Google partners with Nest in race to be your smart home provider

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On Monday, Google announced it is spending $3.2 billion to buy Nest Labs, the trailblazing company funded through its Google Ventures program and responsible for transforming “unloved” home products into beautiful, smart appliances. That’s a lot of money for a business with only two products: a thermostat and a smoke detector. Nest is not exactly reinventing the wheel, right? Well, actually they are.

Welcome to the smart home

Google’s move is a starting shot in the race to become the go-to smart home provider, putting in place stepping stones to realizing a future in which our homes will become one ecosystem – integrated and functioning as a whole. Customers are looking for smart appliances that can notify you when they are wasting energy or not performing properly. Plus, these innovative technologies provide customers with more opportunities to engage with and benefit from other cost- and energy-saving solutions, like demand response, rooftop solar power and electric vehicles. This puts customers in the driver seat, giving them insight and control over their daily lives in ways never before imagined (even if just to use automated, “set-it-and-forget-it” functionality).

The Nest learning thermostat learns residents’ behaviors and habits and sets temperatures at the optimal comfort and energy-saving level accordingly. Nest also enables residents to control their electricity remotely and provides the interface needed to participate in demand response, an energy management program that rewards participants for conserving energy during peak, or "rush hour," times on the electric grid.

Many utilities are already taking advantage of Nest’s ability to better manage the flow of energy into and out of homes. We wrote about one such program when Austin Energy partnered with Nest to launch its residential demand response pilot in 2013. Austin Energy’s new program provides participants with an $85 rebate per thermostat in exchange for the ability to raise the Nest thermostat’s temperature a few degrees when electricity supplies run thin and energy prices spike.

Meanwhile, Nest’s other product, Protect, is completely revamping the way we interact with the annoying, chirping smoke detector of yore. Whether you accidentally burnt the popcorn or a true emergency happens while you’re away, Protect will know the difference.

But, while these gadgets are cool and helpful, what motivated Google to spend twice the amount they paid for YouTube to acquire Nest?

Crossing the energy divide

In August, I wrote about smart homes and how we are on the cusp of new technologies for home energy management systems (HEMS) with devices like Nest and others, which promise to revolutionize our lives. The problem thus far has been that technological advances in the electric sphere tend to benefit the utilities more than the consumer. For example, by the end of 2015, approximately “45% of all U.S. households will be served by smart meters but as few as 10% of those meters will be enabled for two-way communications” via HEMS. This two-way communication is what gives customers leverage over their power usage and creation, as well as what helps save them money.

Google’s vision is to close this gap with Nest.

It is not just one thermostat here and a smoke detector there; it is the fully-integrated automation of your home with Nest acting as the sleek hub for all the activity therein. The possibilities are endless when considering third-party app developers are providing answers to problems we didn’t even realize we had yet! Recall the days before the iPhone and social media. Energy management and home automation sit at that same precipice, ready to take us into the future, especially as “serious innovation in core gadget lines like smartphones and televisions is coming to an end,” according to Wired Magazine.

In Texas, if residential consumers were benefiting from demand response at its full potential, enabled by technologies like Nest, we would not have an “Energy Crunch” problem. We would be able to load-shift when the electric grid is strained, avoiding the need to fire up polluting coal plants.

According to GigaOm, “technologies that manage home energy consumption just hit the big time.” And after shutting down its home energy software experiment, PowerMeter, just a few years ago, Google is now at the forefront of home energy hardware and software development. “Nest isn’t just an energy software and hardware company — it’s evolving into more of a consumer electronics and internet of things company. If Google is able to give Nest the resources it needs to get its thermostat and software out there at a much greater scale,” says Giga Om, “that means lower energy consumption ahead for homes that adopt it. And that’s a good thing overall for the world and for lowering carbon emissions.”

Competition is driving expansion

While Nest provides that same “sexy-cool” design that Apple is known for (it was, after all, co-founded by former Apple executive Tony Fadell, who helped create the iPod and iPhone), it isn’t the only player. AT&T is getting into the game with its new Digital Life services that enable home automation and integration of energy, home security, water leak detection and more. Comcast’s competing service is Xfinity Home, teaming up with EcoFactor, a cloud-based energy management platform.

It’s interesting that the, previously disparate, telecom and energy utilities are now competing with each other (and Google) in this brave new world of complete smart home services. As Wired explains, “Nest has made no secret that it doesn’t plan to stop at the thermostat and the smoke detector. It wants to take all the mundane but important technologies you use every day in your home and make them smarter and more pleasing — what Fadell calls the ‘conscious home.’”

EDF is working diligently to bring the understanding and availability of these technologies to the marketplace. With Google’s announcement, innovative energy solutions are going mainstream, which means a better life for all of us and a cleaner environment in which to enjoy it.

This post first appeared on our Energy Exchange blog.

Marita Mirzatuny

Marita Mirzatuny

Marita Mirzatuny is a program coordinator in EDF's U.S. Climate and Energy program.

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Comments

This is listed as conservation and (especially) efficiency. It is self evident that such are mandatory, however, so are growing (not shrinking) OVERALL energy sources for the coming planetary civilization.

Consider some very basic "energy math". The world requires about 500 quads out of which about 2/3rds is wasted in the conversion of useful energy. However, a country like the U.S. uses about a 1/5th of that but is only about 1/20th of the population. At this rate, in order to provide such a "high" standard of living to the entire world, we would need a factor of 4x (2,000 quads). Now, solar and wind can do that because their power is almost 100% , that is no conversion losses (but line losses after being generated). However, they are only "good" for, say, 20% of the time (because they are intermittent). Therefore, exactly five times this capacity would be required in order to provide for 100% efficient energy storage, and 10x such capacity for 50% storage (and even 15x for molten salt storage and conventional steam generators!).

Furthermore, solar and wind are STILL needing subsidy even though they are not (really) being stored. Imagine how much more costly it will be to add in the extra capacity AND the storage. I have come to the conclusion that it will take about 500,000 square miles of solar coverage to power just half of a fully developed world at LESS than Western standards (because efficiency WILL play out to some large extent). Millions of wind turbines can power the other half.

In the meantime, fossil fueled depletion into an over heated biosphere IS RIGHT ON TRACK. We need to fix that!

Therefore, we should re-develop a melt down proof nuclear reactor such as the thorium fueled molten salt reactor and deploy it on a global level.

Less wastes, less proliferation issues and the guarantee that the world does not succumb to the ravages caused by less energy.

I forgot to say that we MUST develop machine mass produced solar, wind and batteries as well because, even without the batteries (or other efficient storage) solar and wind are almost cheap enough (already) to not need subsidy and power a whopping 20% or so of ALL needs.

I simply promote ALL forms of clean energy.