Last week, two major trends made news in energy. The Wall Street Journal reported that Google and Amazon are hoping to expand the market for home energy efficiency products like smart energy devices and internet-connected devices like Amazon’s Alexa that are used to manage energy demand by incentivizing consumers to use less electricity during peak hours, and also collect information about individual energy use. According to The Journal:
- In the not too distant future, these companies will provide solar panels, battery storage, and electric vehicles keyed to those consumer’s demand.
- Home energy consumption analysts found that spending on home-energy devices exceeded $40 billion in 2018 and they expect that number to double in the next five years.
- Google sees the potential for energy savings at scale by harnessing the power savings from small changes across a large number of people, which can provide great benefits to power companies, the energy grid, the environment, and consumers.
- Amazon now has a service that installs, and then helps consumers program and manage “smart” home tools like home-installation business, Amazon Home Services, to help consumers set up and manage a smart home to manage thermostats and lights, and is looking to partner with utilities to incentivize consumers to switch to smart home technology.
Corporations are also looking to lower their carbon footprint by buying more renewable power. On last Friday, Forbes cited new data reported by BloombertNEF showing “that corporations bought a record amount of 13.4GW of clean energy through power purchase agreements (PPAs) in 2018, well over double the previous record of 6.1GW set in 2017.” According to Forbes,
- Facebook was the biggest buyer — procuring 2.6GW of capacity, which was more than three times as much as the next biggest company, AT&T.
- In general, because they need lots of power to run their data centers, high tech companies are the biggest purchasers of clean energy.
Why This Matters: Government policies can go a long way to incentivize smarter energy choices — both for individual consumers and for corporations. But the markets themselves — the availability of new technologies for energy conservation and for affordable renewable energy — will also provide the impetus for change. If there were no opportunities to make money or improve the bottom line, companies like Amazon, Google and Facebook would not be rushing into this space.