What do you think would happen to electricity costs in Connecticut if we were to move forward and and why they deploy this type of technology? I think two things will happen. We will never again have to face the threat of a blackout and our costs will come down. Just a quick reminder for you to like, subscribe and rate this podcast so we can get your feedback and know how to make it better. Hey, it's Ari. Welcome to an exciting episode of the Made in America podcast.
I'm with Christina Lampe-Onnerud, the CEO of Cadenza Innovations. Christina, thank you so much for coming on today. Thank you. Very excited to have you on. We've got a really new and exciting and innovative company that's doing something really interesting, not just sort of in manufacturing and creating something new, but also impacting all the manufacturers that listen to this podcast. So I think it's kind of a, it's kind of an interesting, you know, a show that's got so many different layers.
So I'm just really excited to get into it. But I got to start off with the same 2 questions. What do you make and why do you make it? Thank you. Thanks first for having me. So Cadenza Innovation is an energy expert company on battery storage with software that is basically attached that can communicate with a grid, regardless if it's fossil fuel or solar or geothermal or wind. So it sits as a node on your grid point. I'm sure we'll talk more about this.
It helps you lower the energy cost and it makes you more sustainable and have more resiliency. I started a company because I saw this whole opportunity of change in an energy paradigm and energy sovereignty is really, really important. And it's a top strategic issue also for the state of Connecticut, for the United States and for many countries around the world. At this point, you saw that problem and decided, I see a global problem that seems very tall and insurmountable.
And you said, let's go get it. I must climb this mountain. I must climb this mountain. That's exciting. And so I mean, well, I guess I started with the first thing. What sort of gave you the, you know, the chutzpah, the energy, the belief that this was a mountain that you could climb and that was worth climbing? Yeah. So I started a company in 2005 that was reasonably successful. We had over 1000 employees operating in nine jurisdictions globally and I exited the company.
So with that, you get a little bit of cash and you feel like, oh, that was fun. And then my my general inspiration was the team came back and it's like, man, that was so much fun. And we were behind the scenes. We were a little understated, but we were the first battery to power a laptop across the Atlantic Ocean from the United States with HP, followed by Lenovo and AsusTek. We went into GM with a Saab 95 car.
We had a EV on the auto show in 2009, which was acquired by the Chinese ultimately, but we did some cool things. I've had innovations on the moon, and it has always been like these crazy things where people say I can't do it and somehow those mountains, it's like Muhammad says you can't, the mountain won't come to you. I have to go there. But I think it's important. And I had the privilege of coming to Connecticut through Ray Dalio and Bridgewater, where you have a little bit of a garden year.
You can think about new ideas, but you can't compete with your company when you sell it, as I'm sure you know. So I worked with Ray. I had a chance to meet a lot of experts in all kinds of markets and I got reinforced that everybody's moving into this energy paradigm.
But the thing that I actually know and the relationship that I can carry, which is in manufacturing, in executionable innovation by shaping markets and helping people figure this out together, like the onset of big markets, that's like my passion. So having an opportunity to learn, get a little strengthened by, hey, everybody's missing this.
And I made the commitment to my team and said, hey, if we can identify batteries that can go on the nodes anywhere in energy storage and ultimately in cars, and we have 3 value propositions #1, we will define safety. So there's a problem in the world around safety in this related to batteries related to power, all the above. Yeah, explosions, fires, resiliency in general. And then second, we would make it at a cost point where you leverage what the industry knows. So this is an older industry.
Batteries have been around forever, right? Take everything that works and fix the things that don't work but have a cost down mentality as we approach this big mountain, this amazing opportunity. And the third one is as we enter into a new market and we look at electricity specifically, it is possible that we don't know and our customers don't know and the players don't know. Let's put together a platform that is agile. So I gave a TedTalk in I think 2011 or 12.
Can we make Lego blocks of energy? Can we make them smaller so I don't have to tear down big buildings or put huge containers everywhere? Can I think about power differently? And now I'm so proud to say we have it, you have it. So let's take a step back. So you had safety, cost and then you said agility, which to me is like performance, OK, performance and and so the the idea being we're not we we're not trying to do this moon shot that ends up driving up costs.
We know we've got to get to the, we got to get to the goal of effectiveness but we got to do it in a way that's cost effective. Yeah. And part of our our kind of culture inside this group is collaboration. So we're not overstated. We're possibly too understated, but our partners like that. So we go in, if you have a building that you would like to see, can I lower my electricity cost, we can go in and do a proxy for you fairly quickly and say, yeah, that makes sense.
Your address actually has weakness on the grid or we can help you with backup power, whatever your issue is and we could model it roughly. And payback periods are about this amount of years. Maybe it's three years, maybe it's four years. And over 10 years where you have a 10 year warranty on the product, you actually have revenue streams coming from this battery. It's like a whole new era, A whole. OK, wow. That's you got, yeah, unloaded a lot on me in one little bit.
