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• A near-term outlook for big data
• Connected world: the consumer technology revolution
• Ups and downs for cleantech in Q1

It’s no surprise that LPs are growing cold on the sector. I discussed this with a panel of investors late last year at the VERGE conference. Salzman tells VentureWire that the reality from the LP community was: “show us the money.” Other firms that have pulled back (slightly or a lot) or changed their strategy to focus on green IT include Mohr Davidow, NEA, Draper Fisher Jurvetson, and Kleiner Perkins.

VantagePoint had a few wins, but it also has had many losses. On one hand VantagePoint backed Tesla and Solazyme, which both went public. But the company also backed firms like MiaSole, Serious Energy, Tendril, and Better Place, which have struggled. Bright Source was planning on going public but pulled the IPO in the 11th hour.

Salzman embodied the aggressive all-in approach of cleantech investing. He told me in an interview in late 2011 that “when it comes to greentech investing, it’s basically all or nothing.” And instead of becoming more cautious when the market cooled following the 2008 recession, Salzman and VantagePoint seemed to double down.

VentureWire asked Salzman whether focusing VantagePoint on cleantech was a mistake, and Mr. Salzman told them: “I wouldn’t admit it if it was.”

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• Green IT’s Q4 Winners: Wind Power, Solar Power, Smart Energy
• Green IT Q1: Cleantech Breaking Out — and Bracing for Hard Times
• A 2011 Green IT Forecast

So here’s my first, where I parse out what I think have been the top 10 best, and the top 10 worst, things that have landed on the cleantech scene in 2012. Feel free to add your own in the comments.

The best:

1). Tesla remains (mostly) on track and is one of the last standing: Tesla hit its goal to launch its second electric sedan the Model S in the Summer of 2012, and reservations have remained high throughout the year. The introduction of the car was met with rave reviews, and towards the end of the year the car won Motor Trend’s Car of the Year award, making it the first electric car to do so. While Tesla did assemble and ship some of those cars more slowly than expected, the company remains on track with its slightly lowered estimates. Tesla CEO Elon Musk even tweeted recently that the company has now become cash flow positive.

In comparison, a lot of other electric car makers, and electric vehicle parts makers, struggled in 2012. A123, which supplies batteries for electric cars, declared bankruptcy, while sales of GM’s Volt and Nissan’s LEAF in the U.S. are lower than expected.

2). Google put almost a billion dollars into clean power: Even though Google isn’t a power provider or utility, the search engine giant invested almost a billion dollars ($990 million) into clean power projects. Google is doing this because it wants to power its data centers with clean power, but most solar and wind are more expensive than fossil fuel power right now.

Last year Google shut down its Google.org-sponsored RE<C project, and many saw this as a sign that Google was moving away from its clean power commitments. However, just this week, Google announced that it has hired energy innovation wiz Arun Majumdar — the former ARPA-E program director — to work on Google.org’s energy research strategy. Expect to see some interesting energy innovation outta Google in 2013.

3). Rock bottom solar prices: Super cheap solar panels might have caused problems for solar manufacturers, but for companies and home-owners that want to put solar panels on their roofs, low cost panels are leading to an unprecedented amount of new solar installations. The super cheap panels has been leading to solar installers doing well, and SolarCity had a successful IPO just last week.

4). Clean Web, Green IT, digital green, or whatever you want to call it: It’s become very clear that investing in capital-intensive cleantech manufacturing technologies is a lot harder for most investors, than investing in software, computing, mobile and the web. Which is why new phrases called Clean Web, and digital green, have emerged to explain startups and big companies that use digital technology to address resource constraints like energy, water and food. See photo below of investor Sunil Paul talking about Clean Web back at Green:Net 2011 (our conference focused on this topic).

5). Big data and energy collide: One of the biggest trends, that is making startups money and actually helping buildings reduce their energy consumption, is new types of energy analytics for energy data. Some of the companies that are playing in this space include Opower, Nest, Tendril, EcoFactor, EnergyHub, Bidgely, Stem, Auto Grid and others.

