In the same way (albeit on a smaller scale) that the South Korean government pumped money into developing broadband infrastructure, the government plans to invest 37 billion won (about $32 million) initially into building out the smart grid test-bed. The companies that will start building the smart grid infrastructure include a who’s-who of South Korean IT companies including mobile leaders SK Telecom and KT, consumer electronics and cell phone heavyweight LG, power companies KEPCO and GS Caltex, and Hyundai Heavy Industries. Taking the same approach as the island nation of Malta — isolating the buildout to a geographical area — the South Korean government plans to build the smart grid test bed on the island of Jeju, which is south of Seoul (see map above).

While the investment from the South Korean government isn’t huge at this point, I wouldn’t discount its goal to acquire a 30 percent share of the global market as unreachable. KT, SK Telecom, and LG have long histories of mobile and broadband innovation, and they tend to spend a lot of money on R&D, taking risks and rolling out products and services that are at the bleeding edge. That means some of the companies’ risky products can be duds — see SK Telecom’s failed mobile joint venture Helio, which was sold off to Virgin Mobile. But the approach seems to be working for many of them: LG is the third largest cell phone maker in terms of marketshare, solidly beating out American phone maker Motorola.

I haven’t researched the ins and outs of what types of smart grid products South Korean firms are working on, but the country’s leadership in the battery space could also give it a leg up in energy storage for the smart grid. Very few American firms have so far been able to compete with both South Korean and Japanese companies when it comes to battery technology.

Given the smart grid industry is just being developed, recently getting a boost from the $3.4 billion in U.S. stimulus funding, it’s not strictly about competition at this point. There’s some cooperative learning going on as well: Earlier this year the U.S. smart grid trade group the GridWise Alliance and the Korea Smart Grid Association (KGSA) teamed up to share intelligence about building out smart grid technology.

Khosla, who has seemed a lot more bearish than many investors in terms of the smart grid (in contrast, Steve Westly, partner at the Westly Group welcomed GreenBeat attendees to bring him their business plans), predicted not many of the next-gen smart grid entrepreneurs in the room would be successful, but that there would be enough winners to make the sector “interesting.” Next-gen applications and services could sprout up in the middle of the grid or at the edge of the network. It’s at the edge where Duke Energy CTO David Mohler said earlier this week he aims to “let thousand flowers bloom.” Here’s 3 companies that have developed next-gen smart grid services that were at the GreenBeat show:

Locust Storage: Locust Storage tied for the innovation award at GreenBeat (with established player CPower), and the San Diego, Calif.-based startup has developed a data storage system that CEO Seth Georgion says can reduce power of data storage systems in data centers by 90 percent. The device, which the company plans to commercialize early next year, caches data partly with flash storage (more expensive but a next-gen storage tech) as well as traditional spinning discs. What makes the technology interesting for the grid is that the storage unit can power up and down quickly and potentially add power back onto the grid in the same way solar can. It’s an example of innovation at the edge of the grid with implications extending all the way to the data center.

Building IQ: Building IQ launched at GreenBeat and has created optimizing software for commercial buildings that is fully automated. The company sells its software via a subscription to building owners, and says its service can be used for a next generation demand response.

R2EV: R2EV says its on-demand energy storage solution, which is made of lithium ion and lithium polymer batteries, is a portable solution for the power grid. Based in Boise, Idaho, R2EV says it is working with the U.S. Army to commercialize the units dubbed Fuel 2.0. Again it’s innovation at the edge of the network.

Gore highlighted three benefits that the smart grid will provide: a connection to link renewable assets to areas that need it, a way to empower consumers, and a way to drive technology innovation in much the same way the Internet has done. When comparing the Internet to the smart grid Gore said, “the analogy is almost exact.” The energy industry is moving toward a distributed model (solar rooftops and devices at endpoints), from a highly centralized one now. Eventually, Gore predicted the power grid will look more like the distributed model of the Internet.

Arguably, said Gore, the most important effects of the smart grid buildout will be the potential benefits for consumers, who will finally become aware of how much energy they are using and find new options for reducing energy consumption. “Most people are simply not aware of ways to reduce consumption,” he said. Andy Tang, senior director of PG&E Smart Energy Web expressed a similar sentiment on the panel prior to Gore’s speech concerning just how big the change in mentality about energy consumption will be. Tang said many even in the utility industry are just beginning to grasp the large effect that a digital grid will have on consumers.

