Last week we learned that both Microsoft and Google were dropping their home energy management efforts (Microsoft Hohm and Google Powermeter). So now the postmortem. If we were making an electric power version of the film Dumb and Dumber, which company would play Dumb? And which one would be Dumber?
To know the answer, we have to measure both their consumer IQs and their utility IQs.
Consumer intelligence quotient
Both companies were blindingly stupid about what consumers want. Consumers do NOT want to stare at a home energy monitor. What they do want is a smart system that does the watching for them, then makes recommendations. They also want "cruise control." They want to set the parameters confident that the system will make the small adjustments along the way to keep things in bounds.
Utility intelligence quotient
Let's call the consumer IQ question a tie. Both companies get a D. What about their utility IQs?
Here I have to give Google the lowest possible grade for its egregious combination of ignorance and arrogance. Google didn't understand utilities but it also didn't care. As one utility executive told me: "Google treated utilities like they were speed bumps." (At least Google earns some extra credit. Its hubris qualifies it for the next Jackass sequel as well.)
As Tendril CEO Adrian Tuck put it, "The announcements by Google and Microsoft reinforce a market reality we've understood for some time — energy management vendors need to enable the utilities and not circumvent them. " (Tendril sells a utility-centric home energy management platform.)
Microsoft, by contrast, does have a small utility vertical that has published an excellent reference architecture for utilities. Too bad the Hohm team didn't spend more time with the utility group.
The final score:
Microsoft – Dumb
Google – Dumber
How do you see things? What is your analysis of the reasons for these nasty failures? Are there companies even dumber about home energy management? Which companies have the highest home energy IQs? The comment form awaits below.
Jesse Berst is the founder and chief analyst of Smart Grid News.com. He consults to smart grid companies seeking market entry advice and M&A advisory. A frequent keynoter at industry events in the US and abroad, he also serves on the Advisory Council of Pacific Northwest National Laboratory's Energy & Environment directorate.
I travel and I am constantly gone..If I invest in a storage bank to purchase off peak kwh's...then I want the control monitor to KNOW when to kick in. My life is crowded, so let's get this kicked into high gear and offered to the consumer in an EASY TO USE AND PURCHASE with a complete ROI expectation. I am ready, but where is the PACKAGE, easy to use, easy to buy, EASY and RELIABLE.
Lynn H. Beasley - 07/06/2011 - 06:21
Not Just Smart Meters
You're assuming that PowerMeter and Hohm were smart meter interface devices. Though they could do that too, that wasn't the raison d'etre.
I don't know where it stands now, but in early days a significant portion of users were operating standalone devices (e.g. that ran of the breaker box). PowerMeter provided a really simple internet interface for remote viewing of that data.
I had always assumed that as home automation systems became more common place, Google (and/or Microsoft) would have released APIs to tie it all in - - but right now, how many *real* residential home automation systems are implemented? I'd be surprised if it were in the low four-digits world wide and it's very much a high-end luxury novelty (and even, then home automation need not have anything to do with AMI, even when there's real-time pricing).
Not everyone is in this for the smart meters; don't forget that we can achieve a lot of the same ends without smart meters. Google and Hohm did not assume smart meters, so they did not assume a utility was involved.
All in all, it was a great adventure while it lasted and I'm sad to see PowerMeter go. I hope it turns out to be like the Apple Newton - a product that maybe wasn't quite what the market wanted just then, but unknown to those at the time, it was the start of something truly huge.
Tom Simchak - 07/06/2011 - 07:03
Walk before you run!
Jesse: I'm not sure I agree with your assumption that the consumer wants a "smart system that does the watching for them". You have to walk before you learn to run. Or as an analogy from a previous era, you didn't appreciate an automatic transmission until you learned to drive a manual.
There may have been an attempt to skip a generation of technology and the understanding it enabled along with the inherent motivation for the next generation of technology.