6). Low power servers: Using low power ARM chips for servers, finally got some more mainstream traction in 2012. Our analysts at GigaOM Pro just held a webinar about this on Wednesday. Earlier this year AMD bought SeaMicro, a startup building servers based on ARM low power chips, and Intel is also into so-called “microservers,” too.

SeaMicro’s SM10000-64 server.

7). Obama won: We’re not super political here at GigaOM, but the fact that President Obama will be the President for another four more years, means that a lot of the incentives for clean power and energy innovation will remain in place. Some might get cut, but the Obama administration has been really active in supporting energy innovation and put an unprecedented amount of funding into clean power, electric vehicles, biofuels and energy technology through the stimulus package.

8). Chinese investors: Chinese giants like auto parts maker Wanxiang are stepping in to buy up low cost cleantech assets that aren’t getting the needed funding in the U.S. Wanxiang is acquiring bankrupt battery maker A123 Systems (given the deal is approved in the U.S.) and also invested in GreatPoint Energy, and Smith Electric Vehicles. It’s not great for the U.S., but the funds are helping energy innovation stay alive in difficult times.

9). Food and Ag tech innovation: One of the most interesting areas to emerge in recent months is startups that are looking at ways of using technology to make food consumption and production more sustainable. There’s now startups building new types of plant-based proteins, invitro meat printing, biotech for crop development, new kinds of insurance for crop production, and more.

10). Desire to address “big problems”: Pervasive across the web and mobile sectors, is a growing desire of entrepreneurs to tackle really “big” and difficult problems. The idea has even graced the cover of the MIT Tech Review recently. As those struggling in the cleantech sector know, this is one of the main reasons that many cleantech entrepreneurs started their businesses. Now a second wave of web entrepreneurs is focused on “big problems” with new investment methods like Peter Thiel and Obvious Corp.

+1: Bill Gates. An outsider to energy that’s fully embraced funding and discussing energy innovation.

The worst:

Since there were a lot of bad things to happen in cleantech in 2012, I’m just going to briefly run down some of the hurdles:

1). Electric cars struggled: Electric vehicles moved way more slowly than expected in 2012. The Volt and the LEAF are below their numbers in the U.S., and Better Place is struggling gaining traction in Israel, it’s first target market. Fisker Automotive has been plagued by problems, and battery makers like A123 Systems have gone under.

2). Solar prices hurting manufacturers: Solar prices kicked solar makers in the teeth in 2012 (and yes, this is also one of the best things). There’s been dozens of solar companies that have closed factories, gone bankrupt or gotten out of solar completely in 2012. It’s even affecting solar thermal companies, which make systems that use mirrors to harness the sun’s rays to make heat, as well as solar concentrating thermal companies, which have developed hybrid systems.

3). Natural gas prices undercutting clean power projects: Super cheap natural gas might make the U.S. energy independent and lower overall carbon emissions, but the low prices are making wind and solar projects less economical. Expect higher natural gas prices in 2013, as they really can’t get much lower.

4). Cleantech got politicized: Cleantech, clean energy and electric cars became fodder for the U.S. Presidential election and it has yet to recover. Somehow clean energy became a cause to fight for by the left, and fight against by the right, despite that some red states are adding clean energy jobs at a faster rate than blue states. Hopefully that will die down now that the election has been decided.

5). Lots of cleantech investors lost money: Many of the generalist venture capitalists that put money into cleantech over the last 5 or 6 years have lost money, and decidedly pulled back on investments in 2012. That will continue in 2013. Though, this is also a good thing, as it is weeding out investors that didn’t make money. The same thing happened in the dotcom bust.

6). World coal domination: As developing countries look to add more and more cheap energy, coal is becoming the defacto energy option. By 2017, coal could replace oil as the largest source of energy. That’s really bad as coal doesn’t just have a lot of emissions, but it has other problems like air pollution, and safety issues for workers. There’s a time factor for clean technologies, and if the world becomes even more dependent on cheap fossil fuels it’ll be hard to turn that boat around.

