Navigant Research Blog

The Trouble with Trying to Reduce Residential Energy Consumption

— January 5, 2015

A recent story in The Wall Street Journal (subscription required) reminds us of the difficulty in trying to reduce energy consumption.  The story, by Jo Craven McGinty, notes that after 3 decades of effort aimed at lowering residential energy use in the United States, the overall level of consumption is still about the same, about 10 quadrillion BTUs per year.

Taking a deeper look, however, there is some positive news in the data.  While overall consumption is nearly unchanged, the average energy consumption per household has decreased, dropping to about 90 million BTUs a year in 2009 (latest year available) from about 114 million BTUs in 1980.

So, what is going on? Several things: newer homes tend to be larger than older ones.  And though they have more efficient envelopes and systems (double-pane windows, improved insulation, and efficient heating-cooling systems), it takes more energy to heat larger spaces, and the proliferation of devices in homes has required more energy use.  We now plug in more TVs, computers, DVRs, mobile phones, and second refrigerators.

The Efficiency Paradox

While our homes are more efficient, this is offset by an increase in energy consumption, a phenomenon called the rebound effect, or the Jevons Paradox, which holds that an increase in efficient use of a resource, like energy, can result in greater use and reduce the benefit.   This is not a hard and fast rule, and it is often debated among economists.  Nonetheless, there is a propensity toward squandering some efficiency gains once realized.  For example, when gas prices drop significantly, the cost per mile is lower, and people are more inclined to drive further or faster.

As McGinty points out, Americans receive mixed messages, being hectored to conserve energy while also being constantly invited to buy new gadgets and appliances that require energy.  This is evident in the U.S. Energy Information Administration data showing how consumption by type has changed.  In 1993, appliances, lighting, and electronics accounted for 24% of home consumption, which rose in 2009 to 34.6%.  Space heating was 53% of home energy consumption in 1993 and decreased to 41.5% in 2009.

Annual Residential Energy Consumption by End Use, U.S.: 2009

                               (Source: U.S. Energy Information Administration)

Helping to reduce residential consumption lies at the heart of home energy management systems and represents a key goal of utility energy efficiency programs.  No one is suggesting these efforts should stop just because the net result can seem frustratingly ineffective, or merely incremental.  But, as noted in Navigant Research’s report, Home Energy Management, one of the inhibitors to wider adoption is the uncertainty around net benefits.  Some argue that one way to avoid the rebound effect would be a tax to keep the cost of energy use the same.  But that would be a hard sell.

 

Big Retailers Boost Home Energy Management

— October 28, 2014

Home energy management solutions have struggled to gain traction beyond early adopters and consumers enrolled in a sprinkling of utility programs for demand response.  That could be changing as more retailers push connected home devices that have advanced energy controls as a component.

Best Buy, for example, has been selling a handful of smart home products for several years, and for a time it tested dedicated home energy management sections in three of its locations.  But now the electronics retailer plans to set up new connected home departments within about 400 of its 1,400 stores.  These new sections are expected to show up around Thanksgiving, and will be staffed with blue-shirted experts who will be trained to offer smart home solutions for homeowners.  Products on the energy side will include smart thermostats from Nest and Honeywell and smart lighting controls from Philips and Belkin, ranging in price from about $50 to $350.

Out on the Floor

Beyond hardware products, Best Buy will also highlight services for the connected home from a variety of providers, including Comcast, DirecTV, Time Warner, ADT, and others that can tie the hardware to services geared toward automation, security, and energy management.  This could be a key to wider adoption of home energy management, since many people have not heard much about energy management services.

Other retailers, such as Walmart, Lowe’s, and Home Depot, offer similar products and services for increased home automation, security, and energy management.  Office supply giant Staples now offers Connect, which combines a hub with a single mobile app to connect door locks, thermostats, and lighting for homeowners or small business owners.

One of the main inhibitors to growth for home energy management products and services has been a lack of awareness among consumers, as noted in Navigant Research’s Home Energy Management report.  This current wave of retailers promoting a variety of solutions to create a more intelligent home should help increase customer knowledge and drive adoption.  It will likely take a couple of more years to reach widespread consumer adoption, but this current retail push is a start.

