In a bid to drive clean energy and conservation efforts, Google is spinning out its Google Nest Renew business and partnering with Sidewalk Infrastructure Partners (SIP) to create a new company called Renew Home. SIP will invest $100 million in the venture and become the majority shareholder, while Google will hold a minority stake. The merger formalizes the existing collaboration between Google Nest and OhmConnect and aims to expand into both existing and new markets.
Renew Home will build on the success of OhmConnect, which currently has 226,000 homes on its platform in California, Texas, and New York. During the recent heat emergency in California, OhmConnect was able to provide the independent system operator, CalISO, with power equivalent to that generated by three power plants. With an initial capacity of 1.4 gigawatts of peak energy, Renew Home aims to have 10 gigawatts installed by 2030.
The mission of Renew Home is to help homeowners 'truly electrify their homes using smart devices' and participate in energy markets. By using Renew Home thermostats, customers can reduce their energy consumption during peak times and shift heavy usage to periods when renewable energy is more abundant and fossil fuel use is lower. This not only lowers electricity bills by around 10%, but also reduces carbon emissions.
The after-the-meter market, which focuses on residential electricity consumption, is highly competitive. Other thermostat makers, including Honeywell, are eager to establish their virtual power plants. However, Renew Home has no plans to incorporate occasional generators like hospitals and universities, which utilize standby generation during periods of high demand due to extreme weather conditions.
Renew Home's focus is exclusively on residential consumers, aiming to involve them actively in the virtual power plant concept while providing them with incentives, prizes, and additional cost savings. Utilities and Independent System Operators are increasingly turning to demand response and distributed energy resources to meet electricity demand during times of stress. For instance, David Naylor, president of Rayburn Electric Cooperative in Texas, reported saving 10% of power through resource management and demand response initiatives.
Looking to the future, speculation suggests that virtual power plants may tap into domestic batteries like Tesla Powerwalls and incorporate rooftop solar installations, as well as leverage latent generating capacity in emergency generators. This reflects the 'Uberization' of non-utility generation, promoting decentralized and sustainable power solutions.
Renew Home is set to receive revenue from ISOs, similar to Google Nest Renew and OhmConnect. SIP's $100 million investment will primarily be allocated towards marketing efforts and expanding the company's reach in the three states where OhmConnect currently operates, with plans to enter new markets soon.
While Google remains involved, it now takes a more silent role in homeowner energy management, allowing the Renew Home team to lead the charge, albeit with valuable input from Google thermostats.
The formation of Renew Home is an exciting development in the realm of clean energy and virtual power plants. By empowering residential consumers to actively participate in energy markets, reduce their carbon footprint, and enjoy cost savings, Renew Home is paving the way for a more sustainable and resilient energy future.
