Friday, July 08, 2005

Current Communications raises $100M

Current Communications has raised a large round (reportedly around $100M) from investors including Goldman Sachs, Google, and The Hearst Corp (update: also included previous investors EnerTech Capital Partners and Liberty Associated Partners). Current has broadband over powerline (BPL) offerings that allow internet access through electrical lines in your home and through the power grid.

Why is this of interest to cleantech investors? Because of the applications it enables. As the "smart grid" and demand-side energy management technologies develop and mature, one consistent obstacle to mass adoption is the lack of a consistent communications media to serve as the backbone of such smart networks. It's difficult for an electric utility to roll out remotely-controlled energy efficiency technologies across an entire neighborhood, for example, when the utility has to access and control those technologies across a hodgepodge of DSL, cable, dial-up, wireless, etc. technologies which the different residents may each be using. Instead, if every home were connected to the internet via BPL (often in addition to their existing broadband connection), it would make the utility's job a lot easier and cheaper.

Many telecom investors, perhaps including Current's new backers, are expecting that BPL will be a "third pipe" into the home that will successfully compete with cable and DSL to provide entertainment and information services. The utility would build the pipe, and then lease the access out to someone like Earthlink, a satellite TV provider, or competitive local exchange carriers (CLECs) for IP telephony. By itself, that is not necessarily a cleantech play.

But if a utility does roll out a BPL network, it enables a lot of cleantech applications: smart metering to help residential and commercial energy efficiency decision-making, remote control of lighting and HVAC, power grid monitoring, power grid automation, indoor air quality monitoring, water usage monitoring and control, etc. (Take a look at how Current describes some of these applications from their perspective) And indeed, many utilities are counting upon that as part of the justification for rolling out BPL networks, for both internal business cases, and justifications to their public utility commissions.

Current Communications' funding may not be a "cleantech" investment per se. But it's an indicator that BPL may finally be getting ready for prime time (there are a surprisingly large amount of utility roll-outs and pilot programs out there already -- note: opens a PDF), and that has implications for other cleantech investment opportunities.


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