By Meghan Hall
The way utilities function has changed little over the decade, but as new data around climate and its relationship to the built world is released, those in the commercial real estate industry are creating new technologies to combat inefficiency. The Registry spoke with Edo’s Hendrik Van Hemert, Managing Director, about Edo, a new energy start-up. The company seeks to make buildings more able to participate in the utilities grid.
Please tell The Registry a little bit about Edo. When did McKinstry and Avista first begin to conceptualize a technology that opens information pathways surrounding energy usage and consumption?
McKinstry and Avista recognized that buildings are a significant factor in our climate crisis, consuming 40% of all energy produced in the U.S. and generating nearly 40% of our carbon emissions. Considering half of all building energy is wasted, and the urgency of combating climate change in an affordable manner, McKinstry and Avista conceptualized an entity that would improve the one-way relationship between energy producer and energy consumer. The first physical demonstration of a grid-interactive campus at South Landing was built in collaboration with McKinstry, Avista, and other partners, and Edo heads up the energy management, analytics, smart controls, and ultimately operation of the building. Edo’s software and services are the key that allows the building’s assets to balance shifting loads within the energy district, and on the local distribution network when needed.
There was widespread recognition that this was not a scalable approach – a greenfield shared energy district was a unique opportunity that would not present itself for every utility. However, the concept of a grid-interactive building or ‘GEB’ was proven out here, and the campus serves as a testing ground and open innovation lab as Edo scales the approach through existing buildings and building retrofits within utility demand-side management (DSM) programs.
Can you elaborate on what it means to open these communication and information pathways?
The grid has been a one-way piece of infrastructure for 100 years. Supply is built and delivered to consumers at the level demanded, and suppliers receive pre-set rates of return on electricity delivered. This paradigm has barely shifted in the past century, and there is widespread agreement that it needs to in order to meet our larger clean energy transition goals in an affordable, equitable manner.
Buildings are a network of complex, unique systems that have historically spoken unique languages. Uniting these communication protocols so that systems within a building can be more easily optimized has been a focus in the industry for at least a decade, if not more. The next frontier is uniting the communication protocols used in buildings with those used by grid operators. Innovators in the space like OpenADR and others have already begun making headway in this arena. Now it is on the rest of us to implement it!
Both McKinstry and Avista have plenty of experience in the CRE industry—more than 200 years. How have the companies’ experiences in the CRE industry shaped Edo?
We are made up of a team of professionals who have been working for decades on building science, energy management and analytical systems, and establishing lasting relationships with building owners and operators. From McKinstry, and within the Edo leadership team’s collective experience, we understand real buildings and how real buildings work. This is a bit different than other entrants in this space who have developed a new piece of software to deploy but don’t have the real-world building experience, and so certainly would be challenged to successfully scale this type of program the way we need to.
Can you talk a little bit how Edo works?
Edo partners with utilities to transform buildings into smart, efficient, actively managed energy assets that have the capability of providing demand flexibility services (automated load shed/shift) to the grid. We are not a third-party aggregator. We think the most sustainable and durable model is one in which utilities play a leading role in the transition to a new energy value. We work by enabling utilities to be a trusted energy advisor with back-of-house support and white-labeled tools, we enable building-level visibility to improve and strengthen the relationship with end customers. The data that comes from the end use systems monitored by our portfolio energy information system can be mined to inform program design (e.g., distributed energy resources, or DER, program needs) and to understand the actual potential of buildings on a feeder to provide flexible load to the grid.
One of Edo’s first projects was the South Landing EcoDistrict in Spokane, Wash. Can you talk about the project and Edo’s integration into the development?
In the South Landing development, thousands of Internet of Things (IoT) sensors backed by machine learning algorithms pull Avista beyond the meter, providing the visibility needed to balance on-site energy generation and demand with overarching grid operations. If the grid needs more supply, energy consumption within Catalyst will decrease, freeing up any renewable energy generation and stored electrical and thermal energy supply within South Landing. If the grid can’t absorb more supply, excess energy from the grid will be moved to the on-site electrical and thermal storage systems. This load shed and shift capability is operationalized by Edo. Edo provides the data layer, energy analytics software, and advanced supervisory control functions that allow the design and automated execution of various “operational modes” tuned to what Avista may need to see from the campus at any given time.
How is Edo different than other energy-based proptech currently coming to market?
The Edo model enables utilities to be service providers to their largest energy consumers, eventually growing the opportunity to use flexible, grid-responsive load in those buildings to shed and shift during peak times. We are not selling IoT or a nifty app; we are selling participant recruitment, building owner relationships, white-labeled energy analytics services, and the basis of a grid-interactive buildings program. You will see proptech firms in our space selling energy management software direct to building owners, and this was important in early stages of commercialization of the underlying technology and before utilities might have wanted to enter a market like energy services and demand flexibility. At Edo we believe in facilitating our utilities to provide more building energy services will enable other shifts we want to see around.
How do you see GEBs evolving in the future? Why are they so important to the CRE industry and the built environment?
The potential carbon reduction impact of successful GEB program is significant. A recently published study from U.S. Department of Energy’s National Laboratories estimated that by 2030, GEB measures could reduce national CO2 emissions by roughly 80 million tons, or 6% of total power sector CO2 emissions. This is achieved by decreasing generation from carbon intensive (fossil-fuel based) sources and then by the timing of electricity consumption; namely shifting usage to hours with lower emissions rates (e.g., noon in an area with high levels of solar irradiation). Further, the same technology used to operationalize GEB operating modes within a building also contributes to lower energy spend, better occupant experience, improved fault detection capabilities, among a range of other benefits to the building owner and their tenants. We should be acting on this opportunity now, it is a win-win and helps us begin to decarbonize immediately as we wait for longer term investments, such as procurement of utility scale wind, solar, and storage, to catch up.
