The entrepreneurial Farid Dibachi and his team at Rocklin’s JLM Energy have invented a briefcase-size battery storage system that tucks beneath solar panels and powers a home or business, even as the panels continue sending excess energy to the electric utility grid.
“If you look at any one of our competitors’ systems, even the most advanced systems that are out there, they can either send the power that is generated by the solar panel to the grid or send it to the batteries,” Dibachi said. “We’re the only company that has created a piece of technology that can do both at the same time, and that … is the secret sauce, our prime competitive advantage.”
The 55-year-old Dibachi, who co-founded JLM in February 2011 with CoreLogic co-founder Kraig Clark, has started and sold three other technology businesses since he was 28. JLM systems also provides customers with a software system that shows them how they are consuming electricity and how they can increase their savings.
Dibachi talked with The Bee about where JLM’s solar-plus-storage systems are most cost-effective right now, what has driven him to create one business after another, and what he’s learned about success and failure.
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Q: Tell me about your solar-plus-storage systems.
A: If solar systems are built one panel at a time, why can’t we also deploy the energy storage one panel at a time? We came up with Phazr, which is a truly innovative product. It’s a briefcase-size product that gets installed underneath the solar panel, and it takes the secrecy and the myth out of energy storage.
There’s no real estate required for it. There’s no skill required for installing it. And, there’s no operation and maintenance. If something breaks down, you simply unhook the briefcase-size system. You don’t need to bring in a lift or a crane or any kind of industrial equipment to deal with it.
We are taking energy storage and making it scalable, so as you build small solar panels for your house or a massive sea of solar panels on a utility-scale system, the batteries would scale with one panel at a time.
Q: Many homeowners currently send energy generated by their solar panels to an electric utility and receive a credit on their bills. Why would people want energy storage?
A: If millions of people build solar-panel systems, the electric utility is going to be confronted with a problem. There is going to be an over-generation of electricity during the day, and an under-capacity at night. More and more, electric utilities are coming to terms with this fact as solar is gaining significant adoption.
Their fix is to implement ways of charging you that counteract the supply-demand problem that they’re seeing. If during the day, for example, there’s an oversupply of electricity, then they want to give you very little money for that electricity you generated. So in a place like Nevada, for example, or Arizona, they’re saying, “Look, the electricity itself, in terms of kilowatt-hours of energy generated, we don’t really value it that much. What we value is when that electricity is produced and whether its available during peak hours.”
Electricity is a perishable commodity with a value that is highly dependent on the hour of the day and the month and the year. It’s a time-dependent value. Sooner or later, more and more utilities are going to undervalue the electrons that you are generating using your solar panels during the day — between the hours of 10 (a.m.) and 3 or 4 p.m. and overvalue the value of electricity during the time when the demand is higher.
When we first started this process five or six years ago, we thought, “Let’s go develop this technology, and yes, the market is going to come to us.” It was a rough guess at the time. We didn’t know if, in fact, it was going to happen. About two or 2 1/2 years ago, the first utilities to move in that direction were in Arizona. Very soon thereafter, utilities in Hawaii cut payments. Now it’s also happening in Southern California and Nevada.
Q: So, is your system a more viable option in places that get more sunshine?
A: That’s one of the considerations obviously. A system in Massachusetts is not going to generate as much electricity as a system in California or Arizona. So that’s one of the drivers. The other driver is the cost to produce electricity in that state.
Let’s go to Washington state. A lot of their energy is produced using hydro, and they’re selling electricity to customers at 4 cents or 5 cents per kilowatt-hour. We can’t compete with that. Our levelized cost of electricity (a utility industry metric that takes lifetime costs such as construction and financing into account) is approximately 12 cents today. (That’s also higher than what SMUD customers pay, Dibachi said, but they can compete with PG&E’s costs in some regions of California.)
If you were to go to Google and say, “What’s the average cost of electricity per kilowatt-hour in the United States?” You end up with 12 cents. So we’re right there with the average cost of electricity.
Q: Entrepreneurship is sometimes painted as being glamorous. What’s it really like?
A: I started my first business when I was 28 years old. In a single day, I decided to do it. My boss was talking to me, and I just followed him to his office and told him, “I’m done.”
I suffered for several years afterward. I spent years building a product, and no one bought it. The phone never rang, so I had to learn how to sell products. I was a single guy wearing my ski jacket because I couldn’t pay the heat bill. I ate Campbell’s soup, I think, for 50 days straight because I couldn’t afford anything else.
That company, I grew to about $3 million in sales after about 5 years, and I’m skipping a lot of the struggles and waking up in cold sweats in the middle of the night. Nobody wants to hear that stuff. People only want to focus on how fun it must have been to start a business. It’s not. It never is. It’s an addiction, I think. You get addicted to the high highs and the low lows and the transition between.
Q: What would you describe as key lessons you learned over your career?
A: We had a leadership session here for some of our sales folks, and there was a leadership coach that came in, and he had the 21 irrefutable laws of leadership. Our VP of sales asked me to talk to the sales guys to start that session.
I didn’t really know what to say, but I sat down and I came up with my own law of leadership and I called it: The Law of the Abyss. When you’re a leader, you don’t really know where you’re going. You always have one foot in the middle of a very wide chasm. You don’t know what you’re going to step into.
You’ve just got to get comfortable with the uncomfortable and the unknown. You have to put the work into fixing any challenges that you face.
Business can be harsh sometimes. You run into all sorts of problems. You run into cash-flow problems. You run into people who want to compete with you by hitting you below the belt sometimes. You run into changing circumstances.
Basically, business is a tough atmosphere, particularly as the head of a company. You have to fight some battles that are lonely at times. The biggest lesson … is never give up. There’s always a way, and if if you stay in it long enough, you’ll find it. That’s been proven to me over and over again.
This conversation has been edited for content, clarity and space.
Title: Founder and CEO of Rocklin-based JLM Energy
Education: Bachelor’s in mechanical engineering from the University of Tennessee, Knoxville; master’s in mechanical engineering, Stanford University; master’s in electrical engineering, Cornell University
Books he recommends:
- “Crossing the Chasm” by Geoffrey Moore: “I bought 20 copies of it and handed it around to the staff here. It’s about technology adoption cycles. How does technology get adopted and what can you do as a member of a management team to make sure you don’t screw it up?”
- “The Tipping Point” or any other book by Malcolm Gladwell: “He’s very original in his thinking. He takes concepts people already know and breaks them down.”