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EcoFactor Goes Beyond Energy Monitoring

EcoFactor Inc. , a clean technology startup, is hoping to convince broadband service providers that one easy path into the energy management business is to white label a product that helps consumers not just monitor energy usage in the home but control it.

EcoFactor's service is cloud-based and focuses primarily on helping consumers lower their HVAC costs by correlating data from a programmable thermostat with other information, such as weather forecasts and local utility rates, to devise a thermal model of the home and determine the most efficient way to heat or cool it on a given day.

The idea is not just to monitor energy usage, as many other services do but to proactively cut costs by constantly adjusting thermostats and making other energy-saving changes, says EcoFactor Co-Founder Scott Hublou. In its pilot projects, the Silicon Valley-based firm says consumers saved an average of 17 percent on their heating and cooling bills, or about $30 to $40 a month, while retaining the ability to override automated controls of their thermostat to suit their own comfort.

Based on those savings and research that shows consumers will spend some money to save three to four times as much, Hublou is projecting a service worth as much as $10 a month, which EcoFactor expects to share with service providers that resell its service under their own brands.

"We built it as a private-label service," Hublou says. "We are negotiating wholesale rates with home service providers, and we have seen some interest from broadband service providers. We are in pilot programs with some of them."

On the partner prowl
Ideally, EcoFactor will partner with a utility company, local HVAC contractors and a broadband ISP, he adds. The contractor is important because the first step in the process is to evaluate the home's ability to withstand weather elements and the quality of its heating and cooling systems and make recommendations for changes. In EcoFactor's experience, about 30 percent of home HVAC systems are in disrepair or are poorly sized for the task at hand.

Once that is done, the EcoFactor service uses the broadband connection to extract data from a programmable thermostat and combines that with other data to make key decisions such as when to crank up the AC or heat and when to turn it down. It can make 90 adjustments a day or 14,000 a year.

For example, Hublou says, if forecasts show 90-degree weather is on its way and the utility company charges peak rates, the EcoFactor system will load up the house with warm or cooled air during off-peak hours and then lower or turn off the furnace or air-conditioning when peak billing hours are in effect. It can also send alerts to homeowners to open or close windows or take other actions.

Utility companies could well be EcoFactor partners as well, or anyone else willing to use the broadband pipe into the home, instead of a broadband ISP, Hublou admits. They are under pressure, both from federal and state mandates to create energy-efficiency programs that can address demand, and from the reality that when demand exceeds supply, the choices get ugly: rolling blackouts or expensive purchases of energy on the spot market.

"Utilities can contract with people and offer them a discount or a rebate if they participate in a demand-response program that allows the utility to turn off their AC," Hublou says. "From what we've seen, utilities want to get to a minimum quota on these programs to get the required number of kilowatts under management. They have the money to seed the market for these programs but then they are happy to get out."

He argues that a broadband service provider that sees energy management as a value-added service to generate more revenue would be able to capture the larger market share -- assuming they move before someone else does.

— Carol Wilson, Chief Editor, Events, Light Reading

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