GridPoint is going home again.
The Arlington, Va.-based company -- which has raised over $200 million to date -- started out in the early part of the decade promoting a system for managing energy in upper-middle-class homes. Because energy prices were still comparatively low at that point, the market failed to develop. In turn, GridPoint decided to take the software and transform it into an operating system for the grid.
Then, in 2008, the company started to go on a buying spree. It bought V2Green (which allows utilities to communicate with electric cars) in 2008 and followed in 2009 with Lixar, which makes building energy management consoles and tools.
But in February of this year, GridPoint took an unusual turn. It bought Standard Renewable Energy, a company founded by a former Enron exec that markets energy-efficiency retrofits, weatherization services andsolarmodule installations. Basically, it's about as un-smart grid as you can get.
The move, though, signals a push that's likely going to become more prevalent in the industry. With President Obama asking Congress for $6 billion for the Home Star retrofit program and Vice President Joe Biden promoting PACE programs as a means to finance home retrofits and repairs, everyone is going to start getting into manual labor and household repairs.
Last month, Rick Rommel, senior vice president of emerging business at Best Buy, said the electronics retailer wants to become your big brother in home energy management. You want an electric car? They will sell it to you. Networked appliances? Check. Services? Yes.
"We are that last five feet to make it all possible," Rommel said.
Lowe's and Home Depot are expected to continue to expand offerings for solar panels and energy retrofits. In December, Obama actually made one of his pitches for retrofits and green jobs near a Home Depot in Virginia. Sears will work with Coda Automotive to help electric car buyers ready their homes for car charging. After that is in place, how big of a step will it be for Sears to look at the energy needs of other appliances in the home?
A large part of the appeal of home energy retrofits and services lies in the relatively cheap and easy gains that can be made in the reduction of energy consumption. Building operations consume roughly 39 percent of all of the energy in America -- half gets consumed in commercial buildings and the other half goes into homes -- and that energy is not consumed particularly efficiently. Construction also remains, despite the downturn, a somewhat large industry: green building entrepreneur Marc Porat estimates that $40 trillion in new construction and $15 trillion in renovations will occur in the U.S. between 2008 and 2035.
On top of that lies the political advantages. Although national unemployment has dropped below the ten-percent mark, unemployment in construction rose from 18.7 percent last October to 24.7 percent in recent months, according to Matt Golden, co-founder of energy efficiency retrofit specialist and software developer Recurve and one of the creators of the Home Star program. The vast majority of building materials consumed in the construction industry are produced domestically, so retrofits would boost factory jobs, as well, he said. Politicians on both the left and right ends of the spectrum can gain points by voting for Home Star or other programs. (Growth in green buildings, though, will likely attract overseas companies, too. Several Japanese companies are collaborating on research projects in New Mexico to see if any of their domestic building technologies work well in the U.S.)
And finally, there are the policies that have been, or soon may be, enacted to provide the needed cash to get the trucks rolling. At least fourteen states and 30 municipalities have enacted PACE programs that allow homeowners to finance retrofits through property tax supplements. Renewable Funding, whose president Cisco DeVries helped created PACE, received $12.2 million in funds from Draper Fisher Jurvetson and other VCs recently. Citibank and other large banks are currently setting up programs to funnel credit to PACE programs.
"With a federal loan guarantee (for PACE programs), it can grow from a hundreds-of-millions to a $400-to-$500 billion program," Jack Hidary, a PACE advocate, told us last year. "It can also help the 1.5 million people out of work in the construction industry."
Pinstripes and work boots: it will be the fashion statement of 2010.