Cracking the Smart Energy Market

By JIM WITKIN

American homes are getting smarter, at least when it comes to using energy, a consumer research firm reports. By 2020, some 60 percent of homes in the United States will have some type of smart energy management system, according to estimates from the firm, Parks Associates. Still, adoption has been slower than some companies had hoped.

MicrosoftMicrosoft’s Hohm energy-monitoring service failed to catch on.

Smart energy management systems consist of products and services that enable you to watch how you consume energy and help you use less. I wrote about one such gadget recently, the in-home energy monitor, a small electronic device that resembles a car’s G.P.S. system. The monitor communicates wirelessly with the home’s electric meter and shows how much electricity the home is using and at what cost at any given moment.
Having this information in real time, rather than once a month in a billing statement, helps you quickly identify which appliances are the biggest hogs so you can turn them down or off. Knowing the price you are paying at that moment allows you to use less when prices are highest, based on your rate plan with the utility.
Research from several pilot projects has shown that people who use these types of devices are saving money on their monthly bills, in some cases up to 20 percent.
Yet despite the upbeat prediction from Parks Associates, consumer response has been mostly lukewarm, according to Neil Strother, an analyst with Pike Research. He said that fewer than 1 percent of homes in North America had installed some form of in-home energy management system by the end of 2011.

Google and Microsoft tried to ignite interest with online services that displayed home energy data, but both failed to crack this market. Google’s PowerMeter service, introduced in 2009, was offered free to consumers. An online dashboard displayed real-time energy usage in a Web browser and offered conservation tips. Google discontinued support for PowerMeter late last year because of a low response from consumers.
Microsoft’s similarly free service, Hohm, was also introduced in 2009. Recently it announced that it would be discontinued at the end of this month because of “slow overall market adoption.”
Several big box retailers are now taking a run at this market. Late last year, Best Buy, the electronics retailer, opened Home Energy Learning Centers in three of its stores to test consumer interest in smart energy management systems.
And Lowe’s, the home improvement and appliance retailer, announced in January that it would start selling its own home energy management solution, Iris, around the middle of this year.
Kevin Meagher, the vice president of Lowe’s smart home initiative, said in a telephone interview that he still sees potential in the market. Lowe’s strategy will be to bundle together a package of home control systems that go beyond energy monitoring. “We want to appeal to a broad group of consumers, not just those interested in energy management,” he said. A price point has not been been announced.
Iris can monitor and control not only thermostats and appliances but also door locks, security systems and motion sensors, Mr. Meagher said. For example, he explained, “you can attach a sensor to a door lock or pet door and Iris can alert you when the door is opened or closed.”
The energy controls can be automated, he said. “For instance, Iris can automatically turn down the temperature and turn off the lights when you leave your home according to the rules you have set,” Mr. Meagher said. Homeowners can control Iris from a Web browser or a mobile phone.
Will the ubiquity of smartphones finally make our homes smarter too? Lowe’s will soon find out.