Encorp reboot puts it on track to double revenues
A microgrid distributes energy in addition to — or in place of — whatever electricity is available from a utility’s power grid. Microgrids collect energy from traditional and renewable sources and store it in a large battery the size of a 40-foot semi trailer.
Encorp says its technology can yield greater efficiencies and savings.
“Encorp provides the products that connect those existing 20- or 30-year-old (diesel) generators with the new solar, with the new wind, with the new battery together and controls those at a system level to make them work with one another,” Encorp President Michael Clark said.
A gold box the size of a laptop computer represents the key piece of electrical equipment in the microgrid. A team of Encorp engineers developed the technology over a period of five years with funding from the U.S. Department of Energy and the National Renewable Energy Laboratory.
The boxes are now manufactured in Fort Collins and Loveland and installed in electrical subassemblies the size of a conference room.
Founded in 1992, Encorp had raised $40 million in venture capital by the turn of the century. It built an 80,000-square-foot facility in Windsor and employed 200 people.
But the market was not ready for Encorp, Clark said, and a private equity firm, Primary Integration in Washington, D.C., bought the distressed company. The company later moved to a modest office on Sharp Point Drive in Fort Collins and repositioned itself to play exclusively in the microgrid market.
It has emerged a success, almost doubling its revenues annually since 2010, Clark said. The company anticipates revenue of just below $10 million this year.
“Our revenues today are greater than they were with the 200 people and large office space,” he said.
Encorp at the moment employs just 15 people, five more than it did in 2010.
The company has completed more than 400 installations of its technology, and it continually maintains many of those sites. An installation’s cost can range from a few thousand to hundreds of thousands of dollars.
Encorp’s customers include the Chicago Police Department, Fort Bragg, J.P. Morgan’s data center and Miami International Airport.
In Santa Rita, Calif., the company worked on a microgrid for a 1-million-square-foot jail. The facility actually saves money because it supplements the power it buys from a utility with the power it generates itself using the microgrid.
“There’s an energy payback,” Clark said.
“It’s environmentally responsible and economically viable, which means that companies will put them in place.”
Encorp’s current projects include a microgrid for a nuclear submarine base near Seattle.
Encorp’s growth comes as Pike Research expects microgrid capacity to grow more than 22 percent annually during the next five years to 4.7 gigawatts. That growth will represent $17.3 billion in annual global revenue by 2017, according to a report by the Boulder cleantech market intelligence firm.
Large companies play in the microgrid market, too.
Swiss industrial company ABB leads the market in transmission and distribution infrastructure for microgrids. Boeing and Siemens are joining together to serve the U.S. military microgrid market.
However, microgrids face considerable hurdles to widespread adoption, according to Pike Research, in part because governments have yet to develop policies that would help create markets for them.
Still, there’s much hope for the sector.
“Microgrids can offer a quality and diversity of services that incumbent utilities have not been able to offer up to this point in time,” senior energy analyst Peter Asmus said in a report earlier this year.
That should mean continued growth for Encorp.
Clark is hopeful.
“Together, when you consider the high cost of generation of electricity from renewable energy with the low cost from (a microgrid), it adds mutual benefit,” he said.
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