Energy Central Power Perspectives™: Welcome David March, New Expert in the Energy Efficiency Community
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- Oct 29, 2020 11:00 am GMTOct 29, 2020 10:58 am GMT
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When looking at the utility sector as a whole, focus on energy efficiency sometimes gets trumped by the attention and resources poured into generation, transmission, and customer management. But energy efficiency is the type of tool that can improve and support each of those silos within the utility business, and provide countless other opportunities and benefits.
As energy efficiency continues to carve out a critical role across power providers and for their customers, the perspective of experts in the field—especially those who approach energy efficiency thinking from new angles influenced by other types of businesses—will be incredibly valuable. David March, the CEO of Exergy Energy and COO of Skyven Technologies, is just such a voice in the field.
David recently joined the Energy Central Network of Experts within our Energy Efficiency Group and he brings with him an entrepreneurial history, a commitment to innovation, and a valuable background that can inform the future of energy efficiency programs at utilities. Don’t take my word for it, though, see what great insights he was able to share via an interview for the official Energy Central Power Perspective ‘Welcome New Expert Interview Series.’
Matt Chester: Thanks for agreeing to be our newest expert, David! Our community loves getting to know the experts via these interviews so they have the background on who to turn to for what issues, questions, and topic areas. So, to kick things off, can you give the audience a broad background of who you are and what your experience is in the energy industry?
David March: As for background, I’m a chemical engineer. I have a Masters in Quantitative Finance. I’ve been in energy mostly from the industrial side early in my career. I was a process optimization consultant primarily in pharmaceuticals where I would go in and help pharmaceutical companies essentially optimize the energy and material usage within their plants. I have a couple of patents in energy; one specific on how to identify and evaluate in an automated fashion, energy savings in complex industrial processes.
I also have extensive experience in the renewables space, so in 2013 I started a company called Entropy where we bult 425 megawatts of utility-scale renewables. I started another company in 2018 called Exergy, which works with organizations that need to run 24/7 and if the grid goes down, they need to keep running. We devised a process how we can make them 100% renewable and 100% resilient without costing them more, or even saving them money.
Skyven is a decarbonization outsourcing firm for industrial process heat applications. While many expect the grid will go carbon-free, the process heat-side is a whole different story and is really challenging. And for a lot of industry, particularly in food and beverage, where Skyven specializea, 70% of their energy consumption is heat, coming from fossil fuels, mostly natural gas. They’re challenged in how do you get to a zero-carbon future with process heat. That’s where Skyven steps in, first in a technical way. We look at all of their heat usages and find the best ways to improve the overall efficiency of the thermal processes. But you got to start first with efficiency in this game. After that, we start transitioning them to zero-carbon footprint with things like solar thermal, biomass, hydrogen and electrification of processes. We take, end-to-end, full life-cycle responsibility for the decarbonization of processes.
MC: Your history isn’t restricted to just the energy industry, but also includes businesses like manufacturing and software. When you look at different businesses and how they interact with the energy industry, what challenges jump out? Where do you think the energy business has opportunity to learn from other types of industries?
DM: That’s a really challenging one. Energy tends to be much more complex not from a technical sense but from a business sense because of the regulatory environment, monopolies and the overall infrastructure. So, for example, if you’re in a regulated utility market then your electricity prices are not market based or dynamic. In some cases, regulations disallow third-party power purchase agreements, which makes it more difficult. Then you have tax incentives that create a further challenging environment.
And again, some people only think of electricity rather than the full energy footprint. So, let’s take, for example, the food and beverage operation. 70% of their energy consumption is fossil fuels. For such an operation that wants to go 100% carbon-free, they may think let’s contract with wind and solar and we’ll shift everything into electricity. Well, that would be fantastic except the infrastructure isn’t there to deliver that additional energy to the plant. The substations aren’t there, they don’t have the distribution facilities, and so they can’t just triple their electricity consumption just because there’s no way to actually serve it today. So, energy tends to be a lot more complex than most other things in optimizing manufacturing process.
