Banking on KC – Joe Kessinger of HCI Energy: Powering Critical Infrastructure
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Kelly Scanlon:
Welcome to Banking on KC. I'm your host, Kelly Scanlon. Thank you for joining us. With us on this episode is Joe Kessinger, the CEO of HCI Energy, a Kansas City-based company that provides renewable hybrid power solutions for critical infrastructure. The company's innovations deliver energy solutions to telecom providers, public safety agencies, and underserved communities around the world. Joe brings more than 35 years of experience in business development and operations, and he's here today to share how HCI Energy is transforming the way we think about power. Welcome, Joe.
Joe Kessinger:
Thank you, Kelly. Good to see you again.
Kelly Scanlon:
You too. It was really nice to reconnect here. Let's talk about HCI Energy. So it's developed two main products, the Hybrid Power Shelter and the Zero-glitch Power Module. So tell us about those products.
Joe Kessinger:
Imagine a shipping container 8 by 10 typically. What we have inside the shipping container is our brains of the system, which is the Zero-glitch Power Module, the ZPM. And the ZPM manages all the power units that can be integrated within the shelter. So typically, we are using solar energy and/or wind energy. In addition to the ZPM, we're using lithium-ion batteries. And the lithium-ion batteries is really what is powering whatever we are powering, typically telecom sites, public safety sites, and the like. So where having any sort of glitch, for instance, in the 911 call would be disastrous. So the batteries are always being used to power whatever that infrastructure is.
The Zero-glitch Power Module, the ZPM then is always monitoring the level of the batteries, monitoring the level of the solar energy or the wind energy. And there is also a genset on board. The generator is used as the power source of last resort. So the ZPM is sitting there and saying the batteries are full, and don't need to do anything. The batteries get low, the sun's shining, turn on the solar, and recharge the batteries. It's at night and we've had a cloudy day, the batteries get extremely low, turn on the generator, charge up the batteries. So simply that's kind of what our system does.
Kelly Scanlon:
Lots of backups built in, and the other thing it allows you to do is you don't have to have somebody there monitoring it constantly. You're sitting somewhere else if somebody on your team is sitting somewhere else and they get probably some sort of an alert or notification if the readings are getting a lot of whack.
Joe Kessinger:
You've done your homework. Yes, part of the ZPM. Not only is it the operating brains, but it really is a monitoring system. Most of our sites are in very remote locations. There is a generator as I said on board. The generator has to be refueled and recharged. So one of the great things about our system is we are monitoring that generator. We're monitoring the batteries, we're monitoring the whole system, and relaying that information back to the user so they have a dashboard that can see exactly the battery levels, gas level, oil level, how much the generator is running, how much we're getting off of the solar panels, and the like. So it really is a monitoring... So not only is it relaying the status of the system, but it's also alerting you on when preventative maintenance needs to be done.
Kelly Scanlon:
You mentioned telecom, but you really serve a variety of industries. Are there any industries in particular that benefit the most from this sort of setup or this sort of situation?
Joe Kessinger:
For the most part, we're mission-critical. And what's mission-critical? Communications. So, yes, we are predominantly in telecom and public safety.
Kelly Scanlon:
You've been deployed in a lot of different locations. I know I've read some of your situations or activities up in rural Alaska, also Canada's Highway of Tears. What are some of the other projects or areas where you've worked that might sound familiar to our listeners, and give an example of where your solutions really made a significant impact.
Joe Kessinger:
We've been deployed in Africa, in the Caribbean islands. You think about the uniqueness of island nations and their power and infrastructure, and a lot of those island nations have hurricanes. And the last thing you want to go down and/or the first thing you want to come up after a hurricane is the communication system.
