Monday, August 8, 2005

Community

How we See it: Energy bill contains plenty of fuel

When Congress approved the long-argued $14.5 billion energy bill recently, it opened the door for a potential windfall for area tech companies.

While the energy bill - expected to be signed into law quickly by Pres. Bush - has funds for encouraging the exploration of ways to recover oil trapped deep in the ground, and encourages with incentives the building of more gas and oil pipelines, it is in some of the smaller areas the greatest impact will be felt in New England's innovation economy.

The bill calls for national mandatory reliability standards for grids and utilities. In Westborough, American Superconductor Corp. makes its D-VAR (Dynamic Volt-Ampere-Reactive) reactive power compensation system used to help stabilize power fluctuations in an electrical transmission system by injecting power into the grid where voltage problems occur. AMSC could see a jump in orders from this provision of the bill. Beacon Power Corp. of Wilmington makes a grid stabilization system based on flywheel technology, another possible winning technology following the energy bill passage.

Another feature of the bill calls for the public to be offered time-based electric rates beginning 18 months after the bill enactment. This means pricing has to fluctuate based on time of use, critical peak pricing and other features. To get the best information for establishing these prices, the utilities will likely look to smart metering and possibly smart sensor networks. Lexington's muNet has just the trick with its WebGate Automated Meter Reading system. The company already has customers in places like Kentucky and Washington, but could see its roster grow rapidly in response to the new regulations.

Even biotech could be swept up in the bill's largesse. The bill mandates oil refiners increase their use of ethanol from about 4 billion gallons a year to about 7.5 billion by 2012. Cambridge-based startup Agrivada Inc. is working diligently to create a better strain of corn for producing ethanol. With agro-business giants Monsanto Co. and Archer Daniels Midlands Co. producing the bulk of the ethanol in use, either one could come knocking on Agrivada's door soon.

The bill also includes a reported $3 billion in subsidies and incentives for alternative energy sources for electricity. New England is awash in these companies from solar businesses Konarka Technologies Inc. in Lowell, Solaris Nanosciences of Providence, R.I., Spire Corp. in Bedford and Evergreen Solar Inc. in Marlborough to fuel cell companies FuelCell Energy Inc. of Danbury, Conn., Nuvera Fuel Cells Inc. in Cambridge and Protonex Technology Corp. in Southborough. All of them could see a jump in interest and revenue from the funds allocated by the new energy bill.

The oft-maligned elected officials in Washington, D.C. deserve some credit for getting a bill done that has some real value, both to businesses and consumers, and both immediately and in the long term.