Utility Thoughts on Leveraging Smarter Technology for Deeper Energy Savings

January 26, 2017 (2:00 PM – 3:00 PM EDT)The webinar will begin at 2:00 PM

Slides for this webinar are in the “Handout” section of the Webinar

Asking a Question

Utility Thoughts on Leveraging Smarter Technology for Deeper Energy Savings

Moderators

Taylor Jantz-Sell

ENERGY STAR Lighting Program Manager

U.S. Environmental Protection Agency

Meghan Heneghan

Research Assistant, ENERGY STAR Program

ICF

Introductions

Kari Binley

Senior Program Manager – Energy Efficiency Product

Innovation

Pacific Gas and Electric (PG&E)

Claire Miziolek

Market Strategies Program Manager

Northeast Energy Efficiency Partnerships (NEEP)

Attendee Polls

Leveraging Smarter Technologies for Deeper Energy Savings

Claire MiziolekMarket Strategies Program Manager

Northeast Energy Efficiency PartnershipsThursday, January 26th, 2-3pm

ENERGY STAR Connected Webinar

About NEEP

6

Mission

Accelerate energy efficiency as an essential part of demand-side solutions that enable a sustainable regional energy system

Approach

Overcome barriers and transform markets via

Collaboration, Education and Enterprise

Vision

Region embraces next generation energy efficiency as a core strategy to meet energy needs in a carbon-constrained world

One of six regional energy efficiency organizations (REEOs) funded by the US Department of Energy (US DOE) to link regions to US DOE guidance, products and programs

Introduction

7

What is the Smart Home?

8

Security

Energy Management Capabilities??

Image credit: Icon.asid.org

Home Energy Management Systems (HEMS):• Any hardware

and/or software system that can:– monitor and

provide feedback about a home’s energy usage,

and/or – enable advanced

control of energy-using systems and devices in the home

Energy

Definitions: HEMS vs. Smart?

Going a step further, NEEP defines “smart” systems monitor energy use and:

9

Size and Scope of Smart Home Market

10From: 2016 Sylvania Socket Survey

Our Interest

11

Image credit: Inventrom

Energy (Efficiency)

IoT

Kari BinleySenior Program Manager-Product Innovation

12

PG&E Connected Home Vision

ENERGY STAR Connected WebinarThursday, January 26th

Kari BinleyProduct Innovation-Energy EfficiencyPacific Gas and Electric Companyk1bs@pge.com

Agenda

• Why Do we Care about Connected Home?

• Regulatory Landscape

• Research Overview

• Connected Vision

• Energy Efficiency

• Integrated Vision

• Tying it all together

• Next Steps

14

Why Connected Home?

Fewer opportunities for product efficiency

Emerging Category and

AB 793

Research

Diminishing Res Savings Opportunity

Two Phases:HEMS 1: 2014HEMS 2: 2015

Connected Devices Gaining Consumer Traction

California Law enacted 2016 to provide incentives on HEMS products/software for Res and SMB

California Regulatory Landscape

AB 793

60% Mandate

Evolving Savings Mechanisms

2030

Market Transformation

Connected Home

• Incentives for Connected Home• Outsource 60% of Programs• Meter Based Savings-Market Driven

• Market Transformation but no Evaluation Framework

• Double Savings, Same Budget

HEMS Phase 1 Research

• Questions

• Who are the key products and players?

• What is the EE/DR potential?

• Who is the ideal customer and how do we target them?

• Methodology

• Literature Review

• Technology Assessment

• Expert Panel (Delphi)

17

HEMS Phase 2 Research

18

Roadmap

Technology Industry

Interviews with

key

stakeholders:

Utilities

Regulators

Researchers

Vendors

Retailers

Industry orgs

Consumer

Online Survey

1k customers

Retail

Partnerships

Target & Sears

Content Analysis

of Product

Reviews

What is the role of the utility?

Product

Assessment

database with

product attributes

System

Assessment

protocol analysis &

user scenarios

Customer-Key Findings

Top 3 Smart Home Products (pre-Echo)

• Smart Locks (Ring Doorbell)• Connected Cameras• Connected Lights

Barriers to Adoption• Interoperability• Perceived Lack of Benefit• Reliability• Product Stability• Lack of knowledge• Difficult to set-up or Install

Customer Values

Convenience

Comfort

Savings

Security

Product Adoption

Technology-Key Findings

• Interoperability

• Education

Category Efficiency gains Load shifting

Smart

thermostats HVAC Hours of Use Pre-heating/cooling

Smart lights Device Control Limited.