7). UN climate change discussions: Every year they don’t deliver on important decisions, and end up determining just the very basic needs in the 11th hour. It’s time for a new method of discussion, and a new way to make these important decisions.

8). Advanced Equities: The Chicago broker that raised funds for capital intensive cleantech companies like Fisker, Bloom Energy, SolFocus and Serious Energy, was charged and settled with the SEC over lying to investors. It makes the entire industry, and particularly the VCs that invested early in these companies, look really bad. Thanks guys!

9). Solyndra still hurts in 2012: Despite that Solyndra’s fall was over a year ago, the ghost of the company is still hovering over cleantech deals, investment, political discussions, and the public’s view of solar.

10). Expensive and slow moving battery innovation: One of the reasons electric cars are still not mainstream is because the batteries needed to power them are too expensive and don’t give the cars enough range. While there are a lot of innovative new battery startups, chemistry just moves a lot slower than computing innovation. Sigh — look out another decade for game changing battery innovation.

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• Ups and downs for cleantech in Q1
• A near-term outlook for big data
• Big data meets the smart grid

AutoGrid is officially launching on Monday, though the Palo Alto, Calif.-based company was founded in 2011. While a variety of big data energy startups have emerged in recent months (like Bidgely, and Stem) AutoGrid has a particularly impressive team, it’s got investors that know the smart grid sector well, and it’s already got some utility customers, including the City of Palo Alto Utilities and Sacramento Municipal Utilities District.

The company’s team includes founder and CEO Amit Narayan, who was the director of Smart Grid Simulation Research at Stanford University; CTO Chris Knudsen, who was the Director of the Innovation Lab at PG&E;  and VP of Business Development Andrew Tang who also hails from PG&E. AutoGrid has raised $9 million from investors including Foundation Capital — which has backed other smart grid plays like Silver Spring Networks — as well as Voyager Capital and Stanford University, and the company is also working on projects with the Department of Energy’s ARPA-E program.

So what is AutoGrid selling? It’s created a software platform it calls the the Energy Data Platform (EDP), which takes petabytes of grid data — both structured and unstructured — and crunches it to predict and analyze what it happening on the grid in real time. AutoGrid can then provide services to its utility customers like predictive applications, optimization of the grid, or analyzing trends in energy usage. The platform is cloud based and can be delivered via private or public clouds to utilities and broadband providers (like a cable company) and requires no extra hardware.

The data that will be ingested into AutoGrid’s analytics comes from the utilities’ increasingly connected devices like smart meters on every home, and connected substations and transformers, as well as publicly available data like weather and demographics. AutoGrid’s Narayan tells me that because they don’t sell or make any hardware, they can more easily partner with all of the companies that are making these types of connected home and grid energy devices, like a Nest  smart thermotstat or a RuggedCom router for the power grid.

While the power of such a platform could be huge, AutoGrid needs to start off by selling specific applications. It’s first product is analytics for demand response, which is when utilities curb energy consumption of its customers at different peak times of day (like a hot summer day in the afternoon) to better manage the grid. AutoGrid says its demand response application can help utilities review their programs and cut the cost of their demand response systems by 90 percent and also increase the response rates of the customers in the program by 30 percent.

Both the City of Palo Alto Utilities and  Sacramento Municipal Utility District (SMUD)are using this demand response product. Utilities, which tend to be conservative when it comes to using new technologies, could be interested in AutoGrid’s tools, partly because it doesn’t require a huge commitment of time or money to test them out. The utility just needs to give them access to their data. Narayan tells me utilities can use its tools to be more innovative and to try out new services. Remember AutoGrid has two former PG&E execs in its upper management, who are familiar with the difficulties of rolling out smart grid tools from the utility’s perspective.

For the power grid to be much more efficient — and be able to include electric vehicles and clean power like solar and wind — it needs the type of real time intelligence that AutoGrid’s platform can provide. Some companies are working on similar software tools — for example, Tendril recently has shifted its focus away from hardware and more towards creating a software layer for the power grid. Stem is a startup that recently revamped and uses data and analytics — as well as energy storage — to predict and analyze the energy use of companies’ buildings. Bidgely is a new startup that is looking to crunch smart meter data to deliver information about home appliance use in real time.

