The Sacramento Municipal Utility District wants to ensure that it captures the value of intellectual property (IP) that it develops when entering strategic alliances with companies. In a sign of how seriously the utility takes IP, SMUD has developed a program where utility employees are taught how to detect and protect IP, said Laura Lewis, Chief Legal Officer at SMUD.
Lewis made her comments at the Energy Bar Association’s 2019 Mid-Year Energy Forum in Washington, D.C., on Oct. 15, where she participated in a panel that examined the 21st Century Utility. The panel was moderated by Julia Hamm, President and CEO of the Smart Electric Power Alliance.
Shifts in the business model
When asked by Hamm to discuss shifts being seen in business models, Lewis said that “at SMUD we still intend to be a full-service electric provider, but we understand that our customers now have choice.”
SMUD’s customers have the ability to install onsite generation and storage “and so we really have to shift our mindset to ensure that we continue to provide value to our customers in the form of affordable rates and innovative products and services,” she said.
At the same time, as the utility’s load continues to flatten out and sometimes decline, “we’re looking at how to generate additional sources of revenue. In the past, we never really had to worry about that.”
SMUD shifts approach when it comes to intellectual property
The SMUD official noted that in 2006 the utility partnered with OPower “and helped them develop software that basically analyzed our meter data to compare customer usage.” But at the time, the utility didn’t think about how “to capture this value, this intellectual property” related to the effort.
Opower was recently acquired by Oracle “and if we had thought about how we could get some kind of revenue out of that in the form of royalties, we would have made a significant amount of money.”
Now, when SMUD partners with companies “we ensure that we’re going to capture the intellectual property that we contribute. We’ve developed an intellectual property management program at SMUD where we teach our employees what IP is, how to detect it, and how to protect it, so that going forward when we enter into these strategic alliances we’re able to capture that value in the form of royalty payments or something along those lines.”
Lewis noted that SMUD has a partnership with Open Systems International, which is going to develop the utility’s distributed energy resources management system (DERMS).
“That system will help us have visibility over the DERs on our grid and ultimately allow us to send control signals to control those DERs to better manage operational issues” on the distribution system, she said.
“As part of that agreement, to the extent that that system is utilized in other utilities,” then SMUD would receive a royalty payment.
SMUD played a role in the passage of legislation this past year that allows the utility to hold a non-stock security in companies as a way to greater ensure that SMUD can receive any revenue from IP it develops.
While SMUD was not able to take an interest in Open Systems International, the utility plans to use this power going forward.
Integrated resource plan
Meanwhile, Lewis noted that SMUD’s board of directors last year passed one of the most aggressive integrated resource plans in California. “We’re looking to be net zero carbon by 2040, which means that we’re going to have to make significant investments over the next twenty years to get there,” she said.
Lewis said SMUD plans to invest around $4 billion in renewables, including about 1,000 megawatts of local renewables, and $2 billion in electrification “because we understand that in order for California to meet its carbon goals we really need to look past the electric sector and focus on what we can do in the transportation sector.” The utility also plans to spend just under $1 billion on energy storage, Lewis added.
SMUD’s energy store
At a later point, Lewis described what SMUD is doing in terms of new products for customers. She noted that the utility has an energy store on its website “where customers can go and purchase energy efficient appliances and other equipment.”
The store is a vehicle for SMUD to “make sure we maintain that customer relationship because obviously it’s going to be critical for us to ensure that we have the ability to communicate with our customers and that they understand our business. We want to get people going to our website.”
Lewis said that “as we go forward with some of these new technologies and electric vehicles and more customers interacting with us, we want them to understand how they can change their behavior in a way that actually benefits our system as well.”
Lewis also discussed SMUD’s activities with respect to electrification.
SMUD’s efforts and partnerships have brought electric school buses to local districts. The utility partnered with the state’s air quality districts “to roll out one of the largest deployments of electric school buses, with twenty electric school buses that primarily serve disadvantaged communities,” Lewis said.
Also, the utility is exploring a charging as a service program for fleet vehicles “and certainly we’d be looking at governmental vehicles as part of that, as well as transit agencies,” she went on to say. Under the charging as a service program, we are considering a full service offering under which the utility installs a charger and maintains and operates it on behalf of an entity.
Lewis also referenced the California Mobility Center. In May, SMUD’s Board of Directors formally approved the utility’s founding membership in the center, including an initial investment of $5 million to establish the center. An additional $10 million will be made available once matching funds are committed by other partners.
The California Mobility Center is a joint initiative between SMUD and local and regional institutions to build a world-class, electric vehicle prototyping facility that will develop and promote electric and autonomous vehicle technologies in the greater Sacramento region.
With respect to electric vehicles, Lewis noted that SMUD has a workplace charging program and is involved in a project that will utilize blockchain-enabled tokens as part of an effort to encourage EV owners to charge their vehicles at workplaces when local renewables peak during the day.
The project, which is being funded in part through an award from the American Public Power Association’s Demonstration of Energy & Efficiency Development program, was also detailed by Denver Hinds, R&D project manager for smart energy technologies at SMUD, at a recent blockchain in energy event in New York City.