British Gas’ recent acquisition of AlertMe, a London-based provider of energy and home automation services, signals that home energy management and connected home technologies continue to attract significant investments. Utilities and others are seeking to provide consumers with new tools to more efficiently control energy usage and automate their homes.
The deal brings AlertMe fully under the control of British Gas, a subsidiary of Centrica, the leading energy service company in the United Kingdom. Prior to the acquisition, valued at about $68 million, British Gas was already using AlertMe’s platform. It had also been a strategic investor in AlertMe since 2010, owning about 20% of the company. British Gas leverages AlertMe’s technology for Hive, a service that enables the utility’s customers to control their home’s heating and hot water systems remotely using a smartphone, tablet, or web browser.
AlertMe was attractive to British Gas because its products and data services are used in 500,000 homes. What’s more, the platform is interoperable, able to connect disparate devices like thermostats or door locks made by different manufacturers. And AlertMe supports a range of networking protocols, including Z-Wave, ZigBee, Wi-Fi, and cellular, giving it flexibility.
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The acquisition has implications in the U.S. market, as well. Home improvement retailer Lowe’s has used AlertMe technology as the underlying software platform for its Iris connected home service since 2012. AlertMe will continue to support Lowe’s and its Iris customers. Also, since British Gas’ parent Centrica owns Direct Energy, one of the largest residential energy retailers in North America, British Gas expects to offer the AlertMe technology and service to those customers as well.
In a wider context, this acquisition by British Gas underscores the increasing importance companies are placing on home energy management and the connected home. France-based utility GDF Suez recently invested $7.2 million in Tendril, a Colorado-based company specializing in cloud-based technology for personalized energy services. GDF Suez intends to use the Tendril technology for customers in Europe. In addition, solar panel manufacturer SunPower has invested in Tendril, committing $20 million to the company and agreeing to license Tendril’s technology. Similarly, Sunnyvale, California startup Bidgely, a firm specializing in energy customer engagement and analytics, has gained traction, winning new deals for its cloud-based technology with Texas-based utility TXU and Illinois-based ComEd.
Nonetheless, the energy management-connected home space is still quite crowded, with big non-utility players such as Google (Nest), AT&T (Digital Life), and Samsung (SmartThings) making plays and a number of smaller energy tech firms, such as EcoFactor, Ceiva, ecobee, and Tado, trying to compete as well. Consolidation is at hand, and we can expect to see similar deals as the market matures.
Tags: Building Innovations, Building Systems, Home Energy Management, Mergers & Acquisitions
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