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Home energy management (HEM) technologies can drive energy savings from 1.5% to more than 40%, but their value to utilities beyond savings includes customer engagement, competitive differentiation and demand response, according to a report by Lux Research.

HEM technologies, Lux notes, give residential customers energy dashboards, user advice, and automated and adaptive controls, among other features. The firm says that utilities are increasingly partnering with HEM providers to engage with residential consumers in order to maintain an edge in competitive markets.

In addition, Lux reports that telecom companies like Deutsche Telekom and even technology companies such as Google are getting into the HEM mix, threatening to shake up residential electricity markets.

The firm's findings after evaluating the U.S., European and Asian markets in regards to HEM include the following:

- The largest opportunity exists in the developed world. While housing stocks are growing most rapidly in developing countries, such as India and China, 90% of HEM opportunities lie in retrofits of existing homes, making markets like the U.S. and Western Europe most attractive.

- Customer engagement is the broader goal. Utility revenues are sizable - about $265 billion in Europe, $370 billion in the U.S. and $1 trillion in Asia. In order to stay competitive, utilities are spending less than 1% of revenues on HEM to engage with customers via energy dashboards and in-home display panels.

- Automated meters, rates and renewable energy are crucial. The success of HEM will depend on three key factors: automated metering infrastructure, electricity rate structures and renewable energy supply mix through 2020. Asia is ripe for HEM but lacks a renewable energy mix. European countries, meanwhile, are subject to directives to equip 80% of consumers with intelligent metering systems by 2020.

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