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• The Smart Energy Home

Empower consumers

The most direct way to do this is to go straight to consumers and let them monitor their power usage so they can change their behavior accordingly. This is where companies such as Wattvision and PlotWatt come into play by connecting to users’ smart meters and displaying energy usage, warnings on thew web and mobile apps. It’s simple information, simply delivered.

Empower utilities to empower consumers

On the other hand, some startups are taking a more-removed approach to reaching consumers by partnering with utility companies, device manufacturers and others to offer a deeper service than an app can provide. Opower, for example, uses big data technologies to let utilities provide advanced analysis of power usage to their users. Companies such as EcoFactor, which announced $8 million in new funding on Thursday, lets utilities offer smart thermostats that users can control over the web, but also uses energy data and weather data to automatically adjust the temperature for maximum efficiency.

Tendril is among the kingpins of this space. It has a slew of utility and appliance partners, as well as a cloud platform on which developers can build applications that leverage its vast collection of energy data. Underpinning all of this is some serious data analysis that, like what Opower and EcoFactor do, learns and recommends based on users’ behavior.

Just make buildings more efficient

Somewhere in the middle of the power-to-consumer and utility-partner approaches lies WegoWise. It’s trying to lower energy costs in multi-family units such as apartment buildings in order to save both landlords and tenants lots of money. It’s also not relying heavily on complex algorithms — just lots and lots of data to help property managers see clearly where their units can stand to be improved.

According to WegoWise Founder and CTO Barun Singh, his company analyzes utility data for about 10,000 multi-family units and collects data from about 500,000 utility bills. Its customers aren’t the types that can justify equipping their properties with lots of sensors and real-time information systems, but they do need some sense of how their buildings are performing energy-wise. So, he explained, WegoWise will let customers compare usage across their own property portfolios, as well as against other similar buildings.

Singh said he thinks services like WegoWise will help ensure more buildings get retrofitted because property managers can identify upfront which ones might need the most work right away. Once they know this information, they can schedule an energy audit and have an expert identify the steps necessary to improve efficiency. The alternative, he said, is for someone to get audits on all their buildings — an expensive proposition they might rather avoid altogether.

“Our goal is not to replace the auditor,” Singh said. “Our goal is to ensure more audits are done.” Already, he added, WegoWise is working with an affordable-housing organization in the Boston area and has identified “huge savings” that landlords could make to save their residents money on their power bills.

On top of their utility bills, WegoWise asks customers for about 30 additional data points — “enough [data] that we can actually do something useful with it,” Singh said. Factors such as year built, living area, type of building, materials and other things can provide valuable insights about how much energy certain units should be consuming assuming normal usage by tenants.

But the key to making WegoWise work — just like consumer products such as Nest, EcoFactor and PlotWatt — is making it a joy to use, Singh said. It has to use data and infrastructure everyone already has, so as to not be too cumbersome. But in aggregate, that ends up generating a lot of information. “It turns out if you have a whole lot of that data,” Singh added, “you can actually do some interesting things.”

Feature image courtesy of Shutterstock user Kovalchuk Oleksandr.

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• Connected world: the consumer technology revolution
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• Big data meets the smart grid

For the past few years I’ve been negative on home energy management. Sales were slow. And hundreds of companies were fighting for a piece of that tiny pie. (Yes, I said hundreds. Research firm Groom Energy has identified more than 300 companies in the energy management space.)

Today I’m going to reverse my stand and predict that the sector is about to turn the corner, starting now, accelerating in 2013 and becoming widely known in 2014. Sales are rising (albeit gradually). And at least four companies are starting to separate themselves from the pack. Opower and Aclara in the data presentment subsector. And Tendril and Silver Spring Networks in data presentment + device control.

In this article, I want to talk about Tendril and its prospects. As widely reported in the press, Tendril recently went through layoffs. Today it has 160 employees, with four offices in the U.S. and one in Australia.