Gale Horst - 07/06/2011 - 07:03
Google and MC Hohm
Having watched the roll out of the smart grid concept, there was and is excitement -- as much as can be ponied up in the pragmatic utility industry -- over the possibilities of using technology to gain more operational control, and the potential for greater customer engagement and involvement. And to be sure, that will come, incrementally. That said, electricity demand is a passive endeavor, without an emotion context upon which to hook a highly charged marketing campaign. We only feel the "love" when the monthly bill unexpectedly doubles or the power is out for more than 5 minutes. In a world of so many distractions and demands for time, watching daily and hourly consumption of power shares qualities with watching paint dry, and therefore for most consumers, it is not a priority. I'd not say Google and MS were dumb or dumber. I'd say good try and we learned a few things. Thanks for spending your money to get the lesson. Many of us who labor in the utility biz have found there experience instructive and while they failed, we know we have to use information technology in a way that helps consumers easily and quickly partner with us to save energy, adjust usage, reduce costs, report incidents and support efforts in the areas of safety and reliability. The Google/MS experience is one story on the long road to integrate data with the electron. We've just started the trip.
Jeff Almen - 07/06/2011 - 07:19
MS Hohm and Google Power Meter
As a user of Microsoft Hohm and follower of Google Power Meter, as well, I lauded their efforts and felt it was a good start. Since my utility was not one of those participating, I used my existing Blue Line Innovations PowerCost Monitor to connect with Hohm and found it useful and informative. However, being limited to Microsoft's vision of what I could see and access was a bit frustrating but I anticipated future improvements. One limitation I could not understand was not having access to the data. I could see graphics and displays of usage data but could not download actual usage data. As an energy analyst I could have used that so I re-typed the hourly data into my own application. A true analytic application would have been much more useful since there were only a handful of graphs available and no tables. With all their resources Microsoft should have created some more views and tables or retained energy experts to advise them. I have done that kind of work and understand what consumers and businesses find useful (it's different!) and what Hohm provided was way short. So that may have been part of the reason for the lack of interest. MS may have also lost interest due to the slow adoption of smart meters, which would have cross-pollinated interest in it as utility customers looked for ways to access their own data. I would expect utilities to create some customer applications as smart meter data becomes available. Maybe then MS and Google would offer something as an alternative or work with the utilities again. In the meantime, I am expecting others to step up and give me access and info that I can use! Too bad - an opportunity lost!
Joseph Lopes - 07/06/2011 - 07:59
MS Hohm and Google
These are not the first or the last to "quit" the home energy management maze. There are too many varibles in the market place today. I agree that these are still building blocks, but what they consumer wants some control over monthly expenditures (and yes ROI is 1A). The ability to see what one is spending on an hour by hour basis is a start. The next step is on the individual to reduce and/or control what is consuming energy and utilities have been telling the public that message for many years. I propose that utilities will want to take the next step in helping the average homeowner consume less only when it serves a purpose for the utilities, i.e. demand response.
John Hemenway - 07/06/2011 - 08:04
well stated
Great blog, Jesse. Right to the point.
Elisa Wood - 07/06/2011 - 08:10
Home energy management
" Cruise control" is the perfect analogy, Jesse. We want to set it and forget it. I think it is way too soon to write off the home energy management market segment. The problem I see is that the hassle of savings energy is far greater than the savings from saving energy. Adding more gadgets to process only makes it worse. PowerMeter and HOLM were good starts but not sufficient. They failed because they didn't deliver what we wanted. I think the answer will probably come from embedded technology in a non-utility-centric solution such as: sensors built into appliances, data slurped from smart meter, home area network to collect it all, home energy analyzer software to organize it, output file to "Comcast Energy Channel" or iPhone App. Set it and forget it until it sends you an alert that your energy use exceeds your preferences and offers options or recommendation to correct it.
Do NOTHING and recommended solution will be implemented. To select alternative hit "OPTIONS" and choose one. Hit "ACCEPT OPTION" or "IGNORE ALERT" and go about your business.
My personal favorite: Your kid cranks down the A/C to 47 degrees one hot August afternoon while you are working to pay the PG&E bill. ALERT goes off on my iPhone. Default option is give him 2 degrees cooler to 76 and that is all! DO NOTHING and let it happen!
Gary Hunt - 07/06/2011 - 08:52
It's the Economy Stupid!
