The Denver metro area is often said to be one of the country’s more prominent tech cities with a large Google presence as well as offices for Arrow Electronics, HomeAdvisor, Cognizant, SendGrid and more. Sitting right up against the mountains, Colorado innovators have also planted deep roots in innovations around the “internet of things” — to help people better manage the resources they use and the impact they have on the environment.
“We have one of the largest tech industries in the country and we see this is foundational to every other industry that’s in Colorado,” said Kelly Brough, CEO of Denver Metro Chamber of Commerce, an association that represents 3,000 businesses that employ about 300,000 employees. “We have one of the most diverse economies in the country in the metro area in Denver.”
Colorado is hugely supportive of entrepreneurs, said Brough, explaining why the state weathered the recession better than other markets. Mix in 30 federal laboratories, the state’s higher education system, and the tech industry’s ability to collaborate across sectors and the result is a responsive economic ecosystem.
Boulder-based Tendril is among the local companies to tap into the IoT movement, or the idea that everything from your home to your phone to your car is connected and talking to each other. On the energy front, IoT tech can help relieve stress on the grid.
“The IoT space can be about customer convenience or customer-focused and the thing we bring to that space is this awareness of what the customer wants to achieve or expects out of their device from a comfort or convenience perspective but then knowing that that device also offers an opportunity to save energy and or change the time of day you use energy,” said Marissa Hummon, Tendril’s director of product.
For 14 years, Tendril has been working on residential energy efficiency and demand response. Ten years ago, it began building an IoT platform at the home level, said Hummon, calling it about seven years ahead of its time.
Tendril’s software, Orchestrated Energy, is designed with both the homeowner and the utility in mind.
When managing power, utility companies decide how much power needs to be produced to meet demand, and they make calculations and changes on a second-by-second basis.
Orchestrated Energy is integrated into a home’s smart appliances, talking with a home’s other smart devices to make sure the homeowner is, for example, staying comfortable while adhering to the energy provider’s needs and even pulling from customer-preferred sources like wind or solar.
Hummon said about 10 years ago people started looking at developing load thermostats to help control supply and demand, turning on and off a utility as the energy company needed. But it didn’t quite cut it for customers because the thermostat would turn off, the temperature of the house or building would creep up, and the air conditioning wouldn’t turn back on for hours, after peak usage was over.
Install a smart thermostat like Ecobee, which Tendril has been working closely with for the last three years, and the user can set the temperature for 68 degrees. On the other end, that thermostat is talking to the utility company to make sure it can meet that demand. If the utility’s energy usage peaks in the afternoon, the smart thermostat can adjust to cool the house earlier instead of when the utility is facing intense demand. The software makes sure the room doesn’t get hotter than 1 degree of the set temperature. Any more than that and a customer starts to feel the difference, Hummon explained.
“It allows the utility to get a lot more flexibility out of the residential demand without compromising on customer satisfaction or customer comfort,” Hummon said. “The IoT space really offers this big opportunity to go from the utility putting in specific equipment for the utility’s use inside of somebody’s house to this notion of people wanting a connected home. They want automation. They want their home to be smart and responsive and the utility can essentially sponsor some of that because they want to get some value out of it, but the customer gets a huge amount of value just in terms of their visibility convenience and ability to control their home to be more specific to them.”
Tendril’s software doesn’t just stop at heating and cooling. It can be linked to a hot water heater, solar panels, or an electric vehicle charger. Maybe someone needs their Tesla charged by 6 a.m., but wants to use wind energy. If it’s not connected, Hummon said the car will start charging immediately. However, if it’s connected, Tendril’s software can facilitate with the energy company the best time to charge the car according to the customer’s settings.
It’ll factor in green-brown mixes, or using a mix of wind and coal, too. “As long as the customer has some range of flexibility, then they have lots of opportunity to achieve their convenience or comfort base,” Hummon said.
Rachio is another Denver metro company innovating in the IoT sector. Formed in 2013, construction project manager turned tech entrepreneur Chris Klein wanted to focus on outdoor water usage, where there is a significant amount of waste in the U.S. Available products weren’t really addressing the issue, Klein determined.
This year Rachio launched its third generation of products.
“The most exciting thing about this launch is it includes a wireless flow meter for the outdoors that measures all water use,” Klein said. Not only does it make a lawn watering schedule smarter for the homeowner, it will shut down leaks.
The Rachio unit can be connected to an Alexa or Google Home device through which homeowners can request certain zones to be watered or ask if their lawn will be watered at all on a particular day or if there will be a rain delay.
And users can download an app that allows them to pause and play a watering so the user can, as Klein explained, turn the sprinkler system off to get maximum water pressure for their shower, then turn it back on when they’re done.
Also for the first time, Rachio is sourcing all of its products from Colorado manufactures.
“There are a handful of companies that are in sort of the IoT space. ... I think one nice thing here is manufacturing is accessible, especially when you’re just getting going,” Klein said.
Savings and growth
It’s hard to pinpoint exactly how much someone could save because it all depends on usage, but Klein estimates that users can cut back on their water usage by 30 to 50 percent. Even if they aren’t saving water, Rachio can help prevent headaches, like having to run out into the rain to shut off a sprinkler.
It's also difficult for Hummon to know exactly how much energy a customer could save using Tendril’s Orchestrated Energy software. She estimates that customers with solar panels on their home in California, where energy rates are among the highest in the nation, could save $500 to $1000 a year. Coloradoans could save about $150 or more in a year.
And both companies have experienced significant growth.
At first, according to Klein, Rachio saw triple-figure growth year over year as people narrowed in on the products and services they were looking for. While Rachio is still growing, it’s not as fast, Klein said.
“I think you do start to see what the entire industry is seeing outside of, call it voice, and that is how do you cross that chasm and get that later majority interested in IoT,” Klein said. Once someone gets a Rachio interface in front of them, there’s usually no turning back, Klein said. Getting it there can be a challenge, though.
“It’s been tremendous,” Hummon said when asked about Tendril’s growth. The company is on target to be in 100,000 households by 2019, in effect taking off the grid the equivalent of a 200-megawatt coal plant, according to Hummon.
Tech companies’ respect and stewardship of the natural environment is another reason for the success of Colorado's tech industry, according to Brough, at the Denver Metro Chamber of Commerce.
"[These are] two companies who are really advancing that stewardship,” Brough said. “They’re not innovating to come up with an interesting idea that has no value. They’re innovating around ideas that have meaningful impact and I think that’s another one of our values.”