Despite the layoffs, I think the company is positioned for a rebound. First, the sector is slowly ticking up. Pike Research says the category will grow at 38 percent per year to reach $2 billion by 2020. Groom Energy is even more optimistic. It says the energy management software category (which includes commercial and industrial as well) is already a $5.2 billion industry in North America alone and is growing at 40 percent per year.

Second, the company is positioning itself to be a leader in the next phase, which — as I’ll explain below — will be about automation.

Tendril’s beginnings

Tendril began by creating a platform to connect wireless sensors, with an emphasis on the ZigBee protocol. Once that had been accomplished, the company started to look for problems that its solution could solve – that is, to look for sectors that would soon have many wireless sensors on the network.

Tendril dabbled in building automation and parking automation and home health before stumbling upon the nascent smart metering market. The company reoriented itself to sell to utilities because “when we started, there were very few ZigBee-enabled devices except for smart meters,” explains Ivo Steklac, Chief Sales and Strategy Officer.

Tendril’s first order of business was to solve the connectivity piece – to learn to talk back and forth with all the meters and other devices. Once that was accomplished, it started to look for additional value it could provide from that connectivity. And from all the data it was collecting.

Tendril Products

That quest for added value led Tendril to purchase Grounded Power, a startup using behavioral science for customer engagement. It is that technology that forms the core of Tendril’s current differentiation. (But I predict it will NOT be the heart of the next phase, as we’ll discuss.)

Tendril’s current differentiator

When I asked Ivo Steklac how Tendril differs from the competition, he made this claim: “We are the only company that does both consumer engagement and consumer enablement.” Whether or not you agree that Tendril is unique in this regard, you should pay attention to the company’s dual goals. Eventually, every utility needs to achieve both.

The first piece is engagement – getting consumers to pay attention to and to sign up for utility programs. Utilities have several tools here, including paper reports, online portals and social media.

Tendril wants to see its utility clients move to an online presence as soon as possible “because that is where you can best accomplish the second piece – enablement,” says Steklac. Enablement means providing consumers tools that give them more control over their bills and their energy use. With the software provided by Tendril, for instance, utilities can give customers personalized energy-saving recommendations; or offer them new tools such as communicating thermostats; or sign them up to special programs. It is online that a utility can “recommend action and fulfill it at the same time,” he explains. “The software lets you have a dialogue with customers, not just deliver a speech.”

The power of variables

To make those customized recommendations, the Tendril software considers 600 to 700 energy variables, including but not limited to:

• Building envelope: age, size, number of levels, attic, basement, garage, aspect ratio, building orientation, age, internal mass, roof construction, roof reflectance, etc.
• HVAC: age, type, efficiency, zoning factor, cooling schedule, setback schedule, etc.
• Weather data:  temperature, humidity, wind speed, insolation etc.
• Pool/hot tub: size, heated, heating fuel, solar cover, etc.
• Lighting: types, quantity, hours of operation, home/work schedules, etc.
• Occupancy: number of occupants, ages, home/work schedules, etc.
• Kitchen: appliances, electric/gas, load, efficiency, appliance schedules
• Laundry: washer, dryer (electric/gas), loads, efficiency, water consumption, etc.
• Electronics: number and type (TVs, cable boxes, DVDs, audio, PC’s/laptops, tablets, cell phones, cable modems, gaming consoles, printers), schedules, etc.
• Water heater and use: age, fuel type, rated input (BTU/hr), water temp, delivery temp, energy factor efficiency, recovery efficiency, use hrs/gallons, etc.
• Solar electric: array tilt, azimuth, efficiency, temp coeff, inverter load curve, nominal power, etc.

The software can also use its behavioral model to make offers only to those customers most likely to sign up.

What comes after engagement and empowerment?

Tendril has been perfecting customer engagement and empowerment in concert with utility partners. (To learn more about Tendril’s utility partnerships, click the links below to review the slides and/or watch replays from two recent webinars.)