Smart plugs

Control-Hours of Use and

Standby Mode

Impact determined by

End Use Device

Smart

switches Device Control

Impact determined by

End Use Device

Smart

appliances Not specific to “smarts”

Yes, and potential for

response to pricing

signals

Savings Potential

Interoperability

Foundation Building

• Data Access and Availability• Customer Privacy and Security• Support Customer Education re:

interoperability

• Collaborator:There is a strong desire to work with and support vendors and industry stakeholders.

• Connector: There is recognition that Smart Meters enable the utility to serve as the HEMS gateway, especially for DR and DG.

• Educator: There is a relatively strong commitment to a pro-active role as an unbiased trusted energy advisor on HEMS products/services.

Industry Findings

What is the role of the utility?

Recommended Roadmap

Test products beyond smart thermostats

Expand research into SMB market

Identify and promote product bundles

Leverage gateway products and middle actors

Train auditors and other customer service staff

Partner with retailers to educate and enable adoption

What’s In It for Me?

No Energy Savings, No Funding… Unless!!!

Energy Efficiency Vision

Optimization:

Begin testing various capabilities for optimization. Conduct market characterization study for delivery of optimization.

Data Mining:

Support Product adoption and collect data that supports customer use cases, how customers use the products, and the associated energy usage.

Market Enablement-Data:

Support industry needs to leverage AMI data

Connected Product Vision

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Strategy

Cross-Functional

Energy Efficiency

Optimization

Data Market

Enablement

Activities

Connected as Grid

Benefit

Create Business

Model for 3rd

Parties

Customer Control

for more

affordability

Imagine…

Lights dim depending on incoming natural light-Optimization for EECustomer sets budget (Rate engine) and house optimizes end uses to achieve budgetAppliances run according to requested load shape (Flatten Load)Customer remotely responds to DR request and house respondsTechnology recognizes EV charging and suggests EV rate.

What if there are multiple houses

on a single feeder doing the

same thing?

What if there are multiple houses

on a single feeder doing the

same thing?

How it might work

Utility

Hub Vendor Cloud

Grid Controller Platform

Hub/BrainsCustomer

Flatten Load

Flatten Load

Price Engine

Response

Price Engine

Response

DRDR

TOU Response

TOU Response

EEEE

Shar

e M

y D

ata/

Stre

am M

y D

ata

Ener

gy A

ctiv

itie

s

Tim

e Sp

ent

CUSTOMER

UTILITY

• Request Load• Provide load shape demand

BUSINESS

• Enable New Functionality• New Business Models • Seamless Integration

Tying it all together

Create opportunities for 3rd party providers to deliver grid and customer benefits by enabling the market to aggregate multiple energy benefits through a single interaction with the customer.

Residential Pay for Performance• Support initial RFP effort to identify potential providers.

• Support market building for connected solutions for 2018-2019

AB 793 Efforts• Align activities to support EE and integrated strategy

Market Characterization Study for Optimization• Who and how?

• Cost effectiveness threshold

• Data requirements

Integrated Strategy• Present integrated strategy for leadership approval

Next Steps

NEEP’s Strategies to Transform the Market

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NEEP’s History in this Space

http://neep.org/initiatives/high-efficiency-products/home-energy-management-systemshttp://www.neep.org/business-consumer-electronics-strategy-northeast-2013http://www.neep.org/smart-energy-home-strategies-transform-region 31

20132014

20152016

Potential from the Smart Energy Home

Smart Product Energy

savings

Demand

response

Load

shifting

DER

integration

Smart Thermostat

Smart Water Heater

Smart Appliances: Inflexible timing (refrigerators, stoves, ovens, small appliances)

Smart Appliances: Flexible timing (clothes dryers, clothes washers, dishwashers)

Smart TV

Smart plug, outlet, or switch

Smart Hub

In-Home Display

Energy Portal

Smart Home Platform

Smart Lighting 32

Why isn’t the Smart Energy Home a Reality?

Barriers1. It’s hard to make a strictly energy

savings argument, and evaluation? A mess!

