The aptly-named Development House doesn’t appear much from the outside but, located in the heart of London’s tech city of Old Street, it hosts a wealth of talent working across a range of ethical companies. One of them is Open Utility, a firm intent on disrupting, but also collaborating with, UK electricity’s established names.
James Johnston co-founded the company in 2013 having studied for a PHd in microgrids at the University of Strathclyde. It was there he stumbled on the concept of an ‘Enernet’ – or internet of energy – which was first promoted by online guru and co-inventor of the Ethernet connection Bob Metcalfe.
Metcalfe began pushing his Enernet concept in 2009 but it wouldn’t look out of place today. The venture capitalist considered that smart grids consisting of cheap, renewable energy could come to dominate the power landscape of tomorrow by combining local generators, system architecture and storage.
It was this concept, Johnston says, that served as a roadmap for Open Utility.
Describing himself as “particularly commercially driven”, Johnston went about assembling a co-founding team, roping in software developer Andy Kilner and user interface specialist Alice Tyler. More than four years on and the trio still lead the firm, serving as CEO, CTO and CPO respectively.
Johnston, Kilner and Tyler established the firm and sought start-up backing from Bethnal Green Ventures, a London-based accelerator programme for tech start-ups. Open Utility then spent much of the next two years developing its maiden project Piclo.
Its premise is relatively simple, matching local generation with demand. End users have control over whom and what they purchase their energy from, enabling them to tailor generation profiles to suit any specific needs or sustainability goals. Local co-ops can support community renewables projects in the area, while if a certain user was particularly taken by solar PV, they could choose to only procure solar energy whenever possible.
The product was soon picked up by Somerset-based clean utility Good Energy and launched, initially on a trial basis, with a select few customers and generators. There’s no transactional process involved in the system developed by Open Utility – that much is left to the utility – but the product simplifies what can be a particularly complex market.
In granting a face or place to a name, Piclo also drives user engagement with the energy procurement, pricing and consumption process, something more traditional utilities have long since struggled with.
The initial trial of Piclo was so successful that Good Energy leapt at the chance to commercialise it further, allowing Juliet Davenport’s firm to launch Selectricity late last year. Good hasn’t disclosed any specific numbers or performance metrics relating to Selectricity since but the product sits squarely within the firm’s new strategy.
Open Utility has since taken Piclo global with launches in Italy with ERG and Essent in the Netherlands, with a fourth utility in a fourth country set to follow, perhaps before the year’s end. This fourth adopter could also prove to be a landmark moment for the platform as it will be the first to launch in a standard retail market, rather than limited to business customers. Johnston gives little away as to the identity of the customer, but does reveal it will be in a country with ubiquitous smart metering and half-hourly settlement, a vital component.
Taking on the demand for flexibility
Attention has now turned to what Open is doing next, and any established artist will warn you of the sophomore slump. Having become well versed in local distribution grid issues, the firm is turning its hand to flexibility trading with the help of a £400,000 grant from the Department for Business, Energy and Industrial Strategy. In much the same vein as Piclo, Open intends to develop an online marketplace through which distribution network operators can procure flexibility whenever necessary.
Johnston explains that the idea stems from a project the company worked on for DNO Western Power Distribution (WPD) examining local flexibility, which is fast becoming a problem on the UK’s distribution grids given the significant quantities of renewable generation installed on them. Most of the UK’s solar is installed at the distribution level, with storage set to follow in its tracks. DNOs, Johnston says, need to do things smarter.
“Business as usual plans just won’t cut it in the future,” he warns.
Open has worked extensively with DNOs – or DSOs as they now like to be called – and wants to continue to do so. The firm is currently in talks with one in particular about participating in its flexibility marketplace and Johnston stresses that he is eager to work with all six in the UK and others overseas.
Johnston is convinced there has been a change in DSOs over the last 18 months, a willingness to embrace the evolution of the power market and drive it themselves. DSOs are not alone in this though. When Open partnered with its supplier partners with Piclo it found itself placed not in innovation teams, but in business as usual divisions. The pace of change in the energy market has only accelerated in recent months and forward-thinking suppliers are haring out of the starting blocks too.
Traditional utilities? Not so much. “I just think utilities are missing a trick. [With Piclo], they have all that data at their disposal already, and we’re just presenting it differently,” Johnston says. Any utility that can’t keep up with the pace of change is facing a bleak future in Johnston’s eyes. “You can’t just sell a commodity anymore. You’ll get left behind.”
Open Utility’s future looks a little rosier. The firm is to seek further investment early next year to fuel growth plans and, to facilitate those ambitions, an expanded headcount. This will mainly come in the form of more software developers, which Johnston says “you can never have enough of”. The only problem for Open Utility is this places them in direct competition with some of Shoreditch’s finest tech companies. “In the energy sector we’re quite well known, but in the tech space we’re a nobody,” Johnston says.
It’s not an uncommon complaint for those based in London’s technology hub. Many firms from various industries have sought to ride the crest of Shoreditch’s wave and recruit leading tech talent, only to find themselves outgunned by big, established names in the mould of Facebook, Google and Apple.
But that’s a problem Open Utility is likely to have to get familiar with, particularly if the firm is to continue on its current trajectory. Johnston meanwhile insists his firm wants to be regarded not as disruptors, but as collaborators as the energy transition gathers pace. Judging on their success so far, it’ll be a brave utility that doesn’t want to collaborate with them in the future.