Outsmarted by our smart homes?

A couple of weeks ago I presented some recent work on innovation in process evaluation at the International Energy Policy and Program Evaluation Conference (IEPPEC) in Amsterdam. While there I heard a number of interesting talks that made me think quite deeply about the future of our energy and electricity system, particularly in light of the growth of distributed generation, the electrification of heat and vehicles, and increasingly engaged consumers, which are all leading to challenges in how electricity systems are managed across time, location, and the multiple actors involved.

Across the world we're seeing increasing quantities of distributed energy resources with solar photovoltaics (PV) receiving a huge amount of attention of late. In Amsterdam the deputy mayor talked about the city’s goals to grow PV from the 5000 installations they have today to 80,000 within four years. He noted how this task will be especially challenging due to the urban environment and lack of roof space, but also highlighted the available roof space on office buildings and factories which are underused. The city Government is now trying to act as intermediary to bring together people who want to own/co-own generation with building owners who have space to find a way to make it happen. And it’s not just Europe - in San Francisco we’ve seen recent legislation mandate the incorporate of solar on all new buildings.

While this is fantastic in terms of rapidly increasing the share of renewables in electricity systems, there are a number of concerns emerging, particularly due to grid constraints. During the closing plenary of the conference, Philip Lawton from the UK Energy Systems Catapult talked about how the UK is already experiencing quite severe constraints at many levels in the grid (transmission and distribution), and to manage this he believes we need to leverage flexible demand, by separating end-use loads into those that are required immediately (e.g. the TV or kettle) and those whose operation could be delayed for a short time period without people noticing (e.g. hot water heating, EV charging). But, he argues, this opens up a number of key questions that need to be addressed, including getting a better understanding of how people might feel about a third party controlling their appliances, and whether they will allow this.

Prior work undertaken as part of the GREEN Grid research programme in New Zealand has attempted to address this. As part of a national online survey participants were asked, "If putting some of your appliances under automatic control would save you $100 per year, would you consider it?” Figure 1 shows that substantial proportion of the population were engaged and open to this.

Figure 1: Willingness to participate in demand response (DR)

A choice modelling experiment - included in the survey - highlighted that, in the instance of a demand response event, people were more concurred about the time of day that this may happen, the notice period they would get, and the degree to which they would have control over turning things back on again, than they were over the duration of the event or what they might save (see Figure 2).

In addition, close to 50% said they would never want refrigeration devices put under any control , but over 90% would be happy for towel rails, water heaters, dishwasher, clothes washer and dryer to be controlled in some way , and about 75% would let their heat pump be controlled .

Figure 2: Relative utility of DR attributes (different colours indicate a significant difference)

But, as we move toward a smarter and more connected world, I’m not convinced that demand flexibility of the future (at the household scale) will simply be a scaled down version of the demand response programmes we’ve seen in the past. In a world where every lightbulb has in-built sensing, control and communication technology, demand management opportunities are increasing in size, scale, and complexity.

During the closing plenary of the IEPPEC, Stuart Jeffcott of the International Energy Agency's Energy Efficient End-Use Equipment (IEA 4E) task outlined some examples that illustrate these issues. He asked the audience to imagine a refrigerator - just a regular refrigerator that keeps food cold, and, as a consequence, releases heat from the coils at the back. Typically this heat is released into the room in which the refrigerator is located, and contributes to heating that space. But what about if you could instead take this heat and use it to pre-heat water for the hot water system (if the room is already at temperature) and use to heat the space if it’s cold outside? Now we are no longer thinking about 3 separate systems - refrigerator, water heater, space heater, but these systems are becoming intertwined in their operation by the use of real time data to drive optimisation at the system level rather than the appliance level.

Now, imagine that your refrigerator also has a scanner and can tell what foods you are putting in and taking out. It could use this data to generate a shopping list for your weekly grocery delivery, automating the process and saving you some time. Now, imagine that all your neighbours also had this fridge, and now, perhaps, it makes sense to combine the information from everyone in the street, and for the supermarket to do a daily delivery (using an electric van of course) of all the foods that you are running out of. Perhaps this means you no longer need such a big fridge as you are able to get food more quickly and store less. And perhaps this could reduce the energy emissions and carbon demand of entire system.

But to optimise across a system relies on huge amounts of data from each part of that system, which may typically sit in silos that are hard to access. For example, what if your fridge was made by Siemens and your neighbour’s by LG? Or what about if you want food from Waitrose and your neighbour’s from Tesco? In a world where the value in products is shifting from hardware to software, data is king and no-one will give this data up for free.

And even if we could find a way to share the data from all these sensors, there may still be barriers in place. One of the most commonly discussed barrier in the smart home space is around interoperability. And while we see more and more hubs come into the market to support multiple network protocols on a single home area network, little has been done to address interoperability on the application layer. More and more smart appliances are coming onto the market, but, to allow the user to control it remotely, the appliance: (1) has to be connected to the home area network, (2) its address needs to be specified, and (3) the capabilities of the smart appliance need to be knows in order to generate a command that the appliance can understand (something like: “OnOffDevice.Off”). But these commands and capabilities are not standardised, and can vary by manufacturer and even within a manufacturer’s portfolio.

As the smart home space continues to grow, with the smart thermostat market alone predicted to grow from $1.1 billion in 2016 to $4.4 billion in 2025, developers of smart platform software can potentially have to code a different command for all of them (e.g. “OnOffDeviceBelkingPlugTypeA.Off”, “OnOffDeviceGEPlugTypeZ.Off”) and manage exceptions, error and details of each specific implementation. A cleaner solution is to create communication and control standards, and the ZigBee Alliance is hoping to fill this gap for the Internet of Things space within the home. Blockchain are looking to fill this gap between homes, through supporting "consensus-driven, peer-to-peer transaction records that allow any parties to transact with each other but which no-one controls”.

We’re entering a world where the key value is in software and data, and not the hardware we are used to selling and buying. And this brings me back to Google’s recent decision to stop supporting Revolv. In a world where software holds to the key to operation, “when does an expired warranty become a right to disable core device functionality?” How should we be regulating our connected world to ensure that we think about what’s best for society and the broader system rather than just one entity in that system?

We seem to be approaching a crossroads… On the one side, we need to think about management and optimisation across the entire system - from the operation of lightbulbs and refrigerators in a single home up to how resources on the whole network are consumed - and we need to make decisions in real time based on real time data from across the entire system. And while we are seeing some efforts to increase data sharing and interoperability between manufacturers and between homes, stronger efforts are needed as bigger markets and opportunities to leverage this data are realised. And this could have major impacts. Right not the decisions, as Jeffcott pointed out, are being taken by the big corporations, but researchers, utilities, and policy makers need to get into this discussion before it becomes too late.