By now, you’ve likely heard about smart technologies that “learn” your habits and automatically adjust the energy use of your home. Companies like Nest and Opower as well as terms like the “Internet of Things” were completely unfamiliar just a few years ago, and are now working their way into everyday conversations. There’s a lot of information out there — let’s take a look at a few of the factors contributing to the surge of big investments in energy efficiency technology.

Recent Developments

Making headlines late last year, Google purchased Nest Labs Inc. for $3.2 billion — the second largest acquisition in the company’s history. Many believe Google made such a large investment to stay ahead of the curve in smart devices and to be the go-to service for coordinating future “smart homes.” Some had concerns that Google’s motives were related to information access, although Nest has stated they will adhere to the company’s privacy policy to assure customers about the safety of their personal information.

Although we may never fully understand the reasons behind Google’s purchase, it undoubtedly brought a lot of attention to efficiency technologies. The Nest story is not unique; according to the International Energy Agency, global spending on energy efficiency technologies and programs hit $250 billion in 2013, and those numbers will likely reach $500 billion by 2035.

Big Investments

As the private sector invests more and more in efficiency, the government is doing the same. Department of Energy Secretary Ernest Moniz recently reiterated how important it is for the government to support energy efficiency projects and technologies, particularly with DOE’s loan program. Moving forward, efficiency technologies will have the opportunity for successful development with continued federal investment and with government partnerships with private financiers.

As supported by a collection of case studies from the American Energy Innovation Council (AEIC), public-private partnerships have historically been key to the successful development and market entry of energy technologies. The report states, “Acting as a catalyst or instigator, government innovation investments quicken the cycles of discovery and invention.” The case studies range from alternative vehicle technology partnerships to low emissivity windows, but in each situation, government support allowed companies to make high-risk bets with high-rewards.

What’s Next?

One of the most recent developments in the tech industry is the launch of Thread Group. Founding members include Big Ass Solutions, the now-familiar Nest, Samsung and several others. The Group is newly established, but aims to build a technology that utilizes the Internet of Things and combines the best available smart technologies for the most efficient use of resources. 

Part of what makes the sector so exciting is that new innovations are coming about constantly. Companies, organizations and the government agree — investing in energy efficiency technology is important, and the continued development of this sector will help us save more energy than ever before.