40%

Annual Growth

in AMSC’s grid business six years in a row

87.1

Million Dollars

in total revenue in 2020

5

Unique Technologies

designed by AMSC to enhance grid resiliency and optimization


The Path to Drawdown: Smart Grid

Addressing climate change and staying below 1.5ºC of global temperature rise requires a massive scaling of emissions-free energy sources. Thankfully, renewables like solar and wind are quickly expanding their capacity worldwide. But to provide reliable clean energy to every household and organization in the world, we need a smart power grid.

The power grid is the dynamic network of power generation, transmission, distribution, storage, and consumption. But today’s power grid was designed more than a century ago, when electricity needs were simpler. It relies on a handful of (mostly fossil fuel-based) power stations, and electricity only flows one way from power stations, to transmission stations, and finally to consumers.

This centralized, one-way grid system has outlived its usefulness. It’s economically inefficient because consumers often can’t plan for the fluctuations in the price of electricity throughout the day. It’s vulnerable to blackouts when power lines break or when power stations can’t generate enough power to fulfil demand. It doesn’t easily integrate renewables like solar and wind power, whose electricity generation is intermittent. 

The smart grid can overcome these weaknesses. By integrating sensors and software to the existing grid, it gives utilities and consumers the information they need to understand and quickly react to changes and the supply and demand of electricity. With smart meters, consumers can plan their electricity usage according to its price, lowering the cost of electricity to households and overall demand during critical periods. Through data and automation, the smart grid can integrate and optimize solar and wind generation, even with their intermittent nature. This also means power generation becomes decentralized and adaptable, reducing the likelihood of blackouts and price fluctuations.

About

American Superconductor (stock ticker: AMSC) provides power resiliency solutions. In the power grid market, they enable utilities, industrial facilities and renewable energy developers to connect, transmit and distribute cleaner power. In the wind power sector, AMSC helps manufacturers field competitive wind turbines through advanced power electronics and control system products, engineering, and support services. Headquartered near Boston, Massachusetts, AMSC has operations in 8 countries.

AMSC's Role in Drawdown

AMSC’s business with utility companies includes enhancing their networks’ capacities to accommodate intermittent renewable energy, increasing power flow, reducing transmission loss and minimizing environmental impacts cost effectively. They also offer solutions designed to increase capacity and reliability

For wind turbine systems, AMSC helps both onshore and offshore wind companies design turbines, as well as offer hardware and software to optimize power generation and control. 

These business segments account for almost all of AMSC’s revenue, which has grown by 15.73% annually since 2016.

AMSC: What We Like

We applaud AMSC’s strong track record of product innovation (p. 9) aimed at enhancing the resiliency and optimization of the power grid and wind turbines.

  • Resilient Electric Grid system increases the reliability and capacity of urban grids and provides cost-effective, simplified solution for urban load growth
  • D-VAR allows utilities to build distribution networks using distributed renewable generation
  • Electrical Control System for wind turbines act as the brain and nerves of turbines, maximizing power generation

On top of this, AMSC’s recent acquisitions and partnerships that have helped them rapidly grow their market share in the smart grid business: 

In July 2020, AMSC and ComEd began the construction of the Resilient Electric Grid system in Chicago

AMSC: What We Want to See Improve

Publish ESG Reports


For a company that provides renewable energy solutions, it’s surprising that AMSC doesn’t issue ESG Reports or have an environmental policy. We urge them to develop a consistent practice of publishing documents that include comprehensive data about their climate impact so that ESG-conscious investors can hold them accountable.

Track GHG Emissions


As part of the effort to publish ESG reports, we would like AMSC to track their GHG emissions from all sources. Tracking scope 1, 2 and 3 emissions can then lead to the next step of setting concrete sustainability targets for the company as a whole to strive toward.

Curtail business with the US Navy


We applaud AMSC’s close business with the US Navy (p. 10) to better protect its fleet. But we urge AMSC to increase its efforts in electrifying the fleet. AMSC does support the navy’s mission to electrify the fleet by allowing its ships to generate a large amount of electrical power and distribute the power through an in-board power system. AMSC should expand these efforts to push the US Navy move toward zero-emission.

Other SmartGrid Stocks in the Climate Index

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