May 2008
Interview
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Rodney BoucherEMAIL INTERVIEW  Rodney Boucher & Ken Sinclair

Rodney (Rod) M. Boucher, CEO of Microfield Group, Inc.

Rod is a co-founder of EnergyConnect, Inc. and CEO of Microfield Group, Inc. (the parent company to EnergyConnect, Inc.). Rod has an extensive background in the electric supply and delivery industry, having served as a senior officer of major utility, power marketing, and independent power companies including PacifiCorp, Citizens, and Calpine. His extensive experience in production, operations, mergers & acquisitions, information services, telecommunications, engineering, marketing, trading, finance and risk management provides perspectives that few in the industry possess.


Innovative Solutions to Address the Nation’s Energy

The advances in next generation demand response we are seeing today are only the beginning. As more technologies such as smart meters, economic distributed solar power, advanced storage, and enhanced software platforms enter the market, the opportunities for demand response and other market driven opportunities will increase dramatically.

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Sinclair:  Rod, you’ve been in the industry for some time, what is your perspective on the ability of generation to keep pace with our growing electricity needs?

Boucher:  Well Ken, I think it is becoming increasingly apparent to all of us that we are in need of innovative solutions to address the nation’s energy challenges and growing electricity needs.

Electricity needs are projected to grow at a rate that will be both difficult and very expensive to service with new and replacement power plants. Building more generation and transmission is not the sole answer. Decades of insufficient transmission investment has impaired the reliability of the grid and causes billions of dollars in congestion costs that are borne by consumers. It is clear that we have a serious situation on our hands that is going to take a concerted effort on the part of grid operators, utilities, consumers and providers of innovative energy management solutions to begin to solve.

Sinclair:  Sounds pretty grim. Is there a silver lining to be found somewhere?

Boucher:  Indeed there is. We are already seeing an inflow of capital investments and technology advances for renewable energy and innovative solutions. Wind turbines are getting more efficient and more reliable, PV is becoming more cost competitive and we’re seeing advances in areas like tidal, wave energy and even algae that simply were not on the radar screen a few years ago. However, there is no one silver bullet to address our energy needs and renewables alone are simply not going to address our growing needs. Just as important as technology advances are market forces. We need to make sure that our energy markets are structured in a way that promotes maximum efficiency. If the right economic drivers are in place, we can do a lot to meet growing demand through demand response and similar market driven opportunities.

Sinclair:  That’s where EnergyConnect fits in?

Boucher:  Exactly. Next generation demand response has the potential to significantly contribute to the more reliable and sustainable electricity grid of the future. This will translate into savings for all of us, but particularly those individual companies who enroll as participants in an income generating demand response program.

Sinclair:  There are an increasing number of demand response providers offering to provide financial compensation to customers who shed their electricity load in response to an ISO-initiated event. Tell me what it is that sets you apart from the others?

Boucher:  There’s a great deal behind our position as a leader in providing innovative, next generation demand response services to the market. Most importantly, we provide the information and tools businesses need to manage their energy resources more efficiently. This in turn provides them with more control over their energy costs – something we’re all looking to acquire in today’s volatile energy market.

Since 2005, the first commercial introduction of our next generation demand response products and services in Chicago, we have seen demand response participation grow in awareness and popularity. One particularly responsive sector is colleges and universities who recognize the adoption of innovative demand response technologies and services as a significant way to both leverage existing building automation systems and fund additional efficiency, conservation and sustainability efforts. They appreciate the opportunity to earn money while reducing their overall energy usage. At present, we have more than 35 academic institutions on our participant roster.

Today, we are active in most of the larger ISO’s and IOU’s offering a range of products and services to customers in more than 25 states. These include traditional demand response offerings but more importantly, we’re offering next generation price responsive products that give energy consumers the opportunity to directly participate in the electricity marketplace when they choose.

What further differentiates EnergyConnect is precisely the kind of value that the building automation industry seeks to provide. Our portfolio of demand response products and offerings are automated, scalable, reliable, secure and easy for the customer to implement.

Sinclair:  So, in a nutshell, how does it work?

Boucher:  As you know, the energy marketplace is incredibly volatile with price swings often exceeding 1000 percent over the course of a day. Our role is to bring transparency, order, and discipline to the wholesale electricity market and in doing so, give participants the information, guidance, structure, strategies, and execution platform they need to manage their energy resources more efficiently.

We begin by reviewing and monitoring participant capabilities; working with them to establish load shift and curtailment strategies. We then provide direct hands on access to our secure, web-based demand response platform which puts electricity consumption patterns and real time information about the wholesale electricity market in one place; allowing participants to leverage their existing building automation systems to shape, shift or shed load in response to changes in the energy market. With access to information regarding a participant’s energy usage patterns and electricity market data on one comprehensive platform, facility managers need to devote only a few minutes each day to bid into the electricity market and move loads around. Finally, we execute the transactions, measure, settle, verify and track the results of their participation. Upon receipt of payment from the grid, we then pay participants.

CatNet Systems Sinclair:  You’ve worn multiple hats in the electricity industry, how do you see demand response contributing to our long term electricity needs?

Boucher:  I’ve had a career that has given me insights on electricity from every side of the equation – generation, supply management, transmission, operations, sales, and demand. I’m convinced that traditional programs must change and that bringing transparency to the marketplace and providing the financial incentives that accompany a robust demand response program will drive changes in behavior that can contribute to a more stable and reliable electricity grid.

Our success in doing this is contingent on being able to effectively leverage existing building automation control systems to affect the load shifting strategies. Many building automation companies now recognize this new market opportunity and are beginning to package more sophisticated demand response capabilities in their product lines and build service organizations to support these customer opportunities.

We’re bringing our expertise in how markets operate and where they are going to our participants and to partnerships with leading energy and building automation suppliers including Johnson Controls and Suez Energy North America. And, we’re interfacing, negotiating, and sponsoring solutions with the major ISOs and utilities on behalf of our customer participants and our partners. It is this level of partnership and collaboration involving utilities, building automation suppliers, demand response providers and grid operators that will lead us toward the smarter, more sustainable grid of the future.

Sinclair:  What do you consider to be the major factors driving growth in the industry today?

Boucher:  Without a doubt, energy consumption is a high priority for every business. Demand response offers businesses another means to control costs. At EnergyConnect, we provide participants with real-time information and guidance that enables them to make informed decisions about their energy use. This in turn influences how they run their operations and plan their future.

I encounter consumers every day who want to move away from the traditional ISO and utility driven programs where participants are asked to drop load on demand. Businesses, institutions, industrials, and governments all want to do their part to help maintain a stable electric grid but they are not excited at the prospect of turning over control of their operations to do so. We understand this and our next generation, price responsive products and services allow participants to remain in control of their operations and costs while also providing a valuable service. Having complete flexibility in determining when and how they participate makes it possible to deliver much more than under a system that requires giving up control to a third party. Without a doubt, putting consumers in control of their energy management positively impacts their bottom line and through our systems aligns their bottom line with the development of a more efficient, reliable, and sustainable grid.

Sinclair:  What should we be looking for in the future?

Boucher:  That’s the exciting part. The advances in next generation demand response we are seeing today are only the beginning. As more technologies such as smart meters, economic distributed solar power, advanced storage, and enhanced software platforms enter the market, the opportunities for demand response and other market driven opportunities will increase dramatically. Many more energy consumers will be able to participate as our automated systems make it possible for smaller accounts to participant economically. We are already seeing these changes. Although not the only answer to our energy challenges, next generation demand response is certainly going to be an important one.

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