Alarm.com: ‘Reduce Your Use’ will help increase RMR

Company says new partnership with utility will save customers money and drive demand for ‘smart’ thermostats and security systems
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Wednesday, September 26, 2012

VIENNA, Va.—Alarm.com has found a new way to tap into consumers’ growing interest in saving energy: It is partnering with a California utility in a program that gives Alarm.com customers extra savings on their utility bills if they cut energy usage during peak demand times.

Alarm.com has partnered with San Diego Gas & Electric, a move it says will help dealers sell more “smart” thermostats and security systems, according to the interactive security services provider, based here.

SDG&E, which serves 3.4 million Californians, has chosen Alarm.com for its new Reduce Your Use Thermostat Program, the company announced in early September.

Through the program, SDG&E customers can earn credits on their utility bills for reducing energy usage on very hot days when demand for air conditioning is high. And those who use Alarm.com's emPower home energy management technology can earn higher savings, Alison Slavin, VP of product management for Alarm.com, told Security Systems News.

“Alarm.com customers who have the Alarm.com thermostat solution can leverage that to their advantage to use less energy during that peak demand time frame,” she said.

She said that happens in two ways. First, Slavin said, Alarm.com residential customers will save $1.25 per kilowatt hour for energy reductions on Reduce Your Use days, while customers without the technology save just 75 cents per kilowatt hour. Slavin said Alarm.com customers save an extra 50 cents because the company’s solution has been qualified as an “enabling technology” in the program. The company said the solution is considered effective at saving energy because it “enables consumers to remotely monitor and control their thermostat settings through the Alarm.com website and mobile apps.”

Customers can also ask Alarm.com to “automatically manage their thermostat during these periods to optimize their savings so that they reduce as much as possible.”

Alarm.com’s emPower solution has such features as Smart Schedule Activity Patterns, which uses data gathered from a home security system about when family members are likely to be home to better program a thermostat to save energy.

She said that emPower, marketed as an add-on to a security system, “has been very popular” since Alarm.com introduced it in June 2011. The company said last spring that more than 100,000 customers had subscribed to the solution.

“Vivint is one of our dealers and they have been very strong promoters in the market of energy management services and home automation,” Slavin said. “Through dealers like them we’ve been able to build a very large install base of thermostat customers, and so [for about a year] we’ve been trying to figure out ways we can start to participate in these types of programs with utilities throughout the country. They have a very strong need to control energy during these peak times, and we through our platform and with our existing customer base and through our dealers are in a very good position to help the utilities.”

She said the partnership with SDG&E stands out. “We’ve done some pilots here and there with other utilities, but this is the first one where the program is defined like this, where the customer is getting a bigger credit as the result of using Alarm.com technology,” Slavin said.

How will the Reduce Your Use program help dealers?

Slavin said the emPower solution already aids dealers because such an add-on increases RMR and also boosts the “stickiness” of customers who use it on a daily basis.

Then, she said, “when you layer in a program like this, it really helps in getting the customer to see upfront the return on investment. They can do the math themselves and say, ‘Maybe after just a couple months of a San Diego summer, I will have paid back my costs on the thermostat and over time I’ll actually be making money having the thermostat if I participate in the program.’ … I think for the dealers it really helps them close the sale.”

She added, “Right now it only impacts customers and dealers in San Diego … but we are as a company definitely looking to integrate more and more programs like this, because we do see them as a big opportunity to help dealers convert more customers and specifically convert them to these higher services levels that will create higher RMR for them and stickier customers in the long run.”