EcoFactor: Using big data to reduce home energy by 17%

EcoFactor, a startup that uses big data tools to act as a new brain for connected thermostats, has some stellar results from ten different trials where it automated the process of turning up and down consumer’s thermostats. The company, which launched at the end of 2009, says that on average its services can reduce a person’s home energy use by 17 percent compared to a programmable but non-optimized thermostat.

That’s a 17 percent reduction in a consumer’s energy bill, too, and EcoFactor found it could reduce consumer’s bills by up to $56 per month when its service was used. EcoFactor did many of its trials during demand response events for utilities, which are times (like a really hot day) when a utility wants to turn down the energy consumption of some users to better manage the grid. EcoFactor also found that it delivered better demand response events for utilities, providing a 36 percent increase in yield for utilities during the event.

As I noted back when the company launched: finally a smart way to control thermostats. I’m not sure why every utility, energy service provider and consumer wouldn’t want to use this. The only requirement is a connected thermostat (well, and waiting for the service to be available in your area).

Here’s how it works: EcoFactor collects thousands of data points — from weather to regional building codes to home value — that give a clue about how an individual home might use energy and also respond to a service that promotes energy savings. EcoFactor then combines that service with the consumer’s ability to manually override the system (i.e., press up and down on the thermostat). When a consumer signs up for the service, EcoFactor uses the first couple of weeks to set a baseline for how that individual user prefers the temperature in their home: When a person pushes up or down on the thermostat, the original baseline starts to get set.

Then EcoFactor’s service automatically makes over 1,000 micro adjustments per month to the thermostat, bumping it up and down every so slightly, so that the user doesn’t notice the temperature change but also reduces her energy consumption. During demand response events on a particularly hot day in the summer, EcoFactor can precool some houses, turning on the AC a bit before the demand response event; then it can turn down the power use of the house during the event while the house acts essentially as a thermal battery, and the residents don’t notice the inconvenience of having their energy use curbed.

EcoFactor is first and foremost targeting consumers as its end customers, but it is working via distribution channels like utilities, broadband service providers (cable, DSL) and home security systems companies to reach those customers. The only reason EcoFactor isn’t in more widespread use today is probably because partners like utilities and telcos are notoriously slow-moving when it comes to adopting new services. EcoFactor worked with Oncor in Texas and other unnamed utilities for its trials.

It’s still in the early days for the service. The demand response trials included hundreds of homes, and EcoFactor says by the end of the year (after its summer trials), it will have been tested in “tens of thousands of homes.” In the utility world, that’s still a small footprint.

But EcoFactor is one of the only companies out there in the energy and utility world that is truly leveraging big data tools and the cloud to make energy use smarter. (To learn more about cloud computing, come to our Structure event on June 22 and 23 in San Francisco.) And for those not used to reading energy reduction metrics, 17 percent is actually really high for an energy management service. In comparison, OPower’s smarter energy bills on average reduce consumer energy consumption by 2 percent. EcoFactor is backed by RockPort Capital Partners and Claremont Creek Ventures.