Spirae energizes energy cluster
By Kristen S. Bastian
Northern Colorado Business Report
September 15, 2006
Forming a cluster takes collaboration, as does growing primary employment.
Spirae Inc., an energy technology company based in Fort Collins, knows this. It teamed up with Colorado State University, along with various state and local agencies, to develop a lab at CSU to help test and develop energy systems for its customers.
The company is now looking at nearly doubling its small but highly specialized staff.
Sunil Cherian founded Spirae, which focuses on distributed energy technologies and systems, in 2002. The company is only a few weeks away from flipping the switch on new equipment that will allow it to simulate, test and develop energy systems.
"We have a lab that we put together with CSU," Cherian said. "We have all the equipment and we're very close to turning it on."
The Grid Simulation Laboratory will allow the company, as well as CSU researchers, to simulate actual grid conditions under varying scenarios. The applications of such research are numerous. Spirae will be able to not only test new conditions on existing power distribution systems, but also develop new controls for the industry.
To outfit the lab, CSU procured an electric power system. The purchase was made possible by $225,000 in state grants, with the help of numerous agencies.
"The NCEDC has been involved with Spirae for a couple of months now," said Jacob Castillo, director of business development for the Northern Colorado Economic Development Agency. "It's a great example of the collaboration that has come together in Northern Colorado."
The NCEDC, with the city of Fort Collins, the city's utility department, the Governor's Office of Energy Management and Conservation and the Colorado Office of Economic Development and International Trade are all lending support in some form to Spirae. The equipment for the lab comes from grants from the state offices, and the city is subsidizing the facility that will house the equipment.
Cluster brings primary jobs
"Northern Colorado is widely positioning itself as a national leader in the clean-energy industry," Castillo said.
Last year, leaders in the business and academic communities converged to hammer out details for the formation of a clean-energy cluster in Northern Colorado. One of the focuses behind the cluster – one that the NCEDC is particularly excited about – is the prospect of primary job growth.
Spirae is looking at the possibility of nearly doubling its full-time staff next year. The company currently employs six full-time, along with a handful of long-term contractors for specific projects. Cherian said the company could add up to five employees next year.
"Facilitating the expansion of Spirae is really the first big win for the clean-energy cluster," Castillo said.
Spirae began talks with CSU early in the summer of 2005 and the contracts to enable the collaboration took about nine months to work out. Overall, the university was very easy to work with, according to Dan Zimmerle, chief operating officer for Spirae.
"The university sees itself as a key contributor to economic development," he said.
The addition of the lab to Spirae's resources is invaluable as the company tries to make a name for itself in the changing environment of the utilities industry. However, changes in the industry are the lifeblood of Spirae.
"It's not just the lab that is driving the growth," said Cherian. "Our level of activity is growing substantially."
The company is looking for employees, especially those with some expertise in energy systems. Most of the hiring will occur next year, and be dependent upon the company's active projects.
Spirae's revenue growth is driven by projects commissioned by clients, as the company looks at issues and develops technologies on a per-project basis.
However, even as it is customizing controls for its clients, Spirae is developing technologies of its own. The company hopes to begin offering its own customized, but widely integratable, products in the near future. Cherian estimates that early-stage products could mature as early as 2008.
The company will also likely move toward service contracts for its clients. Because of the long duration of most projects, Spirae has had little opportunity to perform follow-up services. Cherian believes that post-project services will likely become a part of the company's offerings, and it is currently working out a model to follow.
With all of this action, Spirae is likely to continue to see strong growth. Since 2002, the company's revenues have doubled each year. Cherian said he can't estimate if such growth will continue.
Growing pains
But with growth comes growing pains. Both Cherian and Zimmerle see recruiting talent as one of its biggest obstacles. When Spirae is looking to expand its staff, it is looking for expertise as well as flexibility. Because the company works on a diverse set of projects, employees need to have an understanding of and ability to work with myriad types of energy issues. At the same time, they must understand the technologies in the industry today.
In addition to employment issues, Spirae is also challenged by finding companies in the utilities industry that are ready to make changes to their systems.
"They're like everyone else, they don't change unless they have to," Cherian said.
Pressure on the industry in the form of regulatory requirements has led to an increasing number of companies looking for new and better ways to implement more efficient controls and find ways to integrate renewable energy sources into the grid.
"We have to find the early adopters that are leading the pack," Cherian explained.
Being a small, new company trying to affect change in a large, old industry could be daunting, but Spirae has stepped up to undertake. Now, with the explicit support of CSU, the city and the state, it has even better momentum than before.
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