Source: Cleantech Group
Some pundits see energy efficiency as a killer application for cleantech. With the recent $50 million equity raises for OPOWER (see Company Insight Report, subscription required) and C3, it would be hard to disagree. But the venture capitalist in me says that the common form of energy efficiency isn’t an application; it’s a feature of a product. Whether it’s a Prius or a Macbook, consumers buy a product for its applications (Prius: transportation, Macbook: laptop computing), with efficiency as a desired feature but a feature nonetheless.
Unfortunately for grid operators and purveyors of McKinsey charts, energy efficiency for industrial, commercial and residential premises isn’t likely to buck the trend. People buy a thermostat or HVAC system for its heating and cooling applications, not for its efficiency accolades. Particularly in the residential market, consumers are unlikely to spend time looking at an energy management dashboard when they have Facebook, baseball season and Glee as distractions. This is where California-based EcoFactor comes in. EcoFactor claims up to 30 percent of a residential home’s HVAC bill can be reduced without the consumer changing behavior or looking at a digital dashboard or billing insert.
How does it work? EcoFactor is a cloud-based service that works with “off-the-shelf” two-way programmable thermostats. The company constantly pings the thermostat for the ambient temperature inside the premise while simultaneously tracking the external temperature (by zip code). Over time, EcoFactor’s software measures the different deltas between the two temperatures, creating a dynamic thermal signature of the home. With an established dynamic thermal signature, EcoFactor can estimate the optimal energy required to heat or cool a home. For example, EcoFactor can pre-cool a home with a Time-of-Use pricing structure to avoid paying the higher tariff because EcoFactor can model how the external temperature later in the afternoon will impact the home. EcoFactor can also help detect degradations in the home’s HVAC system, saving operational costs from faulty equipment. Because EcoFactor uses the homeowner’s existing Internet connection, smart meter integration is helpful, but not required. As EcoFactor automatically adjusts the thermostat based upon internal and external conditions, active engagement from the homeowner is welcome (the system learns from and adapts to user inputs), but isn’t required, either. At any time, a home owner can override EcoFactor’s settings. Ultimately, its value proposition is simple: It maintains comfort but at reduced energy use and cost without asking customers to actively manage their thermostat.