Navigant Research: Bring your own thermostat demand response programs represent a target market of $1.4B

BOULDER, CO — A new slide-based report from Navigant Research analyzes the U.S. market for bring your own thermostat (BYOT) demand response (DR) programs, focusing on technology trends, utility rollouts, and the vendor landscape, with cost curve projections and adoption forecasts, through 2024.

Since 2012, utilities across the United States have been piloting BYOT DR programs, supplementing legacy direct install strategies that use pre-selected one-way thermostat models. These pilot programs allow customers to purchase devices from vendors of their choosing while still offering the ability to participate in the utility’s DR or load curtailing programs.

“Utilities offering one thermostat model to customers is not sustainable due to ongoing technology advancements and the fact that today’s consumers want more choice in the devices they use to participate in DR programs with the features that they desire,” says Brett Feldman, senior research analyst with Navigant Research. “BYOT projects are in the pilot phase right now, but are expected to be ready for larger deployment in the near future after initial program evaluations show positive results.”

A number of drivers such as lower adoption cost, demand for customer choice, and improved synergies with dynamic pricing programs point toward a potential for BYOT to capture 10 percent of the residential DR market, according to the report. Taking advantage of two-way communicating smart thermostats, BYOT DR programs can also help utilities reduce acquisition costs for load curtailment programs and improve customer satisfaction.

The report, Bring Your Own Thermostat Demand Response, examines the BYOT DR market in the United States, with a focus on technology trends, customer adoption, utility rollouts, and the vendor landscape. Cost curve projections and adoption forecasts are provided through 2024, along with estimated customer distribution by U.S. state. Featuring Navigant Research’s Utility Technology Disruption Matrix and Execution Grid, the report also examines implications for traditional utility business models, highlights utility case studies, and offers strategic recommendations for industry stakeholders to position for long-term success. An Executive Summary of the report is available for free download on the Navigant Research website.