A Korean company offering Demand Response solutions to business customers.
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The Story of Gridwiz
Gridwiz is a Korean company offering Demand Response solutions to business customers. In essence, they offer complete control over efficient energy consumption by providing instructions on when to adjust the use with the peak and low demand moments. They offer smart solutions, which means they offer the hard- and software to help the customer either reduce or increase the use of energy at peak or at low demand. Also they offer their clients economic demand response. This is offering support (or is this complete service) to trade on the Korean Power exchange to buy at lowest costs.
Gridwiz is a communications software & hardware company with more than 15 years of significant resources and expertise in the deployment of connectivity solutions for the embedded device market. Working with organizations and leading technology providers across many industries gives us the ability to provide valuable insight to our clients with a broad spectrum of functional areas.
By continually analyzing evolving markets, they provide practical consulting and up-to-date smart energy communication solutions that go beyond the hardware itself to include associated smart energy product designing, total system design, communication module technology, testing and certification, and related application productizing.
Gridwiz provides high-level in-depth training and Seminars both in house and on-site training for smart energy communication by specialists. Gridwiz aims to assist customer goals by integrating development and training, standard education and certification harness. Training areas include, but are not limited to: Product Development and Productizing, Standard Stacks, TCP/IP Internet Stack, Embedded System, Test Tools and Certification Tools, and System Designing from the perspective of Smart Energy.
Gridwiz training team claims to know the smart energy standards and products inside-out and to have expertise in OpenADR2.0, SEP2.0, TCP/IP stack, Communication Hardware, RTOS[2] and overall embedded systems.
The business model Canvas
As the current standards are too costly and restrictive, Gridwiz cooperates in the ADR alliance to reduce the resources needed to achieve results with DR programs. (www.openadr.org). the Gridwiz offer is a high tech solution in the relative young field of DR solutions. The cooperate with the Lawrence Berkeley institute for R&D. Their revenue models is a percentage of the savings the customer achieves with the DR program. Also, their profits consist of Operating profit from DR future as well as expected profit from PV, ESS, ESS+DR.
Gridwizz is more or less co creating their offer with their clients in order to tailor it to the specific needs and the specific situation of their clients. They don’t really have any other option, as each a specific situation requires a different solution.
Although the Gridwizz offer is a high tech solution from many perspectives, their key activities consist of, besides R&D (being a high tech solution in the relative young field of DR solutions a large bit of their efforts is being spent on R&D), consulting and participating in conferences and training their clients. These activities aim to assist their customers to be able to use the solution and make the right adjustment in their day to day business.
The Gridwiz solution is described as a new way to handle the excessive demand of energy.
The value proposition is the high tech and very smart solution to help the client with their DR goals. As this smart solution still requires a serious effort from the customer in order to use it properly, training is included in the offer. From how the offer is described on the website, Gridwiz still positions itself as a tech company with a smart tech solution.
Their clients, especially those with a high energy consumption, suffer from two things. High costs and the exposure to power shortages and blackouts, which is growing problem. Not only to companies, but also to the Korean energy providers.
DR solutions potentially are a solution to this problem, however, in many cases this requires severe knowledge and recourses.
According to Gridwiz and how it is described, Demand Response will always be the result of a close cooperation between actors that understand the essence of DR as well as the technological backgrounds.
Market Performance of Gridwiz
According to Gridwiz, it achieved sales of USD 19 Million (operating profit USD 0.2 Million) mainly in the DR sector last year. The sales, which were USD1.3 Million in the first year of 2014, jumped more than 15 times in three years. It claims to have a steady profit structure with more than 400 workplaces (customers) in the DR field of Reliability (Peak reduction) and Economy (Fee reduction).
Competitiveness comes from a 1-minute real-time data acquisition & processing, and system operation technology. As the core of the DR trade market is real-time response, it should support faster and more accurate power demand management system. Big data technology, which combines remote advanced meter reading infrastructure (AMI), which collects real-time power data with system semiconductor technology, and data analysis algorithm, was applied. It claims to have provided demand management services since 2014 and to have secured open standard ADR 2.0 (Open ADR 2.0) standard technology.
Gridwiz is set to expand its `ESS[3] + DR` market. Last year, ESS, Power Management System (PMS) and international standards-based test operation were claimed to have been successfully conducted in three locations in Los Angeles, California, USA. This year, ESS will be used to expand the service to automatic control of power usage at the load site. The customer obtains the base and usage rate reduction and the energy consumption effect by avoiding the power peak. In addition to upgrading demand management services, GridWiz additionally conducts plant energy efficiency projects that can be linked to demand management.
Mr. Kim, CEO, said, "With this year's ESS solution business, we will expand the business beyond the DR by establishing an electric vehicle recharging service module and a photovoltaic power generation business. We will promote ESS · PV power generation and personal transaction (P2P) Based energy trading market. "
Dynamic capabilities
The user sensing capability is well developed, based on their efforts to train and educate their clients in (preparing for) using their solutions. However, Gridwiz can grow in their understanding of the desired outcomes of their clients. This however depends on the growth ambitions of Gidwiz. If Gridwiz’ ambition is to expand their business beyond the innovators to a larger, less tech skilled client base, they could benefit from reframing their offer.
The conceptualizing capability is also well developed, based on training and education.
Gridwiz is co creating with both partners and clients, which implicates that their orchestration skill is developed. This orchestration is important as the smart solution and the aggregator requires both development and partners[4].
Although Gridwiz is a tech-oriented company, they pay a lot of attention to the use phase. This is probably efficient, as their client base consists of larger, heavy users with technical knowledge. It seems that they have many pieces of this puzzle already: partners, training the users, high tech communication software to alert the user etc. However, to me it seems they have to align and position all these pieces in order to serve the client. As it is now, the client needs to have a lot of understanding of the offer. Gridwiz can be categorized as a type 3 businessmodel.
Context Strategy
Gridwiz, they are a smart matcher. This means they work very hard to align al partners needed to form a coalition and enhance the technical standards. Gridwiz ‘matches’ with partners and clients who are on a more or less similar knowledge level. This can be a very effective strategy at this very moment in time, simply because many stakeholders as well as rules, standards and regulations need to be aligned.
[1] Gridwiz is an officially registered DR aggregator at KPX (Korea Power Exchange). Refer to KPX website for details: http://dr.kmos.kr/main/market_05.htm. [2] Real-time operating system, http://rtos.com/PDFs/What_Is_An_RTOS_and_Why_Use_One_Embedded.com_.pdf [3] Energy saving and storage [4] For the partners of Gridwiz, refer to http://www.gridwiz.com/wp/about-us/partners/