Five years ago in a robust economy and everyone feeling great Home Energy Management was a great idea, very altruistic. We could all afford the time and money to play around with it. Now, as people are cutting their expenses (fewer and shorter vacations, less eating out, and other luxuries)because they have to, they are going to hold onto whatever lifestyle items they can. Cutting down their energy usage is last on the list, they are going to hold onto their big TV's DVR's (which can use as much as a refrigerator) and keep their home a comfortable temperature. There just isn't much to save after you remove these items. Google and MS got it wrong, but even the best companies likely will not make it, allowing anyone that much control (real or perceived) of your home just doesn't fit in our culture. How many years of conservation measures in homes can we afford? Have we already hit the limit of what is achievable or cost effective? Let's eliminate the waste on the utility side of the meter before we ask more of our customers!
Richard Damiano - 07/06/2011 - 09:14
Could have worked with Utilities
MS and Google could have worked with Utilities to make better and robust applications out of the submetered data. End-use residential data is very valuable to utilities. The Google/MS home energy management data was not "utility-grade" to begin with and thus perhaps utilities were not very inclined to forge business partnerships with Google and MS anyway. But Utilities could have used this data for offereing their customers, data portals to assess usage. Then there is the "data ownership" issue which Google and MS did not adequately address. Even customers did not have access to their own data.
Krish - 07/06/2011 - 09:40
OpenADR / goal 6 / conservation pricing, that's it.
[I don't agree consumers have little leeway to save, there are plenty of non-LED non-CFL bulbs out there, plenty of electronics not plugged into power bars, plenty of old beer fridges, uninsulated cement walls, old windows, you name it... and the cost of expanding generation and transmission is only going up so Richard Damiano is basically completely wrong. In a recession, the best investment is usually efficiency, but the numbers so favour efficiency/conservation investment that this was true even in boom times. The accounting is clear, what is a mess is the incentive system: pricing that doesn't reflect cost of generating and transmission including the emissions and balancing peaks].
On the main point:
What part of "open automated demand response" (OpenADR) and US National Broadband Plan goal 6 didn't they understand? The utilities are not allowed (under that Plan and goal) to monopolize this data, but they have some leeway to find good solutions and partner before sharing all the data with every service provider worldwide is enforced.
Eventually though utilities slowing things down will be told/forced to share all the data in real time as goal 6 requires. The winning services will be those that get a toehold in the utility market but which do not *rely on* utility involvement and can still operate fairly well with hostile utility interference (until they can shut it down legally).
Goal 6 is the driving factor, though.
Craig Hubley - 07/06/2011 - 09:57
Problems with HAN; why not medium to small business
The issue for Home Energy Management is to (a) have a system that automates the decision rules with the option to over ride, (b) There needs to be ongoing analysis of usage patterns that recommend (such as the behavorial HAN providers offer) alternative approaches to saving money. Allow the end user to select among serveral options based on their impacts (cost versus comfort). (c) The Microsoft and Google product provided a handy interface, but they needed these automation and consumer over ride features to make them complete. The problem is that until we have appliances that communicate over the HAN with the economies of scale that this will provide, Smart metering can only show when the consumption occurred. It does not allow you to identify what contributed to the peak usage. A Home Area Network would minimally allow the most costly energy consumer to be monitored - the HVAC system, the swiming pool pumps, the spa pumps and heaters. Until the economy returns to the full throttle (fingers crossed) only the wealthy will be a able to afford to install these systems, If I had the option between installing HAN or Solar Power system, I would go the renewable option every time.
The question is how to make HAN capablity cheaper. There has been a lot of talk about using electrical signature data to identify which appliances are powering up or shutting down. This would provide the data that a software based solution could use to pinpoint the potential contributors to peak energy consumption - the energy hogs.
The low haning fruit in this equation are small to medium businesses such as food stores, restaurants and other retail outlests where power or gas consumptions is a major cost factor and reduction of energy usage would contribute to their bottom line.
Charles Bolton - 07/06/2011 - 13:50
Neither MS or Google have quit this market
Neither MS or Google have quit the market, in fact they are actually moving the the correct way of managing energy, which is real time and not 24 hours after the event.
Both companies are still developing smart home applications that interact with the meter real time and both companies are pursing fully automated solutions via items such as Android Home OS.
All the comments for this article above can only be delivered if you have real time access to meter data, which is why the current solutions (24 hour delay) would always struggle to provide value.
