The SAVE Act opens a new chapter in the relationship between energy efficiency and home value

Though prior attempts have been made to attach a precise value to energy efficiency at the whole home level, there has never been a broadly accepted standard. The Sensible Accounting to Value Energy Act (SAVE), currently being considered in the United States Congress, may represent a step toward codifying the relationship between home energy use and resale value.

In the wake of the 2008 housing crisis in which lenders were faulted for not screening mortgage applicants thoroughly enough, the SAVE Act aims to add an additional metric for qualifying new loans. Like property taxes and homeowners insurance, SAVE would also require lenders to factor energy costs into the requested loan amount.

Essentially, a potential home buyer could be turned down for a new loan because they don’t appear financially capable of meeting future obligations to utility companies. But given the inverse relationship between energy costs and home value under SAVE, potential buyers may also stand a better chance of getting approved for a mortgage on an energy efficient home.

With SAVE, anticipated energy savings are used to calculate the loan-to-value ratio, boosting value where energy savings can be verified by (1.) licensed industry professionals or (2.) a review of past utility bills. A higher valuation with respect to the loan amount is, of course, more attractive to mortgage issuers.

Likewise, higher appraisals mean that homes can be marketed at higher prices. Thus home owners are given a powerful incentive to commission upgrades, helping to ensure that their investment is reclaimed even if they don’t stay in the home long enough to collect yearly dividends.

Beyond establishing a much-needed reward system for energy efficient homes, there are, of course, other incidental benefits of such legislation including extra revenue flowing to businesses at various stages of supplying the energy-efficient home. Perhaps this broad distribution of benefits is the reason why the bill seems to be enjoying such widespread support.

Posted in Electricity Bills, Energy Conservation, Energy Consumers, Energy Efficient Homes, Energy Incentives | Tagged , , , | Leave a comment

The argument against Wi-Fi enabled HAN

The market-leading chip maker, Broadcom, recently announced that it would offer a new Wi-Fi module that would allow manufacturers to add a wireless component to their products. Essentially, the idea is to use the popular technology platform to link appliances such as refrigerators and washing machines to existing home networks.

Given the considerable presence that Wi-Fi has in homes throughout the world, the concept can’t be easily dismissed. In some circles, it’s even regarded as the only viable option for networking all the varied energy-consuming devices found in the home. Take the following comment, for instance, which was left in response to one of GigaOm’s highly insightful articles on the wireless standards war.

Certainly Z-wave is gaining share against ZigBee. But overall neither ZigBee or Z-wave is a real mass market solution. The reason is simple. Deploying these requires a new “base station” or access point that speaks Z-wave or ZigBee. Let’s focus on home power automation or demand response control. 80% of U.S. households that have internet have 802.11 (WiFi). From a practical standpoint, it’s hard for vendors to sell another overlay network.

Gary Ambrosino on Z-Wave: Gaining Ground on ZigBee for Home Energy Networking?

However, there are several arguments one might be able to make against the expectation of a sudden onslaught of Wi-Fi enabled home electronics.

A key component of the smart grid initiative is energy savings and, according to the consumer appliance giant, GE, the Wi-Fi chips simply aren’t the most efficient. In a 2010 comparison of suitable technologies for the future energy grid, GE found that Wi-Fi chips used nearly twice as much power during a 24 hour period as Zigbee modules (Notably, the results in GE’s study were met with harsh opposition from the Wi-Fi Alliance). Whether the difference is as marked as they claim is somewhat irrelevant if we consider that even an incremental increase in power consumption will have dramatic effects when multiplied over the potentially billions of networked devices.

Whether it’s security, lighting control, or energy management, utilities and service providers also need an app to sell in order to get consumers on board with the HAN and smart grid scenarios. In this respect, Wi-Fi doesn’t have a lot to offer. To present, Z-Wave is the most widely utilized home networking standard with over 500 certified products and counting. Zigbee also enjoys a wide level of support from manufacturers and utility providers. So, despite there being a Wi-Fi station in an overwhelming number of homes, there are few available products that can directly leverage the connection.

Now that devices like Actiontec’s SG400 Service Gateway are starting to feature built-in support for multiple networking standards, the incentive for manufacturers to convert existing devices to another standard is considerably lessened.

Not insignificantly, Wi-Fi does enjoy the endorsement of the Association of Home Appliance Manufacturers, an industry group responsible for nearly 95 percent of all home appliances sold in North America. But there really is little appeal for the consumer in a connected appliance that doesn’t operate as part of a useful home management system and, presently, one just can’t be constructed around Wi-Fi.

