower is the national leader in distributed energy resource monetization. And to put that in simple terms, what we do is we pay customers to reduce their electricity usage,in times of grid lead. So in essence, we're a virtual power plant. So the grid needs sources of flexible power, and they pay providers to do that. And our customers are the DDR owners have the resources to provide that flexibility to the grid.And then see, power is really that bridge between the grid need and those customer capabilities. And we facilitate using those customer capabilities to fill the grid need. And by using those capabilities, that customers we've coined the term, a customer powered grid. And, and so that is our vision is to create this customer powered grid, we've got 6.3 gigawatts of Dr. Capacity under management that over 17,000 customer sites,and we really help balance the grid across the United States.And best of all, we're doing it in a very clean manner. And where we are helping enable energy transition, as you just talked about, you know, in in pursuit of this flexible, clean and dependable energy future, so we're really proud of, of what we're doing. It's HIPAA.

Well, the little I understand of the grid, is that it is one of the most complicated machines that humanity has ever designed and built. And so I immediately go,Well, gosh, that sounds really hard. What you're doing so tell us a little in a little greater depth, what exactly do you do isn't a hardware and a software solution? And, and then let's talk about some of your, you know, success stories? Who are you working with? What is the good customer? What are the best markets? Is it truly anywhere,their solar, wind and storage happening, you can go there, or

maybe let me get a little bit of background and maybe define some of the terms that, you know, many people throw around, and I get to put them into context of how we use them and how I'll talk about it,I think it's helpful, you know,for this first term is distributed energy resource. And how we define that is any behind the metre asset that either consumes, generates or stores electricity, and can respond to a grid needs. So that could be something as sophisticated as battery storage. Or it could be the refrigerator in your house.You know, if it's consuming electricity and can respond to a call from the grid, we consider that a distributed energy resource. Then another term that many of your listeners I'm sure have heard about is in a strategy to use Drs. You know,to help stabilise the grid is something called demand response, then demand response has been around for many years,and has proven very effective in promoting grid stability. And it really involves paying customers to reduce their energy usage when called upon by by a grid operator. So, for example, on a hot summer day, you know,there's a lot of air conditioning being used, the grid might be stressed, where demand is exceeding supply there. And so the grid can do one of two things. They can call on additional supply, like a peaker plant, which is usually a fossil fuel burning plant to help put in supply and demand and balance. But we think the better alternatives, or an additional alternative is to use demand response to lower demand.And then an example would be like a big box store in your neighbourhood that's signed up to participate in, in these programmes. They'd be contacted by us on this day, to respond in the manner that they agreed to,and that might be for that store that they lower or they increase their temperature by a couple degrees. They dim their lights in areas that aren't going to pose a safety threat to customers. And they you know,curtail their load by the agreed upon amount, maybe 100kilowatts, and then when we aggregate that all to, you know,among 1000s of customers. It really is impactful align the grid. And then one more term, we use this concept, Dr.Monetization, I said, we're the leader and Dr. monetization. And what we mean by that is it's a broader term than just demand response. And it really means we go out to our customer sites and optimise their distributed energy resources. And it might be that they participate in a grid programme through demand response, that also might be helping them lower their electricity bill, you know,through shaving their peak, or it could be just using their distributed energy resource for resiliency purposes during that particular time. So it said optimization of those DRS that we really think is, you know,where the future of this business is going.

Yeah, you know, we energy professionals, sometimes we forget that many other parts of the built environment can be or can provide services to the grid, you mentioned refrigerators, any HVAC system,the building itself, right is a container of heat and cold. And you can leverage that to moderate demand, as you said,and so, you know, the, I guess the light bulb is starting to go off for me that you're, you're,you're kind of turning on the built environment, and leveraging all of that infrastructure that we've already built in ways that are good for the grid, and can be potentially monetized for customers. And, you know, I'm looking in your, in your newsroom. And my goodness, you know, you've got this slew of really awesome news, you're expanding your footprint, into ISO ne, you're already in PJM,which is the largest ISO in the country. So you're, you know,serving huge swaths of the United States. But let's let's I would love to bring this down to earth, though, also and talk about a use case is, is it? Are your customers, you know, large corporates, are they real estate companies, are they cities would give us give us a taste of a couple of customers?

