What is the Killer App for the Smart Grid? Part 2

“The smart grid better be cool for consumers—otherwise, they’re not going to adopt it.”

Eric Wesoff June 09, 2010

Eric Wesoff

Editor-at-Large
Greentech Media

Eric Wesoff is Editor-at-Large at Greentech Media. Prior to joining GTM, Eric Wesoff founded Sage Marketing Partners in 2000 to provide sales and marketing-consulting services to venture-capital firms and their portfolio companies in the alternative energy and telecommunications sectors. Mr. Wesoff has become a well-known, respected authority and speaker in these fields.

His expertise covers solar power, fuel cells, biofuels and advanced batteries. His strengths are in market research and analysis, business development and due diligence for investors. He frequently consults for energy startups and Silicon Valley's premier venture capitalists.

I'm reporting (and speaking and moderating) from the Fujitsu Labs of America Technology Symposium 2010 -- "Smart Grid: When Energy Meets the 'Internet of Things.'"

Here are some observations on the smart grid and the smart grid killer app from the event:

In an alternate universe, the smart grid applications layer, also known as the 'soft grid,' sits above the power infrastructure and network communications layers, providing a platform for advanced applications and services. The meme goes like this: once we get the smart grid hardware and network issues taken care of and sorted out, the really interesting part gets started.

Demand response is the first smart grid killer app for industrial and large commercial customers. What's the killer app for the residential smart grid?

What mass-market customers want is a lower electric bill and little, if any, extra work. So, for residential customers, the killer app is energy efficiency. How does that get accomplished?

At GTM's Networked Grid event last month, Peter Corsell, the president and CEO of Gridpoint, suggested that smart EV charging software has the potential to be a killer app, especially with Corsell's expected "non-linear adoption of EVs."

At today's event, Donald Paul, the former CTO for Chevron, now the Executive Director of the USC Energy Institute, asked, "It remains to be seen [what] the benefit for the customer [will be]. The value for the consumer in the smart grid is not the money savings. What's the value proposition?"

"The smart grid better be cool for consumers -- otherwise, they're not going to adopt it," according to Gene Wang, CEO of People Power.

"The killer app is waiting to be found," according to Sylvia Burks of law firm Pillsbury.

Conrad Eustis, a Director at Portland General Electric, said, "The killer app is a battery home back-up system, not the one in the EV -- we need a transaction cost for that," adding, "One change in smart appliances will give us 100 gigawatts of capacity."

The killer app is probably not smart meters. Those are just "cash registers for the utilities," according to Jeff Tolnar, the CTO of BPL Global.

Is the killer app the home energy dashboard like those offered by Tendril, EnergyHub and others?

The killer residential energy application engages the energy consumer and places the consumer in a partnership with the utility. It's not easy, it's not sexy and it doesn't look like a shiny new smart meter. But it creates a value that the majority of customers understand.

And we haven't figured it out yet.