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Wireless providers poised to bridge smart grid – smart home communication gap

How exactly the power grid of tomorrow will look is still being decided. But several key developments over the past few months indicate that one industry may play an influential role in making the smart grid concept an eventual reality.

In the smart grid scenario, the utility company would be able to talk in real time to consumers and the things they use. The data that they’d collect would then allow utilities to respond more competently to demand.

The biggest obstacle that utility companies face is bridging the information gap. The current grid is only equipped for one-way communications, which limits efficiency upgrades. And, in order to enable two-way communications, an entirely new infrastructure is needed.

Rather than build an expensive new communications network for this highly-specialized purpose, utility providers are likely to outsource. Far-reaching networks are already available in the adjacent cellular communications industry, and we’re starting to see utilities, hardware providers, and telecoms converge around the smart metering concept.

In September, smart grid equipment manufacturer, SmartSynch, announced that it had struck a deal with AT&T to prepay up to 10 years of data charges for each device it installs. The cellular enabled devices are essentially hubs that will collect data from a neighborhood area network (NAN). Making up the NAN are individual meters. These so-called smart meters collect energy usage data from households and business, then relay it to a local hub via low power wireless signals (Zigbee has become the de facto wireless standard for this purpose). Where the cellular network comes in is in making sure that data reaches the utility company miles away.

This month, another major telecom provider also announced that they would offer a low-power wireless solution on the consumer side. Verizon said that they would initially make their Z-Wave enabled gateway available to roughly 5 million existing FIOS customers. Here, they’d be leveraging not only their customer base, but the broadband infrastructure that would allow customers remote access to their security, entertainment, appliances, and lighting.

Undoubtedly, there are still numerous hurdles to clear when it comes to enabling truly universal communication between the utilities and the home’s biggest energy hogs. The least of which is not who owns the data and the infrastructure used to carry it. However, the point is simply that utilities and their telecom partners are aggressively pursuing the smart grid opportunity, and that the other large telecoms are also poised to bring end users into the fold.

The next step logical step toward enabling end-to-end communication between power providers and power consumers would be to bridge this gap.

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Shifting trends in home entertainment may boost Z-Wave tech

By nearly all industry analysts’ estimates, the shipments of Zigbee-based smart meters are set to explode over the next few years. This is often cited as one of the more unfavorable conditions stacked up against Z-Wave, a competing wireless technology. But even if Z-Wave doesn’t manage to conquer the energy management space, there may yet be another way into the home.

To be sure, if it’s a Zigbee-enabled smart meter that acts as the go-between for millions of homeowners and their utility company, there’s more than a small advantage to be gained. At that point, the demand response scenarios that we hear so much about, like the ones where your ice machine only produces cubes when it costs the least, will become a tangible reality.

Like smart meters, IPTV and other digital media applications are also waiting for their big day. Companies like Netflix and Hulu have shown that successful businesses can be built on digital entertainment alone, and there’s no shortage of devices in our homes where content can be enjoyed.

Sigma Designs, producer of the Z-Wave chipset via acquisition, is also heavily invested in IPTV as well as standards-based technologies for wired home media networks. Though they aren’t without competition on this front, Sigma’s set top box solutions provide support for content streaming technologies like G.hn, capable of transferring multiple gigabytes per second over three types of legacy wires. This provides the in-home infrastructure necessary to link up multiple media devices, and to support seamless content sharing among all of them.

The same set top solutions also integrate Z-Wave RF remote control, a functionality that Sigma will lend itself to helping manufacturers fully incorporate into their media and CE products. Recently, the Z-Wave specification was updated to support richer metadata, ensuring that media-related data like movie titles is available to remote controls and other devices on the Z-Wave network.

In this regard, Sigma is probably in closer competition with Google and its Android@Home approach to home control than the Zigbee Alliance. With its recent acquisition of Motorola Mobility, Google is poised to integrate its home control standard into the set top boxes Motorola already makes (Motorola Mobility’s set top boxes currently use chipsets made by Sigma Designs). However, the ecosystem of products that support Android@Home is vastly underdeveloped. According to our count, there are currently more than 500 certified Z-Wave products to none that we know of for Android@Home.

The strength in the solution by Sigma is really a single unit concept that enables an IP connection to deliver content from providers, technology that enables ultra high bandwidth sharing of content within the home via existing wiring, and ultra low-bandwidth, energy-efficient control over home systems like lighting and security.