Sure. I'd like to start by just by talking a little bit about, you know, the vernacular we use around customers. Because, you know, in reality, from an economic sense,we're providing the service to the grid, and the grid is paying for that service. So in a true economic model, that grid is our customer. And those that provide the, the load to the grid, or the reduction in load, in our case that are really in a true economic sense stands, those are suppliers, but we feel so passionate about those companies that, that help us achieve this,that, you know, we want to make sure we treat them, like with the most care and in the best.And so we refer to them as our customers. And so, customers, in our sense, we've got over 2400unique customers and 17,000sites, the majority are CNI customers, and that could range from department stores, Home Improvement chains, it could be a large data centre, it could be an industrial, like a steel manufacturer, commercial building, or, you know, health care facilities that also governments are make up a good part of our customer base. And those could be things like military bases, or, you know,another good example is the state of Virginia as one of the biggest programmes around they,they are really active in getting all the state facilities and departments to sign up in a,a programme that where they're able to participate in demand response. They're more and more it's it's companies like DRS that owners so a someone like a micro grid developer scale micro grid is one of our customers, as well as customers like it could be an Eevee fleet owner or Evie charging company likes of ampli power and island electric car,our customers there. And then you know, in those cases, what we're doing is help them achieve, you know, reduce their cost of providing the service to their customer. to immerse, you know, so we can deploy more of that out in the marketplace. In even companies like residential aggregators, an example would be resilio, or our Google mess,that have 1000s, of thermostats,you know, for that their customers of theirs purchase,and we can help them and roll those thermostats and net customer H PAC load into these programmes. So it's, you know,it is is really back to the definition, anybody that can,you know, is consuming can store or generate electricity, you know, has that capability of participating in these programmes, and being our customer there?

This sounds fantastic. I mean, I resonate tremendously with this. But again, it also sounds quite complicated. So I'm just curious, you know, think of a,think of a factory, it's, you know, it's got a lighting system, it's got an HVAC system,it might have refrigeration in it. If there's cold storage,and, you know, talk to us about what exactly has to happen for a customer to onboard a service like C power? Is there, you know, do they have to instal new hardware? Or will you plug into some existing building control system that they already have?

Yes, so it may be sounds like it's complicated,but it really is relatively straightforward to participate,excuse me, in most of these great programmes. In your example of a factory, what we would do typically is send our engineer and one of our engineers out to the factory and, and talk to them about the possibilities of, you know,understand what machinery equipment and other, you know,assets they have on site,including their H fac, and lighting, etc. So we would look at their normal electricity,electricity load, and then talk to them about in a time of an event when the grid needs your support, what is it that we can together do at your facility, in order to drop electricity load and meet a commitment that you have to the grid, and it could be as simple as like turning off certain machinery, you know,modifying the lights modifying the temperature, in order to bring the electricity load down.And again, while you know, even if a customer can participate at a fairly low level, and what might seem like a low level of50, to 100 kilowatts, in aggregate, if we do that across1000s of customers, it adds up to the 6.3 gigawatts that we have. So you know, it's, we try to make it as simple as possible for a customer to participate in these programmes. Well, one other point on that, you know,where we're going as an industry here is to our goal is always to make it as easy as possible for the customer. The easiest is some kind of automated, you know, deployment of the signal from us to the customer. And,and, you know, at the customer site, it automatically does, you know, puts in place the protocol that they've agreed on, this happens quite a bit at big box retailers, where we interface with their building management system, and, you know, just by sending them the signal, it can do things like lower lighting,you know, affect the temperature there. And so they don't even have to really think about it.They're they're just participating as, you know, as as needed. There. Right. You know, one, one thing you had mentioned, Tim, about just, you know, some success stories, and I didn't answer that earlier.But I would love to, because I think it is is really important.In the past, we thought about things like demand response as something that maybe would be participating on peak summer days to help out when the grid is really stressed in the summer, but more and more it's used as both a year round resource. We help out in winter weather events, or throughout the summer, and it can fill in the gaps of intermittency created by renewables. on the grid times when the sun doesn't shine and the wind doesn't blow and you get that drop and and power generation, you know, use of DRS and help very much in those the areas there. You know,we dispatch in 60 programmes throughout the year in 2022. We dispatched over 1000 times including, you know, for three days straight in Ohio in the summer when, you know, due to that the storm there was infrastructure damage and severe heat and really helped stabilise the grid there in California.You know, there's constant need to help stabilise the grid grid and we you know, in summertime especially get dispatched multiple times a week and I think one of the things we do one recent example that we're really proud of is during winter storm Elia that occurred over the past you know, in December over the holidays there, CPower customers delivered more than 50gigawatt hours to to load relief there. And you know, that is just like proves the fact that this isn't just a summertime peak resource anymore. It is something that can help stabilise the grid, year round and, and on quick notice as well.