Image courtesy of World Economic Forum flickr Creative Commons (not from GreenBeat)

Ipsen was entirely vague on specifics, but said Cisco sees itself playing at all critical points of the network of the power grid in the areas of “enhancing operations, manageability, and scalability.” You’ll see products from Cisco in those areas early next year, said Ipsen. While Cisco engineers are hard at work on smart grid products, Cisco could also “acquire,” “partner,” with or “invest” in companies developing new tools, she said.

While originally Cisco seemed to be focusing on the home and consumer portion of the smart grid — as it did in its first smart grid deployment with Florida Light and Power, General Electric and network provider Silver Spring Networks — the networking giant is clearly now looking to play across all areas of the smart grid network. Cisco has partnered with Duke Energy on an end-to-end smart grid network, along with several other utilities. While CTOs of utilities will be interested to see what such a large network player has to offer them, we’re guess that all eyes from competitor Silver Spring will be on Cisco’s 2010 launches. Will those products be directly competitive with Silver Springs? We’ll be watching.

Smart grid technology and smart meters don’t represent new or risky or bleeding-edge technology. They use the same type of information technology — wireless networks, silicon, software — that controls our cell phones, computers and Internet, and that plays a massive role in the U.S. economy. It’s just being used in a new industry: electricity. Of course software can occasionally be glitchy, but so can a person manually driving by and reading home meters. As Grid Net CEO Ray Bell told audience members of the GreenBeat conference today “digital meters are rigorously tested, and highly accurate.”

The big issue is that utilities need to learn to communicate a lot better, and develop a much stronger relationship, with their customers, whether that’s through marketing, PR or customer outreach. As Seth Frader-Thompson, CEO of energy management startup EnergyHub said at the Dow Jones Energy Conference this week, utilities, with their regulatory markets, have a long history of looking at their customers as “rate payers,” or even “load” “repairs.” There needs to be a sea change in the relationship between utilities and power consumers.

“It comes down to trust,” explained Scott Hublou, co-founder of EcoFactor, which makes smart thermostat software and recently won the Cleantech Open grand prize, on the GreenBeat panel last night. The customer has to trust that the utility is installing devices that will make their service better, that the utility will keep their data private and safe, and that the smart meters will help them save money.

Devices like a smart thermostat can provide more transparency, and services like EcoFactor and EnergyHub can help bridge that relationship between the utility and power user. But utilities don’t necessary need these tools for a better customer relationship, they can start by offering much better online billing, enabling a customer to access their energy consumption history online, and giving them tips about how to help reduce energy consumption. Startup OPower is doing some of these more low tech online things now and even does paper mailed billing statements that can help the relationship. More transparency with data also means utilities can more easily follow the trail of data and fix or investigate a problem that could occur with a customer’s billing.

Some utilities are hard at work on marketing messages, PR and customer outreach. But I think the industry needs to do a whole lot more and take a page from some of the Internet firms like Google that have had to deal with online data and digital privacy for years. Google’s business model hinges on maintaining customer trust, while using data to optimize search, online advertising and its other web services. When I was a reporter covering Google’s San Francisco citywide WiFi plan, Google regularly did things like hold town-hall-type meetings where the public could ask questions and get feedback (the WiFi plan didn’t work, but not necessarily because there was backlash from residents).

Google, through it’s Google.org division, is also using its expertise with privacy issues to develop a tool that will manage the relationship between the electricity user and the utility: PowerMeter. As VentureBeat editor and CEO Matt Marshall and Google’s Ed Lu, who presented at the GreenBeat show this morning, put it: the idea that Google will step in and take over that customer relationship can be terrifying to some utilities and as a result many utilities won’t partner with Google’s PowerMeter.

Well, utilities don’t need PowerMeter, but they have to do something. The PG&E Bakersfield hullabaloo is just the beginning of the backlash against smart meters and smart grid technology, which will only grow as smart meters continue to be installed throughout the country. The public concern reminds me of when digital voting booths were introduced, or when consumers first started to online bank. There’s some real concerns about keeping digital information private and secure in these systems, but ultimately it’s the responsibility of the organization that’s leading the switch to the digital two-way system to keep the line of communication open.

