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GE's Smart Home: A Tester's Review

Posted by: Michael Arndt on July 17, 2009

This is a guest blog by Venessa Wong, who joined BusinessWeek’s Innovation+Design team in June.

General Electric hosted what it called a Smart Grid Symposium on July 14 to publicize plans for a “net zero energy home.” This is a smart grid project that would allow residents to generate their own electricity from, say, solar panels and sell it back to the local utility Meanwhile, they’d reduce power consumption by using “smart appliances.” Bottom line: No individual electricity costs by 2015.

At the event, at GE’s Global Research Lab in Niskayuna, N.Y., I spoke with Mark Brian, manager of home energy management at GE’s Appliance Park in Louisville, Ky., about his experience as a participant in a smart home pilot that began eight months ago. The family is saving money but the lower utility bills come from not just smarter usage, but having more-efficient appliances, as well as a cooler summer.

GE’s smart grid relies on using pricing data to alter consumer behavior. In the pilot, washers, dryers, refrigerators, electric stoves, and dishwashers connect to a smart meter that communicates with the power utility. A monitor gives residents real-time updates about power usage in the home and electricity prices, which fluctuate through the day, so they can make a choice: use the appliances now or program them to run later when prices are low.

“It was a little strange at first,” says Brian. Taking their cues from power prices, his family changed the time for activities such as cooking and doing laundry. During the winter when peak price occurred between 5 p.m. and 10 p.m. his wife, Dana, did the wash before 5 p.m., he says. The dryer, one of the most energy-intensive appliances, waited until after 10 p.m. to turn itself on.

Smart appliances also go into power-saving mode when prices are high. For instance, the dryer may switch to a low-power mode; that saves money though it lengthens the cycle time. Smart refrigerators defrost run only during off-peak periods.

Add it all up, and the Brian household reduced its bill in June by 18% or $26 compared to a year earlier when they were on a flat-rate plan. A significant portion of the savings came from using less electricity. A milder summer had to do with that, and the Brians also set the thermostat at a higher temperature. Also, their new GE appliances use less power. Smarter behavior—running that dryer at night, for instance—helped them to avoid buying electricity at peak prices and saved about $2 a month compared to a flat-rate plan, as the cheapest electricity in the tiered plan cost slightly less than the flat rate.

Brian expects the savings will be greater as electricity prices rise and technologies such as solar panels, small wind turbines, geothermal heat pumps, and batteries for energy storage are added to the smart home.

GE plans to further integrate these technologies with an interactive display called Home Energy Manager, which is still under development and may be available by 2010. In addition to providing energy pricing and usage information, the manager will monitor how much energy the home is producing and allow users to choose whether to sell it to the utility.

While more people seem to be growing environmentally conscious, the key driver for changing behavior continues to be financial. Brian hopes the increased communication between the appliances and the Home Energy Manager will make saving more convenient.

“You don’t want to turn off the hot water heater every time the electricity goes up,” he says. “The system should take care of it.”

Reader Comments

Mark Brian

July 19, 2009 3:45 PM

I need to make a clarification in this article. My overall bill is down almost 20% since I received the smart appliances and started modifying my consumption behavior. The $2.00 savings number quoted above is a comparison to my actual "variable rate" bill, and what my bill would have been if I had paid a flat rate of 6% per kW-hour. What this tells me is that I have successfully avoided the price increase that came with time-of-use pricing. Overall ... my bill is still down 18%-20% on average and I'm successfully bypassing the electricity price increase!


July 24, 2009 12:46 PM

Mark - thanks for clarifying that in your comment above. I was a bit disheartened to know that such a great project didn't have much impact financially, but now I'm reassured. Things like GE Smart Grid and Google Power Meter have tremendous potential in making an impact on the earth's sustainability. Kudos to GE for this initiative!

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