Last month, I pontificated on the emerging energy industries and exhorted everyone to develop a plan to enter growth markets. Growth markets, in this economy are clearly tied to energy reduction or energy generation via clean sources. Egret has jumped into this market and is currently helping a client attract engineers who understand how to connect wind farms onto the grid. It's pretty arcane stuff but it's also a window into a market that is well hidden from the media storm of disinformation.

The Transmission and Distribution side of the power industry is facing an explosion of requests to expand wind and solar generation capacity. As an example, the state of CO has assessed that they will need an additional generation capacity of 2500MW. There are currently applications 'in queue' for connecting to that grid that total an expansion of 22,000MW. All of those requests are for variable, clean energies, wind and or solar. The construction costs to add that load of energy, including potentially hundreds of miles of new transmission lines is in the mega-billions.

Utilities and their RTO affiliates (Regional Transmission Operators) have queues in excess of five years out for requests to connect to a grid that in most instances is ageing and incapable of handling huge increases in capacity. The challenges of adding variable generation to the grid are numerous; wind power as an example is not only variable (it only generates power when the wind is blowing and when it's blowing at the proper speed range), but it also has problems with adding an inductive load to the grid. Inductive loads (think 'motors' starting up in an industrial plant) create huge power factor issues which need to be mediated with specialized control equipment. That control equipment (banks of capacitors or newer forms of power factor correction) also has issues with creating harmonics or voltage fluctuations. In short, I'm not an engineer, but the issues are complex and require very specialized engineering talent to assess and compensate for this addition of power onto the grid; as well as electrical equipment.

So what does this all mean to our industry? Growth. Opportunity.

If you're a consulting engineer; there is a large unfilled void of specialty engineers who can assess the interconnection issues and provide the expertise to complete the RTO requirements for connecting onto the grid.

For manufacturers who aren't in the utility market; look to those manufacturers who are, because the opportunities for an OEM relationship should be ample.

For distributors who have shied away from the 'power' business, go call on a dozen solar installers, see what they need to help them improve their business. Solar panels have complicated wiring and cabling issues, as well as control panels. A smart distributor could easily develop a solar value proposition: pre-wired cable assemblies, packaged connectors, enclosures, transformers, panels, etc.

For wind power, the current path to market is through the developers, who have close relationships with the turbine manufacturers and the large manufacturers of transformers. You may not get any of the large capital equipment, but every wind farm project has miles of wire and cable plus connectors and enclosures and controls and insulators, etc. etc. Go meet 5 developers and you'll be far smarter; before you dismiss this and say "this makes no sense for our business".

The economy stinks. Housing is down and will stay down. Commercial construction is limping along and may not regain growth until next year. The opportunities to make money in this economy are in the segments that may be new to most of us: wind, solar, LED, building automation, energy retrofits, and controls. If you're waiting for GM to come back and the housing market to return; you've got nothing but time on your hands any way... go learn about the opportunities around you.