Posted by: JaredFurtado on Nov 8, 2011

By: Louis Szablya
In the area of home energy management, Microsoft and Google made two mistakes: failing to fully understand the needs of the application, resulting in "solutions" that offered limited real value; and abandoning this nascent market, which is destined to be a significant global opportunity for any vendor with a solution that satisfies the market's needs.

Their failings are understandable because electricity is a peculiar market. Consumers take it for granted. Regulators tightly control it. Utilities struggle to satisfy consumers while being constrained by the regulatory oversight.

Worst of all, the relationship between supply and demand is upside-down: In virtually every other market, as prices go up, demand goes down. But with electricity, wholesale prices increase during peak periods while retail prices remain constant, creating a problem for utilities.

Without demand response capable of reacting to pricing signals, the peak will ultimately exceed generating capacity, as it did in Texas last winter (a summer peaking region!).

Reducing peak demand is the driving force for consumer-connected home energy management, where the VERGE paradigm applies fully. Indeed, the convergence of energy, information, buildings and transportation will forever change the way people use, conserve, store and make energy at home.

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