So, even if there is a Zigbee logo affixed to the electricity meter of every home, it may not be the devastating blow to Z-Wave’s progress that some predict. Because Sigma Designs is focused on integrating its multiple technologies, we may see Z-Wave and the digital media experience coalesce nicely. From there, applications like lighting control, energy management, and security will add value to the network infrastructure.

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Where do wireless technology and human health meet?

According to a recent report, shipments of Zigbee modules are set to increase by more than 700 percent over the next five years. Zigbee, for anyone who is unfamiliar with the brand, is a wireless technology that allows us to incorporate physical objects like light switches or water valves into intelligent networks. Though Zigbee is only one of several options available, the concept is being applied to increase efficiency and save energy everywhere from factories to living rooms.

As we add more and more “things” to this globally connected network, we also have more and more radio waves swirling about in the air around us. Understandably, this has prompted questions from both the public and the media about whether wireless technology poses a health risk to humans. The discussion normally begins with cellular phones, but consumers may be left wondering about other wireless products as well.

Notably, the World Health Organization, the US FDA, and numerous organizations around the globe have repeatedly confirmed that there is no credible cause for health concerns when it comes to the ubiquitous cellular phone. They say that the devices simply aren’t capable of negatively affecting the human body at the power levels at which they operate. Whether you remain skeptical shouldn’t really matter, as we’re going to explain why low power wireless products are entirely different.

When regulatory bodies such as the FCC evaluate the safety of wireless devices, they do so by assigning each device a Specific Absorbtion Rate (SAR). A device’s SAR rating is a concise expression of how much radio frequency energy (or heat) is absorbed by the body when the device is used as directed. The key elements in gauging potential impact to to the human body are power level, duration of exposure, and proximity.

A typical mobile phone has a transmission power rating of about 500mW, though maximum output may vary depending on network and environmental conditions. By comparison, Zigbee and the home networking-specific Z-Wave each transmit at around 1mW. All things being equal, this represents a reduced potential impact to the tune of about 500 percent. (To be sure, at extremely high levels, radio transmissions or radiation do have the potential to compromise human health. Essentially, this is due to excessive heating of tissue and the body’s inability to cope.)

An SAR rating is only required for wireless devices intended for use within 20cm of the body. Few Zigbee or Z-Wave products, especially those built for home control, fall within this parameter. What this means for consumers is added piece of mind. Even with cellular phones, the SAR drops off dramatically when the device is moved just a few centimeters away from the body.

What’s more, devices that incorporate Zigbee or Z-Wave radios spend most of their time in sleep mode, only transmitting data at distant intervals when not in use. Z-Wave nodes, for instance, have a duty cycle of about 1 percent, meaning that 99 percent of the time, they’re not sending out any radio frequency energy at all. Oversight agencies like the FCC also take duty cycle into account when calculating SAR. For example, let’s say that a device has an output power of 100mW, but only transmits 10 percent of the time. At that point, SAR is more accurately calculated using an adjusted output power of just 10mW.

So, the basic idea that we’re trying to communicate here is that even if you remain unconvinced by all of the reputable studies that say cellular phones are completely harmless, there’s no reason to lump all wireless devices into the same category. Technologies like Zigbee and Z-Wave show extraordinary potential, making everyday life more comfortable and energy efficient while helping to modernize industry and the energy grid. All the while, they operate at a fraction of the power of handheld phones, from relatively distant points, and at incredibly infrequent intervals.

Posted in Home Automation, Smart Homes, Uncategorized, Z-Wave, Zigbee | Tagged , , , | Leave a comment

Getting everyone to think like an early adopter

Since its debut, home automation has never lacked a core group of excited and dedicated followers. It did, however, until recently struggle in gaining broader acceptance.

In Simon Sinek’s book “Start with Why”, he introduces a concept he calls the Law of Diffusion of Innovation that illustrates the hurdles a product or idea must clear on its way to the mainstream.

Basically, Sinek says that with just about every innovative new product or brand, there’s going to be a segment of early adopters who just get what you’re trying to do. They know what the products can accomplish, and quickly put them to use.

Early adopters, according to this schema, make up about 13.5 percent of the population. New technologies and products hit their radar just after the 2.5 percent of actual innovators.

With home technology, this group quickly identified what it meant to automate lighting, security, and entertainment systems. But in order to really achieve mass market success, businesses need to move beyond the people who intuitively understand a product to the early majority. So, what is it that the early adopters understand that the early majority is now catching on to?