2. Equity challenges—these are expensive, non-critical devices

3. Consumer concerns about device security

4. Device interoperability and usability-- may not be ready for the mainstream

5. AMI infrastructure is inconsistent throughout region

6. Low customer awareness overall33

Opportunities

1. Program administrators already have rebates in place and ENERGY STAR certified connected products

2. Customers are interested in smart home technologies, and demand is increasing

3. Home Security is a huge motivator for investment

4. R&D continues, new and interesting devices entering the market

5. Increased need for residential DRand DERs

Issue Focus: Standby Power

• Most smart products operate in an “always on” mode – ready to receive or send a signal

• .1-2W range on average– can be larger for major equipment

• The more energy intensive the equipment, the relative significance of standby load decreases

• BUT standby load for small wattage devices can be hard. Smart lamps may be a significant challenge:– For an 8.5W LED (60W equivalent), .5W is 47% energy increase, 1W

is 94% energy increase, and 2W is 188% energy increase

• ENERGY STAR providing the motive for reining in standby power

Energy benefit from smart device > Standby power

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Where can we take this?Regional Market Transformation Goal

Truly smart homes will delight the resident and optimize the energy components of a home

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Market Transformation Curve

36

0

10

20

30

40

50

60

BAU Intervention

0%

10%

20%

30%

40%

50%

60%

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Pe

rce

nta

ge

Pe

ne

tra

tio

n

Year

HEMS Market Transformation Curve

Business as Usual

Intervention

A

C

B

D

A: Start on the strategies outlined in report!B: Partnerships with security and service providers start to gel AND interoperability worked outC: New Codes and Standards to support smart energy home adoptionD: Variable use pricing in Northeast and Mid-Atlantic

Strategies for Success

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Two Schools of Thought

1. Push: This is a great opportunity that we need to push, likely won’t success without us

2. Pull: This market is moving and there are benefits that we don’t want to let pass us by, pull ourselves onto it

38

1. Leverage any HEMS infrastructure to drive home efficiency improvements.– Send information about home performance offerings and upgrades

out through the user interface. • Comparative norms to motivate action.

– Market the right decision maker• Smart device owners are not necessarily home improvement centric. Gender

dynamics.

– Integrate with home energy rating and labeling efforts

2. Smarten water heating. – Retrofits, incorporate into on-site visit program

• turn existing water heaters into DR ready, smart water heaters.

– Integrate smart water heaters with other HEMS to optimize performance. • HEMS could send price signals or follow an expected demand curve to optimize

WH schedule, “vacation mode,” occupancy information

– Promote connected functionality in new water heating equipment, especially heat pump water heaters.

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3. Adjust savings expectations for smart thermostats, then put into permanent programs– PAs and regulators should shift to an aggregated savings approach across a

service territory to realistically evaluate savings

– Lean heavily on the ENERGY STAR process to get state-wide savings estimates

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Savings$

4. Smart appliances, water heaters, and lighting should be promoted in existing programs– PA should not lose the opportunity to promote the smart versions of

these products in existing programs

– Look towards pilots to prove both energy and grid benefits

5. Develop strategies to seriously engage with service providers in the IoT space, especially home security.– These “nontraditional” market actors are moving a lot of products,

– Efficiency stakeholders need to strategically build partnerships with them, not try to complete.

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6. PAs diversify support of HEMS from strictly monetary incentives to other support features and roles. – Smart Energy Audit program:

• On-site visit to help with installation and set-up of hardware or software within the home.

– Programs play role of ongoing energy advisor for smart systems and HEMS• could include a call support center.

– Partner! Retailers, HEMS vendors, shifting program intervention upstream?

– Add to realtor engagement

– Pilot new efforts

7. Investigate user friendly technologies, such as voice control.– Opportunity exist to increase persistence of scenes and efficient settings

• Efficiency stakeholders should partner with players such as Amazon, Google, Apple.

8. Promote dynamic energy pricing to help make all other strategies more impactful. – Dynamic pricing will amplify the return on investment for most HEMS.

– policymakers, regulators, and utilities should work to promote the adoption on dynamic pricing rate structures.

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Conclusion

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• This is an ongoing effort and we welcome your participation.

• NEEP is actively looking to advance several of these strategies, specifically:

– Smart Water Heating Initiative

– HEMS to drive Home Performance

– HEMS Working Group

• To get involved or talk further, contact Claire Miziolek, cmiziolek@neep.org

THANK YOU!

Contact:

Claire Miziolekcmiziolek@neep.org781-860-9177 x 115

Read the full Report: http://neep.org/smart-energy-home-strategies-transform-region

Northeast Energy Efficiency Partnerships

91 Hartwell Ave Lexington, MA 02421

P: 781.860.9177 www.neep.org