Image courtesy of Juverna Flickr Creative Commons.

“If we’d been able to foresee the crash of the market we wouldn’t probably have launched a green initiative. Because these ventures really need capital. The only way in which we were lucky I think is that the government stepped in, particularly the Department of Energy. Led by this great administration that put in place these loan guarantees. I’d say about a third of the Kleiner backed ventures and most of the really capital intensive ones have applied for and many of them received either loan guarantees, or grants form an agency called ARPA-E.”

For example Kleiner Perkins has backed 7-year-old Bloom Energy, which Doerr described as a “distributed fuel cell company” that now has “substantial revenues and orders.” Bloom has “required ten times as much capital,” compared to other venture companies — it took Google $25 million to get to an IPO, Doerr pointed out, and Bloom has already taken $250 million. Doerr said he’d wager Bloom will take “nine years to a successful public offering.”

Doerr’s admission of the challenges VCs and startups face as a result of the economic downturn is interesting because it’s A). So honest. B). Shows how venture capitalists are still not entirely sure how to successfully navigate greentech investing and C). Probably doesn’t make Kleiner Perkins limited partners feel so great about their green fund investment.

Image courtesy of JDLasica Flickr, Creative Commons (photo not from GreenBeat).

While we all know News Corp — with its vast network of film studios, TV networks, web sites and newspapers — Hara needs an intro for many. Two-year-old Hara only came out of stealth in May of this year with backing from venture capital firm Kleiner Perkins, and follow-on funding from JAFCO Ventures and Nth Power. Hara’s software-as-a-service product gives companies and municipalities the ability to itemize and track all of the inputs (water, electricity, chemicals) and outputs (the product, greenhouse gases, wastewater) that make up their business processes.

There are so many startups working on carbon management, it can make your head spin (see Verdantix’s report on 22 companies in this space). But Hara has been signing up a string of high-profile customers. Content delivery network Akamai told us recently that it is working with Hara as well, and announced customers include Coca-Cola, and the cities of Palo Alto and San Jose Calif., as well as Aerojet. The Verdantix report also places Hara as the only startup in it’s “leaders” section.

News Corp’s manager of Energy Initiatives, Vijay Sudan, said in the company’s release that News Corp had looked “at numerous solutions,” and chose Hara “due to the intuitive nature as well as the breadth and depth of the Hara solution.” Given the sheer size of News Corp, it’s a very big win for the small and young firm. Back in 2007 Murdoch described the impact of News Corp going carbon neutral as similar to “turning off the electricity in the city of London for five full days.”

Many TV makers have opposed the rules, while the state’s utilities support it. Groups like the Consumer Electronics Association say that the efficiency standards will result in higher prices of TVs in California, closings of stores that sell TVs in California (because those customers will go online or out of state to buy TVs), and unhappy customers who won’t be able to find certain popular TV models in California because they won’t be economic to produce there. The CEA says that the industry has been getting more energy efficient on its own and doesn’t need regulation, which will lead to “decreased industry competition and less innovation.”

But as Amy Westervelt pointed out over on Solve Climate earlier this week, the ruling could lead to a boost in sales in the state for manufacturers that specialize in energy-efficient screens, using LCDs backlit with light-emitting diodes (LEDs) and next generation organic light-emitting diode (OLED). Consumer electronics giants from Sony to LG to Samsung are working on OLED TVs and the technology is supposed to be more widely deployed by 2012 — just in time to meet Cali’s new green TV rule.

Startups know those metrics pretty well already. Lucid Design Group, for example, has been selling its energy management system for years to the commercial sector, as well as governments and universities. But while the company has always discussed plans to eventually work in the residential market, Lucid Design has yet to make a big push into homes. As Michael Murray, Lucid Design’s CEO, has maintained in conversations with me over the past couple of years, the energy management market for large commercial buildings is much more accessible compared to energy management in homes.