● That pursuing a completely connected lifestyle is fun
● That home controls are part of an ultra-practical, ultra-efficient home
● That centralized home controls for lighting, security, and entertainment can add outrageous levels of convenience and enjoyment to home life

As Sinek argues in his book, it is critical to effectively communicate these Why reasons to the early majority. In other words, features only become selling points after the concept is sold. So any message that focuses on only the advanced and intricate capabilities a system offers simply won’t do. And while we’re on the subject, nor will one that presents a vision of the home as a cold, futuristic, tech paradise.

For proof that the Why frequently precedes the What, one need look no further than the runaway success of the Toyota Prius. The Prius is arguably not the best looking car on the block, yet its awkward lines make a lifestyle statement much bigger than the car itself.

This hybrid’s case also helps to illustrate another important point: that the Why isn’t unequivocal. What we mean is that there are people who get the concept, yet still have practical concerns like whether there’ll be enough room for the kids and few bags of groceries.

In the world of home automation, there are similar issues. There are plenty of people who’d probably love to start living a more technologically enhanced lifestyle, with energy-efficient, iPhone connected lighting scenes. But the reality is that they aren’t yet convinced that the experience will match the ideal.

Standards like Zigbee and Z-Wave that guarantee interoperability among products are helping to reassure consumers with a marking that’s consistent across all products. Then there are devices like the iPhone and iPad that serve as access points, and it goes almost without saying that these names have become synonymous with an intuitive user experience. The remaining burden falls with product developers to make sure that there’s no retreat from this apparent tipping point that’s been reached in bringing home automation to the mass market consumer.

Posted in Home Automation, Innovation, Smart Homes, Uncategorized, Z-Wave, Zigbee | Tagged , , , , | 1 Comment

Home automation and the smart grid play complimentary roles

What is smart grid HAN?

For newcomers to the discussion, HAN (or home area networking) is the concept of adding all devices in the home to a single network. The point of this is to make them more accessible, which in turn should make life at home more comfortable.

The term “smart grid” refers to the idea of a completely connected power delivery system that not only delivers power from providers to consumers, but that is also capable of incorporating large amounts of data to make this process more efficient.

Tying these two concepts together will certainly strengthen home automation solutions with even more advanced energy management capabilities, but may also help consumers to see the practical benefits of transitioning to smart meters.

HAN provides an application for the smart grid that utilities can sell

While the smart grid has big potential to do things like cut down on fossil fuels needed to generate electricity or help utilities identify more efficient ways to provide power, much of its success relies on getting consumers behind the idea.

As of last year, fewer than half of the individuals who participated in a US survey had heard of the smart grid (though those that were most knowledgeable shared largely favorable opinions about it). In other cases, proposals to change over to smart meters have been met with a great deal of resistance.

The 2010 report, Smart Grid HAN Strategy Report 2011: Technologies, Market Forecast and Leading Players, argues that in-home networks will give utilities the compelling case they need to successfully convince customers that upgrades are worthwhile.

For consumers, opening up to a demand response system in which large, energy consuming appliances in the home can connect to utilities in real time will produce tangible benefits in the form of cost savings.

What is the current level of integration?

There aren’t a lot of utility providers are looking to get into the consumer electronics business. So, the integrated experience will need to come from multiple companies working on products at various points in the smart grid supply chain.

A seamless experience where devices in the home can respond to price increases and more detailed cost data is available to consumers isn’t quite where we’re at yet.

This isn’t to say that the various components of the HAN smart grid aren’t providing plenty of incremental value. In select locations, we have fully functional smart meters allowing utilities to improve their service, we have graphical energy displays, and we have programmable, remotely accessible switches, sensors, and appliances that enhance home life. Frequently, we see integration of two of these concepts. When all three are connected, we’ll see a network that is exponentially stronger and more capable.

Korea’s fully integrated smart grid environment

Here in Korea, you’ll find the world’s most integrated smart grid on Jeju Island just off the southern tip of the mainland. The project is an experiment undertaken by the Korean government in collaboration with SK Telecom, one of the nation’s largest mobile and broadband providers.

The idea is to strategically hone the smart grid concept in a limited area, assessing and refining the technology until it is ready for deployment in some of Korea’s larger cities.

Currently, there are more than 2,000 homes connected to the Jeju network and with ongoing investment it is scheduled to become one of the world’s largest smart grids by 2013.

Though this select area along Jeju’s northeastern coast is now one of the few areas where full provider-consumer integration is available, the entire nation is slated for upgrades before 2030.

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