Hello,

We noticed you're browsing in private or incognito mode.

To continue reading this article, please exit incognito mode or log in.

Not an Insider? Subscribe now for unlimited access to online articles.

Sustainable Energy

Gluing the Grid Together

Silver Spring Networks, one of the earliest smart-grid companies, was founded in 2002 by software engineers who saw a need for standardized technology that would enable systems throughout the grid to communicate with each other. “You want a secure network infrastructure that can be connected to an arbitrary number of devices—thermostats, displays, electric vehicles, anything that plugs into the grid,” says Silver Spring’s chief technology officer, Raj Vaswani.

So the company developed devices, services, and software to help monitor and manage energy supply and use for both consumers and utilities. Today, its products can be found in a number of projects in the United States and Australia. Oklahoma Gas and Electric, for example, has built its communication chips into smart meters and uses its software to read them. Consumers can monitor their energy use by way of a Web portal that Silver Spring provides. The utility now manages demand so much better that it has been able to shelve plans for two new power plants, which would have cost up to $320 million.

Silver Spring raised $100 million in venture capital in December 2009, bringing its total funding to around $250 million. And it has been broadening its scope beyond meter networking and into software, which has a higher profit margin. This expansion has the potential to cause problems. “There’s a risk that they are growing faster than they can support,” says Steven Minnihan, an analyst at Lux Research.

This story is part of our January/February 2011 Issue
See the rest of the issue
Subscribe

But failing to grow would be risky as well. Heavyweights like GE and Cisco are entering the smart-grid market with the advantages of name recognition and, in the case of GE, an already established foothold in the global energy market. Vaswani, however, describes the business scenario for Silver Spring as one of “coöpetition” rather than competition. Fixing the grid will take a great deal of infrastructure, he says: “No one company is going to be able to build all of it.” He adds that Silver Spring and GE already do a lot of business together as partners.

Want to go ad free? No ad blockers needed.

Become an Insider
Already an Insider? Log in.

Uh oh–you've read all of your free articles for this month.

Insider Premium
$179.95/yr US PRICE

More from Sustainable Energy

Can we sustainably provide food, water, and energy to a growing population during a climate crisis?

Want more award-winning journalism? Subscribe and become an Insider.
  • Insider Premium {! insider.prices.premium !}*

    {! insider.display.menuOptionsLabel !}

    Our award winning magazine, unlimited access to our story archive, special discounts to MIT Technology Review Events, and exclusive content.

    See details+

    What's Included

    Bimonthly magazine delivery and unlimited 24/7 access to MIT Technology Review’s website

    The Download: our daily newsletter of what's important in technology and innovation

    Access to the magazine PDF archive—thousands of articles going back to 1899 at your fingertips

    Special discounts to select partner offerings

    Discount to MIT Technology Review events

    Ad-free web experience

    First Look: exclusive early access to important stories, before they’re available to anyone else

    Insider Conversations: listen in on in-depth calls between our editors and today’s thought leaders

  • Insider Plus {! insider.prices.plus !}* Best Value

    {! insider.display.menuOptionsLabel !}

    Everything included in Insider Basic, plus ad-free web experience, select discounts to partner offerings and MIT Technology Review events

    See details+

    What's Included

    Bimonthly magazine delivery and unlimited 24/7 access to MIT Technology Review’s website

    The Download: our daily newsletter of what's important in technology and innovation

    Access to the magazine PDF archive—thousands of articles going back to 1899 at your fingertips

    Special discounts to select partner offerings

    Discount to MIT Technology Review events

    Ad-free web experience

  • Insider Basic {! insider.prices.basic !}*

    {! insider.display.menuOptionsLabel !}

    Six issues of our award winning magazine and daily delivery of The Download, our newsletter of what’s important in technology and innovation.

    See details+

    What's Included

    Bimonthly magazine delivery and unlimited 24/7 access to MIT Technology Review’s website

    The Download: our daily newsletter of what's important in technology and innovation

/
You've read all of your free articles this month. This is your last free article this month. You've read of free articles this month. or  for unlimited online access.