• Leveraging Behavioral Science for Persistent Customer Engagement featuring Kansas City Power & Light
• The Science of Customer Engagement featuring Duke Energy

The next step, Steklac tells me, will be to move toward automation, and I heartily agree. I’ve long argued that relying on consumers to change behavior is at best a stopgap. It will be far better and far easier to train devices to be smart about energy than to train every customer.

I’m talking here about automated demand response and automated energy efficiency. I’m talking about a future world of smart, connected appliances; of grid-connected HVAC systems; of grid-savvy electric vehicles; and of many other smart devices, all of them connected by an underlying control platform.

Tendril Insight

I think autoDR and autoEE are poised for growth because:

1. The autoDR spec is out
2. The SEP 2.0 profile is finally ready
3. Hardware prices are coming down
4. Utilities are realizing what a pain it is to rely on fickle consumers to change their behavior in order to meet your goals.

The upshot: Right now Tendril is battling with Opower to be the best at behavioral science. In the future, they’ll need to be the best at controlling devices. Certainly Aclara and Silver Spring see this future too. And I can only assume that Opower is working with Honeywell and other partners to bolster its device capabilities.

So Tendril wants to grow from its current behavioral emphasis to be the leader in the automation phase. And they have a reasonable shot at success, especially when you consider that this evolution actually takes them back to their roots as a control platform.

(What comes after automation? Optimization in near real time… but I will leave that to a future analysis.)

Challenges

I see at least eight challenges Tendril must overcome. (Most of them apply equally to Tendril’s rivals, by the way.)

1. Getting to scale. I believe 2013 will be the get-big-or-go-home year in home energy management. Or at least “get big enough to seem stable.” Utilities may do pilots with tiny startups. But when it comes to system-wide deployments, they want a partner who is sure to be around for the long haul. As we move out of the trial phase and into the deployment phase, utilities will want to know that companies are past the “valley of death” and close to cash-flow positive. I think the leaned-down Tendril is within striking distance.
2. Providing lots of energy management applications. Both utilities and consumers will want to know how many apps the company has in its “apps store.” Tendril is beginning to have a strong story in that regard, thanks to its long-term platform orientation and its Tendril application developer support program.
3. Overcoming consumer apathy. Only a small percentage of customers really care about managing their energy. For the rest, the effort is just not worth the $5-$10 per month in typical savings. Only when the industry finally gets to automated systems will utilities truly be able to tap into residential demand response. Which brings us to…
4. Automating demand response and energy efficiency. We are all coming to realize that relying on consumers to change their behavior is not a great long-term solution. Far better to automate as much as possible (while still allowing customers to set their preferred parameters, of course). Achieving that automation will be Tendril’s next big hill to climb – and the computational challenge will be even steeper than with its current behavioral approaches. Here companies like Tendril and Silver Spring may have an edge over companies focused primarily on behavior.
5. Overcoming regulatory hurdles. It’s not just that Tendril needs regulatory mandates and incentives to “persuade” utilities to adopt demand response and energy efficiency. It’s also that some PUCs are suspicious of targeted marketing. Tendril’s mantra is personalization, giving customers only what they are most likely to want. Some PUCs believe that anything offered to one customer set must be offered to all customers, at the same time and on the same terms.
6. Expanding past residential. Some utilities may prefer to deal with one partner for all customer programs, whether residential, commercial or industrial. Can Tendril grow beyond its residential roots? And should it? Or should it remain focused on consumers? The real action these days is in small- to mid-sized commercial. What’s more, many companies currently focused on commercial & industrial have residential in their sights next.
7. Competition from adjacent sectors. Yes, I believe the home energy management space will see some failures and some consolidation, reducing the confusion. On the other hand, dozens of companies from adjacent sectors are crowding into the residential space. All this noise makes it hard to get noticed no matter how good your offering.
   For example, here is a partial list of overlapping sectors. I’ve included an example for each, but in reality each category has many competitors: big box retailers (Lowe’s), cable companies (Comcast), home security companies (ADT), controls vendors (Schneider), demand response providers (Comverge), energy efficiency specialists (C3), metering companies (Aclara), smart device makers (Nest), unified operations centers (Calico Energy), utilities on their own (ConEd).
8. Venture capital overhang. Tendril has obtained roughly $90 million in venture funding and convertible debt. Some of it comes from industry sources such as Siemens Venture Capital and GE who can be presumed to have a long-term view. But some of it comes from independent VCs who may have a shorter horizon. VCs typically want their money back — plus a fat return — in a relatively short time frame. And some of those VCs can get pushy if a successful exit fails to materialize on schedule. (Just ask GridPoint.) If they lose faith, they may press Tendril to accept a less-than-ideal buyout offer from a larger firm, or otherwise compromise Tendril’s options.