MC: As an expert in our Energy Efficiency Group, can you speak to what you think the role of efficiency is going to be in the next decade? Lots of focus goes into the generation side, and some may even contend that if we can solve generation & grid challenges suitably then efficiency doesn’t need to be a high focus. What would you say to that?
DM: Efficiency should be number one. The United States really came to industrial power globally because of cheap energy; it wasn’t that we were any better than other folks in manufacturing or anything else. This country is built on cheap energy, but energy prices started to creep up 15 years ago or so, but then we got shale gas and the prices again plummeted. Energy prices in the United States have actually fallen consistently over recent years. So, we are extremely good at using lots of energy to get things done and it’s absolutely the right thing to do if you look at it from the engineering and financial sense. You use your cheapest resources as much as possible to create as much value as you can.
But that was before we all learned about the externalities and global warming. We are now having to reconcile our use of energy and that’s really all about efficiency. We didn’t really care when we had boiler if 30% of the energy was going up the smokestack. Who cared? It was so cheap anyway, right? But now we see a focus on the cost, not in energy terms, but the cost to the world, the environment, and more importantly, the cost of my ability to compete effectively for customers who now are voting with their wallets and rewarding those companies that are more sustainable.
The next thing is, this is a global problem, we don’t call this U.S. climate change, we call it global climate change and many businesses in the United States are really taking the initiative. Businesses are taking the initiative because they’re very concerned, about global competition and the potential that we would actually get carbon tariffs put on our products because we pulled out of the Paris Agreement. Europe is not going to subsidize the carbon footprint of competitors when importing their products. It’s got to be a level playing field. So, can you imagine you’re a U.S. exporter and you’re saying, hey, I’ve got a huge market in Europe, in China, so I’d better be able to prove and attest that I am as climate-friendly and committed as possible. So, in the United States, businesses are definitely taking the initiative.
MC: For someone who’s looking to break into the energy industry with a new idea, an entrepreneurial effort, etc., what advice would you give based on your experience in those areas?
DM: I would say focus on driving efficiency through knowledge optimization and software. Hardware is difficult to get financed and off the ground. Venture capital is really hard to get for clean tech if it’s got a significant hardware or project finance component. If you look at all the cellulosic ethanol plants, cellulosic biofuel plants and everything else, you might be in the several tens if not hundreds of millions of dollars to build the first plant, and most of them have failed to provide a satisfactory return on investment.
So, what you really want to do is to be able to help companies identify where they can improve their operations, where they can reduce their carbon footprint that they literally can’t find themselves. So, that’s essentially what Skyven does. There are tons and tons of different thermal energy efficiency products out there. Everything from simple heat exchangers and heat pumps to condensing economizers, and each of those companies is trying to sell you a point solution, The poor utilities engineer or plant manager is getting calls all the time telling them what they should be doing. They don’t have the bandwidth nor do they have the holistic experience to be able to step back, look at their operation and say, what makes the most sense, especially first. Because once you start increasing efficiency, it’s not isolated. So, if I recover heat from something and I reuse it in a process, that reduces the heat demand on something else which then changes how you optimize that. And it can get quite complex. We don’t build hardware but we identify what things should be done and will manage getting those things done and getting the equipment in and the design right. It’s really the ability to holistically look at the energy and process flows of a system and ferret it out where the best returns are.
MC: What brought you into the Energy Central community initially? What attracted you about the community and what keeps you coming back? How do you hope to bring value to others within the community as well?
DM: What attracted me is it’s exactly what you referred it to as: a community. I think that the comments and articles from people tend to be much more objective, practical, non-commercial and real value-add. I post a lot of Energy Central articles on LinkedIn because it’s good content with valuable information and I don’t feel like I’m sending someone an advertisement.
Please join me in thanking David March for his time in this interview and for his accepted role as a Energy Efficiency expert in the Energy Central community. When you see David engaging with content around Energy Central, be sure to say hi, ask a question, and make him feel welcome!