The opportunity

As electrification progresses and utilities face mounting pressure to safely build variable load, grids are transforming from simple, linear flows into complex, multi-directional networks.

Numerous software and hardware solutions have been developed to augment flexibility at transmission level; however, existing solutions at distribution level that provide both data collection and control are expensive, thus limiting scalability.

Portico was engaged to evaluate an investment opportunity in a new hardware solution offering grid operators real-time, distribution-level visibility on usage as well as remote power flow control.

The solution

Portico led an in-depth technology assessment of the proposed hardware solution, aggregating technical reviews by leading industry practitioners and conducting key informant interviews with end-customers (DSOs).

We prioritized interviewing experienced technicians responsible for installing, monitoring and troubleshooting power flow control equipment on a day-to-day basis across the grid: this surfaced practical considerations around new hardware adoption that the ‘grid-tech’ investment community typically overlooks.

When combined with independent analysis of the strength of the team’s experience, GTM roadmap and balance sheet, our review informed a set of unambiguous recommendations:  

1. The technology was at much earlier TRL than needed to achieve commercial scale. If and when it is shown to work, the impact could be transformational, but utilities will need to see years of testing and pilot performance data in real-world installations before accepting it, as equipment failures could create knock-on network wide vulnerabilities.  
2. Beyond functionality, the solution itself was pre-product-market fit in an industry that typically adopts new hardware only at the natural rate of replacement of existing solutions. Given our client’s criteria, which included a credible pathway to winning commercial contracts with reference customers, the time to revenue stretched too far beyond the runway provided by the capital raise.
3. Our diligence discovered a long-standing and unresolved dispute over core IP – potentially creating an open-ended risk for the company and its investors.