OhmConnect nets Nest in smart home demand-response expansion

Having signed up Centrica’s Hive in March, OhmConnect has now become a ‘Works with Nest’ partner, snaring Google’s smart home wing in its bid to become the premier demand-response platform. The startup is hoping Nest gives it access to many more homes, which it can then aggregate as an incentivized grid response asset.

The gist of the offering is that OhmConnect provides a free platform that lets a home sign up, which pays out cash to homes when they let a utility control the home’s energy usage. That remote control trend is called demand-response (DR), or sometimes demand-side-response, and the utilities are very interested in DR because of its potential to save them a lot of cash in procurement costs.

Effectively looking to offer DRaaS, OhmConnect is hoping to ensnare enough homes that it becomes an enticing prospect for the utilities to partner with. In exchange for cash, OhmConnect could remove the user acquisition headache from the energy providers. To this end, OhmConnect has partnerships with Schneider Electric and Centrica.

Now, OhmConnect is able to capture Nest users, thanks to the partnership with Google. The pair say that the OhmConnect experience will seamlessly integrate with Nest’s two thermostats, and will “automatically save energy when it’s the most meaningful to community members’ wallets and the environment.”

Those who sign up to OhmConnect are then able to ‘use clean energy without buying an expensive solar system,’ although, that’s not exactly how electricity delivery works – it would be a bit like paying to get mineral water delivered through the same pipes as everyone one else’s.

Google claims that its Nest systems have saved over 22bn kWh of energy globally, since launch in 2011. That sounds like a lot of power, especially as the average US home uses around 10,700 kWh annually. This would mean that the savings would be enough to power just over 2mn homes for a year, however, when viewed globally, that 22bn kWh is enough to meet global energy demand for just an hour. It’s a strange statistic to throw in a press release, but there we are.

OhmConnect has been running since 2013, and this summer’s record temperatures were responsible for the highest customer energy savings the startup has seen. The company says that the growth is attributable to better consumer awareness, smart home adoption, and its own growing customer base.

It says that the platform has saved over 2mn kWh to date, paying out $5mn to its users. The 2mn kWh saving is apparently equivalent to 519 tons of landfill waste being recycled instead of buried. With the Nest partnership, OhmConnect should accelerate the growth of its savings and revenue, and hopefully attract more utility partners.

This is currently OhmConnect’s biggest barrier. It is limited to California, specifically the three major energy suppliers – Pacific Gas and Electric (PG&E), Southern California Edison, and San Diego Gas & Electric. California’s strong solar market and higher than average environmentalist consumers made it an obvious launch choice for OhmConnect, but the next step is to break out of the state.

This is where the DRaaS comes in. OhmConnect does prove to the energy suppliers that consumers are very interested in using cleaner energy, and for the state of California, the emissions reductions from using this energy is what has incentivized the state to pay OhmConnect to enable these reductions.

By telling customers when to use their most energy intensive appliances, when the energy mix is cleanest, OhmConnect helps cut the state’s emissions. However, not all states are going to take such a view, and OhmConnect’s main drive going forward will be to provide this DRaaS service to energy suppliers, so that they can reduce emissions to meet regulations, or to encourage energy use when it can purchase the cheapest energy on the wholesale market.

So if OhmConnect can head to another country or state, sign up a bunch of early adopters, and then essentially sell DRaaS capacity to energy providers, for a price, then it seems like a pretty straightforward business model. Signing up the likes of Hive and Nest is essentially, as there needs to be as few barriers between the prospective customer and the OhmConnect platform as possible. In turn, another channel is to convince other countries or states that they should copy California’s approach, in order to meet their own environmental targets.

“Our goal of becoming the largest clean-energy provider in the world has been propelled forward by partnering with Google and Nest,” said Matt Duesterberg, CEO and founder of OhmConnect. “Since the beginning, our customers have been asking for an easier and more valuable smart home experience, and now with Google Nest as a partner, we are able to deliver a remarkably smooth, valuable, and rewarding experience.”

In related news, Ikea is apparently set to launch a HomeKit compatible smart plug, as part of its Tradfri (‘wireless’) range of devices. At $10, it would be significantly cheaper than rival smart plugs, and these devices are a great way of bringing smart home functionality to non-connected devices.

Lights, white goods, or media equipment, could all be plugged in via one of these controllers, allowing the smart home management system to turn them on and off. That in itself would have a noticeable effect on baseline power consumption, but if partnered with systems from the likes of OhmConnect, the home’s ability to finely regulate its power consumption would be significantly increased.