Think about it this way: Lucid can focus on selling its energy management system to companies like Yahoo, which is using the product for its five building offices in Sunnyvale, Calif., where more than 3,000 Yahoo employees work. That’s one deal and a custom job. Or Lucid could work on packaging its software and sensor product into a relatively low-cost (some think it has to be dirt cheap to sell to consumers), probably low-margin box to sell to a market that’s still in a very nascent stage.

Businesses are also often more eager to save money on their lighting and heating/cooling costs than consumers. The return on investment is much higher for a large building that uses a lot of energy than it is for a single family home. In addition, regulations and shareholder demands increasingly require companies to report their carbon footprints, and energy management systems will help them gather and report that data.

That’s not to say that the market for residential homes in the U.S. isn’t attractive — it’s the holy grail for many energy management firms with dreams of turning their brands into a household name. It’s just a lot more difficult.

In other words, Duke plans to enable its customers to choose from a variety of home devices and services that will be developed by third parties, including startups, consumer electronics makers and software developers. “This is one of the most exciting areas ,” said Mohler, adding that he doesn’t think we’ll even know what possible innovations will emerge at the edge of the network. In that way it’ll be like the early days of the Internet, said Mohler: “Who knew the Internet would produce the iPhone?”

Mohler, who became one of the first Chief Technology Officers in the utility industry three years ago, placed a strong emphasis in his talk on why the smart grid needs to be based on open platforms and interoperable standards in order for those “thousand flowers” to bloom. Duke is working with network giant Cisco to build this type of network based on Internet Protocol (IP). “There’s got to be a way to get beyond building silos and proprietary products,” said Mohler. “Currently there’s a lot of products that don’t talk to each other, and require their own operating systems,” said Mohler: “[S]omeone needs to crack the code on that.”

It’s the same sea change that the mobile industry has recently gone through, as Google and Apple have developed their own ecosystems to develop mobile products at the edge of the cellular network. The Internet industry learned this lesson early and Internet companies like Google have been pushing that mentality into other industries like the power industry (Google has developed the energy management software PowerMeter).

Some early-adopter utilities are looking to take a similar open network approach as Duke. PG&E’s senior director of the Smart Energy Web Andy Tang told me that PG&E is waiting for the Open Smart Grid group to establish a single standard interface for energy management software before it starts working with third parties like Google and Microsoft. Tang told me: “I don’t want to pick winners. I want to work on more of a neutral ground.”

Mohler’s words were encouraging to the leaders of several energy management startups in the room (like EnergyHub and AlertMe). After Mohler’s talk I asked him how startups building innovation at the edge could work with Duke. Like his network mentality, Mohler sounds pretty open to the startup relationship: Just contact someone on my team, he said.

“Smart grid security” is most often discussed in the terms of national security — a hacker develops a worm that can jump across smart meters and black out neighborhoods, for example, or can make a generator blow up remotely. Privacy — keeping personal information in the hands of the consumer and away from advertisers, the utility or any other third party — is an entirely different concern that utilities have to be prepared for with the buildout of the smart grid. Most importantly it will shape the relationship between the consumer and the utility.

As Jules Polonetsky, co-author of the Ontario report puts it: “[T]he success of the grid will be completely dependent on consumers trusting that their data is being handled responsibly. If companies do not get privacy right from the start, billions will have been spent in vain.” The report says that the utility industry needs several key initiatives, including: “privacy laws, regulation and independent oversight; accountability and transparency; audit and assessment; market forces, education and awareness; data security; and fair information practices.”

Unfortunately privacy concerns seem to be taking a back seat to security concerns for the smart grid. The National Institute for Standards and Technology Smart Grid group found that utilities are lacking privacy policies and state utility commissions often lack formal privacy guidelines related to the smart grid. In addition if a state has privacy laws, they often aren’t specific to utility groups.

In response to these findings, NIST suggested these steps to ensure consumer privacy: 1). Appoint personnel to ensure privacy practices exist and are followed; 2). Explain clearly to consumers what and why any data is collected; 3). Give consumers choices for collecting their data and get consent; 4). Don’t collect more data than needed; 5). Only use the data for which it was intended to be collected; 6). Show consumers the data that is being collected and enable them to correct it if need be; 7). Protect data from security vulnerabilities.

