The pieces are falling into place for a small Spokane company called Consolidated Electronics Inc.
Last week, the company announced it has been awarded a patent for its “high-voltage transmission switching apparatus with gas monitoring device.”
Their brainchild may not have a very exciting name, but Allen Ringer and Wendell Satre think the patent will make Consolidated a big moneymaker for its investors.
“Within a few years, I think we’ll see this device in every utility company that has a high voltage system,” says Satre, the retired chairman of Washington Water Power Co. “I think it will become a standard in the industry. There’s no limit on the potential.”
At Consolidated, they don’t call it a “high-voltage transmission switching apparatus with gas monitoring device.” That’s just the government’s name. Its real name is an SM-6. Granted, it’s not a much sexier name, but at least its shorter.
The SM-6 is a monitoring device that keeps track of the temperature of sulfur flouride gas. The gas is used to cool the huge breakers that help regulate the flow of vast quantities of electricity as it is distributed by utility companies. The SM-6 monitors the temperature and pressure of the gas in order to determine its density. If the density drops too much, then the gas can’t cool the breaker adequately and the device is in danger of failure.
“Most of the people in the industry who knew we had a patent applied for scoffed at it,” says Ringer, who is president and chief executive officer of Consolidated. “They said people have been using temperature and pressure to measure gas density forever, and they didn’t think we could get a patent.”
But the patent office determined that the mathematical formulas Consolidated uses to interpret those measurements, and the electronic system within the SM-6 were unique enough to warrant the patent.
Ringer acquired Consolidated, which employs about 15 people, a couple of years ago. It is a subsidiary of Plentech Electronics Inc., a holding company traded on the Vancouver Stock Exchange in British Columbia. The potential of the SM-6 attracted him to the company. It also attracted Satre who is now chairman of Consolidated’s board of directors.
In addition, Satre is taking over the interim presidency of another Plentech subsidiary, Adept Engineering, which also figures in the SM-6’s future.
Adept is a small company that assembles electronic circuit boards. It is also the manufacturer of the SM-6.
“Wendell suggested to us,” Ringer explains, “that come the day this thing (the SM-6) takes off, we’d better be able to manufacture it on our own. That’s why we sought out and acquired Adept.”
Consolidated convinced a few utility companies to test the SM-6 a couple of years ago. They liked what they saw, and the interest in the device has slowly gathered momentum.
More than 40 utilities have bought a total of 400 of them, Ringer said. “The Western Area Power Authority, which is a federal utility, has bought 135 and has indicated they will buy 300 or 400 more over the next few years,” he added.
In fiscal 1994, the company lost $1.8 million, in Canadian dollars, Ringer said. During the first six months of the current fiscal year, it has cut those losses to about $320,000 on sales of $2.4 million.
Consolidated’s officers hope that as utilities try out the SM-6 and see its value, they will ask for it to be included in all their new orders. That will attract the attention of original equipment manufacturers, who will hopefully begin building them into the breakers.
And with the newly-won patent, those companies will have to strike licensing agreements with Consolidated.
One “very large” company in the utility industry has put a lot of money into developing a device to monitor all aspects of gas-cooled breakers, Ringer says.
“They’ve already acknowledged that our patent is in the way of their finalizing that development,” he adds. “We are going to talk to them very soon about how we can resolve that problem.” The patent is also paving the way for international licensing agreements, Ringer says.
If the device does, indeed, become standard in the utility industry, the financial potential for Consolidated and Adept is huge.
And the company is already anticipating what its customers will want next. Scott Hamilton, Consolidated’s chief operations officer, says the company is working on endowing the SM-6 with an artificial intelligence system that will be able to predict well in advance when a breaker’s gas cooling system is going to need maintenance.
“Predictive maintenance” rather than “reactive maintenance” is what Hamilton calls it.
“It will help a utility control its costs and manage its labor resources better,” Hamilton says.
When they get to that point, they ought to at least think up a better name.