And then as you mentioned in Alaska, we have a strong alliance with a large telecom company up in Alaska as well as throughout Canada. And you mentioned the Highway of Tears. This is one we're very proud of. The Highway of Tears is Highway 16 in British Columbia. It covers about 250 miles. And since 1970, estimated up to 50 Indigenous women have been lost and or murdered in that area. And one reason is transportation isn't very reliable so they rely a lot on hitchhiking, and there has been no telecom service up there until we were able to bring energy into that region so that the telecom could bring their antennas and the like and create cellular coverage in that area.
Kelly Scanlon:
You mentioned that these are about the size of a shipping container. How do you decide where to go? and how fast can you deploy these and get them set up and operating?
Joe Kessinger:
For the most part, ours are permanent installations. We make them here in Kansas City, in the West Bottoms, and then ship them to the location. And in a lot of situations, like the Highway of Tears, they're literally helicoptered up to the top of a mountain. So once up there they, they-
Kelly Scanlon:
Not coming down.
Joe Kessinger:
They aren't coming down. We have had some applications where people want it for quick deployment to be able to go into disaster relief. We're in conversations now with LA, which just had the devastation, the fires,
Again, you have devastation like that. The one thing you don't want to go down is the communications. Likely, the energy is going to go down, the power is going to go down, but you want your telecommunication sites to be up and running throughout that. So, again, in the most part, we do both on-grid and off-grid applications. The value proposition for off-grid is you don't have power there. So if you don't have power, this is a site that would be unreasonable to do. Or if you did do it, you would have to be running a generator 24/7. So our solution reduces emissions and reduces reliance on the generator by up to 90%. So that much less carbon emissions, that much less fuel, that much less maintenance, and therefore, the generator lasts that much longer. So we really are a savings in operating costs not to mention, environmentally friendly.
Kelly Scanlon:
Absolutely.
Joe Kessinger:
Because of those aspects of it, we do look at on-site or on-grid locations as well where they want our solution because it's more economical and more eco-friendly.
Kelly Scanlon:
Over the years, this has been an area that has had a lot of development, and there are other companies that provide alternate energy sources. What makes HCI Energy different?
Joe Kessinger:
Our niche again is telecom. Telecom has unique power needs. There's a lot of people doing solar, a lot of people doing wind, but they're doing it on a much larger scale. So if you think of the footprint underneath a cell tower, it's pretty small. And so, some people are doing it in integrating parts and whatnot into it. So that's part of it.
The other part is the ZPM that we talked about. That's proprietary software. We've been developing that since the inception of the company seven years ago. And that whole remote monitoring and just being able to manage the systems, especially off-grid, becomes quite a unique challenge.
Kelly Scanlon:
And if I remember right, you just doubled the size of that product and introduced it, and I think you won an award for it or some kind of recognition for it in fact.
Joe Kessinger:
Yes, we did. The other thing that I did mention before within the shelter is racks for our clients to be able to put their telecom equipment, their servers, and the like. Sometimes they want more rack space. Sometimes on that cell tower, there's two or three carriers so you have to have enough space for two or three customer racks for their telecom equipment and that may require more batteries. So we have gone from our standard 8 by 10 unit to now we offer an 8 by 20 unit as well.
Kelly Scanlon:
There is an increasing demand for these off-grid power solutions as you've mentioned. With that in mind, what trends do you see in the hybrid energy sector, and how are you, HCI Energy positioning yourself to meet those needs?
Joe Kessinger:
Well, first, battery technology is always changing. We have two battery suppliers now both lithium-ion batteries but they're smart batteries, and they're very condensed, most condensed lithium-ion batteries on the marketplace. Battery technology, the chemistry of it's going to change so we're always trying to stay ahead of that. There's also the thought that perhaps someday hydrogen might be a source. So we're always trying to keep up in front of what the new energy storage solutions may be.
In addition to that, you look at telecom, and we're at 5G now. They're talking about 6G, 7G, not to mention satellite technology. All that needs to be energized, but it all needs to be energized in different ways so how do we stay ahead of that curve, and the like. So those are the things we see changing in the not-too-distant future.