All utilities need to do is to look at the modern problems with privacy in the digital age — namely people’s reactions to companies like Google — and they’ll see how important the problem is for the smart grid. The issue will also need to education for consumers as well, since as Stacey from GigaOM puts it: “personal privacy on the web is an illusion.”

What’s as interesting as the size of the impact of the smart grid stimulus funds on GE, is the method in which GE looked to influence the smart grid stimulus funds. GE CEO Jeffrey Immelt, a longtime Republican, sits on the President’s Economic Recovery Advisory Board alongside Kleiner Perkins partner John Doerr. According to the Journal article, Immelt was a “driving force” behind stimulus funding gains for smart grid initiatives. GE invested $7.55 million in lobbying efforts in the second quarter of this year, a 34 percent increase from the company’s lobbying spending in the prior year second quarter. The investments — in initiatives including promoting the Democratic stimulus package, lobbying for smart grid stimulus fund increases, lobbying for the max smart grid stimulus award to be $200 million, helping customers apply for the stimulus funds, and developing “a colorful two-page fact sheet” on the stimulus for its customers — have apparently paid off.

More specifically GE’s fun-filled fact sheet told its customers that GE would “be involved with setting national standards and energy-transmission policy,” and said that GE could “help regional utilities and governments win federal stimulus money earmarked for making the power grids more efficient,” says the article. Although, GE General Counsel Brackett Denniston III explains that just because GE provided counseling on the Recovery Act legislation “does not ensure its clients will win the resulting contracts.” But with a third of its customers winning the smart grid stimulus funds, clearly GE’s counseling didn’t hurt.

At this point I agree with the Financial Times when it says the news is part of “the consolidation that’s sweeping through the solar industry.” Siemens announced last month that it’s buying solar thermal firm Solel and firms in other solar sectors are being snapped up as well (MEMC Electronic Materials, a company that makes silicon wafers for the solar industry, announced that it plans to buy up SunEdison, a pioneer of the solar as a service business model).

Over the past year Ausra has changed it’s strategy from looking to build and operate solar thermal power plants — using mirrors and lenses to capture the suns heat and turn it into electricity — to providing its equipment to solar power producer. Building and operating these solar power plants would have taken a ton of financing, which, in a hard economy, would have proven to be a difficult route.

Proof that Ausra was continuing down this new path emerged earlier this month, when the company announced that it is selling the Carrizo Energy Solar Farm project, a proposed 177MW project still under development in San Luis Obispo, Calif., to industry thin film solar giant First Solar. And in September Ausra said it had been chosen to provide its equipment for a 100MW concentrated solar thermal power project being developed in Ma’an, Jordan.

Ausra declined comment on the reported acquisition talks and deal, but Katherine Potter, Vice President, Communications, Ausra, told us: “As our recent string of announcements have shown, our business strategy of focusing on being a solar steam systems provider is working and producing results.”

But for Ausra’s investors, which include Kleiner Perkins, Khosla Ventures, Al Gore’s Generation Investment, Alberta, Canada-based KERN Partners and Melbourne, Australia-based Starfish Ventures, they’re going to need a sizable exit to consider the sale a success. Ausra has raised around $130 million to date and was founded in 2006.

In comparison 14-year-old Solel, which raised at least $100 million and employs several hundred people, was bought for $418 million. Solel claims a revenue of nearly $90 million for the first half of this year, thanks to a solar receiver supply business and its work engineering, planning and building solar fields. Solel was also continuing down the path of building and operating solar thermal plants when it was bought up, unlike Ausra. However, Ausra’s advanced technology is supposed to be its differentiator, which is difficult to put a price on.

Energy storage provides the key to these innovations and will be the cornerstone of the economy that will emerge around the next generation of energy. Here are three questions for three experts — Rick Luebbe, CEO, EnerG2; Jill Watz, senior adviser, Vulcan Capital; and Ahmad Pesaran, principal engineer, National Renewable Energy Laboratory — that have spent years digging into the technologies, the chemistries, the economics, and the future hurdles for the deployment of energy storage. The following are edited excerpts of their answers:

Rick Luebbe, CEO, EnerG2

Why is energy storage so essential to the new energy economy?

