Presentation Transcript

1. Impact of Smart Grid on Connected Homes Continental Automated Buildings Association CABA and the following CABA members funded this project: Emerald Sponsors Diamond Sponsors Prepared by:
2. About CABA Continental Automated Buildings Association International not-for-profit industry association Dedicated to the advancement of intelligent home and intelligent building technologies Membership driven Provides members with networking and market research opportunities Celebrating 25th anniversary in 2013 4
3. CABA Connected Home Council Continental Automated Buildings Association Established in 2004 Initiates and reviews projects that relate to connected home and multiple dwelling unit technologies and applications. Examines industry opportunities that can accelerate the adoption of new technologies, consumer electronics and broadband services within the burgeoning connected home market. 4
4. CABA Research Program The CABA Research Program offers a range of opt-in technical and advisory research services designed to provide industry stakeholders with collaborative market research and R&D opportunities. Benefits Reduced cost of research by working with other industry leaders in a collaborative research environment. Tailored to member research project development needs and requirements. Completely formatted research reports that are actionable business tools. Reduced workload for participating companies. Collaborative setting without antitrust issues. Organizations direct research objectives. 4
5. Key Study Objectives Key objectives of the research project are as follows: Increase awareness and generate demand for connected home solutions Understand the changing dynamics of the industry with Smart Grid deployment and the impact on connected home solutions Create the right business models and technology roll-out initiatives to meet changing demand Achieve standardization with regard to codes, communication standards, and topologies, that will be critical for market adoption of these solutions Understand the technology market curve and isolate hype elements from actual growth trajectory Create differentiating platforms for solutions and demonstrate value adds through field trial data and case studies Define growth zones and prospects for market participants 4
6. Summary of Key Findings The connected home consumer prefers easy-to-use interfaces and simplified options to control, monitor and remotely manage his or her home. The demand potential for connected home solutions is further impacted by the perceived price-performance ratio of these products. Consumers do not have a clear idea of the actual benefits of buying these products and solutions, other than adding to their tech-savvy lifestyles. Competitive advantages will depend upon the vendors’ ability to offer solutions that have multi-faceted features and can meet scalable needs for the customer. This will influence how home networks operate and which networks gain popularity, presence of more than one internal and external network to meet customer needs is inevitable. The ability of a connected home to integrate with the smart grid is a beneficial proposition both for home owners and utilities, however, optimized solutions in this area are currently in pilot stages only. There is a greater need for vendors and service providers to collaborate and create joint business models to service the connected home market. The immediate need for the industry participants is to organize initiatives to unify standards and protocols to enable peer-to-peer connections within the home as well as to better manage external communications and applications from a third-party service provider’s network. 6
7. Smart Grid - Key trends in Implementation Smart grid implementation is nascent stage but has the potential of enabling connected home through wide roll out of TOU rates… 10
8. Utility Initiatives Full deployment of AMI systems in order to integrate TOU rates with current and future smart home appliances Open platforms for meter technology to enable wide adoption Achieving consensus on communication protocols Increase customer participation Gaps 11
9. Grid-enabled Applications for the Connected Home The market is currently is very early commercialization stage. The vast majority of pilot projects involves in-home displays and programmable thermostats. With the full deployment of AMI systems and TOU rates for residential customers the industry will see a growth of smart grid enabled devices that will be registered by utilities. Most utilities do not have the intention of selling HAN devices due to the pact of offering universal customer service. Future grid enabled applications have yet to be determined/qualified by utilities. 12
10. Consumer Perceptions Frost & Sullivan’s research shows that residential customers are adopting energy management systems in the form of… Type of Energy Management System Currently Owned Functions Controlled by Home Automation and Control System 13
11. Motivating Factors There are very few residential customers on demand response programs. However, Frost & Sullivan’s research shows that potential customers are drawn to demand response due to the prospects of cost savings… Motivating Factors for Using Demand-Response or Energy Management Devices (N=1,013) 14
12. Integrating Connected Home Devices to the Grid Integrating connected home devices to the grid is currently met by the following challenges… 16
