SolarCity and Nest offer a glimpse of the future 

Source: David Ferris, E&E reporter • Posted: Wednesday, April 15, 2015

SolarCity, the country’s hungriest solar installer, and Nest, the maker of the highest-profile thermostat, announced a partnership yesterday that hints at how rooftop solar and the connected home might play together.

The program, offered in California, gives a free Nest thermostat to the first 10,000 homeowners in the state who sign up for solar panels from SolarCity and also agree to be part of Nest’s growing ecosystem of connected home devices. As soon as this summer, the two may start to link, seeking energy efficiencies when the sun is shining.

The sales pitch to the homeowner is a combination of dollar savings. Nest says it can save customers as much as $145 a year on energy bills by automatically managing the thermostat, and SolarCity over time can reduce the power bill through the feed from rooftop solar panels (EnergyWire, Feb. 4).

But the story can also be seen as that of two ambitious Silicon Valley companies betting that by combining their high-profile names, they can wrest market share from their rivals.

SolarCity, the nation’s leading solar installer, with 34 percent of the market, has made two major announcements just in the last month, one, described in the San Jose Mercury News, about its venture into microgrids and another about a sales partnership with DirecTV.

Meanwhile, Nest, owned by Google and a 20-mile drive south SolarCity’s headquarters, is slugging it out with rivals from Samsung to Comcast to ADT to be the operating system for the connected home. Analysts have estimated it is a market that will be worth tens of billions of dollars by the end of the decade.

The Nest-SolarCity partnership is a sign that two major trends of the decade — distributed solar power and the connected home — are starting to combine in ways that make them greater than the sum of their parts.

A post on SolarCity’s blog yesterday said the company “will work with Nest to develop ways for solar customers to maximize their energy savings so that one day SolarCity can regulate the home’s air conditioner, pool pump and other appliances based on the availability of inexpensive, clean solar power.”

Nest has done big giveaways of its thermostats in programs with utilities and even with one of SolarCity’s main rivals, SunRun, described in a blog post on SunRun’s website. But the initiative with SolarCity will be Nest’s first attempt to integrate data from solar panels into Nest’s inner workings.

“There had been some desire from both SolarCity and Nest to be able to work together for a while,” said Brian Farhi, a lead channel developer with Nest who joined the company last year after a long career in the solar industry. “SolarCity is one of those solar companies that on the technology level has a lot of emphasis on innovation.”

SolarCity will become the first entity that is not a utility or government agency to be part of Nest’s efficiency program, called Seasonal Savings, which uses the thermostat to automatically tweak energy use in the summer and winter.

By as early as June, the new Nest-SolarCity customers in California may start seeing other integrations between the two, Farhi said. They may start with energy-use messages but may lead to deeper integration with other products under the Nest umbrella.

Nest has a mushrooming roster of partners in its connected-home program, called Works with Nest (EnergyWire, Jan. 9). They now number 7,000, from major corporations to tinkerers, said Ha Thai, a Nest spokeswoman.

Some reveal that Nest is moving into a closer integration with electrical systems. One partner, Insteon, makes high-voltage electrical switches, and some solar-inverter manufacturers are applying to join, Farhi said.

Privacy advocates worry that the connected home creates more avenues for a home to be hacked (EnergyWire, Aug. 8, 2014).

As part of the Works with Nest program, a homeowner gives permission in much the same way that an app asks for permission when installing itself on a smartphone, Farhi said.

For the Works with Nest program, some common permissions for access to information include knowing whether or not you’re home, the temperature on the thermostat, and whether a peak load event is underway. Another is access to information from Nest’s smoke and carbon monoxide sensors.