Today we launched a new website for Tangent. The new site provides a great snapshot of our current product offerings which are Tangent AMP™, Demand Design™ and Demand Design PLUS™, but it also reflects the latest phase of our unwavering mission to support the enhanced role that customers play in the energy value chain. Yes the site is new, but our underlying belief that customer resources are an integral part of the energy grid goes back a long, long way.
My indoctrination to the energy grid began at an early age. During road trips with my father, he would point to the power lines and quiz me about them. What type of lines were they? What was their voltage? What type of industries do you think the lines serve?
These early lessons, especially the last one, proved to be very useful later in life as I built a career that focused on helping large commercial and industrial customers extract the maximum value from their energy systems. Even though the industry classified this work as “behind the meter”, I never saw customer energy systems simply as attachments to the grid. To me they were an extension of the grid and an integral part of the overall system. This insight, grounded in those early roadside lessons, has paid dividends throughout my career. On more than one customer call, educated guesses made from the parking-lot based on the facility’s power connection helped pave the way toward more productive discussions with plant personnel.
For a while the industry started to catch on to this customer-inclusive view, especially when Demand Response emerged and emphasized the importance of customers’ energy systems as a resource for balancing stress on the energy grid.
At the time, we had a long list of Fortune 500 customers that were ideal candidates for this program. We also had a deep understanding of their energy systems’ capabilities and how they could be most efficiently and effectively dispatched when events were called. This approach succeeded beyond our expectations. Before ultimately selling to Comverge we had built the largest Demand Response company in PJM; the largest power pool in the world. At the time, I thought Demand Response was the perfect example of the energy grid on both sides of the meter working in harmony. Unfortunately, the Demand Response industry had other ideas.
Instead of evolving toward an operational focus based on how customers could best participate, Curtailment Service Providers (CSPs) were evaluated on how much curtailment they could extract from customers on behalf of utilities and power pools. The customer’s situation further deteriorated when CSPs later went public and the Wall Street metric of shareholder value fixed almost exclusively on megawatts under management. Operational teams diminished as more aggressive sales and marketing efforts were launched to secure larger participation commitments from customers who increasingly had to figure out, on their own, how to meet curtailment commitments.
In 2008 I left the Demand Response industry and in 2009 formed Tangent to provide customers with the resources they needed to effectively and economically participate in energy markets. Once again our goal was to focus on our customer first, but in a way that also accrued benefits to the overall energy system they were a part of.
We continued to address the same issue that drove Demand Response – peak demand periods on the energy grid. But, instead of building a business model based on utility and power pool priorities (i.e., maximum load curtailment), we focused on customer priorities (i.e., better economics with less disruption to customer operations).
In other words, instead of signing customers up to 60 hours more of potentially mandatory curtailment, because on the grid more is better, we identified a minimum number of hours that drove better economics and less disruption. We developed a proprietary software platform that not only accurately predicted when these critical hours would occur, but also actively managed their participation to provide a very lucrative, but also a very easy, way to participate in energy markets.
The final piece of the puzzle was to help select customers add on-site generation, not in a way that isolated them from the energy grid but enough to further enhance the value and convenience of energy market participation.
In hindsight, this last piece of the puzzle somewhat overshadowed our technology offering because a solar array is much easier to showcase than a “negawatt.” In truth, this may have caused some confusion over our industry role. A situation we are now taking steps to correct.
As a start, we are proud to launch a new website that more clearly communicates our value proposition as a customer-side technology resource for energy markets, and restores balance to our other offerings.
Today Tangent is thriving, and others in the industry are even starting to follow our lead, by refocusing their messaging toward the customer economics of demand peaks. It’s an encouraging sign – but so was Demand Response.
My concern is that the industry does not repeat its mistake from the past. In 2013 the industry still wrestles with the same challenges it did in 2006. Every day I read about disagreements between power-pools, generation and DR firms. Each points finger at the other assessing blame while promoting solutions where they benefit only at the others’ expense. Our opinion is that customers are and always have been the least common denominator in the energy value chain. Returning to a customer-side approach to these issues is a path to a successful future but it needs to be more than a message.