Sense raises $105M to bring real-time home energy data to the masses

Sense, the energy-disaggregation startup that raised $105 million last week, got its start selling what CEO Mike Phillips calls its ​“fancy energy monitor.” That’s a $299 device that can distinguish how much energy is being used by air conditioners, pool pumps, refrigerators and other electric loads from a single point of connection to a home’s electric circuits.

But Phillips wants Sense’s energy-sensing technology to come embedded in smart meters and electrical panels that can communicate with a range of household electric appliances. Giving individuals detailed information about their energy use could make it easier for them to decarbonize their homes by switching to efficient systems like electric heating and electric-vehicle charging.

“This becomes the driver for all kinds of things in the energy transition,” he said. Second-by-second data is vital to get consumers engaged in how they’re using electricity and informed about how to better manage and automate that usage to save money, he believes. But it could also give utilities the information they’ll need to balance these new loads on their electric grids.

“If we all get [electric heat pumps] in homes and we all get EVs, everyone’s wringing their hands, asking [whether] the grid’s up to the task,” he said. 

Last week’s $105 million Series C investment round is aimed at expanding Sense’s role with strategic partners such as smart-meter maker Landis+Gyr and electrical equipment manufacturer Schneider Electric. These companies are embedding the Cambridge, Mass.–based startup’s energy-disaggregation tech into smart meters and smart electrical panels, respectively.

Sense can also feed its whole-home energy-sensing data to Wi-Fi-connected devices like the Amazon Alexa and Google Assistant smart home platforms, Philips Hue LED lighting and ​“smart plugs” from Belkin Wemo and TP-Link Kasa.

These technologies on their own give homeowners control over energy-using devices, but they don’t capture the whole-home energy-usage impacts of decisions about the use of individual appliances, he said. ​“You combine the two, and you have a more complete picture.”

A short history of energy disaggregation

Sense’s new funding round was led by Blue Earth Capital and joined by new investors Telus Ventures and MCJ Collective and previous investors including Schneider Electric, Energy Impact Partners, Prelude Ventures and iRobot. It brings Sense’s total capital raised to nearly $157 million — a significant amount for a company in the energy-disaggregation field.

Technologies for energy disaggregation, also known as nonintrusive load monitoring, have been under development for more than a decade. Some use whole-home energy consumption data and compare it to massive data libraries of typical home energy-using systems and appliances to infer the share of power being used by individual devices in homes. Others tap into the alternating current flowing through household circuits to tease out when different appliances are running and how much power they’re using.

Competing technologies use a variety of complex means to discover and track individual loads, including methods for recognizing the electronic ​“signatures” of particular appliances and different machine-learning algorithms to fine-tune the resulting data. 

But independent studies indicate a simple rule of thumb: More frequent and detailed sensing technologies yield more accurate results, but they also cost more to implement.

Sense’s approach is built on speech-recognition technology that Phillips developed as co-founder of SpeechWorks in 1994 and Vlingo in 2006. The system takes millions of measurements per second, he said. That gives it high-fidelity readings of households’ loads that other disaggregation technologies may not be able to capture, down to ​“vampire” loads like home entertainment systems that draw some power even when they’re not in use.

Like many of its competitors, Sense started by selling a stand-alone device for early-adopter households — that aforementioned $299 energy monitor. But that’s a relatively limited market opportunity, Phillips said. Those limits have led to companies like Belkin and Intel largely shelving their internally developed energy-disaggregation technologies over the past decade.

Other startups in the space have been bought by companies with designs on putting their capabilities to use in broader home energy-management strategies. One example is Generac, the vendor of generators, batteries and smart thermostats that bought Neurio, a Vancouver, Canada–based energy-disaggregation startup.

Other disaggregation technology providers have focused on commercial buildings, as is the case with Verdigris and PlotWatt. Still others have focused on serving utilities eager for more ways to understand how their customers are using energy. One example is Pittsburgh-based startup EEme, which was acquired by Tendril, the company that later merged with Simple Energy and FirstFuel to become Uplight, which is now one of the country’s largest providers of utility energy-management software and services.

