Honeywell (NYSE:HON) on Friday announced the acquisition of San Rafael, Calif.-based Akuacom, a company involved in automated demand response technology and services for the smart grid.
Terms of the transaction were not disclosed.
Akuacom's Demand Response Automation Server provides utilities and independent system operators (ISOs) two-way communication with energy management systems at commercial and industrial sites. This gives utilities and ISOs the ability to automate the delivery of price and reliability signals to these facilities, and more effectively trim peak demand. The acquisition adds to Honeywell's energy management and smart grid portfolio.
The demand response (DR) industry will begin a period of dramatic growth in 2013, according to a recent Pike Research report, which forecasts market growth from $1.4 billion in 2010 to $8.2 billion in 2020. A consolidation of companies and technolgies is currently underway. Recent deals include:Silver Spring Networks and Energate; Control4 and Lockheed Martin (NYSE: LMT); Cogent Energy and EnerNOC (Nasdaq: ENOC); and GridPoint and ADMMicro.
Utilities and ISOs use demand response to reduce consumption when electricity is expensive and demand outpaces supply--usually on hot days when air conditioners and cooling equipment are running in most facilities. By working with their customers to control energy use, utilities and ISOs save money by eliminating the need for additional peaking power plants, which typically run only when electricity use spikes. Customers reduce costs as well by shifting consumption to times when prices and rates are lower.
Demand response also helps utilities avoid disruptive brownouts and blackouts. And it enables large-scale renewable energy adoption by absorbing the variability that comes with solar, wind and other sustainable resources.
However, letting commercial and industrial facilities know when demand and prices are expected to jump has been a manual or semi-automatic exercise. Akuacom says it is the first to fully automate this process.
Clay Collier, CEO of Akuacom, said Honeywell, with its deep penetration in the commercial and industrial sectors, is the ideal partner to bring scale his company's technology.
Akuacom will be integrated into Honeywell Building Solutions unit, a global provider of energy and utility services, as well as building automation technology and support services.
Akuacom's technology is based on the Open Automated Demand Response (OpenADR) protocol, a communication standard developed by Lawrence Berkeley National Laboratory, and selected by the National Institute of Standards and Technology and US Department of Energy (DOE) for the smart grid. The open, standards-based approach allows almost any facility to participate in demand response programs. Energy management systems from more than 30 vendors, including Honeywell, can currently connect to the Demand Response Automation Server with an Internet connection.
Honeywell was one of only four non-utility companies to receive a Smart Grid Investment Grant (SGIG) from DOE as part of the American Recovery and Reinvestment Act. It is using the grant to support a peak pricing response program that will use Akuacom's technology to help approximately 700 commercial and industrial facilities in the Southern California Edison service territory reduce peak consumption and costs.
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