Kelly Scanlon:
With weather patterns changing, the climate change, and so forth, how can these units be evolved to address those future challenges in those emergency situations?
Joe Kessinger:
Well, we have had some conversations with FEMA and you mentioned earlier, we won an award last year at a telecom conference for most innovative new product. FEMA and the World Bank and the Red Cross were all judges on that.
Kelly Scanlon:
Some big names there.
Joe Kessinger:
Yeah, yeah. We were very proud to get that award. So we have had some conversations with FEMA to be able to have a fleet of these available so that if and when there's a disaster like a hurricane, they can be staged and ready to roll into those areas.
Kelly Scanlon:
So you're prepared ahead of time and not just being reactive. You talked about this a little bit, but get more specific about how your energy solutions contribute not just to sustainability but also social equity, particularly in the underserved regions where you're located.
Joe Kessinger:
Yeah. Well, I mentioned about that Highway of Tears. That really helped because of the Indigenous women that went lost or were murdered along that highway. But we have a large market also in Tribal communities, so it's hard to sit there and think about us while we're sitting here in Kansas City and in the United States that there are some very remote locations that have no cell tower, no cellular service.
What does that mean? Well, they're lacking education. They're lacking the ability for telemedicine. They're lacking being able to just be part of society. These have been very remote locations, and therefore, it hasn't been feasible to be able to put cell coverage in that. The federal government has a mandate to make sure that those are covered. And so working with the federal government programs, working with integrators and the like, we are providing our power into those very remote locations, and thus comes with it, education and ability for telemedicine.
Kelly Scanlon:
What is the lifespan of one of these units when you go in and set it up? I know that you've got different monitoring systems and so forth. And the batteries, you talked about those. But overall, once you put it into place, how long can you expect it to be there?
Joe Kessinger:
We've had our units up and operational now since the beginning of our business, which is seven years. Batteries typically last about 10 years. The generator about the same, especially on the draw that we use it for. Obviously, there's going to have to be ongoing maintenance to it. But one of our largest customers that I mentioned earlier in Canada, we're talking to them now about our units being a 20-year lifespan. Now, of course, 10 years in that, probably going to have to switch out batteries in a generator but the shelter itself is custom-made and very durable.
Kelly Scanlon:
You have a very recognizable name in Kansas City, Joe. You've been involved with entrepreneurship endeavors for decades now. I've known you for decades. But what in particular drew you to this particular company and this particular sector? The hybrid energy sector?
Joe Kessinger:
Well, I'd like to say I was drawn to it` but I was selected for it. I work for Paul DeBruce in his family office. Paul is a very successful entrepreneur in the grain business, started his grain business when he was 27 years old, and sold it about 14, 15 years ago. And they were doing about $6 billion in revenue at the time. So, Paul, after his liquidity event, loves entrepreneurs and started investing in Kansas City-based entrepreneurial companies. And the DeBruce Companies now cover about a dozen entities that we have a controlling interest in and that we are incubating, if you will, and funding. HCI happens to be one of those.
I was asked to come into DeBruce Companies by my longtime friend, Leo Morton, who's the president of the DeBruce Companies a little over two years ago to help them manage this portfolio. About 18 months ago, we started to see that there needed to be maybe some new leadership and new direction in HCI. And although I had no background in renewable energy, no background in energy, no background in telecom, I think Paul and Leo trusted me with my vast entrepreneurial experience to be able to go in and give it some strategic direction and implement a strategy there. So we have implemented a new strategy for the last 15, 16 months, and we're moving that forward and making good progress.
Kelly Scanlon:
You may have been selected, but listening to you, it sounds like you're in this for the long haul here. So what is driving that commitment, and how do you envision HCI Energy's role in shaping the future of global energy?
Joe Kessinger:
Well, shaping the future of global energy is probably a pretty big ambition. But why not, right?
Kelly Scanlon:
Exactly. You're doing some pretty hefty things right now.