Bidgely, a Silicon Valley startup with disaggregation tech that analyzes less frequent data pulled from utility smart meters, has also focused on utilities as customers, with nearly 40 utilities and energy retailers using its platform. It is integrating with smart-meter vendor Itron and has raised $77 million in funding from investors including Moore Strategic Ventures, Accurant International, Future Energy Ventures and Constellation Technology Ventures.

Phillips highlighted Sense’s real-time approach as a key differentiator from other disaggregation technologies. ​“The fundamental thing is to engage consumers,” he said. On that front, numerous studies indicate that historical energy-usage data, while somewhat helpful in getting people to pay attention to energy efficiency, doesn’t drive as much engagement as real-time data.

“People were telling us when we were starting Sense, ​‘You can’t engage customers around energy; it’s too boring,’” he said. ​“We found you can — but it has to be real time, it has to be actionable, and it has to be about more than energy.”

Getting the real-time data at the right price point

For example, Sense’s system can detect which appliances are on or off and when garage doors open and close — information that’s important for homeowners at work or on vacation for reasons unrelated to using electricity more efficiently.

At the same time, real-time data does improve energy-efficiency outcomes, Phillips said. Last year, Sense partnered with OhmConnect, a startup that pays households for reducing electricity use during times of grid stress, in a pilot project that showed ​“substantially higher savings” for customers using Sense’s technology than for those who lacked it.

Just getting people to check their energy use more frequently via Sense’s smartphone app and web interface plays a significant role in these better results, Phillips said. About one-third of Sense customers check into the app about once per day, he said — a level of engagement much higher than in typical utility efficiency programs. Last month, Sense launched a 500-household pilot project with Wisconsin utility Alliant Energy and consultancy Cadmus to further explore the value of real-time energy data.

Real-time data becomes still more important as homes add solar panels, backup batteries, EV chargers and electric heating systems, he said. The companies making and installing these systems are adding home energy monitoring to their offerings, including some that are working with Sense.

Smart electrical panels and circuit breakers from companies like Span, Lumin, Eaton and others are pulling data and providing smartphone-enabled control over individual household circuits. This circuit-level monitoring is ​“a good solution,” and one that Sense is pursuing with Schneider Electric, Phillips said.

Still, there’s a cost to adding sensors to individual devices and circuits in homes, he said. ​“You either put sensors everywhere” or you tap the energy-disaggregation capabilities of a circuit panel or smart meter ​“and use that as the central point to connect to other smart things.”

Disaggregating at the panel or meter is the idea behind Sense’s integrations with smart-home systems like Google’s and Belkin’s, which on their own control what home energy-using devices do, but lack the data that can add up to a whole-home energy-usage profile, he said.

It’s also the premise of Sense’s partnership with Landis+Gyr, one of the world’s biggest vendors of smart meters and grid technology. Sense’s disaggregation tech is embedded in Landis+Gyr’s Revelo smart meters, which are starting to be deployed by North American utilities such as National Grid.

Hundreds of millions of smart meters deployed over the past two decades lack this kind of granular energy-sensing and analysis capability. But now that many states are pushing utilities to support EV charging, electric heating, rooftop solar and batteries, this capability is particularly useful, Phillips noted. Smart meters that can more accurately track how those distributed energy resources are affecting customers’ moment-to-moment interactions with the power grid could play an important role as homes are electrified.

That could start with tapping into technology that allows these resources to be connected to the grid without costly and time-consuming utility upgrades, he noted. In December, Sense launched an open-source software development project aimed at creating a common way for multiple devices to share data on how much energy they’re using from moment to moment. That could allow them to act in concert to keep household grid demands below levels that would trigger the need for utility upgrades, as indicated by this graph of data from 3,500 Sense-equipped homes.

The Real-Time Power Management Protocol project, which has buy-in from companies including Emerson, Aquanta and Dandelion Energy, is still in its earliest stages, Phillips said. But if it works and can be scaled up, it could substitute software-enabled control for expensive infrastructure upgrades in a way that could speed household electrification, he said.

“We are at this very important inflection point,” Phillips said. ​“First, we had to prove the value proposition around this user experience. Second, we had to convince infrastructure providers like Landis+Gyr and Schneider that it makes sense to run Sense software.”

“Now these systems are rolling out at large scale, in the millions,” he said. ​“We want to use that to build out all these propositions — efficiency, demand response, using data for fault detection in the home and for fault detection on the grid. Boy, do we want to use that data.”