 

Wireless Bulbs Offer Connected Light Controls

— October 20, 2014

Homeowners around the world have begun to transition from incandescent and compact fluorescent bulbs (CFLs) to more efficient and higher quality light-emitting diodes (LEDs).  Navigant Research’s report, Residential Energy Efficient Lighting and Lighting Controls, forecasts that LED sales for residential applications will increase at a compound annual growth rate of 17.6% through 2023.  Within this wholesale shift of lamp types, however, is another trend with far-reaching implications.

More and more  LED light bulbs are being sold with integrated wireless connectivity.  Instead of being controlled with simple switches, or even physical dimmers, these bulbs connect to the Internet, often through the homeowner’s Wi-Fi network, and can then be controlled through applications on a computer or smartphone.

This capability may seem extravagant, but the trend is picking up steam surprisingly quickly.  One of the first entrants to the category of wireless light bulbs was the Philips Hue, launched in October 2012.  Since then, nearly all of the large lighting companies have launched products in this category, including OSRAM, GE, Samsung, and LG.  In total, 18 different wireless light bulb products are available from 16 different manufacturers, including Greenwave Systems, Leedarson, LIFX Labs, Belkin, Fujikom, Whirlpool, and others.

Mood Lighting

These products come with a large range of features.  All are capable of dimming, while only some are able to change color (Philips, LIFX Labs, OSRAM, Tabu, Fujikom, and Environmental Lights).  Through various software applications, the lighting can be modified based on the time of day, weather conditions, or any other user preferences.  Lighting can also be tied into other home systems, such as the Philips Hue’s ability to connect with the Nest Protect smoke detector and flash red lights when either smoke or carbon monoxide are detected.  The Hue even allows lighting to be modified based on programmed sequences as an audio book is being read to provide a fully immersive scene for the listener.

Wireless bulbs come with a significant price premium over their non-connected counterparts.  While outlets such as The Home Depot have begun selling standard A-type LED bulbs for under $10, wireless bulbs are priced between $30 and $60 apiece.  As this premium comes down, and as more users become interested in the range of possibilities made available through connected lighting, adoption is expected to increase rapidly.

 

What Robots Can Teach Us about Energy Management

— October 14, 2014

The Tennessee Valley Authority (TVA) has learned some valuable lessons from a study involving the use of robotics to simulate human behavior.  The results show that dramatic improvements in efficiency can be obtained with a combination of new technology and a focus on energy efficient construction techniques.

The 5-year Campbell Creek project involved three similar Knoxville, Tennessee-area homes.  Each has the same floor plan, with two stories, and measures between 2,400 and 2,500 square feet.  Here is how they differ:

  • Builder House: This was the control home, or benchmark, built to represent a typical residence constructed for the Tennessee Valley and built to local building codes.
  • Retrofit House: This house was essentially the Builder House, but retrofitted with energy efficiency technologies, such as more energy efficient windows, ENERGY STAR appliances, compact fluorescent lights, sealed attic with foam insulation, and high efficiency heat pumps.
  • High Performance House: This house was built using the latest available construction technologies aimed at energy efficiency, as well as PV panels and solar water heating to help make it a near zero energy house.

The TVA then outfitted each home with robotic devices to mimic human behavior.  For example, a robotic arm on the refrigerator in each home would open the door simultaneously at 3:00 in the afternoon, when kids typically arrive home from school.  Each home had the same automated systems to turn on lights, televisions, appliances, and showers.  The homes also had a device that replicates how a person’s body heat affects the temperature and humidity of a room.  In addition, each home had hundreds of sensors installed to monitor energy consumption of all the subsystems.

Results and Lessons

The Builder House had a utility bill of about $1,600 a year, the Retrofit about $1,000, and the High Performance was slightly more than $400, according to project managers.  Based on the Home Energy Rating System (HERS) Index, the homes scored as follows: Builder House, 101; Retrofit House, 68; and High Performance House, 34 (a lower score is better).

The TVA project was conducted with partners Oak Ridge National Laboratory (ORNL) and Electric Power Research Institute (EPRI).  Near real-time data from the project as well as archived results are available at the EPRI web site.

These are not exactly startling results, but this intriguing study has valuable lessons for all stakeholders – utilities, homebuilders, and homeowners.  One main lesson is that doing basic things like tightening a home’s envelope with enhanced insulation and energy efficient windows will have lasting benefits.  Also, investing in the most efficient HVAC and water heating systems one can afford will pay off in energy savings.  The manager of the project, David Dinse, who has just retired, told me the project has generated quite useful data – so why aren’t more builders and utilities taking these lessons and running with them?

 

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