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Are Smart-Grid Appliances Ready for Prime Time?

Control appliances with Smartphone apps

Smartphone apps allow users to control smart appliances at their convenience, starting, stopping and changing functions remotely. Photo courtesy of LG.

Working to save consumers energy, money and time.

Smart products are here, ready or not

Although smart-grid appliances are still in their infancy, consumers are growing more familiar with this technology that promises energy savings for owners and utilities, plus a new level of connectivity in homes.

Manufacturers are rolling out products and features so fast that it can be hard to keep up. Here's what you need to know to be smart-appliance savvy.

Why do we need smart appliances?

Global energy consumption is predicted to triple by 2050. These numbers from the U.S. Department of Energy show just how vital home energy management will be in curtailing demand:

  • Residential housing consumes 37 percent of electricity produced in the U.S.
  • Appliances, lighting and HVAC represent 82 percent of household energy consumption.
  • U.S. households spend $1,400 per year on energy.

Utilities across the U.S. and the world are implementing residential smart meters to help improve grid efficiency and reduce electrical demand and costs, particularly during peak hours (typically 2–7 p.m.). They will also give information to consumers and smart appliances, so that both can adjust to less expensive and demanding options.

Where are smart meters in use?

There are now more than 46 million smart meters installed in U.S. homes, according to the Edison Foundation, with millions more coming.

Pilot programs in Louisville, Detroit, Martha’s Vineyard, Chicago and elsewhere, done in conjunction with appliance manufacturers, have turned up encouraging results. In Detroit, pilot customers reduced their energy bills by 11 percent, a $270 savings, over a 16-month period.

But you don't have to have a smart meter to start using today's smart appliances.

What can smart appliances do?

Smart products are rapidly becoming more useful and intriguing. As with the evolution of personal computers, manufacturers are touting models with greater capabilities and lower prices as the technology moves forward.

While the main reason for using smart appliances is energy reduction, many offer time savings and remote control through cellphones, which appeals to many consumers. Turning appliances on and off remotely, pre-heating an oven or turning up the AC via a smartphone is becoming routine, but there are many more options on the horizon.

Whirlpool's 6th Sense Live appliances can automatically run when power is cheapest. By pressing the smart-grid button, the homeowner's refrigerator, which is hooked up to an online database of energy prices, will choose the least expensive time to defrost. The dishwasher will turn itself on when the price is right, often after midnight. That can cut an appliance's energy bill in half from peak use rates. (Owners can override those choices if they need to.)

On the time-saving front, some Samsung refrigerators have a built-in touchscreen that keeps track of food inside and can provide recipes using what you have on hand. LG has launched a feature that lets owners call up a list of what's in their fridge on their phone, to assist shopping. In South Korea, LG's home base, people can grocery shop online from the touchscreen. The Health Manager provides meal plans based on the user's age, sex, weight, height and BMI. Look for those features to hit the U.S. soon.

The most-accessible smart features on the market are diagnostic. They allow owners to connect to customer service with a cellphone, so the product can emit a diagnostic code to analyze problems. Minor needs, like a refrigerator water filter, might be handled by homeowners, but if repairs are necessary, the technician shows up knowing exactly what’s wrong. Diagnostic options run about $300 extra on Whirlpool refrigerators; advanced touchscreen models can be in the $4,000 range.

Manufacturers are also launching smart water heaters, lighting systems, thermostats, HVAC and home management programs.

Who is the customer for today's smart appliances?

Early adopters are most likely to purchase smart appliances, but these products are not yet big business. According to Pike Research, they totaled $613 million in sales in 2012, a fraction of the world market, but they will be the standard in a few years, experts say.

Making sure smart appliances stay relevant to consumer needs after purchase is a huge issue that has not been solved. GE and LG have launched some post-installation upgrades for smart products, but when large appliances sit in the average U.S. kitchen for 14 years, there has to be a cost-efficient solution to come.

Experts say replacing individual home appliances with smart options as necessary is a good way to get familiar with that technology, but that as time passes, products will improve, the smart grid will come to your client’s home and prices will no doubt decline, making them, indeed, a smarter buy.