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I think, you know,one important thing to know, is just where this whole industry is going, and therefore, where state power is going as well.And if we look at the history of demand response, you know, it's really has been around for 20plus years, and in various forms, like interruptible rates that utilities put, you know,gave to certain large usage customers, or we've tried Time Of Use pricing in the past,which just tried to incentivize the people to say, you know, the price is gonna go up, I can maybe use electricity later time, later in the day or some other time. But on the farm, our most successful use of demand response has been as a dispatchable asset on the supply side. So in here, like I was describing previously, you know,a customer signs up contractually to a specific load drop when called upon, and that's what makes it such a reliable and responsive resource. And it's not only reliable and responsive, but it's very clean because the cleanest kilowatt of all is one that we don't use right in how that is changing now is there's a couple dynamics going on. One is big growth and DRS is is tremendous. You know, we are already have a lot of things that are plugged in, but increased electrification and heating, and other things is exploding, right. And then customers need for resiliency is also driving, you know, a add on of distributed energy resources,you know, more and more customers don't want to be without electricity ever. And so they're putting on the ers in order to meet their need for resiliency. And also, you know,they have certain sustainability initiatives that they are utilising their D Rs for in so that's on the customer side and,and the grid grid side, it really is this, you know,increased intermittency caused by renewables and these increased weather events that we're having extreme weather events, whether it's winter praise, or, or a summer heat that is causing stress on the grid, it's really then technology that's helping us match the capabilities of these DRS to the needs of the grid.And it's changing, like how these D ers are being able to use to solve the grid problem.And it's expanding the participate, the participation among the number of customers that really can participate in these programmes. So you know,it's really an exciting time to,to be part of this industry,where we're going at sea power is is really pursuing exactly those changes. It's, you know,it's it's software to help customers optimise their use of DRS at their site. So they can use it for a grid programme,they can use it for resiliency needs, or they can use it for anvil sakes, we can tell a customer now on a 24/7 period.What were the best use of that particular VR is? I think it is It's technology that helps us aggregate these capabilities of the customers in unique ways.You know, for example, Tim, if you could participate in the summer, and I can participate in the winter, see power can put those loads together and say,now I've got a year round capability that I can present to the grid, when previously,neither one of our capabilities might be able to, to participate there. And the third thing that's really exciting that we're doing, there's more than three, by the way. But a third thing is what we call on demand energy storage, we want to help our customers put on as many DVRs, you know, that help them meet their needs. So we're facilitating customers put in putting in energy storage at no cost to them, they use the storage for resiliency, we put the storage in grid programmes and, you know, together we make that work for all parties, it's good for the customer, it's good for C power, it's it's great for the grid, so a lot really happening, you know, that technology is enabling us to really grab this opportunity of DRS increasing in grid need increasing.

You know, one of the one of the exciting statistics we report on here on the Clean Power Hour pretty regularly with my co host, John Weaver, we do a Thursday, live news round up. And, you know, in2022, we broke the 10% mark of wind and solar on the grid, and we're headed to a grid that is going to be 80 to 90% wind and solar by 2050. So solar of that10% solar is about 5% So we're gonna we're gonna 10x Solar by2050 You know, the the instal base compared to what it is today. And that's a blessing and a curse it it means a lot of economic activity, a lot of installations, a lot of jobs and manufacturing and, and, you know, all the construction work that goes into those projects.And that's and that's good for society. But it can also give,you know, grid operators, the heebie jeebies, and they're kind of scratching their heads trying to figure this out. You know,one of the things you've used,one of the things you said was,you talked about kind of the fractured nature of the grid and our infrastructure. And truly,you know, we've divided the grid into these somewhat artificial zones, you know, these these ISOs, you know, Northern Illinois in PJM, central and southern Illinois and miso, one state, for all intents and purposes, one grid, but two very separate grid operators. And you know, it's an in and then we have, on top of that a whole Swiss cheese of, of coops and Munis in the more rural parts of the state. And that picture is,is quite complicated. And those systems aren't necessarily talking to one another. I mean,the grids are connected.Luckily, you know, we, that is like a mission critical thing that the grid is a super grid,or Akkad is the one exception,and they are not connected to the to the rest of the grid, and that, that almost was a major fiasco for them a couple years ago, when there was that grid outage. And literally, they were just minutes away from a much,much worse problem. But when you think about these kinds of, you know, these mega trends in clean energy, and the services that sea power is providing not only to the built environment to the sea and AIS and the and the, you know, the municipal, off takers,what is what is the value that you are offering to utilities and the offtake community, I guess, to modulate this in some way? Yeah, and that's, you know,I

think as we look at the future, this is what we always say, it's the power we can, like, fight really hard to keep things the way they were,or we can facilitate the future and where it's going, and where it's going is absolutely what you just described, and we're going to have more solar, and we're going to have more wind usage. And those are creating new challenges for the grid. But we're not going to stop and say,because there's new challenges,you know, we're not going to go that way. What we have to do, as an industry is say, so how do we meet these new challenges? And is it absolutely using customer dtrs, you know, to help fill in the needs of the intermittency gaps created by renewables help fill in the times when we have extreme weather that creates a need on the grid. Because, you know, if we don't utilise DRS,in this positive way, they could become a real problem is if because grid operators are also always dealing with uncertainty around demand. But if you put a lot of storage and solar, and then a lot more electrification of EVs, you know, behind the metre, their ability to predict,you know, what is going to happen, and what they need, just gets harder, what we're proposing is we harness all that capability, instead of making it then part of the problem, it becomes a huge part of the solution as, as we're going forward. So, you know, we,there's, there's a tonne of opportunity using distributed energy resources and, and state power is out in front, you know,trying to help make that happen.

