SAN DIEGO – Valves are one of those things you don’t think about – until someone tells you it’s a $300 billion market. That’s right, those things that open and close. The automotive world spends $2 billion alone on little valves inside hydraulic transmissions. Washing machines, soda dispensers, ice machines and air conditioners all require various types and sizes of valves to do their thing.

The vast majority of these industrial must-haves are mechanical.  Austin, Texas-based startup Microstaq wants to bring valves into the electronic age, using microelectromechanical systems (MEMS) technology. Launching here at the DEMO startup conference in San Diego, Microstaq showed off a Tic-Tac-sized – though flatter- valve made out of a sandwich of silicon. When an electric current is applied to the silicon it heats up and expands, shifting a tiny lever that ultimately shoves open a larger hole in the chip. That’s a valve, folks –  hole that opens and closes on demand.

The advantage of an electronic valve is the precision with which it can be opened and closed. In Microstaq’s case, their valve technology is initially built into a valve that will be used in an air conditioner. Air conditioners are typically been very inefficient machines. With an electronic valve installed, and electronic control system guiding it, Microstaq officials claim they can improve the overall efficiency of AC systems by 20% to 30%. Since the valve can precisely control the flow of the cooling fluid, the machine can fully utilize the heat exchange, which means the compressor runs less and the overall energy use goes down.

That should grab the attention of utility companies under pressure to cut greenhouse gas emissions, particularly those in the Sunbelt where air conditioning accounts for much of the electricity demand.

Whether Microstaq’s claims hold up, will be known soon. The company is in field tests with two major HVAC manufacturers and expects its product to be in the market in the first half of 2009.

The technology behind Microstaq’s valve was originally developed for automotive use within TRW Automotive and spun out into a standalone company in 2000. Mark Luckevich, Microstaq’s VP of engineering is quick to point out his company’s technology can’t address the entire valve market. “I would say we could apply our MEMS approach to about one-quarter to one-third of it,” he says with a smile. Of course he’s smiling – that’s still a $100 billion market to go after.