What’s next for Uplight and AutoGrid?

Uplight’s December acquisition of AutoGrid was a milestone in the world of virtual power plants, as the utility software company deepened its connections with utility control rooms. The deal officially closed in mid February, and the companies are now in the midst of integrating their offerings into a single platform.

• The top line: AutoGrid and Uplight say grid flexibility — via an array of customer devices that can stand in both for peaker plants and for day-to-day generation — will become increasingly key. Getting to that reality, though, requires utilities to have not only a huge number of assets under management, but a diverse portfolio of those assets.
• The market grounding: Uplight bought AutoGrid for an undisclosed sum from Schneider, a major Uplight investor, in a deal to combine the companies into a single entity with more than 700 employees. Analysts saw the deal, which brought together Uplight’s customer-centric solutions with AutoGrid’s DERMS technology, as a move to “close the gap” between control room and customer.
• The current take: Hannah Bascom, Uplight’s chief market innovation officer, said Uplight is keen to figure out the best way to connect utilities to the breadth of customer insights and data that could push them toward VPP adoption, adding that AutoGrid’s tech stack is invaluable in this respect. “There’s so much opportunity still to get deeper and broader with those clients,” Bascom said. “That’s really important as we are trying to move away from traditional demand response paradigms, to something that is a core part of the procurement stack for the utility.” 

By some estimates, electrifying the United States economy will require doubling or even tripling current levels of electricity production. Building a grid that can meet that moment poses a major challenge, and new poles and wires — especially the nearly 300% transmission growth the NREL estimates the US will need by 2035 — aren’t going to be the fastest, cheapest, or even most efficient solution to fill the gap.

“We collectively have a choice to make,” Bascom said. “We can let DERs become a problem for the grid by doing nothing, or we can be really intentional about getting these devices connected to the grid at the time of deployment.” 

The best choice, in Uplight’s view, is a combination of assets that can stand in, not just for peaker plants, but for day-to-day generation. But many utilities and regulators remain skeptical of the reliability of DERs for that type of regular generation, she added. Uplight’s message on that front is that there’s strength in numbers.

“That will only be possible if you have a tremendous number of, and a great variety of assets under management,” Bascom said. “In order to truly realize that portfolio of assets, we needed AutoGrid.”

The go-to-market plan

VPPs are one of the top opportunities for grid operators to manage peak demand and grid congestion, but they face a handful of complex challenges, many of them stemming from the solution’s distributed nature. For one thing, large-scale VPPs require hundreds, if not thousands, of connected devices. Then there’s the problem of keeping participants from opting out of events, and of measuring the performance of the resource.

Chris Shelton is the chief product officer of the utility AES, and also sits on the Uplight board; he said the merger with AutoGrid makes the idea of aggregating customer resources to suit both customer and system needs a reality.

“The challenge with that historically has been getting people connected, and signed up, and that’s what Uplight has proven they’re good at: engaging customers and getting them to act,” Shelton said. “So when you combine Uplight’s ability to do that with AutoGrid’s virtual power plant capability, it’s a really exciting combination. They really do make sense together.”

The company’s acquisition of AutoGrid is a full integration. AutoGrid isn’t becoming an Uplight subsidiary; instead, the two tech stacks will eventually be combined into a single platform, Bascom said.

That platform will ultimately offer utilities a path to move away from traditional demand response paradigms, and toward an aggregation of assets that’s at the core of a utility’s procurement stack, she added.

As the two work through their platform integrations, the go-to-market strategy will include increasing the size and scale of Uplight’s existing load-management programs, as well as giving “some extra juice” on the customer engagement side to AutoGrid’s programs: “There’s lots of cross-sell, upsell opportunities,” Bascom said. 

But beyond that, the early stages of the newly combined product will also be about highlighting proof points and data for utility customers. It’s about proving to utilities that “this math pencils,” she added: “you have this asset that is untapped in your territory, and we can turn it on really easily for you.”

One platform to aggregate them all

As the DER management landscape matures and utilities become more comfortable with a digital and distributed grid, Bascom sees Uplight’s customer expertise as increasingly essential.

“We know that there will be lots of other providers that are doing aggregation of device classes or of customer segments,” she said. “We want to be able to truly engage with the ecosystem in pursuit of this bigger goal: the concept that we need to be able to engage with assets of all kinds, and enable them to be most easily connected to truly benefit the utility and the customer.”

Bascom doesn’t like the term “aggregator of aggregators,” but that’s the market gap that the combined entities will eventually look to fill.

Eventually, said Jeannie Salo, VP of government affairs at Schneider, the “utopian” world would be one in which utilities can leverage “a much broader ocean of assets to reduce pressure on the grid.”

Streamlining that process — both for consumers enrolled in demand response programs, and for utilities relying on distributed assets — may ultimately mean reducing the number of vendors interacting directly with each to eliminate customer confusion, she added.