So let me try and peel back some of these layers. So you had a battery company that was like laptop focused, a much smaller concept. But but still the idea is there of I got to take power and move it with me or I got to figure out a way to have power without being plugged into something. Right. OK. So we take that successful exit, and then you're sort of thinking about what can I do next? How can my team and I take what we've learned?
And I think what I heard you say, which was really interesting, is we're gonna use the lessons that people have learned over decades and decades of battery storage and battery power and learn and essentially use those lessons learned to scale up the same concept but use it in a way that sort of grid level. So it's not laptop across the Atlantic, it's factory across a weekend or whatever exactly.
Exactly. So just so I can understand and listeners can understand, let's like talk about sort of the concept of how it works, 'cause as a as a layperson, I think to myself, well, if I have a battery in my building, I'm paying to charge the battery. So even if I go off the grid to run on the battery, I've still already paid for the electricity in the other place. So where exactly does the savings come in?
Because we let's let's talk about resiliency next, because I think that to me is pretty, I don't know if obvious is the right word and maybe I'll learn it. It's not quite as obvious. But I sort of think that intuitively I sort of get the concept of why a battery helps with resiliency, but I don't understand the cost concept. Yeah, OK. So you can imagine, if you look at the traditional way, the way basically the Western world set up transmission.
So you have generators, that's one class and then you have transmission and distribution and then you have the customers. OK, well, let's let's back that up. So the, the first thing is the generation. So that's the factory that generatesthe power or the oil, it can be coal, nuclear power, solar, whatever. So there's some place that's generated. So whether it's a solar farm or more likely something that's burning natural gas or whatever. So I get that.
Then I understand distribution, that's the wires. So transmission companies basically own. So somebody owns the transmission lines and then you have multiple companies that can buy in. So you can be in, in one territory with one main utility company, but there are other companies also. That's sort of the competitive deregulated market where I go.
So when I get my power bill, my generation fee which includes transmission is one thing and then there's like the cost of the power, which is a second charge. So actually when you look at your bill, you have a base charge basically the connectivity, you're connected to the grid and then you have a second charge level which is the most power you used, sets your effective rate, the most power I use in a year. So let's say.
So power is not, it's not like we all use the same power all the time, correct. Yes. Anyone who in your house, it's like you turn on the the toaster and it goes, yeah, got it really, really high. So you have variation in your building. So now the grid companies of course have it's you can think of as highway of electrons and they will divert wherever they needed. So one way to make this more or less affordable to them is they will charge you more what they call peak.
So your high, so that's your peak. So if you can take down your peak, you lower your electricity cost. That's number one. So if you just have a battery for taking away all your peaks you lower your infrastructure cost with no well I lower my the bill I pay per month today today the way so I'm I don't have to change the way the billing works. I don't know we don't have to reinvent the billing. This today would lower my cost just by essentially cutting down my peaks.
And then the second part to your question is they you as a, so I am working with the the state of Connecticut on this. But today all businesses, all business owners, all your listeners, there is an arbitrage opportunity. So you have different electricity rates during peak hours than what they call off peak hours, right. Cost me more to run my machines at 2:00 in the afternoon than at 2:00 in the morning.
Yes. And interesting so in the Ted talk that I gave in 2011 whatever peak what used to be like 6:00 PM to 9:00 PM today in most urban environments it's 12 noon to 12 midnight for it's half the day is peak. Yeah, very interesting. So, so we why is that you ask Of course because we heat and cool more and that will become more needed. We use more data and we use electricity for many more things than we used to when we designed the grid. Well, that's a lesson.
Just as a quick side note, preparation for this, I went back and was looking at because I'm one of those people that saves this information and spreadsheets it, but went back to look at power utilization and it's we are using more power consistently in the same month over the previous year every year for the last 10 years. Like it never it doesn't go down it doesn't even stay the same.
And I I, you know I tried to level out looking at I, you know I knew we probably used more going into COVID we were home more and then over the last 10 years life has changed. We had two people and now we've got two children along with us and so, but it just doesn't seem to matter. We're just constantly using more stuff. And I couldn't.
I was just trying to think back and realizing that, you know, we've got more phones, we've got more iPads, we've got more connected devices, we've got, you know, security cameras that talk to online all the time. We've got Nest thermostats. And you know, all these like little things add up. So I just, I think and and at work as I'm sure the same way, right, like I'll go around and look at people's offices and you're using three monitors instead of two or two instead of one.
You know you've got your phones are using the power because we're not using this old digital phones anymore. So all these little little incremental things and even higher impact you use data server farms which are energy so intense. We never really talk about this, though. I think it's actually sometimes it's good to know why. So the more data you use, somewhere where you place these data forms is really, really important.
