Google Home: A Platform For Intelligent Energy Management Solutions

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Google is well known for big brands and great design, which made the acquisition of leading intelligent thermostat company Nest an obvious target. After the acquisition, the two companies set out to join forces, looking for opportunities to leverage each other as a platform to do more, together.

We spoke with Nest’s Jeff Hamel, who has spent the last 20 years of his career in the energy space, about the impact Nest has had on the energy industry and how he sees that trend continuing as utilities increase their focus on connected, demand response activities.

Nest came onto the scene in 2011 as the first connected, intelligent thermostat for residential customers. Its simplicity and intelligence put the power to adjust their thermostat into the palm of their hand with its smartphone app. Beyond just a connected device, Nest learned what the typical behavior in the home looked like and dynamically shifted the operation of the thermostat accordingly, in an attempt to save the homeowner some cash.

In the early years, Nest demonstrated the potential to save energy and money with an intelligent thermostat and as it scaled up in volume, the potential grew as well. “That has really enabled the technology – and I’m primarily talking about the thermostat – to scale to the point where it’s a sizable – it’s of a size where it means a lot to utilities,” Hamel shared. When you can aggregate thermostats at the tens of megawatts per utility they get interested in being able to have a say in how that portfolio acts on the grid as a collective.

Thanks to its cloud connectivity, that goes beyond just connecting the thermostats to a homeowner’s smartphone, and also connects to Nest’s servers. Nest is able to look at the aggregated loads of all of its smart thermostats in each neighborhood, in each city and in each utility’s service area. That translates to a massive electrical load that Nest can work with utilities to throttle up or down, provided it can develop a mechanism for compensating homeowners for this flexibility.

“The bulk of that connected load in the home today is thermostats,” Jeff shared. Looking just a few steps down the road, that is likely to change as electric vehicles with increasingly larger batteries will become a force to be reckoned with in terms of load on the grid. For now, Nest is focused on maximizing the value it can provide to homeowners and utilities with its smart thermostats. “I think you’re going to continue to see a lot of growth for smart thermostats and demand response capability,” Jeff related.

It is already seeing early interest from a handful of leading utilities like California’s Southern California Edison (SCE). “SCE was one of our first partners who embraced our energy services – which is our Rush Hour Rewards program – which is our demand response program,” Jeff shared. The program allows homeowners with smart thermostats like the Nest to opt-in to the program that gives utilities some measure of control over their thermostat in situations where the grid is strained.

These programs are supported by California’s regulators who are constantly on the prowl for creative, low carbon solutions to keeping grid production in balance with fluctuating demand from consumers. Jeff shared that, “CAISO programs that allow for the monetization of the aggregated load,” and that’s something Nest is already working on, but it requires active partnership with the local utility.

When it comes to homeowners, Jeff and his team at Nest are trying to make the process as intuitive, seamless and effortless as possible. He shared that their goal is to,”take that complexity and put it behind the scenes.”

While that might be easy enough to say out loud, delivering on that goal is high art and not something easily achieved. Simplicity in design is ironically one of the most complex tasks to achieve in the world of design, especially when it requires tying complex back end data calculations together with a beautifully intuitive user interface. Fortunately, design is one of Nest’s strengths and if anyone can do it, it is certainly on the shortlist of companies which can.

Google as a platform for change

Looking beyond Nest, Jeff shared that parent company Google is looking at enabling intelligent energy usage across the board, using its Google Home as a platform to bring about that change. “We are not only representing the thermostat hardware but the entire Google Home portfolio,” he shared. At the front end of that experience is the Google Assistant. “Google Assistant as really that key that brings together pieces of the smart home.”

That’s common knowledge to anyone who has a Google Home, Amazon Alexa, or Apple Siri device that they call on to help out around the house. Yelling at the kids to turn on the lights has been replaced with yelling at Alexa to turn on this or that light, change the lighting temperature, or to change the actual temperature, thanks to integration with smart thermostats like Google’s Nest.

Jeff shared that they are looking not only at ways they can actively affect change, but also at ways where the platforms Google brings into the home can enable them to be more effective.  “Ultimately, we want to provide homeowners visibility and control and options with the various technologies they’re bringing into their home.”

Things start to get really interesting as technologies converge. Can homeowners change the load profile of their entire home with a voice command…from work? Can my Google Assistant throttle the charging down on a connected eMotorWerks JuiceBox? Can I run my home on battery power and stop drawing power from the grid with a remote command? Things start to get really interesting and maybe even a bit messy when we start to open up this Pandora’s box.

Demand Response is perhaps the 2018 buzzword when it comes to energy-focused smart homes. For now, everyone seems to be playing nicely together, but there are sure to be some interesting discussions as residential energy storage companies vie for control over the loads in a home with device builders like eMotorWerks, Tesla, ChargePoint, Nest, Carrier, Philips and the like.

nest new features

As these worlds collide, 2019 is likely to be the year where we see the big question being asked more frequently as consumers start to install this next generation of intelligent energy management devices into their homes en masse. Who ultimately gets to make the deals with utilities to throttle the load in the home? Will it be your electric vehicle, your charger/EVSE, the company supplying your intelligent circuit breakers, or your home energy storage company?

Time will tell. Until then, Nest and Google are eager to be in the game as foundational enablers to bring more connected intelligent tech into the home. Jeff shared that they are, “Ultimately trying to get to the point of how do we provide the homeowner with a really awesome experience,” and that, “we’re actively shaping that, we’re actively creating that.”

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Kyle Field

I'm a tech geek passionately in search of actionable ways to reduce the negative impact my life has on the planet, save money and reduce stress. Live intentionally, make conscious decisions, love more, act responsibly, play. The more you know, the less you need. As an activist investor, Kyle owns long term holdings in Tesla, Lightning eMotors, Arcimoto, and SolarEdge.

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