Peter Newland - 07/06/2011 - 15:21
Money gets their attention
You've hit the nail right on the head. People really don't want another app that requires their time and attention. Andy Colman (now CEO of Gridiant) and I discovered that a decade ago when starting MACH Energy, which was geared specifically for commercial building managers. Even the people paid to understand the difference between a kilowatt and a kilowatt-hour didn't have the time and could not easily see the benefit of looking at detailed interval usage graphs. What they did respond to was being told exactly what to do and what they would save if they did it--and they only wanted to be bugged about it once per day. It's much more useful to denominate all energy consumption--and potential savings--accurately, in dollars rather than kWh. If you tell somebody that their AC cost $14 to run yesterday (as mine did), that is more meaningful than a graph indicating that their AC consumed 36 kWh for the day (yes that math is right in Northern California and yes I do have solar). Ultimately, I think that people will be interested in more "active" management of their energy use, but only if the feedback is immediate and financial. We are a long way however, from having the market mechanisms to support consumers so empowered. Energy consumption is still mostly a pretty "dumb" process, but we're workin' on it...
Greg Tinfow - 07/06/2011 - 15:35
Real-time energy management is overrated
If Microsoft and Google think real-time energy consumption data is the solution, they may be in for a surprise. I truly doubt if the average person has the bandwidth to respond to energy "alerts" in real time. The best we can probably hope for is that people can "tune" their homes or behavior over time so as to optimize the value of their energy consumption. Besides, here in California it won't be too long before they pass a law restricting your ability to effect realtime energy management while driving, operating heavy machinery, riding a bicycle, crossing the street...
Greg Tinfow - 07/06/2011 - 15:46
So, Who IS Providing Something Useful?
Interesting blog and responses -- one of the few I've seen where I think the points and counterpoints all seemed consistent with our own analysis (most everything said I have to agree with, even where debate is at hand).
Let me pick-up from what I believe is a key point (and weakness of MSH and GPM) noted by Greg Tinfow in above post:
"What [commercial building managers] did respond to was being told exactly what to do and what they would save if they did it--and they only wanted to be bugged about it once per day. It's much more useful to denominate all energy consumption--and potential savings--accurately, in dollars rather than kWh."
To a question in the original piece, is anyone doing this effectively? Is OPOWER succeeding at this? Is anyone else even 'in the game'? e.g. what utilities are doing this on their own? De-regulated suppliers in Texas? What about internationally -- different regulatory regimes providing different/better incentives for utilities to get serious about this customer requirement?
These were non-rhetorical questions -- I'm actually curious to know from those who have better intel and understanding than I might.
John Richter - 07/07/2011 - 04:25
Google PowerMeter
My utility was one of the few to adopt the Google PowerMeter program and about 3% of our customers signed up to use the GPM. The members who signed up for the gadget seemed to love it. The GPM had one strong benefit and one strong negative.
The advantage of the Google device was that it was always in front of the customer. Everytime they call up the Internet, their usage was on their home page. It didn't require calling up a special website or going to the utility website to view the data.
The drawback was, it was difficult to implement. The customer had to go through several complex steps to set up the gadget.
The GPM is not what customers want, but it was a step toward educating customers about their energy usage.
Lee Layton - 07/07/2011 - 06:51
What wass missed in PW and Hohm
Ask your self what was missed in these products? I've tested PM and also made greate effort to sell Current Cost + Power Meter. On 2 milj. population I sold 2 units. Today customers are counting payback time or they play. Actually there is no payback time for residentials or it is so small that motivation is killed. Best way is what DIYKYOTO tooked. They went for design. People are constantly buing things which never pays back. Same with energy monitorng it should be staylish, fun, thing to be proud of etc.
Janis Sipkovs - 07/08/2011 - 04:11
Working with Utilities
As you rightly mentioned, bypassing utilities will never get you there. Any product that tries to enable the utilities' goal has to start and end with them. A consumer of electricity hardly knows what a meter does, all he needs is a tool that can help him cut costs. And only a utility knows where the costs are.
Somehow, the smart meters have to get their data into the homes so that it could be used to sensitize the users. Otherwise, the benefits will never be reached to the extent they are possible. A product should utilize the information about times of peak rates and off peak rates and help the user.
Three new demonstration projects caught our attention - a smart grid effort in Albuquerque's business district, a rapid recovery transformer study in Texas and a trial involving low voltage current sensor technologies in the UK. They also got us to thinking: At this stage in the smart grid build out, if you could design a demonstration project, what would it entail? That's our latest Tuesday Topic; click for the details.
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