KG Technologies makes on-off switch for energy management

COTATI -- Ten-employee KG Technologies Inc. is at the heart of the global movement to replace 1.8 billion electric meters in the next few decades with "smart meters" that allow for remote energy management.

KG is one of a few companies in the world that make a remote on-off switch, also called a service relay switch, that fits into an electric meter, according to Netherlands-based energy consulting firm KEMA.

[caption id="attachment_22528" align="alignright" width="360" caption="KG Technologies principals Thomas (left) and Philipp Gruner"][/caption]

Such service relay switches on homes or commercial buildings are considered key to advanced metering infrastructure, or a "smart grid."

Smart meters provide continual usage information so utilities can adjust resources, particularly from variable-output renewable sources, and consumers can better know how much their bills will be via monitoring systems such as Google's PowerMeter software and the TED device.

However, a remotely controlled switch in the meter allows a utility to save labor costs on disconnecting customers for nonpayment or at their request when they move or the property is vacant, such as bank-owned properties or college housing, and on reconnecting service.

Another feature of remote meter relays is "load limiting," in which a utility can reduce current going to specific meters by remotely tripping one or more switches in a meter. However, rules for "auxiliary load control" are varied. For example, PG&E spokesman Paul Moreno said the utility doesn't plan to seek approval for such a feature.

"Smart meters are the foundation for the future smart grid," Mr. Moreno said. The utility is about halfway through installing 5 million electric and 4 million gas smart meters, which are purchased from General Electric and Landis+Gyr.

"The smart grid is just the stepping stone to the smart home and then the smart car," said Philipp Gruner, KG president and engineering director. "If all had electric cars and plugged them into the grid, it would crash."

KG specializes in latching relays, which are switches that use electromagnets to open or close a circuit then have a latching system to keep the circuit that way after current stops flowing to the magnet.

Found in thousands of products, common uses can be automobile turn signals, sensor-controlled switches that turn on streetlights after dark and automatic shutoff switches for big rig cab power to leave enough juice to start the engine in the morning.

However, the high power flowing through electric meters requires specialized and highly regulated design, because these service relays must reliably take the punishment of making or breaking the connection to the grid potentially after many years of nonuse and in extraordinary events such as lightning strikes, according to Thomas Gruner, KG chief executive officer.

That's why KEMA in a 2007 report on remote-disconnect switches for smart meters noted only four major world manufacturers – KG, Gruner AG, Dialight BLP and AMPY Metering, which is now part of Landis+Gyr. These days, KG's major competitor is the family's former company.

The Gruners' late grandfather, Wolfgang, started Germany-based Gruner AG five decades ago and became a world leader in manufacturing such components, with factories in several countries. The company was later sold.

Wolfgang Gruner's son Klaus started KG in the Chicago area in 1992 as talk about the smart grid grew worldwide. However, the first generation of switches to fit inside meters came to market before standards for the relays solidified, forcing the company to head back to the lab in 2005. A year later Klaus Gruner left the company to his sons, including market analyst Wolfgang Jr., who still lives in Germany.

"Between the first and second generations of switches, we had to be creative in marketing," Philipp Gruner said. That included marketing the switches for municipal public works.

In April 2008, KG introduced its standards-compliant second generation of switches with fewer moving parts than Gruner AG's, welded instead of riveted connections and optional plug-and-power connecting wires.

KG has received five patents on its products, including two for the second-generation products.

"The timing was really good," Thomas Gruner said. "We wished we would have launched one year earlier, but laws had to change."

Because it had partnered with major Chinese electrical component manufacturer Xiamen Hongfa Electroacoustic Co. Ltd., KG last year moved to the Gruner brothers' Sonoma County homes to be closer to the factory via nearby airports and in a similar environment to their childhood home in Germany's Black Forest. They also had considered locating near Phoenix and Denver.

Having tight integration with a contract factory over the past 12 years has allowed KG to meet utilities' stringent requirements for meter makers on order lead time, price and quality, according to Philipp Gruner. That includes having to rapidly ramp up production, such as from 10,000 to 200,000 relays a week for a customer in Mexico.

Sales have increased 30-fold since 2006, most markedly since mass production of switches started for the first time in April 2009. To meet demand, the factory in China is set to double in size this summer.

In May, KG moved out of a home office with a half-dozen people to a 5,648-square-foot office building purchased in Cotati. The company has sales representatives in India, Brazil, Germany and the Netherlands.

KG is looking for mechanical and electrical engineers as well as purchasing and supply-chain specialists, all preferably with Chinese language proficiency.

Richard Henderson and Rich Fenske of Cassidy Turley BT Commercial brokered the May 28 building purchase.

For more information, contact Suzanne Bastear, director of marketing, or visit www.kgtechnologies.net.