Yeah. And I don't think, I mean, I just happened to be in that data field. So I I know about about that. But I don't think people really appreciate, you know, they think, oh, we're in the cloud, so we don't have our servers running. But the level of heat, what's up? First of all the servers themselves use a ton of electricity and they generate an immense amount of heat, which then means the data centre providers have to spend yet more money to cool down the server farms.
So you're sort of getting like a double whammy on that. And it's, I mean it's it's intense. Yeah. So anyway a lot more power being used. Got it. That's right. That's right. And so the and so the idea here is you can use the batteries to cut down the peak. You can and you can. So you can cut down the peak. That's that's one value stream. The second one is load shifting. So depending on how you operate and so we have software and hardware and I think that's actually also interesting at this time.
We're also now a contractor ourselves to make sure it gets right at the first time. So you don't have to call in 50 people and everybody takes a little cut because my #2 in this is affordability. So if you have too much complication around this, it doesn't really work. So that the let's let's go back to the vertical integration comment because I think it's interesting you know but let's stick on the on the cost share for a second when you have you observe.
So for example I think I get in a house because it's easy to understand. So if if I gave you an app, so if you install my battery you have an app and then you will see literally literally you'll have access basically and you will see oh look at that our peak is between 6:00 and 9:00. Most families run like this still. What if I now show you now residents in Connecticut does not have differentiated rate. Hopefully we get there soon.
But you should be able to have much lower cost running all your dishwashers, all your laundry, all all heavy equipment during the night and you should get compensated. For businesses we already have the opportunity. So there's some things in your business that you can run at night, for example, some of the server updates, some of the data crunching, you can key it up.
And with this type of integrated systems, you will learn. We were AI before AI was cool, you could learn you can have a little person be part of this equation. Yeah. So it's not exactly taking over as I know you know you need a person to make this judgement, but to me it's also I will hopefully help revolutionize the digitization of energy. Like, let's take one step back on this though is one of the values of the battery to say that I wouldn't have to time shift my work.
But during the peak when I needed it, instead of going to the grid, I go to my battery. So my grid pull actually goes down and then I can just so so essentially I I can instead of having to do all the hard work and listen to some things you can't arbitrage. If I'm trying to run my if I'm trying to run my factory machines, I can't. I can't, you know, just run them at 3:00 in the morning. But I could charge my battery at 3:00 in the morning and then run off the battery.
Then you run down your peak and you have a loader. This there's another very interesting aspect which is the government now is recognizing our grid is not able to basically satisfy the demand. And a couple of Christmases ago, we were really close to a blackout in Connecticut, in Connecticut. So it's not even like like you can imagine what was running. So that's how close we are to edge. So therefore Connecticut policy makers have put a program in place called Demand response.
So when you have a battery, when you are the owner of the battery and it sits with your meter system, you can shift it three ways. You can basically say when the grid is going to be weak, I allow the grid to pull and you can set the percentage. I always want to reserve a 20%.
I want to sell as much as I can and you can go in manual and say like in my house, if grandma is coming, I want it to be cool and nice for her, but otherwise I will tell my kids to just deal with it, deal with it, have some more water like just like mixed and you make you make real money on this so you share. And it's cheaper for the government to allow participation by businesses and private citizens, very very important than to build new infrastructure.
So. So why does a battery mean that I don't need to build more infrastructure? Because instead of wasting the power, I save it. So what happens today when the power isn't used? It goes nowhere. You just it's like you can think of it as you have a waterfall. It's actually good, the waterfalls all the time. You have turbines. If nobody takes the off take, the turbines continue to spin but nothing happens, right.
If you have a battery, the turbines generate electricity and sits in the battery and when you want it, you can pull it from the battery or pull it from the turbine directly you you can decide. But that way if the water levels, if the water continues all the time, So I mean, I just, I mean this is a very personal question but I'm just interested like the power has to go somewhere, doesn't it just dissipates, it just does nothing. Yeah, it just is wasted.
It's wasted so wasted so so the if I if I pull this all the way back to the core what what you're solving is not wasting so much power. It's one of the things I'm solving, I'm I'm also giving you power to manage your costs because today you have no power otherwise. And the other thing is also interesting as we are worried about climate change and we invite more solar and geothermal and sustainable generation, right.
We recognize that that generation is only available at certain times like wind is mostly during night, solar is mostly during day but we need power all the time. So you have what is called intermittent power then. So you smooth out the curve. And in my and and like in my book, we are kind of lucky in the United States because our infrastructure is aging out, typically have a useful life of 47 to 70 years or something like that.
