Nest: World's smartest thermostat raises its utility IQ
By Jesse Berst
Quick Take: In the first phase of its life, Nest Labs used its thermostat's learning capabilities to adapt to customer preferences. Now the company is using it to help utilities as well. I have been saying for years that it will be much easier to make devices smart about energy than people smart about energy. I applaud Nest's first steps towards utility partnerships. I hope they will prod Nest and its competitors to do even more.
Nest Labs is the Palo Alto-based company founded by ex-Apple employees to bring high-end consumer design to energy appliances. The Nest thermostat is its flagship product, one that has seen great success in the 18 months since its launch. Today the company has 210 employees and 3,000 certified installers in North America.
To date, the company has deliberately pursued a direct-to-retail strategy. (That strategy has worked, apparently, since Nest is the number one selling thermostat at Lowe's, Best Buy and Amazon.) Now the company is rolling out a suite of features and programs of value to utilities.
Automated instant rebates. Utility customers visit the Nest website, enter their account number for any participating utility, and instantly get a rebate off purchase. Utilities get the benefits of a rebate program without the hassles of processing printed forms.
Rush-Hour Rewards. This demand response (DR) program automatically adjusts the temperature with a feature called Auto-Tune. It customizes the DR program for each and every house, rather than applying a single strategy for all houses in the territory. It also pushes advance notifications to customers, who can override the temperature changes anytime they want.
Nest Partners with Energy Companies Across the U.S. to
Offer Energy-Saving Plans and Instant Automatic Rebates
Rush Hour Rewards and Seasonal Savings Services Help People Save Energy, Money
Palo Alto, Calif. - Apr. 22, 2013 - Nest Labs, Inc. (www.Nest.com) today announced that the company is partnering with the leading progressive energy providers in the U.S. to offer more than 90 million people the opportunity to earn money and save even more this summer. Together with NRG Energy, its subsidiaries Reliant and Green Mountain Energy, National Grid, Austin Energy and Southern California Edison, Nest is enabling instant rebates and exclusive offers for the NestÂ® Learning Thermostatâ„¢, as well as introducing new ways to save energy with Nest Rush Hour Rewardsâ„¢ and Seasonal Savingsâ„¢ services.
Rush Hour Rewards helps people earn money or credits from their energy provider by using less energy when everyone else is using more. With Seasonal Savings, Nest uses its knowledge of a customer’s schedule and preferences to gradually fine-tune the temperatures in the schedule to help save energy. Both services are powered by Nest’s proprietary Auto-Tuneâ„¢ technology and offered only through Nest’s energy partners.
"According to data from the Consortium for Energy Efficiency and Pike Research, in 2011, energy companies allocated approximately $9 billion to energy efficiency and peak-reduction programs,” said Tony Fadell, Nest founder and CEO. "Nest’s new offerings have the potential to make these programs not only more effective, but effortless for consumers. We’re working with some of the country’s most progressive energy providers - like NRG companies Reliant and Green Mountain Energy - and applying our design and marketing expertise, focus on the customer, and understanding of technology to make energy efficiency simple and accessible for people.”
Early results of the new programs are promising. Based on Nest’s spring 2013 nationwide trial in hundreds of homes, it’s estimated that Seasonal Savings can save five percent to 10 percent on energy for heating and cooling (in addition to savings generated through Nest’s Auto-Scheduleâ„¢, Auto-Awayâ„¢ and Airwaveâ„¢ features). With Nest Rush Hour Rewards, customers can earn $20 to $60 per season depending on the energy provider and other factors, including weather conditions.
Rush Hour Rewardsâ„¢
Just like rush hour on the freeway, when there aren’t enough lanes to accommodate all the traffic, the electric grid can also get congested on hot summer days. To keep up with demand, additional - and often less efficient - power plants are brought online to cover high-demand days. Energy providers would rather reward their customers for using less energy during rush hours, and Rush Hour Rewards is designed to help customers take advantage of those rewards.
