Time to Jump Aboard the ‘Smart Grid’ Bandwagon

Posted On February 5, 2009 | by AllenCaron

Talk of a “Smart Grid” is everywhere, even the Super Bowl (http://earth2tech.com/2009/01/31/ge-ups-smart-grid-ante-with-super-bowl-ad-campaign/). It’s easy to see why, with President Obama poised to spend a healthy portion of his $900 billion-plus stimulus package on the creation of a Smart Grid, the common term for a revamped electrical grid that is much more efficient and uses alternative energy whenever and wherever possible. The city of Boulder, CO is turning itself into a “Smart City” (http://smartgridcity.xcelenergy.com/story/index.html), the entire island of Malta, with the help of IBM (NYSE: IBM, http://www.IBM.com), is vying to become the first “Smart Island” (http://earth2tech.com/2009/02/04/ibm-welcome-to-smart-grid-island/).

For entrepreneurs, startups and smallcaps everywhere, this is the time to jump on a bandwagon typically reserved for the big guys like IBM and GE (NYSE: GE, http://www.ge.com). A small company like Tyngsboro, MA-based Beacon Power (Nasdaq: BCON, http://www.beaconpower.com) is focused on energy storage through the development of a flywheel technology that “uses spinning disks to help stablize electricity grids, allowing the grids to run more efficiently,” according to earth2tech.com (http://earth2tech.com/2009/02/04/flywheel-energy-storage-hits-the-high-seas/).

On the topic of grids and energy, there is promise in the use of advanced lead-acid batteries supplied by New Castle, PA-based Axion Power International (EBB: AXPW, http://www.axionpower.com). These batteries are currently being tested for their grid buffering and storage capabilities in a demonstration project directed by privately-held, NY City-based Gaia Power Technologies (http://www.gaiapowertechnologies.com) for NYSERDA. Axion Power, which is trading at 95 cents (off its 52-week high of $2.75) just received two grants, including an $800,000 grant from the state of Pennsylvania to demonstrate the effectiveness of their battery technology in electric vehicles and HEVs.

The Smart Grid and the power distribution industry is the focus of the DistribuTECH conference this week in San Diego. Smallcaps attending include Pittsburgh, PA-based Tollgrade Communications (Nasdaq: TLGD, http://www.tollgrade.com), which is displaying its new centralized remote monitoring system to improve service delivery for power utlility operations and efficiency of grid systems. The company’s stock is trading at $5.82 and has been on a nice uptick since hitting a $3 bottom last fall. Also attending DistribuTECH is Devens, MA-based American Superconductor Corp. (Nasdaq: AMSC, http://www.AMSC.com), which develops technologies to increase electrical grid capacity and reliability and supplies electrical systems used in wind turbines, among other things. The company hosted a program called “Power Delivery Solutions for the Smart Grid” at the show. The company now has a $719 million market cap and is trading at $16.61, well above its low of $8.22 only a few weeks ago.

There are literally hundreds of other smallcaps jumping into this market, such as Manitowoc, WI-based Orion Energy Systems (Nasdaq: OESX), http://www.oriones.com), which manufactures energy efficient lighting systems and controls. Perhaps its connection to the smart grid movement has allowed it to bounce nicely off its 52-week low of $2.76 and is now trading at $4.53. Of the many solar companies vying for the expected increase in business, one, Montreal-based ICP Solar (EBB: ICPR, http://www.icpsolar.com) just announced an agreement with Largo, FL-based Integrated Metering Systems to market what they call a GreenMeter in North America designed to allow a more precise reading of electricity consumption and production. ICP CEO Sass Peress says the GreenMeter will “monitor energy usage data…and instantaneously provide this information to the web–where clients can access the analysis anywhere in the world.”

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