And we are basically at the cusp of having to decide, should we invest in the old paradigm or should we go to this new paradigm where you have everything that is working in the old paradigm, fossil fuels, let's use it, make it more efficient. And for example, when you have a peaker plant, so those were a peaker plant that's a fossil fuel plant that ramps up and down and try to respond to you like a generator at your house. OK, so you have an outage and you'll hear it and then it goes right.
You pay for it, by the way, when you test it, then you generate it and not always it works, but anyway, I have one too. And then it ramps up. It releases a lot of CO2 and it's a lot of inefficiency, but once it hums, it's quite good. But if you go up and down for small things, say a few minutes or an hour, fairly good. So what we know from macro studies, and I've been involved in a lot of these through World Economic Forum and other foreign doe here.
If you run your batteries for up to four hours and if it's longer than four hours, you should get other sources. It's super economical. Right now you just introduce a new thing I'm trying to pick up. If you run your battery for more than four hours, you can you can size them but economically, so you can decide. I you can say I would like to be completely off. So I have 99 panels on my house. So I can in principal go off the grid anytime if I have enough batteries because I charge every day.
And then if there's storms hitting, I have a close circle. So that's kind of nice. What's that? So I have solar panels and I have a battery in my house. What's the closed circle? So I can so with the battery I can say I will trade with the grid anytime or I will prefer to just take my own solar power. So the closed circle is the grid is down. I use my solar power, I charge my battery, I run on the battery. When the sun is down, sun is up, I run directly off the solar.
So I have that option, got it. And so and so, so that that, so the so we're solving the cost, we're solving the cost thing sort of two ways. We're solving the cost by saying hey, I could use grid less because some of the times I'll just be running off my battery and if I use my battery the right way, which you guys have the software to manage, I'm going to cut my peak down. And so I will cost my cost per kWh will actually go down.
Now we need to have some policy changes in residential because as it sits today at least in Connecticut where we're having this interview, the residences, residents, net metering, so, so it's sort of you you sort of don't that won't impact you, but businesses could already impact that. I believe it will come to residence too.
But then the last value stream is this demand response where you can as a business owner decide should I lower my electricity cost or should I participate in these mega peaks And it's typically heat or cool cold weather. And when you say participate in the mega peaks, you're saying sell my sell the better and it's extremely well paid. It's actually a revenue stream really. Wow. So this is where it's so interesting. And and then there are, you have a little bit of differentiation where you sit.
So different addresses matter how you run, do you are you constant power, are you having peaks like And This is why we offer to our partners and customers. We run a proxy for you to just very quickly say it's roughly like this. So we take your bills from 12 months back, 15 minute interval then you get higher precision and you say I think I'm running like this next year as well.
And then we can talk about if it changes like should we size and we try to help you size it from an economic payback point of view. So you guys. So I mean that's a very hands on approach to the customer getting them set up. So it's got to be really business focus because you can't invest that kind of time for like a two person new home. So let's let's let's talk a little bit about safety and performance that I want to get to customers.
So when you say safety, is the safety really looking at just making a safer battery that doesn't light on fire or explode in my garage. Is it safety along the lines of we would have like other air aspects of of safety. When you think about safety, what are you talking about? Yeah, so I have tried to. So my dream is to empower people all across the value stream. So we have tried to say anything that is working we should try to use instead of inventing something that is just a tad better.
So we're actually using, we have indoor and outdoor systems. So first of all, we can aggregate into virtual power plants. You can mix systems and basically you can think of this, you put some batteries in the basement.
You said put somebody on the rooftop, you can put somebody right next to your building and then you can fill every single utility closet if you have space in there or electrical closet or utility room, so you have you can put them all over and we what would be the benefit of putting them all over versus cost? So it's much cheaper because if I can put them inside structures, so still electrical stuff, so you can't have rain on top of it. So you gotta protect them.
So I use actually standard server racks, something I know you're very familiar with. So standard server racks and we kit it. So when it comes to your shop, you basically have racks, all the cables, and then you have a separate box with the batteries and you just lift them in and you just erect the racks. You secure them in the in the ceiling and in the floor and you just plop them in as like little shelves.
And then we hang a communications box, which is all US software, and we hang an inverter that basically decides the power in and out to your grid or to your house or your building or your machine or wherever you're hooking it up to. And then it talks to the panel. And if I can go into your existing infrastructure, it's just cheaper. Cheaper, yeah, for sure. But I can put relatively inexpensive little cubby houses. And I think this is also where Cadenza is potentially an interesting enabler.
Most of the industry is saying either we make them really small and by the way, these batteries are very heavy, so you must have really good walls. So to me, you immediately say I don't care about the underprivileged communities and I would like to go into low income as well because I think if people are in need, electricity is actually a really big deal.
