Energy Management: The Internet of Things Changes Everything

internet_of_thingsThe emergence of the Internet of Things (IoT) almost certainly is the most important single development in the long evolution of energy management.

The premise of energy management is controlling elements at a fundamental and granular level. The deeper and tighter the control the better. In a world that is saturated in IoT devices, that control will be quite deep. The billions – and eventually trillions – of sensors and other devices that will create a mesh that will facilitate energy management services and procedures that would have been impossible otherwise.

To paraphrase a current presidential contender, the IoT is going to be huge. Yesterday, Gartner released research forecasting 6.4 billion “connected things” in 2016, which is a 30 percent jump from this year. The number will reach 20.8 billion by 2020. Next year, 5.5 million new IoT connections will be made daily.

The IBM Center for Applied Insights compiled other numbers, all of which are similarly impressive: There could be 925 million smart meters, 2.54 million smart lights and 1.53 billion utility-managed connected devices by 2020 (the sources of the figures are, respectively, BI Intelligence, Gartner and Ericsson). Smart grid spending in China alone could total $20 billion by the end of this year (McKinsey & Co.).

No Shortage of Applications

That’s a lot of IoT. And the uses will be many. Some examples illustrate how deeply the IoT will impact energy issues. “IoT can help an organization reduce energy waste in many ways,” wrote Gene Wang, the CEO and co-founder of People Power, a software company that enables smartphone-controlled management of connected devices. “First, by dynamically monitoring overall consumption, an organization can find out when it is spending too much or consuming at abnormally high rates.  Equipment or lights can be turned off.  HVAC can be optimized for energy savings while maintaining comfort.  Consumption can sometimes be scheduled when energy rates are lower.  And workers can be incentivized using Energy Challenges to lower their energy usage and win prizes or awards or gain status.  All of these activities can be enabled using IoT sensors.”

Organizations understand the natural synergies between the IoT and energy-related issues. GE has made to related announcements during the past three months that illustrate where the smart money thinks energy efficiency and the IoT are headed. In September, the company introduced Predix. It is a cloud-based analytics fabric that will process and make useful the massive amount of data produced by the IoT. Last month, GE created Current, which will harness that horsepower specifically for energy-related initiatives. The two will work together. This is how GE positions the partnership:

Current, powered by GE, will meet the unique needs of a wide range of utility, Commercial & Industrial and municipal customers and provide them with Predix enabled hardware and software they need to be more reliable, efficient, and profitable.

Forbes says that Current will be led by Maryrose Sylverster, who was in charge of GE’s LED business. It already has agreements with Walgreens, Hilton Worldwide, Intel and other familiar names. It is cutting customers’ electric bills by 10 percent to 20 percent. It’s also significant that GE’s battery business has been folded into Current.

Smart Buildings Will Get Smarter

 GE is not the only example of the deep connection between the IoT and energy. Another example is the partnership between Intel, Tatung and Elitegroup Computer Systems. They have developed the Smart Building Management System (SBMS). This shows how the IoT is furthering a segment – building management – that has been atop energy managers’ agendas for years. The IoT isn’t, at least in this case, providing something new. Instead, the goal is provide infinitely more powerful items to the existing building management tool chest.

The SMBS, according to the brief, will provide an Elitegroup building with savings of 8 percent this year and 20 percent to 30 percent annually from 2016 onward.

The IoT is a tricky thing to discuss simply because it is so pervasive. Many of the initiatives and cost-cutting structures that exist today – such as smart building and cities – will gradually be supplemented (and eventually rebuilt upon) the IoT. In short, the IoT injects a responsive and controllable granular element far deeper within the structures that the energy industry seeks to control than was imaginable in the past. That’s huge – but difficult to discuss in anything but broad terms.

The energy future will be inexorably linked to the IoT. Wrote Wang: “[M]ore and more devices, factories, lighting systems, buildings, transportation systems and smart cities and communities will be connected and controlled through the Internet. Brains in the Cloud will optimize energy use to a larger and larger extent.  More IoT sensors and devices will enable more control, and greater savings over time.”

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