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If the energy-using devices in buildings were made to act the way a swarm of bees, a school of fish or a flock of birds do, we could significantly cut our energy consumption and reduce carbon emissions. At least that’s the theory behind Toronto-based startup Regen […]

regenenergynodeIf the energy-using devices in buildings were made to act the way a swarm of bees, a school of fish or a flock of birds do, we could significantly cut our energy consumption and reduce carbon emissions. At least that’s the theory behind Toronto-based startup Regen Energy and the work of its founder and CEO, Mark Kerbel. Back in 2005, Kerbel developed an algorithm based on swarm logic — in which each individual makes a decision based on the actions of the group — that can be used in wireless nodes to efficiently control the energy consumed by building appliances.

Kerbel and his crew have made a lot of headway with the technology in their home province of Ontario, including bringing on Toronto Hydro as a client. (Toronto Star reporter Tyler Hamilton has an excellent article on the company’s work up north.) But recently Regen has been setting its sights on the U.S.; it’s currently in testing-related talks with several California utilities (Kerbel declined to name the utilities, as they’re still in the discussion stage). California utilities are interested in using the technology as a way to help implement demand response programs, which enable utilities to work with power users to cut back their consumption during peak demand periods.

In large buildings, Regen Energy’s wireless nodes could be attached to appliances like air conditioners, and on hot afternoons, for example, a utility could send a command to the appliances to cut back on energy consumption. Kerbel says that a cellular modem connection can be placed on one of the nodes, and once a command is sent to the hardware via cellular connection, the swarm algorithm will prompt the other nodes to replicate the behavior. So, even buildings that don’t have a centralized automated management system could be outfitted with Regen’s technology.

Why is California testing out innovative technology like Regen Energy’s? Partly because of progressive regulations. Back in the late 1970s, California utilities adopted a policy whereby their sales are disconnected — or decoupled — from their profits. With revenues no longer tied to the amount of electricity sold, the disincentive for utilities to implement energy conservation measures was removed. According to the California Public Utilities Commission, which oversees utilities’ energy efficiency programs, California’s per-capita energy use has remained pretty much flat over the last three decades, while elsewhere in the U.S. it’s risen by 50 percent.

California utility PG&E already administers a dozen different demand response programs, including its PeakChoice program, which enables companies to dictate how much energy is reduced and when, in return for financial compensation. By the end of 2008, PG&E’s demand response programs had worked with partners to reduce demand by 695 megawatts.

Taken together, California’s decoupling laws and successful demand response programs around the country have shown enough success that there are now calls for a nationwide program. Bill Clinton advocated a nationwide proposal at the National Clean Energy Summit in Las Vegas last year. Even the stimulus package has a nod toward decoupling (though the language is rather ambiguous) that sets financial incentives aligned with energy efficiency as one condition for the release of billions in energy-efficiency grants. Regen’s technology could soon find its way into far more states than just California.

This article also appeared on BusinessWeek.com

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