I'm beginning to think about you as a operating system for for modulating the grid in a way. And, and, and,you know, I, I just wonder,like, what is the response you're getting from utility customers,

the beauty of what we do is it can help on the distribution grid, it can help on the bulk rent, as well,because, you know, we're really helping both of them solve the problems. So, I think, you know,the, there's a definite need and a openness really on all parts to, to embrace DRS as part of the solution. You know, that's that I think technology always moves faster than policy. And therefore, there's a lot we can do and see powers and you know,every day kind of advocating for the changes that will make utilisation of Drs. More you know, wide widespread, but we're really an established with rules that were you know, built for bulk generation there. So when you talk about, you know, the fact that we're enrolling 1000s of customers and you know, our vision is is every item in your home, your refrigerator, your Evie charger, your H PAC system is part of this solution and in the future. That means we've got to go Oh to like millions of customers, you know, that might be able to, to participate and in one to two kilowatts there.So what we've got to do as an industry is make that process of enrolling in measuring that load drop and, and being able to compensate those customers,we've got to make the rules a lot easier. And recognise that this isn't a, you know, huge generation plant, it is something completely different,but has so much value that we've got to put emphasis on making the rules such that we make it easy to participate.

Yeah, well, I agree making it easy as is certainly vital. Um, I'd love to talk a little bit about this United Nations 24/7 carbon free compact I, I didn't know this thing existed. Before some somebody sent me, you know, this press release of yours on that topic. And so what is the what is the 24/7 carbon free energy compact, and how to see power fit into that,

I'm probably not the best person to tell you all the details about this specific compact, but here is what we're always trying to do is, you know, we know that it's going to take a lot of industry cross collaboration, to make the changes that we need to enable the energy transition, and move towards this cleaner, and more dependable grid that we're all working towards. And in so we evaluate, you know, these all these forums, that where we have an opportunity to sit at the table with others that are thinking the same way, just collaborate and brainstorm about ideas in order to advance, you know, our mutual goals there. So well, this is just one or this is one forum, which we think is going to be a really good one.In order to achieve just that.

I guess I'm, I'm curious, you have it you have a unique perspective on, on what's going on in the world of energy?What should our listeners be thinking about that they may not be thinking about? You know, as,as my listeners know, I am I'm beating a certain drum about speeding the energy transition that drum is we have the technology, it's a question of,will we instal the technology fast enough to avoid catastrophic climate change, for example? And, but, but you have a, you have a different perspective. So I'm just curious, like, what should people carrying energy professionals and aspiring energy professionals be thinking about that they may not have on their radar?

I think maybe to sum it up with say that, you know, fully utilising the power of customer DRS, is really going to be critical to the energy transition, because the grid needs that flexibility. And customers that have these DRS have so much potential to, you know, use those D ers to, to provide that flexibility that the grid needs. This is going to take a lot of innovation and development of new technologies on the part of C power and in companies like C power. But it's also going to take a lot of regulatory changes that provoke for multi effective views. So the hours to help solve different needs. But, you know,I think if you put it all together, it really comes down to a simple choice for the community, and maybe just the planet at large there. And when the grid is stressed, there's a couple of choices we can turn on some peaker plant that's burning fossil fuels there, or we can seamlessly reduce customer consumption, you know, to keep the lights on for everybody. And we think that customer power grid really is the answer and,and we're asking everyone to really help us and enjoying on this journey. What's the power?

The Clean Power Hour is brought to you by Dena watts. If you're a solar PV asset manager or performance engineer, you need better data and better business intelligence. With Denowatts digital twin benchmarking technology you get more accurate, efficient and faster performance measurement results.The fourth generation Deno recently completed a technical review by DNV you can download the report at Denowatts.com That's D E N O W A T T S .com.Now back to the show.Well, there you have it a customer powered grid. I love that expression. And I want to encourage our listeners to check out all of our content at Cleanpowerhour.com. Please give us a rating and a review so that others can find this content we need to bring 1000s and 1000s more people into the energy transition so we can achieve our goal of speeding the energy transition. I want to thank John Horton for coming on the show today with CPower. I'm Tim Montague. Let's go solar and storage. Thank you so much,John.

Thank you, Tim.