The movement toward a cleaner, more efficient electrical grid has hit a wall recently. The first phase for most electric utilities has been to roll out thousands of smart meters — meters capable of wirelessly beaming energy-consumption data to utilities and consumer devices — as fast as they can to as many households as possible. But this hasn’t been a universally welcome change.
Since a band of residents in Bakersfield, Calif. decided to file a class-action suit against Pacific Gas & Electric alleging rate hikes linked with new smart meters, a lot of utilities have been slowing their once ambitious metering rollouts. The stall probably won’t last, but it has inspired a a new emphasis on consumer education and engagement around smart grid development.
In fact, facilitating consumer engagement has become a business of its own: a trend exemplified by relatively recent entrant OPOWER, a venture-backed company that gives homeowners web-based tools and even traditional mailed reports so that they can manage and make proactive changes regarding their energy use.
Realizing the need for such a middle-man, 33 utilities have already signed on to provide OPOWER’s services to their coverage areas. The newest addition: American Electric Power (AEP), formerly the biggest greenhouse gas emitter in the world — quite the distinction. Starting at the end of the summer, OPOWER will be providing data and energy management recommendations to 70,000 homes serviced by AEP in Ohio.
This is a big victory for a new company in an increasingly competitive market. Startups and corporate giants alike are going after the residential energy management market — names like Tendril, Google PowerMeter, and Microsoft Hohm, among many others are coming out of the woodwork. But OPOWER differentiates itself by providing information through a diversity of channels: the web, the mail, over the phone, etc. You don’t have the be web savvy to get access to your energy use profile, just interested in learning more about how much you use, where in your house you use it, and how much you pay for it.
Like the Microsoft Hohm energy tracking platform, OPOWER says it is harnessing the power of comparison to alter behavior. It does this by collecting data from people’s smart meters and then using it to show them how much more or less efficient they are than their neighbors and others in their cities, states, and upward. Surveys have shown that keeping up with what others are doing is a compelling motivator for people to reduce their energy consumption.
With AEP now in its pocket, OPOWER is providing its services to more than 1 million households across the U.S. We hear that the company may have another major utility deal coming down the pipe, probably in the Northern California region, but no details have been confirmed.
Based in Arlington, Va., OPOWER has raised $14 million to date, chiefly from New Enterprise Associates.