Energy storage is essential because the efficiency and sustainability of the new energy economy is in absolute jeopardy without it. So many of the generation and capture technologies that are emerging and evolving will depend on storage to make them effective and, in some cases, viable. In addition, energy efficiency is a key element of the energy gains that have become an expected part of our collective future. Energy storage helps to synchronize energy supply and demand, which is an essential first step in achieving global-scale gains in energy efficiency.

What is the most important use or implementation of energy storage?

There is no innovation-oriented market with brighter prospects — or greater sweep or scope — than energy storage. It’s nearly impossible to pick a single use of energy storage that rises above the others; rather, it’s the universality of the need for better energy storage that defines its role in our economy. To date, the energy industry has labored under a model where large-scale energy storage — when it’s even possible — is difficult and costly and usually implemented in the form of vessels of fossil fuel or chemicals. That model is broken and is in the process of being fixed — to everyone’s benefit.

Which energy storage innovation do you most believe in?

So far, the bulk of the energy storage conversation has revolved around ongoing advancements in battery technologies. Batteries are well-understood and virtually ubiquitous. Nonetheless, ultracapacitors, a powerful alternative to batteries, are being increasingly embraced by the automotive industry for hybrid electric vehicles, by electronics and power-tool manufacturers for enhancing the life and usability of consumer goods, and by a variety of industrial customers to deliver applications and technologies that improve energy efficiency. Any application that performs better or lasts longer using rapid charge and discharge cycles will benefit from ultracapacitor-based energy storage systems.

In one particularly interesting example, electric-rail operators in Europe are adopting ultracapacitors to capture the kinetic braking energy created by trains approaching a station. They’re then using that captured energy to power departure and initial acceleration of that or another train. The energy efficiency gains of this relatively simply application have been enormous. If we can find ways to meld batteries and ultracapacitors in new and unprecedented combinations, I believe we’ll double our chances for sustainable success in a variety of key industries while, at the same time, boosting both our energy and economic futures. (EnerG2 is focused on introducing advanced nano-structured materials for next-generation energy storage breakthroughs.)

Jill Watz, senior adviser, Vulcan Capital

Why is energy storage so essential to the new energy economy?

The new energy economy requires a large-scale penetration of low-carbon electricity and an electric transportation system that depends on a new electric grid system that is flexible, dynamic, self-healing, highly reliable and distributed. Energy storage is essential to achieving all of this functionality. At the system level, large-scale storage enables greater penetration of intermittent renewables like solar and wind, and it helps improve system robustness. At the distribution level, storage enables improved power quality to protect increasingly sensitive loads from voltage sags and transients, and enables greater penetration of distributed energy to directly serve load without costly transmission. Lower cost, as well as reliable and robust onboard storage, is also critical to the expansion of electric vehicles, which will greatly increase the efficiency of our transportation sector.

What is the most important use or implementation of energy storage?

Just as there is no single technology solution to solve the climate change problem, energy storage technologies vary by type, scale, application and location. Large-scale physical storage, like pumped hydro or compressed air energy storage (CAES), are proven technologies with well-defined costs, but they are geographically limited. Evaluating traditional large-scale hydro for its potential for firming intermittent power in the Pacific Northwest and other hydro regions is another important opportunity for bulk energy storage, and it could reduce the average cost of power for large-scale renewable penetration in those regions.

Storage plays an important role in improving the efficiency of electricity markets by enabling a more active demand side as well as greater distributed resources. For too long, investments have been skewed disproportionately to the supply side, leaving the demand side relatively inactive and creating market distortions. For example, distributed energy storage in electric vehicles can be aggregated through smart controllers to provide ancillary services to the power system and help reduce electricity costs. Similarly, energy storage devices, coupled with consumer-distributed generation, will enable more local, clean energy production and reduce expensive new transmission infrastructure requirements.

Which energy storage innovation do you most believe in?

There are promising new technologies under development to meet storage capabilities at all levels. Advances in materials science provide new and novel processes and materials to improve energy density and specific energy storage devices. I think there is great promise in the application of nanostructures to create super ultracapacitors for large-scale energy storage in vehicles, and to enhance the electrode capacity in more conventional battery chemistries to reduce costs and improve cycle life.