If you want evidence of Tendril’s progress, click to view a recent Tendril press release that documents some of the company’s recent milestones. And feel free to use the Comment form below to agree, disagree or expand on my commentary.

You may also want to read…

• Opower moving into devices as energy management battle heats up
• Home energy management continues to hit roadblocks, study confirms
• Energy management app competition lets consumers do the judging

From the SGN Research Marketplace…

Building the Technology Framework for Home Energy Management: This IDC

Energy Insights report provides analysis of the home energy management (HEM) technology stack based on our interviews with utility decision makers including chief information officers (CIOs) and solution providers. Many utilities are somewhere on the continuum of piloting programs such as demand response, load control, energy efficiency, and customer education; all of them could involve home energy management. Get details here.

Jesse Berst is the founder and chief analyst of Smart Grid News.com, the industry’s oldest and largest smart grid site. A frequent keynoter at industry events in the U.S. and abroad, he also serves on advisory committees for Pacific Northwest National Laboratory and the Institute for Electric Efficiency. He often provides strategic consulting to large corporations and venture-backed startups. He is a member of the advisory boards of GridGlo and Calico Energy Services.

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While a lot of companies are tackling this problem, the key to what makes PlotWatt interesting is that the startup can monitor the energy consumption of individual appliances without using monitoring hardware. Other startups are selling sensors or smart plugs that can track the energy consumption of unique devices, but PlotWatt says its smart algorithms can determine this type of detail without any hardware at a greater than 90 percent accuracy level.

No hardware means a more capital-efficient business model, and it also means customers can more easily adopt the technology, PlotWatt CEO and founder Luke Fishback told me in an interview. The team spent over two years developing the algorithms that can produce that type of accuracy. Gadget giant Belkin bought a startup called Zensi a few years back that created algorithms that can do something similar by listening to the voltage noise of appliances.

PlotWatt, based in Durham, N.C., isn’t targeting residential homes first. For now it’s focused on selling its algorithms to restaurants and fast-food chains that are looking to use metrics to reduce their energy use, determine faulty appliances, or monitor how workers are using the energy-consuming tools in the restaurant (Why did Betty say she got to work at 8 a.m. if she only started the cooker up at noon?). Fast-food chains have low margins and are looking to optimize their systems every way they can.

The company already has pilot programs with several of the top 10 national restaurant chains, says Fishback, adding, “They love metrics.” Selling to fast-food chains first means PlotWatt can bring in revenue while the smart-meter and smart-grid markets mature.

While less than 4 percent of the world’s 1.5 billion electricity meters were smart in 2008, that figure grew to over 18 percent by 2012, and it is expected to jump to 55 percent by 2020, according to Pike Research. Smart meters can commonly deliver data to homes and utilities in up to 15-minute intervals.

Eventually PlotWatt will focus more on the residential market, which Fishback calls “the sleeping giant of the smart grid.” The company could sell its algorithms to utilities or other service providers, or it could partner with device makers. Picture a Nest thermostat telling you to turn your lights off.

PlotWatt recently closed a Series A round of $3 million from existing investors including Felicis Ventures and Acorn Ventures. Fishback tells me the company will use the funds to start to ramp up commercial deployments, and the team plans to hire sales, marketing and business development execs.

Smart-energy algorithms could provide a crucial tool for helping people, homes, businesses and factories become more energy efficient. Other companies that have developed energy data algorithms include Opower, Tendril, Nest, Viridity Energy and others.

Image courtesy of xJason.Rogersx

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