Joe Kessinger:
I have worked in my career at C-level with startup companies, with turnaround companies. I love the challenge of those. And I love growth companies. So there's a lot of pride going into HCI and getting it to a level where it's sustainable. So it's that personal pride, the commitment I have to Paul and Leo to make this as successful as it can be. We have some great opportunities ahead of us, not only in the US but abroad.
I'll be going to Vietnam next month. We have a potential partner in Vietnam. They have thousands of islands off the shoreline there, all of which need energy, all of which need communications, and so we see applications really around the world for it. So to become that global provider of energy in mission-critical situations, telecommunications, public safety is kind of our ambition.
Kelly Scanlon:
What are some of the key goals that you have, say in the next five years, and how do you expand building on that worldwide impact you're just talking about? How do you plan to expand on that?
Joe Kessinger:
International expansion as you mentioned, and product line expansion. We do have the two cube sizes that I mentioned, 8 by 10, 8 by 20. And we also sell the ZPM on its own. So the ZPM on its own is kind of the lower end of our product scale. The 8 by 20, the top end. What's in between? We don't have anything. So we are going to be introducing, at ConnectX, which is a big telecom industry conference next month, a shelter. The shelter is basically four feet wide by a couple of feet deep, and the generator will not be on board there. So this is applications where someone may already have the generator but now wants to lessen the load on the generator both on-grid and off-grid. With lessening the load on the generator, you have less maintenance, the generator lasts longer, and less CO2 emissions. So we can put our cabinet in there now, and it has the ZPM in it. It has the batteries. It has the shelf space for their network equipment. And so this is another offering.
With that cabinet offering, we see other industries that have applications for it. Again, primarily communications in remote locations so think of railroad, think of oil and gas, think of mining. So those are all verticals that we're starting to look at that we want to expand into.
Kelly Scanlon:
Okay, so verticals and product are on the horizon over the next several years. How does having a company, an innovative company like HCI Energy impact Kansas City, the entrepreneurial community, perhaps down the road even more the workforce, and just the profile in general of Kansas City?
Joe Kessinger:
As you mentioned, I've always been in the entrepreneurial community in Kansas City so I love success stories. So if we can be successful when we are successful, then that'll be prominent for Kansas City that you can start a company in Kansas City, you can grow a company in Kansas City, be successful in Kansas City, especially a technology company. Of course, as you mentioned, that leads to jobs, which is important. We have about 35 employees right now.
Kelly Scanlon:
Two new key hires in the last few months too. Yeah.
Joe Kessinger:
Two key hires and two more coming this next month. So we are growing primarily in our sales team. So we've done a lot of new hires last year on our technical team to bring our new products online and the like. And now that we have the products, now we have to sell them. So we're expanding our sales team. So that's important.
I think everyone likes a good success story, and if you're around green technology, in lessening emissions, I think that's important. I've been amazed since I've been there for the last 18 months now. Our workforce is very proud of what we do. They think it's a cool technology, but it's also something that is integrating renewable energy.
Kelly Scanlon:
Joe, thank you so much for the work that you're doing and for taking the time to come and share that with us today on our show.
Joe Kessinger:
My pleasure. Good to see you again.
Joe Close:
This is Joe Close, president of Country Club Bank. Thank you to Joe Kessinger, CEO of HCI Energy for being our guest on this episode of Banking on KC. HCI Energy is reshaping the future of power by delivering innovative hybrid energy solutions to mission-critical infrastructure around the world. From improving public safety communication in remote regions like British Columbia's Highway of Tears to improving coordination of resources and disaster zones, and shoring up underserved communities, the team at HCI is showing how technology and purpose can come together to solve complex challenges.
Country Club Bank is committed to supporting entrepreneurs who are driving innovation and growing companies that contribute to health and sustainability of our communities. Their vision, which aligns with our core values of achievement, compassion, and teamwork, helps reshape a better future for all. Thanks for tuning in this week. We're banking on you Kansas City, Country Club Bank, member FDIC.