Home energy management continues to hit roadblocks, study confirms
By: SGN Staff
By Jesse Berst
A new study from Pike Research confirms that the home energy management sector continues to struggle. We agree with all the hurdles catalogued by Pike (see page 2). We also note that companies in the space are beginning to struggle. Several have been seeking additional venture capital in vain; others have been forced to accept capital at unfavorable terms; and a few are shopping themselves around.
We think companies that are tied to home energy management consoles are most at risk. Most homeowners would prefer to see energy information on their smart phones, computers or TVs and don't want a new, single-purpose device cluttering their counters.
So what is working? Our sources say the small- to mid-size commercial space is rife with opportunity. Big industrial sites and big high-rises already have energy management systems and tie-ins to utility programs.
But many smaller commercial properties are still not fully on board. And many utilities (correctly) believe that it will be far easier to convince commercial property owners to play along than to convince residential customers to change their energy behavior.
But despite the stall, Pike forecasts that a combination of drivers will grow global revenue from all home energy management segments to more than $2 billion by 2020, compared to a 2011 base of $93 million.
Jesse Berst is the founder and chief analyst of Smart Grid News.com, the industry's oldest and largest smart grid site. A frequent keynoter at industry events in the U.S. and abroad, he also serves on advisory committees for Pacific Northwest National Laboratory and the Institute for Electric Efficiency. He often provides strategic consulting to large corporations and venture-backed startups. He is a member of the advisory boards of GridGlo and Calico Energy Services.
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Home Energy Management
In-Home Displays, Networked HEM Systems, Standalone HEM Systems,
Web Portals, and Paper Bill HEM Reports: Market Analysis and Forecasts
The home energy management (HEM) market continues to struggle for more traction. By now, with major deployments of smart grid infrastructure in place, the expectation had been that a smarter grid would be enabling the wider use of new tools and incentives for consumers to use energy more efficiently. People would save money, and utilities would benefit from lower overall consumption and not having to spend capital so quickly on new power generating plants.
The HEM market has been stuck in near neutral, though, with numerous trials and only a few cases of industry-led deployments or significant consumer uptake. That view is starting to change a bit. Over the coming years, a continued desire among consumers to reduce bills, regulatory mandates for greater efficiency, wider use of variable pricing schemes, and a strong "green” sentiment will combine to help drive adoption forward. These market forces, however, will be countered by indifference to the promised potential savings, a resistance to paying extra for HEM hardware, unsettled standards for interoperability, a crowded vendor space, and lukewarm support by some utilities. Nonetheless, the driving forces will spur some gains, particularly where mandates have the most teeth.
This Pike Research report examines global and regional home energy management trends as they play out along a continuum of five segments: paper bills, web portals, standalone systems, in-home displays, and integrated HAN/HEM systems. The study also explores the drivers and inhibitors shaping the market, plus major technology issues. It provides market forecasts through 2020, with breakdowns by these five segments and by world regions. Key vendor profiles, analysis of new players, and case studies are included as well. In addition to the supply-side analysis, results from a Pike Research consumer survey focus on the demand side of HEM as well, making for a complete market overview.
Key Questions Addressed:
- What are the market forces shaping the HEM sector?
- How many HEM systems will be deployed over the next 10 years?
- How large is the revenue opportunity for the HEM market?
- How does this opportunity vary among the five key segments?
- What technology issues are shaping this market?
- Who are the major players in the HEM space?
- Which global regions will provide the most opportunities for HEM vendors?