Google crashes the smart-grid party

Google now wants to organize your home's energy information.

The search giant on Tuesday muscled into the burgeoning smart-grid software business, showing off a prototype Web application that displays home energy consumption broken down by appliance. The software uses so-called smart meters, which can communicate home energy consumption back to utilities every few minutes.

The driving idea behind the Google PowerMeter iGoogle gadget--and nearly all smart-grid companies--is that giving consumers access to more detailed home energy data will lead to lower usage. There are dozens of smart-grid trial programs now going on, offered through utilities.

Engineer Russ Mirov, one of the Google employees testing the software, was able to reduce his electricity use 64 percent over the past year, saving $3,000, by replacing inefficient refrigerators and running his pool pump at scheduled intervals.

Google cites figures showing that regularly viewing real-time energy use will prod people to cut electricity by 5 percent to 15 percent on average through behavioral changes. The product is now in private beta.

With its smart-grid push, Google is seeking to appeal directly to consumers, rather than working through utility-sponsored programs. Typically, smart-grid companies sell to utilities, giving them smart meters and software to help them operate the power grid more efficiently. As part of those programs, consumers can often get real-time information on energy use.

Google is also trying to influence smart-grid policy. On Tuesday, it published recommendations to the California Public Utility Commission, advocating that home energy data be available to consumers in real time for free in standard formats.

"Unfortunately, many of today's smart meters don't display information to the consumer. We consider this unacceptable. We believe that detailed data on your personal energy use belongs to you, and should be available in a standard, non-proprietary format," according to the announcement on the Official Google blog.

Sending ripples
Google's foray into smart-grid software was expected. Last year, it signed a partnership with General Electric to make smart-grid software. It has also been lobbying for stronger green-technology policies.

Through its Google.org philanthropic arm, the company has invested in a number of renewable energy firms, as part of an effort to make renewable energy cheaper than coal-powered electricity. It has installed a large solar array at its company headquarters and is testing a fleet of plug-in electric cars.

In the smart-grid arena, Google is taking a more overtly commercial position by introducing its own product. To gain broader acceptance for PowerMeter, it is creating a partnership program for hardware manufacturers, utilities, and government agencies. A company that makes a smart meter or in-home display for energy usage could, for example, make its information available in an Google gadget format or build a specialized application using PowerMeter.

"We can't build this product all by ourselves," Kirsten Olsen Cahill, a program manager at Google.org, told The New York Times in advance of the announcement. "We depend on a whole ecosystem of utilities, device makers and policies that would allow consumers to have detailed access to their home energy use and make smarter energy decisions."

Signing on utilities to make information available is crucial to the success of Google in this area, according to Jesse Berst, the founder of Smart Grid News. As a relative newcomer, Google doesn't have the relationships or a full understanding of the complexities of the power sector, he asserts.

"If the initiative succeeds, it will also bring some much needed leadership to the Smart Grid sector," Berst wrote. "If we are to get the Smart Grid we need, and in time to help with our many energy problems, we must have both robust platforms and a sense of urgency--two things that Google could bring about if it is willing to spend the effort and money."

Google's entry could make life uncomfortable for some home energy-management start-ups, including Tendril, Greenbox, and Control4, which need to decide whether to support Google's software or go their own way, he added.

Other smart-grid companies focus on infrastructure and don't necessarily overlap with Google's PowerMeter platform. GE and Silver Spring Networks, for example, focus on adding communications capabilities to hardware along the power grid.

There has been a push toward more standards in smart-grid technology, such as using Internet Protocol for communications, but many products are proprietary, according to industry executives.

Where next?
For a hint on where Google might go next, one could look at demand response software, which gives utilities the ability to remotely control home appliances with a consumer's consent and ability to override. Google joined an industry association called the Demand Response and Smart Grid Coalition in November.

For example, a consumer taking part in an energy-efficiency program could elect to have the air conditioner thermostat raised during peak time on a hot summer day. By making small changes over a large number of customers, utilities can cut down on peak demand significantly, potentially eliminating the need to build new power plants to meet growing energy usage.

The number of U.S. households with smart meters is projected to jump to 6 million by 2012.

(Credit: Parks Associates)

Berst described PowerMeter as an extensible platform, much the way the Google's Android software is for mobile devices.

By building on the relatively simple features it introduced on Tuesday, Google could get into other businesses, such as coordinating the flow of energy from plug-in hybrid cars to the power grid during peak times.

Google's effort to influence smart-grid policy reflects the potential disruption that energy-efficiency regulations and smart-grid products pose to utilities.

Incentives for smart-grid deployments--the Obama administration has set a target of bringing smart meters to 40 million homes over the next three years--are a big part of the stimulus package being considered by Congress, with as an early draft offering $11 billion for research.

Yet many utilities are lukewarm or unenthusiastic about smart-grid technology. That's because utility regulations are traditionally structured around making investments to build new power plants and selling more electricity, not energy efficiency, said Roy Ellis, who focuses on energy, utilities, and chemicals regulatory relations at consulting firm Capgemini.

"Today, the vast majority of utilities are serious about carbon reduction. But once you say that, the business case still has to work for them to operate their business," Ellis said. "The business case starts to bump up against shareholder value."