At the recent ALA Conference, Terry McGowan emphasized to showrooms and manufacturers that ignoring the smart home category is not a “smart” move for a profitable future.

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resh from attending the ENERGY STAR® Partners Meeting just days before the American Lighting Association (ALA) annual conference started, ALA’s Director of Engineering Terry McGowan, FIES, LC, told the audience, “In the last week, things have changed in the connected home environment. We’ve got [products] all over the place talking to you, talking to others, but not necessarily to each other. Our homes are more complicated, as well as more connected. There are lots of devices that are controlled remotely and can even report to you [referencing popular products such as Nest and Ring]. So far, they’ve all been working independently more or less, but that’s all about to change.”

In addition, McGowan shared some of the most relevant conclusions from the most recent CABA™ (Continental Automated Buildings Association) Smart Home as a Service survey. The purpose of the research project was to “provide a clearer understanding of the connected home landscape and the opportunities to drive revenues.”

The most revealing finding, according to McGowan, is that smart devices go beyond security and convenience and are now considered to have an economic benefit. “The CABA survey indicates that cost savings is an important value for the connected home,” he noted. “There are a lot of things [in other industries] that mesh with what we offer in the connected home. We’ve learned some lessons, too, such as lighting is an essential element and is the anchor for connected systems.”

When it comes to which smart control method is preferred by consumers, voice control wins. “Certainly Alexa has wormed its way into our homes,” he chuckled. “I’ve done work with the elderly and those who are bedridden, and it is the only way they feel they can have any control,” he shared. Since every smart home installation is custom to the user, the installation expertise and question of who will service the system if problems arise is critical for those who want to sell smart home technology.

New Term to Learn: SHEMS
McGowan introduced the audience to a term they might not have heard before: SHEMS, which stands for Smart Home Energy Management Systems. ENERGY STAR released the new SHEMS standard on September 3. “You can’t have a SHEMS system without lighting or without a thermostat,” he clarified, stressing the importance of the standard to the lighting industry. Smart lighting control of lamps and fixtures is an essential requirement of SHEMS, and all products must meet ENERGY STAR requirements in order to be a part of the “package.”

“ENERGY STAR will take the approach of energy savings and it will be up to us in the lighting industry to interpret that and make it applicable to our industry,” he remarked. “There’s another new term out there that we’ve never heard before and that the ‘smart home service provider.’ This will be a subscription service, much like security system monitoring. The service providers could have a more important role with consumers,” he advised, adding, “Then there are the electrical utilities and the role they might play.”

In the past, the electric utilities were responsible for broadening the adoption of energy-saving lighting through rebates for CFLs and LEDs. With that effort virtually successfully exhausted, it’s time for the utilities to come up with a Plan B. “Lighting systems have been the leader [in energy savings] by reducing wattages,” McGowan commented. “ENERGY STAR believes there is an additional 30 percent of savings that can still be had without compromising quality. We [the lighting industry] have a proven record, and it’s interesting that there’s [apparently] still more energy savings to be had.”

Consider the Opportunities
SHEMS is very customizable as to what can be put into each package, according to McGowan. “It could even be built into a homeowners association’s benefits,” he suggested.

“The global smart home market is now projected to grow $192 billion in 2023.” —IHS Markit

Building relationships with other similar-minded providers will become key to mutual profitability. “The lighting industry is one of the best for forming relationships,” McGowan remarked. “Lighting is a lot of fun, and its involvement with a lot of people is really first class. We have to consider how these other service aspects will be handled. There are potential relationships that can be formed between the lighting showrooms and the SHEMS service providers for products, installation, set-up, and service. The service provider relationship can extend the reach of the showroom and distributor,” he explained, adding, “If an electric utility is involved, energy-saving rebates would apply to all fixtures and lighting products and not just the commodity type for utility rooms, garages, and closets.”

McGowan also announced that the ALA will continue to monitor CABA’s upcoming research projects and the results they uncover.