13. Utilities’ Current Decision Making Process – Issues and Changes Required The market is dictated by a lengthy decision-making process. The following illustrates the typical approval process for investor owned utilities (IOU) IOU Procurement Process 18
14. Connected Home Overview Defining a Connected Home: Frost & Sullivan’s interactions with the connected home industry, and building upon previous projects undertaken by CABA in the connected home area, the following definition was adopted to define a ‘connected home’: “A residential dwelling unit that uses both technology and process to create a plug-and-play environment that is safe, responsive, adaptive and comfortable for its occupants”. Key characteristics observed by this research: Transition from ‘digital’ to connected Interconnected and intercommunicate Adaptive to a homeowner’s needs and comforts Wide variations in “connectedness” depending upon sophistication of the ‘connected network’ Evolved into ‘Connected Home Platform’ Customer premise equipment used by service provider to deliver services and applications Controlled by consumers and/or service provider Built ad-hoc by tech-savvy consumers Limited or no unifying/connecting presence 19
15. Telecommunication Services Home Control Systems, Security, Entertainment Energy Sources - Conventional / Renewable/ Distributed Utility (LAN, WAN, FAN) Smart Meter Communication/ Other Gateway Home Area Network Energy Management, Monitoring, Others Information Technology Applications and Services Source: Frost & Sullivan Analysis. Connected Home Segments The connected home, and its interconnection with the smart grid, is being conceived as the convergence of four key segments/layers of the industry: Energy resources Physical infrastructure components Data communication Automation and integration interface 20
16. Connected Home – Participant Characteristics 21
17. Connected Home – Presently Active Areas Home Controls/ Monitoring Providing automation and control of specific home equipment such as HVAC, lighting, security, energy management Dominated by home automation and controls companies such as ADT, Crestron, AMX, Control4, Schneider Electric, GE, Honeywell Estimated market size in North America is $2.5 Billion I 2012 Energy Management/ Smart Grid Combination of energy management and home control services that allows proactive energy use suggestions, integration with smart meters, driven by utilities or consumer Key players include Utilities in North America, Smart meter providers such as GE, Itron, etc and associated service providers such as Energent, Energate, etc. Estimated market size in North America is $ 9.6 billion in 2012 Media, Telecom, Managed Services Providing communication, multimedia and entertainment services to the consumer, with an increasing range of home management services Key players include Comcast, Bell, AT&T, Verizon, etc Subscriber base for broadband alone in Q3 2011 is estimated at approx. 92.6 million in North America ($12.1 billion in revenue) 22
18. Connected Home – Non-adoption Issues Cost appears to be one of the most important reasons behind non-adoption or delayed adoption Cost-related factors will continue to impose a potential risk to adoption, although the perception of inconvenience has waned between 2009-2011. Others include: Limited clarity on energy savings Inability to justify the cost of Investment is either deferred until replacement needs, or availability of incentives Upfront the price quoted appears to be a key criterion for customers in deciding which provider to go with. Complexity of solutions made this criterion very important for decision-making. 23
19. Connected Home – Opportunity Areas Take advantage of “sticky” nature of connected home services Use residential gateway as pass-through point for additional solutions Other usage - media servers, home management & support 24
20. Connected Home – Technology Initiatives 25
21. Achieving the Connected Home 26
22. Delivering to the Connected Home 27
23. Emerging Ecosystem 28
24. Implementing Changes 29
25. Key Takeaways The key takeaways of this research are the following: Limited customer engagement and lack of personalization of solutions, as well as the lack of predictive and self-sensing capability of solutions, will continue to hinder value demonstrations in the connected home industry. The industry horizon will continue to be dotted by both pure-play and turnkey players. Competitive advantages will, however, depend upon scalability of solutions to accommodate the emerging demand in technology integration. The connected home’s relationship with energy is likely to be further stressed with the ability of such a home to integrate with the smart grid; however, optimized solutions in this area are currently only demonstrative in nature, with limited initiatives undertaken by the utility industry. At present, the full service capabilities can be expected to come from Telcos and convergence service providers that are already well-entrenched within the connected home market by way of offering multi-point services to consumers. Industry participants need to collaborate in a cohesive manner to make smart home solutions work together; however, both conceptual frameworks and technology development initiatives should work simultaneously toward this end. 30
26. Contact Information Contact George Grimes CABA Business Development Manager Suite 210 1173 Cyrville Road Ottawa, ON K1J 7S6 grimes@caba.org 613.686.1814 ext. 226 31