The utility’s role is changing, and regulation must change along with it – to spur innovation and respond to evolving customer needs. Modernizing the industry will require a dynamic approach.
A land rush in the burgeoning home energy management market.
onward, in hopes they’ll be well established by the time standards and business models catch up. Some innovations and approaches surely will pan out better than others, but that’s the way it goes on the frontier.
In the short term, the most direct tack is to sidestep utilities altogether and sell directly to consumers. That’s the initial strategy of EcoDog, a startup selling a combined hardware and software package. The company plans to launch its product, called FIDO, this fall, with volume consumer sales beginning in early 2010.
The company is marketing FIDO as a discrete smart-home system that doesn’t require any interface with the utility. The basic hardware component attaches to the customer’s breaker panel, and monitors the energy use on each circuit in the home. Additionally, the company plans to add monitoring and control for individual appliances. That data feeds through the home’s electrical wiring and into a home computer via a special converter.
“Our software shows you a floor plan of your home,” says EcoDog CEO Ron Pitt. “You see what’s using energy in your home and how much it costs you. Then it takes that information and couples it with current and projected rate information from the utility company, and comes up with real-world recommendations about what you can do in your home to save the most money on your electric bill.”
Pitt sees a variety of potential customers, from homebuilders who want premium features for a greener product, to security, HVAC and electrical contractors looking to diversify.
“There’s going to be a utility channel as well; some utilities will want to provide these products to their customers,” he says. “But the bottom line is, when you start talking about what the customer needs and what the homeowner needs, it varies widely.”
Companies like EcoDog are betting against the killer app, figuring that the range of consumer desires and the cacophony of regulators and utilities will preclude a single solution. From Pitt’s point of view, most utilities are content to let third-party developers take the lead in creating home energy management alternatives for consumers.
“The thing about utility companies is, they’re utility companies,” he says. “I think one of the things that they’re doing that’s smart is saying, ‘We don’t have core competency in doing all this software, that’s not what we do. So we’re going to leave it to the guys out there who know how to do it.’”
At the other end of the spectrum, tech behemoths Microsoft and Google are jumping into the fray with web-based applications that hope to become as ubiquitous as a certain social networking site.
“I’m not sure if you ever want to call it the Facebook of energy, but we certainly want it to be a destination,” says Jon Arnold, Microsoft’s worldwide power and utilities director, of the Hohm application, which went live in June. “We want it to be a place you can look at your energy use, see how you compare, and get information and help from others.”
It works like this: Customers go