Home energy management can save you money

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If you’re trying to cut your monthly utility bill but aren’t sure which appliances are hogging all the juice, help is in sight.

Home energy management systems — coming to many markets over the next 18 months — can help you identify the amount of energy that different devices use in your home and how much the cost to run them varies throughout the day, says Christine Hertzog, managing director of Smart Grid Library, a consulting firm in Menlo Park, Calif.

Armed with data on your appliances, you can reduce your energy consumption. You also may be able to schedule your energy use and run certain appliances at times of the day when rates are lower, Hertzog says.

Most energy management systems link to your utility company as well as to your home appliances. While they calculate the energy use of appliances and the associated costs, some systems also tell how and when the rates may change over the next 24 hours. That way, you can plan to use more energy when the rates are lower. These data can be displayed on your computer, a television or a separate display device. With some systems, the information can be accessed through the Web, Hertzog says.

Smart plugs collect data on energy use

For energy management systems to determine the energy use of an appliance like your fridge, they need the ability to collect data on the appliance’s power consumption and feed it to the system.

To collect data on power use, appliance manufacturers are developing “smart plugs” with metering capabilities to sit between the management system and the appliance, says Megan O’Brien, a project manager with Pacific Gas & Electric Co., or PG&E, in San Francisco. Smart plugs also will be able to turn a device off to save energy. Smart-plug prototypes are available in limited quantities today, but a consumer product is expected to be widely available by mid-2011, she says.

As they reach the mass market, energy management systems will be offered by different providers around the country, O’Brien says. In some areas, utilities will provide them, either on their own or working with a partner firm. Companies that offer home monitoring services, such as security firms, are likely to include energy management systems among their services. In addition, cable and phone companies also could supply them, she says.

Home energy management systems now run from $100 to several hundred dollars, says Sam Lucero, practice director of ABI Research, a market research firm that follows emerging technologies based in New York City. The market may evolve similarly to the cell phone market, but it’s too early to tell if prices will fall like cell phones did, says Hertzog with Smart Grid Library. That is, some companies could offer a display device for a nominal fee — maybe $50 — while asking customers to purchase one- or two-year service contracts to obtain energy information on an ongoing basis.

Consumer acceptance

The question is: Will such systems help you cut energy use and save you money?

“Initial studies have shown that consumers, once they’re aware of their energy use, do make changes,” says Hertzog. They may become more diligent about turning off the lights when leaving a room or running the clothes washer or dishwasher at night at lower rates.

Lucero says the systems can help consumers cut 5 percent to 15 percent from their bills. If your monthly utility bills average $75, you’ll save $45 to $135 over a year. The key to ongoing savings is sticking with it, he says. If you lose interest after a few months, the benefits will disappear.

The use of these systems may become more widespread as more utilities introduce “time of use” rates to consumers, who would be asked to pay more for energy use in peak periods, says Alan Meier, senior scientist with Lawrence Berkeley National Laboratory in Berkeley, Calif. In fact, PG&E already has tiered pricing so that a customer’s rate per kilowatt hour rises as he consumes more power, O’Brien says.

In the future, the systems are expected to become proactive, says Lucero. They’ll send a signal to let you know the peak demand time for a specific day and ask if you want to delay running some appliances until the rates go down. By helping you better understand your energy use and cost, the systems can help you reduce your consumption. That, in turn, will help the environment and your bank account.