Another development occurred today in Google’s long-term strategy to streamline some of its less core businesses. Google Nest Renew — a load-shifting service for Google Nest thermostat owners to get them to use energy during off-peak hours, when energy is less expensive or when “cleaner” network options are available — is broadcast by Google and combined with OhmConnect, a Sidewalk Infrastructure Partners-invested startup that helps manage load-shifting services for Nest and other smart thermostat brands. The new company will be called “Renovate the house.”
As part of the deal, SIP will inject $100 million into the new entity and become the majority owner. Google is not currently investing and remains a minority shareholder. No valuation was disclosed, a spokesman said. OhmConnect currently operates in California, Texas and New York, and the new company, Renew Home, plans to expand into new markets once it launches, the spokesperson added.
The deal brings together partners and entities that have been investing and working together for some time. While the companies will argue that this merger is a signal of how they are doubling down on the opportunity, it also highlights how Google, SIP and the ecosystem built around them have yet to find stable, longer-term business models in clean energy. industry.
Although tens of millions of Nest thermostats have been sold over the years, Google doesn’t disclose how many of them use the Renew service — which works on third-generation (2015) devices and up. OhmConnect is one of its partners and has a total of 225,000 customers on its platform (which includes Nest and other customers).
“We are incredibly excited about this transaction. Renew Home will optimize the way households across the country consume energy and interact with the electricity grid, strategically aligning energy consumption to lower energy bills while reducing pressure on the grid, particularly at peak times and times when clean energy is less readily available. available (for example, at night when solar power comes offline),” said Jonathan Winer, co-founder and co-CEO of Sidewalk Infrastructure Partners, in a statement provided to TechCrunch. “This is critical: by mitigating renewable intermittency, Renew Home — and the wider virtual power plant (VPP) industry — will be instrumental in enabling us to bring more renewable energy to the grid.”
This spinout is far from Google’s first (or likely last) attempt to streamline its operations and refocus on profit centers rather than loss leaders, which has seen not only thousands of job cuts at the company, but further control especially for some of her other bets. More specifically, today’s news appears to be part of a larger effort to refocus its operations on Nest in particular. Earlier this year, the company said it would be vacation a number of Google Nest products and services, including Dropcam and the home security system, in April 2024;
The combination of Google Nest Renew and OhmConnect is just the latest spinout in a very long line of them. In fact, the spinouts in this story might be enough to make you dizzy. Sidewalk Infrastructure Partners itself was once part of Sidewalk Labs. Sidewalk Labs originally started as a Google moon in 2015 with the lofty goal of using technology to improve urban life. SIP was finally released by Sidewalk Labs in 2020 with a $400 million investment from Google.
Sidewalk Labs was then designated as an Alphabet company, before being folded into Google itself in 2021, downsizing and spinning off a piece (Canopy), effectively shutting down Sidewalk Labs as a separate entity.
Meanwhile, SIP invested $20 million in OhmConnect in 2020 and continued to be a minority shareholder in it. Nest Renew has been one of OhmConnect’s customers, along with Sensi, ecobee, Carrier and others. It also works with water heater manufacturers, appliance manufacturers and solar and battery storage manufacturers, he said.
The deal has some scale. OhmConnect says it currently has over 225,000 customers across various thermostat brands and others it works with. While there are millions of Nest thermostats in use in the US and further afield, they are not necessarily used in conjunction with Nest Renew.
Now Renew Home will work to offer more, but there is already competition for that part of the business. For consumers who want to participate in load shifting, there are a number of other players in the market, including the power companies themselves that directly offer these services as well. In the UK for example, the National grid also offers load shifting.
It’s no surprise, then, that part of the strategy will be to expand what Renew Home does.
Future plans, the company said, will focus on “whole-home energy management,” which includes electric vehicle charging, solar systems and more. That will include, he said, working on further hardware partnerships, as well as developing more sophisticated power management software to work with that hardware and for customers to use to control how, where and when they use energy.
The company has set a goal of covering 30 GW of shiftable load and working in 10 million homes by 2030.
Updated to clarify that the number of Google Nest Renew customers has not been disclosed and that OhmConnect was not a SIP spinout, but an investment.
