Latest News: Technology |  Celebrity |  Movies |  Apple |  Cars |  Business |  Sports |  TV Shows |  Geek


Filed under: News


Why Nest Could Be A Nightmare For Google

Jan 14 2014, 1:46am CST | by

Why Nest Could Be A Nightmare For Google

Photo Credit: Forbes

Google’s headquarters in Mountain View and the California Public Utility Commission in San Francisco are only about 50 miles apart as the crow, or techie commuter bus, flies.

But when it comes to style and outlook on life, they might as well be in separate galaxies.

The Googleplex is the ultimate fantasy workplace. Fantastic food. Free bikes. Infinity pools in case you want to swim laps before a meeting. Jimmy Carter gives lunch hour lectures. I visited last May and shoulder-checked into the crown prince of Belgium in the hallway. Wealth freedom, opportunity, and Green Machines abound.

“This isn’t work,” the wife of a friend that works there said on her first visit. “It’s like adult day care.”

The CPUC, by contrast, is a symphony in linoleum. The most “foreign” dish in the cafeteria is Yoplait. Bureaucrats shuffle about inside, street people hover on the outside.

But it’s not the drab, hopelessness of the décor that stands out. It’s the public hearings. Several times a month activists gather to object to arcane rate proposals or natural gas pricing. I distinctly remember one hearing back in 2010 about PG&E’s plan to deploy smart meters:

  • One individual allegedly died from smart meters, said one witness. Granted, the witness admitted that the individual had cancer, but argued that smart meters accelerated the disease.
  • Another person quoted Shakespeare and said that smart meters violated the U.S. constitution.
  • Another analogized smart meter rollouts to the Nuremberg trials.
  • Another witness said that another person entered a home with a smart meter and felt sick. Then she put foil around the meter and felt 50 percent better.

It was an ordinary day.

So why is this a problem for the Google/Nest Love Fest? Nest sells thermostats that help people reduce power consumption. (It’s actually a robot, fitting in with Google’s robotic strategies.) While Nest makes money on the thermostat, one of the big profit centers, potentially, will be signing up Nest customers to contribute to demand response programs where homeowners turn down their thermostats during hot afternoons for money.

Nest founder Tony Fadell told Forbes last month that his company had struck deals with close to 20 utility companies, who paid Nest $30 to $50 per thermostat annually, to manage the energy usage of Nest customers who had opted into their utility’s demand-response program.

Demand response will play a fundamental role in managing power consumption and it’s a purely American invention. FERC estimates that demand response can replace 188GW of peak demand in the U.S. It’s even drawing the interest of European and Japanese utilities.

But here’s the catch. Demand response payments are heavily regulated. Is $30 to $50 too much to pay per thermostat per year? How do you measure the results? How does Nest ensure that the needed capacity reductions are delivered? Is it really fair to have a program like this that targets upper income households that might own a Nest?

What about competing thermostats from Ecofactor and ecobee? Can they qualify for similar deals? Should we offer rebates per thermostat, per therm or per square foot? And who owns the data and gets access to it?

CPUC engineers and regulators might be unfashionable, but they are scrupulous. They are going to want detailed answers to questions like those above and more before handing $50 per yearpaid by ratepayers across their states–off to a bunch of guys in Palo Alto. One of the big tragedies of green technology is that many companies didn’t realize that selling to utilities is far, far more challenging than selling to consumers or ordinary businesses. The utility business is intellectually engaging and interesting, but also painful and slow, and often for good reasons.

So imagine being the Google business manager trying to justify staying in home energy management, considering the time and legal expenses. Google already exited once before. There he is, listening to the Atlanta Citizens for Thermostat Justice ramble on about his experience in Home Depot. One quick call and I could get a helicopter ride to the airport and a plane to Burning Man. And I could double my salary.

Home energy is compelling, but it’s not for the fainthearted.

Source: Forbes

You Might Also Like


Shopping Deals


<a href="/latest_stories/all/all/31" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.




blog comments powered by Disqus

Latest stories

Getty Images
Courteney Cox at 50: 'Friends' star dazzles in smoking-hot bikini
The adorable actress, known for her role in U.S. sitcom, "Friends," is making waves in a 50-is-the-new-21 way.
George Takei came out because of Arnold Schwarzenegger
George Takei came out because of Arnold Schwarzenegger
Legendary Star Trek actor reveals why he came out. The reason is no other than Terminator actor Arnold Schwarzenegger.
Miss America 2014 Parade to Feature First Ever 3D Printed Shoes
Miss America 2014 Parade to Feature First Ever 3D Printed Shoes
Thanks to Maggie Bridges and Georgia Tech, we will see the first 3D printed shoes on the stage of the shoe parade
Vicki Gunvalson Flirting With David Beador
Vicki Gunvalson Flirting With David Beador
The Real Housewives of Orange County star Vicki Gunvalson admitted flirting with "hot" co-star David Beador

About the Geek Mind

The “geek mind” is concerned with more than just the latest iPhone rumors, or which company will win the gaming console wars. I4U is concerned with more than just the latest photo shoot or other celebrity gossip.

The “geek mind” is concerned with life, in all its different forms and facets. The geek mind wants to know about societal and financial issues, both abroad and at home. If a Fortune 500 decides to raise their minimum wage, or any high priority news, the geek mind wants to know. The geek mind wants to know the top teams in the National Football League, or who’s likely to win the NBA Finals this coming year. The geek mind wants to know who the hottest new models are, or whether the newest blockbuster movie is worth seeing. The geek mind wants to know. The geek mind wants—needs—knowledge.

Read more about The Geek Mind.