Start-up teams with Goldman Sachs subsidiary on products that store up energy to help in times of peak electricity demand.
Goldman Sachs has invested $18 million of the total funding, and its subsidiary Cogentrix Energy has agreed to distribute GridPoint's energy management systems, the start-up said Tuesday. Cogentrix Energy builds and operates power-generation plants.
GridPoint has designed a refrigerator-size appliance with batteries for storing back-up power. It also sells a unit that works with renewable power generation, notably solar panels.
Alongside the Internet-connected appliances, GridPoint offers Internet-based services, such as detailed usage information and the ability to turn off appliances in the home during periods of high electricity demand.
Through the deal with Cogentrix Energy, GridPoint will devise versions of its products that utility companies can then offer to customers, executives said on Tuesday.
The idea is that consumers who are willing to have a storage unit installed will pay a monthly fee--in the range of $20 per month--for services, including back-up and online services.
Having several local storage units can be very interesting to utilities, as it potentially cuts down on the need to ramp up power generation, said Larry Kellerman, a managing director of Goldman Sachs and president of Cogentrix.
A network of the grid-connected units would allow a utility to tap into that stored energy during periods of peak demand and obviate the need for those utilities to build new power plants, he said.
"With the GridPoint product set, you have the ability to not meet every need of the utility, but to meet the part of the need set that is the deferral or even the elimination of some new generation equipment in an environmentally benign manner," Kellerman said.
Utilities in the U.S. are facing rising demand for electricity and are facing challenges in delivering power reliably, he said.
Kellerman added that Cogentrix Energy chose Washington, D.C.-based GridPoint because its products incorporated a wide array of capabilities, including centralized management of several distributed storage units.
GridPoint currently sells its appliances, which can hold either 7 kilowatt-hours or 10 kilowatt-hours, for about $10,000. The up-front cost for utilities, however, will be substantially less per unit, said Peter Corsell, CEO of GridPoint.
The two companies have not signed on any customers, but Corsell said that they have had "productive discussions with a number of utilities" and noted that GridPoint's storage units were certified with California utility Pacific Gas and Electric.