If you don't have electricity, you have no schoolwork, you can't be no Internet with digital divide, heat, overheat during sure it doesn't work. So with this approach you can have basically all the batteries in the little cubby and they are the size of a parking lot. So this has gotten the attention of in the parking lot, you can put one cubby outside and the size of a parking lot, you can put 10 or 100 parking space, you mean. Yeah, exactly. Oh, sorry. Sorry. One parking lot's huge.
Yeah. Yeah. Exactly. 1 parking space. OK. One space. Exactly. So they're pretty small and you can configure them anywhere. So you can say so it's kind of about the size of a of a of like a gas powered generator for a house is what? If. Yeah, exactly. So you can put them in multiple places. The closer the battery is to point of use, the less efficiency loss. So that's the other thing. Well, that's with everything, right.
So I mean, one of the things that I think people don't always think about is especially when you think about as we've gotten more and more urban sprawl, you're just every, every, every mile, quarter mile, foot, inch, whatever that you have to move power from the source of generation to the end use. You're just losing it in the form of R Square losses. Yes, exactly. So it's like, yeah, yeah, yeah, yeah, like that's super nerdy, but but it actually really matters.
So the, the point that you can have these distributed through a building next to point of use helps you as a business owner or you as a homeowner or you as a municipality. Yeah. And you know, this can also sort of solve the not in my backyard power generation problem, right? We struggle to build new power plants, but this sounds like it would allow us to get more out of our existing power plants without having to build many, many more power plants.
Yes. And big containers are very ugly shipping it. Nobody wants them. I can make this. And New York City is very creative around this. They have thoughts around this like when it's a little container like this, I could paint it, I can put messaging on it. And I'm thinking for business, if you can put it in your front visitor lot and say, hey, we participate in lowering the cost for everybody, giving access to everybody. And this is one thing that we do for sustainable Connecticut.
Sustainable, yeah. And so going back to the safety component, let's just talk about that again. So it it's really the focus on making sure the batteries themselves are safe. Is that really the major? So it's interesting because lithium ion batteries compared to if we look at the statistics of car, like let's start with cell phones, a cell phone explosion risk is one in seven to 10 million. Wow. That's actually higher than I would have thought because I have the toaster. It's about the toaster.
Yeah. So that's the budget. It's pretty unlikely, but yes, pretty unlikely. But it happens. Sure. When you take that to EV, it's one in 2000. So the way that. So you have heard of explosion. Wow, that's like a massively different risk profile. Is it because the batteries are bigger? Because it's the same technology, right. That's exactly why it's statistically. But it's interesting to put so it's roughly the same risk as an explosion of a gasoline fired car.
We have 150,000 car fires in fossil fuel cars in the United States every year. Really. But you never hear about it because we're used to it. Yeah. So it's a little bit of perceived, but to me it is. So the EV likelihood of fire on a battery is roughly the same as what we've seen for the likelihood of a Casper, roughly. But the problem is how you put it out. So in my opinion, so when I started this company, Mari, I actually thought I would license this technology.
All the EV we 'cause we we cracked it. We have basically created a battery technology that cannot explode. First principle why 'cause we never generate enough heat. So we are saying like Francis Sikorsky. Sikorsky says like we will have no failures. That's all good. Each one of your toys is like 600 million. My toys are going to be affordable by low and middle income on like wait, so how do you have no fires? So I can basically limit the amount.
So first of all, I know the failure mode, so 95% of all failures in the field are created by manufacturing error. Very pertinent for this broadcast. So the manufacturer can say I'm going to screen out for all errors or I'm going to allow and accept that this is the paradigm I'm in, I'm in. What do I do now to make sure it doesn't cascade? So we have made a structure and we own the patents on this.
And This is why DOE and state of Connecticut, everybody's a little bit excited about the company where we have proven that if you put them into smaller packets and you give thermal conductivity around the battery. So if it gets hot, you lead it away very quickly and you provide that, you basically allow the fuel to be removed from the heating source, you have no chance and it can't spread to the adjacent cell unit. So we have an unintuitive solutions.
You have thermal pathways with built in heat sinks and an insulator between electrochemical units. So you never come below the what is called the lower flammability level which means it can't ignite, it can't ignite, never gets hot enough to sort of get to that combustion place. So that is revolutionary. That is revolutionary. So that so you've got a, so we've got a cost play. We've addressed the safety issue. So let's talk a little bit about performance.
So, you know, one of the things that in this way we can get back into the vertical integration that is maybe part of it, you know, let let's, well, why don't we break it down from your perspective, how do you sort of guarantee performance and how do you think about performance and performance management, 'cause this isn't sort of a, it isn't just a plug and play, right.
