Cleantech Market Intelligence
Home Energy Management Is the Tip of the Home Automation Spear
Anyone who has recently swiped through the App Store could tell you that home energy management (HEM) apps have become as ubiquitous as instant messenger apps. While these energy saving apps can’t put your face on a cute dancing dog (and Millennials may not be as interested), they do have the ability to monitor, schedule, and reduce appliance energy consumption. Mobile solutions for HEM are continuously evolving and companies are trying to expand to new niches of the fledgling industry. But HEM is really only the tip of the larger home automation spear.
Power to the People
One of the core tenets of Navigant Research’s Energy Cloud framework is that the electricity industry of the future needs to be customer centric—which means access to data at any time from any device. The market for these applications has grown as customers have become increasingly aware of the capabilities, convenience, and savings the apps can provide. The global market for residential HEM systems has grown nearly 1300% since 2011, up to $2.3 billion in 2016.
Energy Management Giants Are Acquiring HEM Startups
But few companies are solely focused on HEM. Many smart home/home automation/security companies offer some energy management solution. It is increasingly common for small startups focused on HEM to be quickly acquired by larger companies looking to expand their reach across the Internet of Things (IoT) market. Devices such as smart thermostats are increasingly being bundled as connected home solutions, and as these solutions become more affordable and mainstream, energy management is expected to see increased uptake. Take, for example, the recent activity among several HEM companies:
- Comcast recently completed its acquisition of iControl Networks, an IoT technologies and connected home security company. Comcast specifically went after the Converge business whose platform powers Xfinity Home.
- As covered by my colleague Paige Leuschner, Google, Apple, and Samsung have all launched forays into devices that will give them a window into HEM and the full home energy automation market.
- Startups are also getting involved in the energy app space. Eyedro, a software and electronics design company based in Ontario, Canada, offers an electricity monitor that provides real-time data via a web portal and mobile app called MyEyedro. Toronto-based Wattsly, a personalized energy butler mobile app, offers a tagging feature that allows users to tap a point on their energy usage Smart Graph. It also enables tagging activities like laundry, which helps the app generate advice for further savings and challenge homeowners to be more efficient.
Fortunately for customers, as HEM capabilities are expanding, the costs of HEM and home automation devices and solutions are dropping. Creativity and competition provide an optimistic outlook for the HEM market, and adoption is expected to continue to grow over the next decade as a result. Navigant Research projects the HEM market will reach $7.8 billion annually in 2025.