Rudy Kraus, Validus DC Systems, LLC1

Chief Executive Officer
Brookfield - CT United States

The big idea: In 25 words or less, please tell us how this Fast 50 Nominee is helping to address the planet's problems.

Challenging a billion-dollar industry and a century of electrical history, Validus is helping companies dramatically reduce energy consumption, save money, and green their business.

Please describe how this nominee is using business as a force of positive change. What technology, idea, or strategy is the nominee using -- and what problem, such as global warming, poverty, or pollution, does it address? (suggested length: 100 words)

The world’s power distribution technology is rooted in over a century of electrical history. In the 1880s, power industry pioneers Thomas Edison and George Westinghouse engaged in a fierce public debate dubbed the "war of currents" about whether alternative current (AC) or direct current (DC) was the superior way to distribute electricity. While DC power was more reliable and efficient, Westinghouse and AC ultimately won due to technological limitations of the time, and the world has since built its entire global utility infrastructure using less reliable, less efficient AC power distribution.

The problem is that all semiconductor-based electronics in the world are actually powered by DC electricity. While it historically has been more efficient to distribute AC power over long distances, it eventually must be converted to DC power in order to make any electronic device work, and each conversion induces energy loss. Unbeknownst to many, this seemingly harmless law of physics is a significant source of energy waste. Some estimate that the average desktop PC wastes half the energy it pulls from the wall due to one AC to DC power conversion.

These conversions are even more numerous, and less efficient, in a datacenter. A typical datacenter requires five to seven electrical conversions and transformations from the watt drawn at the utility to the watt that powers various types of IT equipment throughout the facility. All of these conversions and transformations result in energy losses being released in the form of heat, which then must subsequently be cooled, further exacerbating the energy waste. AC-powered datacenters waste up to 50% of their power in conversion, transformation and distribution losses. What’s more is that due to the complexity of bringing redundant sources of AC electricity together, an AC-powered datacenter requires significantly more heat-producing equipment just to ensure that it is fail-proof. This extra equipment produces substantial levels of heat, that must be cooled as well, and because there are more "moving parts," the systems are more likely to fail in general.

Meanwhile, as the world’s reliance on digital data rapidly increases, so does the number, size, and power consumption of datacenters around the world. In 2005, datacenters and their associated infrastructure in the U.S. consumed five million kW of energy, the equivalent of five 1,000 MW power plants. The total electricity bill for operating those servers and associated infrastructure was about $2.7 billion, in the U.S., and $7.2 billion for the world. Total electricity used to power servers by the year 2010 will be 76% higher than it was in 2005, or $4.8 billion in the U.S. and $1.3 trillion globally.

Despite the urgent need to reduce power consumption in the datacenter, AC power and its inherent inefficiencies continue to reign supreme. Providers of AC power infrastructure technology have built billion-dollar businesses supplying the very equipment that feeds the vicious AC-DC circle. Since the AC power equipment industry is dominated by three large electrical equipment companies that have no incentive to destroy their current profitable business, innovation has been stifled. Yet with the exception of DC power’s presence in telecommunication facilities and the light rail industry, there hasn’t been much debate on AC vs. DC power for more than 120 years, mainly because no company has been able to develop technology that makes DC power scalable and deployable in the power density required by the large datacenters. Until now.

Validus DC Systems, an early stage venture-financed company based in Connecticut, has developed technology that reliably and efficiently distributes high density direct current (DC) power throughout mission-critical facilities; a feat previously considered impossible and uneconomical. By eliminating the multiple energy-wasting power transformations and conversions and the extra heat-producing equipment, Validus can improve energy-efficiency in datacenters by up to 40 percent. This means that just a 10 percent adoption of Validus’ DC systems in datacenters would eliminate the equivalent of one 1-GW power plant and more than $1 billion in electricity bills in the U.S., and three 1-GW power plants and $2.6 billion globally.

This technology has massive disruptive implications for not only saving energy and helping companies better utilize existing datacenter real estate, but also redefining the concept of a truly “green” datacenter. Renewable energy sources such as solar panels, wind turbines, and fuel cells all produce DC power, but fall victim to energy-wasting electrical conversions when used to power electronic devices as part of an AC power distribution system. The Validus DC system does not require these additional conversions of DC-to-AC and AC-back-to-DC, thus preserving the true potential and efficiency of the renewable energy source. Additionally, the Validus system substantially reduces the total amount of copper used in the datacenter by up to 50% compared to typical AC-powered datacenters. This is no small feat, as destruction during mining, toxic runoff and air and ground pollution from mining and smelting make copper mining one of the most destructive and toxic industrial activities in the world.

What are the results, both financial and social? How has the nominee's business performed, and what impact has it had on the problem it addresses? (suggested length: 100 words)

With a concept as simple as switching to DC power, Validus is helping organizations reduce energy consumption, improve the utilization of existing datacenters, and reduce the number of new datacenters required to support the exploding demand for digital-based information. This not only helps organizations meet their own CSR, management and budget goals, but even achieve industry-wide standards such as the Leadership in Energy and Environmental Design (LEED) certification, a highly-coveted yet difficult to attain recognition for environmentally-friendly buildings. Recognizing the substantial benefits of the technology, a leading global financial services firm headquartered in New York, NY is deploying the first commercial Validus DC system in one of their mission-critical datacenters. This global 50 organization expects to reduce the size of their data center by up to 50% compared with a traditional AC power system and expects to reduce energy consumption by an equal amount. Further, by simplifying the power distribution architecture, this global 50 organization expects to significantly improve system reliability while reducing the total cost of ownership by over 50% over a ten year period.

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