There's some, there's some intelligence and some decision making that has to be implemented to really get the performance you want. Yeah. And I think it's very interesting right now. So when you and I first met, we talked about courage. So I think it's very important to say this energy shift is happening. And for those business owners who are courageous to would like to participate, you start small. You don't know what 10 years look like.
I don't know what 10 years look like, but I will give you data and the way we have set up this software platform that looks it's like say you buy 10 batteries. So not only will you have ID on each one of those batteries. So let's say you did distribute them or you have them together and they go to different panels. You will actually know the data on each one of these individually. That's new. So you get data and we see the same data. So we love our customers. We will talk to you.
Hey, how's it going? Did you notice you made you are basically paid back in three years. Have you noticed and you're now in the revenue generation, Have you noticed now would you like to just connect, connect, collect here some options like how can you think about it like we partner with you and I think this is ultimately performance. So it's a little bit the humility, we don't know and we've set up the whole battery solution and technology on the the products themselves as Lego blocks.
You can earn it as you go, you can invest as you go. Our state wants us who invest to be the the primary beneficiary because the state's obligation is to make sure the grid doesn't fail. And we are very lucky we have insight in state legislators. So what, what's the like breath of the deployment? Like what what, what is the, what is like a typical customer look like today. So we are in the early stages of commercialization. It's, it's, it's very.
So the containerized systems are like 50 MW hours. So they're large. Some buildings that we're looking at are like 10 MW hours and even for 10 MW hours we can do a mix of maybe some containerized and then we go inside as much as possible to lower cost. And then we have some that are below a MW hour and they're mostly inside. So but what is the, but who is the customer are we talking about like apartment towers, are we talking about South?
Apartments are very interesting, especially condos because every single condo owner can basically participate if you are a CNI. So if you are an operating manufacturer, we would love to CNI. So commercial and industrial. So manufacturers, actually we have looked at a few different manufacturers. We do not have an installation yet, but we're in discussions and it varies greatly where you are.
If you are at weak grid point, if you are where there is already a lot of issues with the grid, it's very, very profitable immediately. And in other instances you would make smaller investments as you go, because I think the other thing is which is never priced in is the idea as a manufacturer can you really have an outage. We even talked to a dentist who is like solar, so that's like in a strip mall. But he's like, what am I doing?
Like I have these people, they are under anesthesia and the power goes out and the drills don't work. The drills, Yeah, that's not good. That's not good. No, that's not good. And even we, we have recently got an E verified, which is E so basically telecommunications. So for schools and libraries, the federal government is sponsoring part of the cost of condenser batteries going in. That's pretty nice. That's very nice.
So what So that's UPS function that has capability to do other things as well. So I guess when you we think about the sort of delivery and the taking advantage of the of the performance and ultimately to get to the cost, someone has to be monitoring it, right. So is it, is it someone has to make these decisions on a day-to-day basis or how do I like if I got this installed, how would I actually get it to work for me. The software will help you. So this is, this is what we offer in part of this.
So you can buy a battery, but all of our batteries come with installation and software costs like it's all baked in. So that's another issue I see in the market. So hopefully this is a disruption a little bit on how the market operates and it's part of the solution to solving affordability. So the software basically gives you data. How are you operating? When are you running?
So these decisions that you could basically make in your manufacturing environment like this service I could actually do at 8:00 AM instead of 10 AM, look at that. And then I lower cost. So you get the data first time, all of the demand response, all of those things, you get a notification it's coming in three days. Do you want to opt out? Your default will most likely be opted in, but if you need to opt out, you have a big tour president is coming through too.
So you know whatever you will probably want it run. So you have those optionalities and I think it's mostly data. The software will give you outputs, your facilities operations team, your finance team gets a chance to have a new tool. Yeah, basically to manage. So, so there will be a learning curve to understand how to manage it. And so does that does that. How do you think about maybe it's this doesn't even be thought about today, but how do you think about solving that on a residential basis?
You know, I mean, especially when you're talking about trying to get this widespread adoption, you could envision challenges with some people sort of being able to sort of make those decisions. Yeah. So I think most residents will basically go on recommendations. So just take the defense. So we have actually. So I was part of the civil servants helping Connecticut solarize Connecticut. And for that we saw one very important aspect and I used my house as one of the demo houses.
One is you need a demo house or demo buildings, people can go and look at it. And for that I'm so grateful to the city of Bridgeport. We have a system in the Firehouse in the headquarters and that should scream some level of comfort. They took it in so they believe it. It was also sponsored in part by the state.
So they are also saying hey look at this, this is an in state company that can do something pretty disruptive and when a resident then looks at this we have on this app, we have a little tree and the idea is you can count how many CO2 molecules you basically saved and you will have your financial metrics as well. So you can get the feel good and the bank feel good too. So let's so you you're in early stages of commercialization talk to me about what is sort of the go to market from here.
