When the U.S. Patent Office published patent application number 11/626,810 in July 2008, few people noticed—at first. Soon, however, the metering-technology community was abuzz, mostly with outrage.
The patent, filed by a group of 21 employees of Southern California Edison, claimed ownership over some basic ideas for using advanced-metering infrastructure (AMI). For example, the Edison employees claimed they invented the methods of communicating via the Internet or meters to deliver such capabilities as outage detection, demand response and dynamic pricing.
If the Patent Office grants the patent and all its claims, other utilities would be legally forbidden from using any of the methods described, without first obtaining a license from the patent holders.
“The audacity is just mind blowing,” said an industry executive who spoke to Fortnightly on condition of anonymity. “They say it’s a defensive patent—to prevent a patent troll from claiming he invented the smart grid and getting rich on licensing. But if that’s true, then why didn’t they assign the patent to EPRI? I don’t believe Edison is that altruistic.”
To get the inventors’ side of the story, we called Paul DiMartini, the primary inventor named in the patent application, and vice president of Southern California Edison’s SmartConnect program, which the California PUC approved in September.
Fortnightly: Why did you file this patent?
DiMartini: We’re not looking to make any money off this. The purpose is to ensure we’ll be able to use the system we’re deploying to the benefit of our customers, and so others will also be able to use their systems as they intend to do. It comes from a defensive standpoint.
Three and a half years ago, when we started defining what we wanted from a potential AMI system—in terms of being able to develop a positive business case and create value for our customers—we identified a number of uses that were new. We wanted to share that with the industry, and we did so, but we also recognized that it was important for us to document the fact that those uses were developed back in 2005, to establish the original date of the ideas.
We saw this was an emerging market, and as we moved forward with our proposal for the $1.7 billion SmartConnect program, we wanted to ensure our customers would benefit from the use of the system without having to worry about a third party saying we were infringing on their ideas about the uses of the system.
From the start, we intended and have made it available as open source. We’re working on a draft for a worldwide, royalty-free, non-exclusive license, to make these use cases available to everyone. We’re taking a light touch. If you want to use one of the use cases, you click an accept button, and you get a license that makes it available to you. A draft of that license already is circulating among vendors and utilities, to get their comments so we can have a very effective agreement. (See www.sce.com/usecases). We’ve spoken at EPRI about it, and we hosted a web conference to share the license agreement.
It’s important to realize this is a business method patent, which covers the uses of an AMI system and not the technology a vendor might develop. That’s the difference between a business method patent and a technology patent.
Fortnightly: The patent application claims some fundamental smart-metering ideas. We’ve published many articles in Fortnightly about those ideas.1 I’ve attended numerous conferences about them. And some of the ideas are discussed in the Energy Policy Act of 2005. How can you claim them as your invention?
DiMartini: The patent process is a long process. We’re at the point now where the patent application was just recently published, and that happens 18 months after a patent is filed. Before that, we had a provisional patent for a year.
I do appreciate that there’s been much said about smart metering in the years since 2004 and 2005, when we first came up with the original ideas. They’re showing up now as a published patent application, but we were talking about them three and a half years before we filed the patent in January 2007.
For example, the idea of using a home-area network (HAN) interface with the meter is something that was there three and a half years ago. But using a chip to bridge into the home, to communicate with an in-home display or thermostat, was a new concept.
We’re strong believers in innovation, and in the industry’s ability to advance both smart metering and the smart grid. In an emerging market, these issues are going to come up. We’ve been talking to the industry about this for a couple of years, starting when we helped form the Utility AMI Working Group. There’s a need for a more structured approach to the contribution of open-source mater-ial, to ensure it stays open.
Fortnightly: A principle of the U.S. patent system is that the first person to invent something gets ownership of it, rather than the first person to file a patent application. Under that principle, a patent claim is negated by prior art—i.e., earlier published works describing the invention. So instead of filing a patent, why didn’t you publish an article or make a presentation about these ideas?
DiMartini: Our IP counsel didn’t believe that would be strong enough to establish prior art, or a clear enough articulation [of the methods invented]. We’re developing more than 100 use cases related to the development of AMI and the smart grid.
One reason we filed a patent at the outset was there was no open-source repository at the time. We’re working with EPRI, UtilityAMI, IEEE and others to establish an open-source repository, where we can publish materials so they will be clearly in the public domain, with a date stamp that will establish the prior art. Had that been available at the time, we wouldn’t have pursued the patent.
EPRI and others are looking to complete an open-source repository by the fourth quarter of this year. That will be very helpful for us. We’ve created uses cases on plug-in hybrid vehicles that we’ve made available to EPRI and SAE International, and we haven’t patented those. Our intent is to ensure we can use the system as intended. Whether we ultimately succeed in making these claims and making it available to the industry as open source, or if there are claims of prior art that make it open source, at the end of the day this is about providing value for customers.
Fortnightly: Given your defensive intent, why not assign the patent to an organization like EPRI, which could ensure it’s available to everyone?
DiMartini: We did this work as employees of Edison, and our inventions are automatically assigned to the company. That’s part of our employment. But should Edison assign the patent to someone else? That’s something we’re taking a look at. The most important part to us is that it remains royalty free for the industry. The challenge in discussions we’ve had is there isn’t any clear group that others would feel comfortable is a neutral party. For the time being we are staying with Edison as the assignee of the patent.
The open-source repository will resolve that in the future, because it will be the neutral party.
Fortnightly: If the methods in your patent will be made available in a royalty-free license, why do you think the technology community is so concerned about the patent?
DiMartini: I’m not sure exactly. Some people might not have read the patent, and are getting the information second-hand. Or people at technology companies might have been concerned that this patent extends to technology, and that’s not the case. It covers derivative-use cases or requirements that the utility comes up with, but it doesn’t extend beyond that.
When we’ve met with people and showed them the draft license agreement, they seem to understand what we’re doing, and we haven’t had any negative reaction after that. We’re looking to do the right thing, and we have done so from the outset.
1. See for example: “Metering in Real Time: A New Cost Equation for Electric Utilities,” by Jack King, Sept. 1, 1997; “Reliability in Power Delivery Where Technology and Politics Meet,” by Karl Stahlkopf and Philip R. Sharp, Jan. 15, 1998; “Demand Response: An Overview of Enabling Technologies,” by Robert H. Staunton, et. al, Nov. 1, 2001; “Advanced Metering: Policy-makers Have the Ball,” by Chris King and Dan Delurey, Sept. 15, 2002; and “What is an Advanced Meter,” by Sharon Allan, Fortnightly’s Energy Customer Management.