In a report yesterday on the website Data Center Knowledge, Active Power, the leading proponent of flywheel based UPS systems, announced a multi-million dollar contract to supply almost 11 MW of backup power to an unnamed Internet search provider with datacenters in the Pacific Northwest. The site speculates that the unnamed customer is, in fact, Yahoo, an existing Active Power user who has been expanding their datacenter facilities.
But in an interview on Critical Power Online, Active Power CEO Doug Milner addresses a few tough questions about the future of his business, which has never been profitable in its 20 years of existence. He outlines plans to increase the value of the company’s stock in the hope of attracting more institutional investment and points out that the company has a very good chance of showing a first time profit in fiscal 2012.
But the interview highlights a much more important issue for the flywheel power business. For the first time, the Active Power CleanSource UPS is available with battery back-up, which has a somewhat chilling effect on the entire premise of the battery-free backup power that has long been the mantra of flywheel ups proponents. Mr. Milner positions this change as a targeted opportunity for the subset of their customers that have infrastructures that are best served by the battery failover.
He takes the position that the combination flywheel/battery UPS system will offer the best of both worlds, with the flywheel technology resulting in much extended battery life due to a reduction in the number of charging cycles the batteries will need to go through in the normal course of business. They are also hoping to offer very extended battery warranties for their combination system, a feature that would have the benefit of making the cost delta a wash, according to Mr. Milner, if it saved the customer the cost of a single battery replacement during the extended warranty period.
From a purely green standpoint, it’s hard to beat the overall benefits of the battery-free flywheel UPS system, even if you were to only look at the environmental impact of the production and disposal of the batteries commonly used in a datacenter UPS. But beyond the novelty of being the greenest kid on the block, the flywheel power business will need to demonstrate strong, sustainable reason for customers to use their more expensive technologies if their business is to survive.