Why Stop at the Smart Home? Giving Utilities More IOT Power Makes Sense and Saves Energy

By Jim Saber, President and CEO, NextEnergy / Digi.City Expert in Residence (Energy)

Whether you are a city planner or a city resident, the idea of developing and/or living in a smart city can be daunting.  This may explain why many modern cities are shifting towards smart infrastructure in stages, even before they have developed formal plans. 

It’s easy to understand the overwhelm. Technology has evolved quickly and the number of interconnected devices - or the Internet of Things (IOT) is increasing. More than 30 billion of these smart IOT devices are in operation today — a number that we expect to pass 75 billion by 2025.

But it is important to take into consideration that piecemealing may be hampering the desired effect. The largest value of smart technology is its ability to operate as part of a wide system; however, the current application of IOT is too often used as individual systems which can limit the benefits of larger scale. This is particularly true in the energy sector. 

For example, if a user turns the thermostat down in their own home, but no one outside of the home benefits from the action, this is a limited use case. If the IoT devices in our individual homes and buildings are freed from single-space usage and linked together by electrical utilities, the jump can be made to the broader scale. Entire communities, rather than just one user, can see additional benefits.

Utilities often define smart or IoT devices as distributed energy resources (DERs) and need them to develop and operate a smarter and cleaner grid. DERs are electricity-producing resources, such as solar panels and small natural gas–fueled generators, and controllable loads, such as electric vehicles, HVAC systems, lighting and electric water heaters. 

When an electric utility can optimize the operation of these IoT devices at scale within their service area, they can also increase the impact of renewable energy within their grid and at customer locations and create new programs and services to better engage with customers. 

To broaden the impact of renewables, utilities can incentivize using energy when renewable production is at its peak, and can use devices in the IoT to ensure that energy is coming from the correct source in precise amounts and reaching the customer at the appropriate times. The amount of energy generated from solar and wind varies from hour to hour and day to day.

Matching the energy demand with this intermittent source optimizes the value of this kind of energy and the benefits of IoT interconnectedness. This allows carbon-free electricity usage, which can be delivered and used in the most cost-effective manner while also protecting the environment.Utilities can also optimize IoT usage by engaging customers in new programs that allow the utilities to remotely dim lighting, turn off air conditioning systems for short periods of time and delay or reduce the rate of electric vehicle charging.

These are just a few examples of shifting or reducing electric loads to decrease demand on the grid during peak hours. Small changes like these often may go unnoticed by the customer in their everyday appliance and energy usage but over time can save them money and lower their overall energy costs.

These changes are already happening in many communities as a natural progression of technology, and as the IoT spreads from individual buildings to utilities to communities to cities, we can all reap the benefits of smarter, cleaner and lower-cost energy. 

What do you think? Please share your thoughts with me via email (saberj@nextenergy.org) or https://www.linkedin.com/in/jimsaber/.