In 2016, additional states legalized marijuana, more people implemented voice-activated smart home hubs, and representatives from 200 countries passed an amendment to the Montreal Protocol. These are just a few energy-related trends we discuss in our new Top 20 Technologies and Trends of 2016 report (available to E Source Technology Assessment Service members). It’s fun to look back at what happened over the course of 2016, but it’s also valuable to think about what those trends portend for 2017.
Our number one trend was voters’ approval of legalized marijuana in eight states. Pot cultivation is one the most energy-intensive economic activities. Though the exact quantity of energy consumed for indoor cannabis cultivation remains unknown, estimates range from about 1 to 3 percent of total electricity generation in states where recreational cannabis use is legal. We expect energy consumption to grow, and with it, more utility outreach to improve the efficiency of marijuana grow-house operations.
Our second trend of the year concerned the smart home space. The Amazon Echo—a voice-controlled device that can play music, answer questions, and control an expanding range of smart technologies—emerged as a market-leading product by selling five times what the Nest thermostat did during a similar segment in its product life. We expect this trend to continue into 2017, with not only the Amazon Echo flying off the shelves but numerous other voice-activated smart home products gaining purchase in the market. Already, Google, Microsoft, and Samsung have gotten into the act, but watch for more.
Despite the rise of voice-activated control, one omen indicated trouble ahead for the smart home market. In October 2016, hackers infected hundreds of thousands of Internet-connected devices with malicious code to run a cyber-attack that crippled more than a thousand websites. Although the attack didn’t involve any smart home technologies, that doesn’t mean smart home vendors can kick back and relax. In 2017 we expect ever more hacking and ever more insidious attempts to infiltrate smart home technology. Utilities are already skittish about data security, given demands that they protect billing data. Imagine how motivated they’ll be to engage with the smart home market should it become a playground for cyber vandals.
Lastly, 2016 marked the passage of an important international agreement that’s likely to have a big impact on a market sector that’s hugely important to utilities. Representatives from 200 countries agreed on an amendment to the Montreal Protocol that, by 2036, would phase down the use of global warming–enhancing refrigerants by 85 percent in developed countries. After the amendment passed, many were concerned that the US Senate wouldn’t confirm it because of its focus on climate change. Then when Donald Trump won the presidential election, people were concerned that the new administration not only would block US involvement in the amendment, but would also undo US Environmental Protection Agency (EPA) regulations designed to reduce the global warming impact of refrigerants. Since then, the HVAC, refrigeration, and chemical industries have voiced their strong support for the refrigerant phasedown. We expect the Senate will confirm the new Montreal Protocol amendment in 2017 and that EPA regulations will stay in place. For more information on this prediction, read our blog post Don’t Assume Trump Will Stop the HFC Phasedown.