You know sounds like we're still in sort of proof of not a proof of concept is the right way to say it, but you know a little proof of concept go live is that our current we are basically commercialization ready. So we are now in negotiations of pretty significant contracts. OK. And so the idea would be to bring those to market 2024-2025 and and it sounds like we're in the focus of like big, big sizable deployment. So we can really get out there.
And and then do you foresee that being like several years to sort of work on those big accounts and work that through before you go to residential? Oh, I love this question. So it's so interesting. So the way we have set this up, we can deliver these systems within four to six months in 10s of thousands of units actually. So we are completely ready.
So it is a very arduous way to get certified, to get listed with the Connecticut Green Bank to go through and get all the approvals and get all of your commercial contracts and all that stuff. But when you have it is very straightforward and so how would how would residents Even so how would businesses or residents find out that this was available that's on that's now your mission is to get the word outlet. People know this is available. So we will need to run campaigns.
So we have an idea what areas that are mostly grid stressed. So we're trying to basically approach people and we're getting fielding a lot of calls and we're trying to basically get that done. And we have an opportunity to I think have Connecticut embrace this type of technology and make it our ecosystem. The Department of Energy, the Department of Defense federally is looking to Connecticut for many of these solutions long tradition of defense operations here.
And I think this is really critical actually if we believe, and I think this is thanks for hosting this podcast, because I think you're connecting people. Like if we believe a stronger manufacturing state is part of the fabric that we need to have, we should invent this together. So I know a lot about batteries. My colleagues are electrical engineers, Mechanical Engineers, chemists, you know, inventors like all this stuff, but we need to actually invent together and shape this market together.
And their words are huge. What do you think would happen all of the things remaining relatively constant as they are today? What do you think would happen to electricity costs in Connecticut if we were to move forward and and why they deploy this type of technology? I think two things will happen. We will never again have to face the threat of a blackout and our costs will come down.
We are in the top five states in every study of electricity which is a deterrent for manufacturing of course 100%. Yeah. So I think that in combination with the state not having enormous resources or program actually resources maybe, but no programs for manufacturers to incentivize large manufacturing opportunities per SE, that's not helpful. We can say we have a great workforce and we do and the programs for for incentives, I don't touch and it's not my expertise at all.
But energy we can make it cheaper if we deployed widely and we will then figure out how to do it and we can also export it. What's the relationship, if one exists, between Cadenza and sort of? The traditional utilities do they is this a, is it a collaborative is it is no relationship is it you do they view it as a as a threat What how do you think the. That's so interesting.
When I exited my previous company, Ari, one of the big utility companies came and said, oh, you know you get a lot of job offers when you do that. And one of them said, oh we would like you to help us think about this. I was like that sounds amazing. What are you thinking? Oh, we were thinking about the next 30 years. So I was like no, but I think these. So we have two main utilities here, UI and Eversource and both are very interested.
UI is actually owned by Eberola Spain and the CEO of Eberola sat on my committee at World Economic Forum. So that was nice for the future of energy. And Joe Nolan at Eversource is personally engaged in this and has visited. If you go to our website you'll see a statement from him already three years ago when before we were ready for commercialization.
List changes the equation, changes the equation for the the permitting process because they don't exploit for the Fire Brigades that basically have a chance to sign off. But most of all it solves the economic problem for the business owner. You make the investment where it makes sense when it makes sense and you grow as you go. And so if I'm a business owner thinking about this, I'm thinking about I'm going to prepaid three years of my electric bill essentially to get this thing set up.
And I'm looking at this as a a minimum of a 10 year life cycle. So I'll make a three-year upfront investment and then I'll pay it back over the next 10 years. So when I'm done in 10 years you will have in most buildings that we have looked at you have a complete back all cash back in three years. So I'm I'm back all my money's you make revenue in three years, four and then you're 4, you make revenue and you continuing to pump energy into your operations.
So starting in year 4I no longer I am getting paid for electricity versus paying for it. And by the way, we have a 15 year warranty, a 15 year warranty, there you go. Well, I mean that sounds pretty important. Yeah, is there. So what what do you view as other than momentum, what do you view as the hurdles to adoption? You know, like there's this, you know this to me is a real, you know it's a paradigm shift in how people think about what they're doing.
You know I think we've, you know I don't remember if this was pre show or on the show but we talked about this idea that you know electricity like many things sort of grew up in a world where it they couldn't possibly envision what was going to happen where we are today. And so you're sort of retrofitting a way to meet the needs of today without having to blow up the infrastructure of yesterday.
But that is still a paradigm shift for people who grew up thinking all I have to worry about is pay my bill and flip the switch. So what do you what what hurdles do you see to getting people to adopt. So I think it change is hard always. So even if like, so it's like I think what you're trying to do and what I'm trying to do in our social circles as well. Like just give it a shot, work with me, help, help me, help you. Just dare a little, start a little smaller.