Ahmad Pesaran, principal engineer, National Renewable Energy Laboratory

Why is energy storage so essential to the new energy economy?

The new energy economy must consist of renewable energy and energy efficiency in all sectors of the energy consumption market, including buildings, transportation and industry. Energy storage is a major and vital component of the green technologies needed in this new economy. In the transportation sector, hybridization and electrification of vehicles increase energy efficiency and fuel economy, thus reducing oil consumption. Hybridization of vehicles with electric energy storage allows significant fuel efficiency increases by using regenerative braking, permitting engine downsizing, engine load leveling, electrifying accessories, and reducing fuel use during stops. Energy storage devices such as batteries and ultracapacitors are the enabling components that make hybridization and electrification possible.

Just as important, the electricity needed for the building, transportation, and industrial sectors could be generated through renewable energy technologies such as wind systems and solar photovoltaics (PV). But to generate significant electricity from wind and PV, we must address one of their major drawbacks: intermittency. The fact that these resources are not always available limits their penetration into electricity markets. Previous studies have indicated that traditional electric power systems are inherently limited in their ability to accept very large amounts of PV or wind energy because of their intermittency. Analyses by NREL and others have shown that energy storage provides the ultimate solution by allowing excess PV or wind generation to be stored and delivered at a later time. Integrating electric energy storage with PV and wind generation has the potential to blur the line between intermittent and baseload generation technologies.

What is the most important use or implementation of energy storage?

Energy storage must be used for the generation and use of green electricity across all parts of the economy: gasoline and fuel-cell hybrid electric vehicles, plug-in hybrid vehicles, all-electric vehicles, PV and wind electric power plants, conventional power plants, substations and buildings.

Electric energy storage must be implemented in solar PV and wind power plants so that excess electricity can be stored for later use and allow greater market penetration of renewable sources into the electricity grid. This type of energy storage can be implemented in a centralized system consisting of megawatt-size units or in many smaller energy storage systems distributed throughout the grid. Energy storage devices can also be used in the building and industrial sectors to store electric energy locally for immediate, same-day or later use. In addition, energy storage systems could be deployed near neighborhood substations or even in residential buildings, to store electricity for later use during peak demand times to prevent brown-outs.

Which energy storage innovation do you most believe in?

There are several options for energy storage: batteries, ultracapacitors, flywheels, compressed air, pumped hydro, flow batteries, and superconducting magnetic energy storage or SMES. Each has advantages and disadvantages for different applications in transportation and stationary/grid applications. There are also many chemistry choices for batteries, such as lead acid, sodium sulfur, and lithium. Initial capital cost and life dictate the choice of energy storage for stationary applications, so $/Wh/cycle is an important selection parameter. For transportation applications, in addition to cost and life, vehicle manufacturers pay close attention to mass, volume, and safety. Connecting the energy storage system in plug-in and electric vehicles to the electricity grid using bidirectional lines will enable their use as distributed energy storage systems for ancillary services, commonly referred to as the vehicle-to-grid or V2G concept.

For vehicle applications, I believe only lithium batteries will be competitive in the new energy economy because of the tremendous advantages they possess for full hybrid as well as plug-in and electric vehicles. Ultracapacitors can play a significant role in mild and start-stop hybrid markets; there could even be considerable potential for using ultracapacitors in conjunction with batteries for plug-in and electric vehicles if there is a significant decline in the cost of the power electronics needed to integrate the two systems.

The synergy between the energy storage devices used in vehicles and the ones used for renewable grid applications is strongest when batteries and ultracapacitors are used for both. This dual use of batteries and ultracapacitors in transportation and utility applications will increase the demand and volume for lithium batteries and ultracapacitors. As high-volume production facilities are built, costs will drop and increase the market penetration of these two energy storage technologies. Therefore, we look forward to a lot of innovation in lithium battery and ultracapacitor technologies.”

Images courtesy of Flickr Creative Commons, NREL, EnerG2, and Vulcan Capital. Thanks to EnerG2 for putting this package together.