Rush Hour Rewards automatically tweaks temperatures around rush hours. Depending on what Nest has learned from you and your home, Nest might raise the temperature by a few degrees during that afternoon and/or pre-cool a home before the rush hour begins to make sure you’re reasonably comfortable while using less energy during the rush hour. The customer is always in control. To override the temperature, simply change the setting during a rush hour and Nest will keep the temperatures you set.
Over time, everyone gets settled into a schedule. We get used to the temperatures we’ve set and miss easy opportunities to decrease our bills. You can save a lot of money by making minor temperature adjustments and tweaks to your schedule. Seasonal Savings is designed to do that automatically for you, fine-tuning your schedule over several weeks so you don’t notice a difference in comfort.
Seasonal Savings can appear twice per year: early in the heating and cooling seasons. It uses everything Nest has learned about your home and temperature preferences to identify ways that you can save energy without compromising comfort. Nest slowly adjusts temperatures over a few weeks - never more than a few degrees total. This allows you to get used to the gradual change to make sure you don’t feel too hot or too cold. Changes could include moving a temperature so that it’s little bit earlier or later in your schedule, adjusting temperatures a few degrees, or even adding or getting rid of temperatures in your schedule. Actual savings will vary by weather, your usage, and your provider’s rate plan, but Nest studies show plan participants can use five percent to 10 percent less energy when heating or cooling. You can change the schedule at any time, but if you stick with Seasonal Savings’ tuned-up schedule, it will reduce your energy use for the season while still keeping you comfortable. In Nest trials, 80 percent of participants kept their new schedules after the Seasonal Savings service was completed.
Nest Auto-Tune technology looks for opportunities to save people money, then makes adjustments automatically for people who opt into the new plans offered through select energy companies. Using Nest's knowledge of personal temperature preferences and schedules, the weather, and home profiles - as well as Nest’s proprietary algorithms - Auto-Tune makes temperature tweaks as imperceptibly as possible while maximizing people’s savings.
No-Hassle, Instant Online Rebates for Nest
For most rebates, you have to fill out paperwork, dig up receipts, mail everything in and wait. And wait. So we reinvented the rebate: we’ve joined with National Grid in Rhode Island and Massachusetts to create an instant $100 online rebate when you buy a Nest thermostat, making Nest more accessible than ever.
Rush Hour Rewards and Seasonal Savings are available only to customers of Nest’s energy partners. If you are an energy company interested in learning more about Nest’s utility programs, contact partnerships@Nest.com.
Reliant - Reliant customers throughout Texas will have three ways to save electricity with Nest: Reliant’s Learn & Conserve Plan which includes a free Nest thermostat; Reliant’s new Free Weekends with Nest plan, the first plan to offer free energy charges all weekend along with a Nest thermostat; and Reliant’s Degrees of Difference with Nest program, which gives customers the opportunity to earn credits when they conserve during times of expected high electricity usage. For more details, visit www.Nest.com/reliant.
Green Mountain Energy - Green Mountain Energy customers in Texas, Illinois, New York and Pennsylvania who sign up for the Pollution Freeâ„¢ Efficient with Nest plan will get the Seasonal Savings service beginning this summer. More details on Seasonal Savings for Green Mountain customers will be available in late May. For more information, visit www.Nest.com/greenmountain.
Austin Energy - Beginning today, Austin Energy customers who own a Nest can sign up for Rush Hour Rewards and Seasonal Savings. To enroll, visit www.Nest.com/ae.
Southern California Edison - Nest customers can sign up today for Rush Hour Rewards and Seasonal Savings. For more information, visit www.Nest.com/sce.
Nest develops consumer-focused energy solutions that keep people comfortable in their homes while helping them save energy. The Nest Learning Thermostat uses a combination of machine learning, cloud computing, sensors and algorithms to build a model of each home and create personalized heating and cooling schedules. Nest Energy Services - offered in partnership with progressive energy providers across the U.S. - use Nest’s proprietary AutoTune technology and two-way communication capabilities to encourage energy efficiency, address peak load issues, and reward people for reducing energy consumption. Nest thermostats are installed in more than 80 countries and have helped save more than 170,000,000 kWh of energy to date. Founded by Apple alums Tony Fadell and Matt Rogers, Nest is privately funded and based in Palo Alto, Calif. For more information, visit www.Nest.com.