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The stimulus trickle down is about to begin for smart grid companies.
President Obama on Wednesday announced $3.4 billion in awards to municipalities and utilities to upgrade the electric grids in their communities.
Bay Area companies including Silver Spring Networks based in Redwood City, and San Mateo-based eMeter count many of the award recipients among their customers.
None of Redwood City-based Trilliant’s customers got awards, but the company said the announcement will boost the entire market.
These companies develop networking and communications infrastructure and software to allow utilities to better manage the electric grid. They also develop software for customers that will allow residents and building managers to understand how much power they’re using, how much it costs and how to reduce their consumption.
Silver Spring Networks’ clients were awarded more than $809 million in federal stimulus money for projects totaling $1.5 billion. And those are only the clients Silver Spring has made public. While the company will net only an undisclosed portion of that, “The dollars will certainly have an impact in accelerating projects, starting up new projects and pushing things along,” said Eric Dresselhuys, executive vice president of Silver Spring Networks.
Dresselhuys said the awardees come from all over the country — something the government emphasized early on. And while he doesn’t know for sure why the federal government settled on some projects over others, he sees some similarities among awardees.
“My suspicion is that real favoritism was given to those utilities supporting open standards and interoperability,” he said. “And because this is a jobs program, too, there was a premium put on shovel-ready projects.”
Customers of EMeter Corp. were awarded nearly $590 million toward projects totaling $1.1 billion. Emeter shares a client with Silver Spring Networks in PHI Holdings, which got $350 million for four projects at its various utilities.
Before the government said it would distribute billions to enhance the smart grid, the market pretty much came to a halt as utilities that applied for money waited to see if they would get it, said Cree Edwards, CEO of eMeter. Now that the money has been awarded, Edwards expects demand for services and products from both awardees and those that didn’t get any money. Both Edwards and Dresselhuys said their companies are hiring in anticipation of increased demand from utilities.
“As the demand starts rolling in, our expectation is we’ll hire rapidly at the end of the year based on increased market visibility and our ability to forecast,” Edwards said.
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