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Tendril Seeks the Middle Road in Home Energy Management

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Tendril Networks, a stalwart in the home energy management (HEM) space, has announced plans for full-scale commercial deployments in millions of homes by the second half of this year. The startup has helped define the HEM space over the past few years, but with these projects, a critical opportunity for the company arises: to stand against an increasingly varied set of challengers or be left behind.

Tendril represents more of a “classic” model for home energy management which involves dozens of utility pilots using a combination of in-home devices and software that link to utility smart meters, at prices expected to be around $100 and up per home. But now, Tendril faces companies like OPower, who have cheaper offerings that don’t need in-home technology, and challengers from the higher end, tech-rich side, such as Control4.

I’m not sure just how Tendril fits into this new landscape:

Tendril is not as cheap and easy as OPower. Rising HEM star OPower has come to define the cheap, light-touch method of getting homeowners to save energy, with tens of millions of homes in dozens of utility deployments. OPower’s data analysis and behavioral modification methods yield 2 to 4 percent efficiency gains — low compared others in the space. But it’s easily scaled up to millions of homes at a cost of tens, not hundreds, of dollars per customer, since it doesn’t need in-home devices, or even smart meters.

Tendril is not as rich as Control4. Salt Lake City-based Control4 recently launched a 20,000-home commercial project with Nevada utility NV Energy. Control4’s EC-100 system costs about $200 per home for a basic system that connects to thermostats; more complete home automation costs more. Also, it uses broadband connections to link utilities to their customers, though it can use slower and lower-bandwidth smart meter connections as well.

In exchange for those extra costs, Control4’s system can hook up lights, TVs, stereos, home security systems and other devices to shut off when people leave home for work or during utility peak load events. That can drive much deeper efficiency gains than systems that rely on homeowners to flip switches. Silver Spring Networks’ pilot with Oklahoma Gas & Electric, for example, proved that automated systems can cut 57 percent from peak load and 33 percent from overall energy usage. Simple in-home displays yield behavior changes worth 10 to 15 percent by comparison.

How is Tendril responding to these challenges? In October, it bought startup Grounded Power, a company with deep behavioral analysis to meet OPower’s challenge. Market share matters — both Tendril and OPower can use customer data to shape and market their energy efficiency pitches. But OPower’s approach does lack something Tendril could do, which is to automate home energy controls, unless OPower adds such a device to its portfolio.

What about competing on the high end? Tendril canceled its $200, full-color touchscreen Vision home energy dashboard in February, and hasn’t said how it might link with devices from partners like General Electric. Tendril also lacks Control4’s existing retail and home contractor relationships for non-utility paths to getting into the higher-end homes. Tendril considers utilities its chief customers, which constrains it to much lower utility price points.

Still, that focus on utilities might be the key to sticking to a middle-of-the-road approach for Tendril. Utilities need technology cheap enough to justify deploying en-masse. Lower-income or elderly customers who can’t afford or aren’t interested in a high-end technology platform are a particular concern, since they have vocal and well-connected representation in the hearing rooms of state utility regulators. Designing a system that delivers the same savings to the last-adopters, so to speak, as well as the first adopters, may be the final test for every home energy management startup out there, Tendril included.

Question of the week

Where does Tendril fit in amongst its low-end and high-end competitors?