With no moving parts to speak of, a solid-state drive is far and away more energy efficient than its disk-based counterpart, the hard drive. Generally speaking, it also delivers better performance, resulting in a combination that’s proving increasingly attractive to data center operators. That edge helps IT shops overlook storage capacities that fall short of hard drives and helps justify the lofty price tags attached to SSD-based storage systems. It’s also an edge that’s attracting VC investment.

The latest news comes from XtremIO. This week the company announced that it had scored a Series A funding of an undisclosed amount from two Israeli venture firms, Giza and JVP. Heading up this early-stage storage player is CEO Rokach Ehud, with over a decade of experience in the telecommunications industry, including a stint as the CEO of Corrigent Systems, a carrier Ethernet switching provider. Details are scarce (the companies web site says it’s in stealth), but the company’s announcement makes clear that XtremIO has enterprise IT ambitions for its storage systems.

XtremIO is just the latest in what’s been a string of SSD-related funding activity. Also this week, Cupertino, Calif.-based SandForce, a maker of SSD control chips that boost SSD performance, scored $21 million in funding from TransLink Capital, UMC Capital, Darwin Ventures and others. Founded in 2006, SandForce is banking on SSD controllers that can coax 30,000 IOPS (which stands for input, output operations per second, and is a benchmark for storage — 30,000 is high) out of NAND flash memory and can reach both read and write speeds of 250 MB per second. Typically with SSDs, data is fetched (read) faster than it can be stored (write).

And earlier this month, Santa Clara, Calif.-based Link_A_Media Devices (yes, underscores and all), a system-on-a-chip producer for storage devices, secured $18 million in Series C funding led by Lightspeed Venture Partners. Chris Schaepe, managing director of Lightspeed, singled out one of the technologies that makes the company an attractive investment, specifically “error correction technologies which can now be applied to flash memory.”

Last month SSD chip and drive maker Samsung poured millions into Fusion-io, a company that’s no stranger to soaking up funds despite operating in one of the tightest VC environments in recent history. Prior to Samsung’s investment, Fusion-io cashed a $47.5 million check from Lightspeed and Dell Ventures, among others. Fusion-io manufactures PCI Express-based storage modules that slot into standard servers. The company counts MySpace and Wine.com among its high-profile customers.

If you’ve noticed Lightspeed pop up more than once in these SSD fundings, there’s a reason. The VC firm seems to be making a concerted effort to back SSD startups. Apart from Fusion-io and Link_A_Media, Lightspeed also backs Pilant Technology, a maker of enterprise-grade SSDs, and Unity Semiconductor, a startup working on high-density flash memory storage chips.

According to VentureWire, which chatted with the CEO Martin Flusberg at the GreenBuild conference this week, the company is in the process of raising $2 million from undisclosed investors. PowerHouse Chairman and CMO Dan Kaplan confirmed the planned funding with us this morning, and according to a regulatory filing, the company has already raised $225,000 out of a planned $750,000 round.

eMonitor seems to be focusing on the higher end of the home energy market. Kaplan told us that the product, which includes a gateway, monitors attached to circuits, and an smart outlet product, will cost $600, in addition to a $12-per-month subscription. While that’s not as high as some of the expensive luxury home automation systems, it’s clearly above a $100 or $200 dashboard. PowerHouse isn’t focused on utilities (Kaplan called the utility an enabler rather than a customer) but is working with distribution channels like solar installers.

There’s also two differences between the eMonitor and some of the other energy management tools out there (here’s 10 players). The company says the eMonitor enables the home owner to measure each appliance or outlet (more information) and the eMonitor also works with or without smart meters in place. Those aren’t huge differentiators — the Energy Detective and software like Microsoft’s Hohm also work without smart meters, and Tendril makes smart plugs to monitor each plug load. But the product could find a market with home owners that want more detailed analysis per plug.

The company says the eMonitor takes “under an hour” to install — a sophisticated DIY-er could do it, but most will need an electrician, says Kaplan — and is available now, but in limited supply. Kaplan tells us that the product will be more widely available next year. Co-founder Flusberg was previously the co-founder and president of Nexus Energy Software, an energy and carbon analysis tool, which sold to ESCO Technologies in 2005. And co-founder Dan Kaplan, who’s also chairman and chief marketing officer, was a co-founder of LowerMyBills.com, now owned by Experian.