So let's say we we calculate on your building that you need 10 MW hours. Start with one or half and just get some data and just do something and then work like if you don't like the interface, well this is the world of software. What do you not like? Oh, you want the tile here for here. OK, these things we can do very easily. You want data coming off this and learn a little bit or you just want to try something or you just want to go with one site instead of 10 sites. Just engage.
I think it's the the call to action. Don't say, oh, I've seen it all before because you haven't. Like, this is completely disruptive in how we think about things without disrupting what you do. So it enables you to get lower cost, you get backup power and you get resiliency. And of course, you have to invest a little bit of time to make this work. So if you're a business owner and listening, the first thing to do is take one step forward and call Christina. There you go.
Well, your information will certainly be in all the show notes. Look, this is super interesting and there's just so much going on. I'm I'm, I'm excited to be able to like you know talk to you about this and hear about the steps forward and now seeing ready for commercialization and going out. I just it's really, really exciting, Christina. So I look forward to to tracking you on it. I'm gonna ask you a couple final questions and we'll wrap it up. Are you ready?
Do you have a favorite business book Actually John Collins from good to great, Good to great. Yeah, there you go. If you had to do something, and it could be anything in the world, but it's had to be something other than being the CEO of Cadenza Innovation, what would you do with your time? I would be a musician. Really. What would you play? So I had a really hard time. Even as a kid. I wanted to do opera.
I got into some very famous opera schools and my parents said, no, you're really good at school. You stick to school. Today I direct an all female acapella chorus out of Hamden, actually with almost 40 members. I love the voice. I love. I play the piano. I I sing. I just love music. It's a big deal. Yes. And I meant to ask the name Cadenza Innovation. You just reminded me. I didn't ask but share with the audience why they.
Yeah. So Cadenza exists in jazz and classical and it is the orchestra or the ensemble holds a note. When somebody gets inspired and gets off on a tangent and everybody's like, oh, that's a cool idea. And then they move a little bit and accommodate. It's a new piece and that's how I think about innovators. So we promise each other to say here's what I know, here's what I think could be true and here's what I dream of.
And as long as you are clear where you are, so don't be asserted when you're you're just dreaming. But please share your dream and maybe we can make it happen. And I've seen this leadership style really create amazing mountain climbers. Yes. Oh, that's really great. That's awesome. What's something, Christina, that you learned early in your life or early in your career that you think's helped propel you to all the success you've had?
Yeah, I think it's there's no substitution, unfortunately for hard work. Like, it's crazy how lucky you get when you just stick with it if you believe you're right. And then, of course, you think humility of being wrong and learning from it. So yes, some successes, but a few scars. A few scars. Yeah, it's one of my favorite quotes was on my e-mail for years and years, which was the harder you work, the luckier you get. There you go.
Exactly. What's something, Christina, that you learned later in your life or later in your career, that if you could go back and tell young Christina and if she'd listened to you, you think it'd have a real positive impact on her? Yeah, I think there are real gender issues. And I think I should have said, guys, that's not cool earlier, but I was trapped in this. Like, you can't really say anything. It's really insulting. You should really say something. And I still struggle with it at times.
But I think now at least I withdraw from the conversation. And I think earlier I just kind of went along with it. It's still very hard. Like what? It's not an equal place. Let's just say how does that manifest? So it's, you know, direct insult, aggression, maybe passive aggressive comments. It's a lot of comments on what you look like or not look like or how you come across or whatever. It's a lot of gender stereotypes. And I think today it is I am much more aware of, OK, I decide to be a woman.
So I have decided it's OK to have a little longer hair and wear earrings. And I cannot tell you how many times I have heard earlier in my career, even in grad school, like, you're not a serious scientist because you have earrings. Come on. Not kidding you at all. And it's like you're like, what, 22? Like, I'm like, oh, what? So it's much more prevalent, I think, even today. So. So you would have gone back and told yourself your younger self to just either what, stand up more?
Yeah. And I would say even like, but it's not the earrings. I haven't done a little bit of a comeback, something like that. And I think, yeah, yeah, that would have probably helped me. It's not not so much in the performance maybe, but in the angst afterwards, like, why are people, what am I doing to invite these guys? The sort of the self judgment that slows you down and causes you to hesitate instead of just climbing forward to increase that confidence, that's good.
I think someone will get something off from that. That's good. Christina, thank you so much for coming on. Keep on fighting the good fight, climbing those mountains. And we look forward to supporting you along the way. Thank you, Ari. Thank you so much. You're welcome. Made in America with Ari Santiago is brought to you by Compass MSP. Thanks for listening and spending some time with me today.
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