Friday, 19 October 2012

Home Energy Management solutions make slow progress in North America

imageIDC Energy Insights, that part of the research firm that looks at technology issues facing the utility and oil & gas industries, has released a report that predicts that utilities in North America will spend $578m on Home Energy Management (HEM) solutions by 2016.

IDC Energy Insights defines a HEM as an ecosystem of technologies and services that enable electricity customers to shift consumption behaviours in response to signals from the grid to see economics benefits and support smart grid goals.

The ‘Technology Selection: North America Home Energy Management Spending Forecast, 2011–2016’ report emphasises that growth in HEM investment will be more conservative than other areas in the smart grid. Electric utilities in North America however, face a challenge to develop the business case for home energy management in light of tepid adoption in pilot projects, current costs of HEM solutions and the long cycle of changing consumer behaviour with fixed electricity rate structures.

To date, utility investment has supported pilot programs and test deployments, but by 2016 there is expected to be broadening adoption as consumers become increasingly engaged and utilities comply with regulatory mandates for home area network development as a critical component of the emerging smart grid.

Other findings included:

  • While there will be a decrease in investment in smart meters, it is expected that there will be an increase in the proportion deployed will HEM capabilities.
  • Customer investment on HEM devices will increase, particularly in smart thermostats.
  • Utilities will decrease investment in in-home energy use displays as other options such as portals and Web pages prove cost effective for promoting behavioural change via consumer devices.


Review:  It’s no surprise that HEMs are not doing well, particularly in the more smart meter-sceptical North America. I’m in danger of sounding like a cracked record, but smart meters and HEMs are only really going to be of benefit, and hence interest, to consumers when they can easily and effectively help save money.

The report picks up on the point when it says that a fixed electricity rate structures is one of the challenge to HEMS. It needs smart grids in place that can effectively provide differential pricing before consumers will really start to get engaged, and that’s still a few years off.

© The Green IT Review

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