Even with today’s rising energy costs, most things do not cost very much. This is a good thing. Food, as a percentage of income, is still at historic lows. In real dollars, gasoline is just where it was at the birth of the modern car in 1908. For most people, switching to a more fuel efficient car will not pay back the initial capital outlay in the next five years. Local energy generation just doesn’t pay back its installation cost quickly enough.

A penny saved may be a penny earned, but today, everyone leaves their pennies by the cash register. Gas prices do not come down because once prices start falling, no one wants to make a left turn against traffic to get a better deal. The New York Times recently indicated that a load in the washing machine might cost $0.53. Who is going to personally manage that? Who is going to miss their $4 coffee on the way to work to negotiate when the dishwasher runs for such a small gain?

Life cycle does more than lifestyle to determine energy usage. Homes with small children have different energy profiles than empty nesters. Life-cycle trumps life style in energy use except in the most extreme cases. Extreme energy savings are not ever going to be a mass phenomenon. People would rather get to the beach an hour earlier, and get the complaining kids out of the car and in bed on time than they would drive for greater mileage on the trip. These facts are not likely to change.

Well, if we are not going to manage our devices, our systems, and our energy, who will? There are only two answers: someone else and the systems themselves.

Few people are willing to let someone else manage their homes power use, because few people are willing to relinquish autonomy over their home. To manage someone’s home, you must offer service, not take control. Powernab offers users high-touch web pages to operate their own houses, to make their own decisions, using web services.

Other companies like Sensus remotely monitor heating and cooling systems for peak performance, and let me know when and what maintenance is needed. With the right contract, a service provider of knowledge based operations could even schedule the maintenance themselves, and verify post-repair performance before I pay for it.

The homeowner will relinquish some control over the home for these services, because they increase his autonomy and free time.

The other choice is for the devices to manage themselves. There are a lot of devices, with a lot of features. If we are going to let these devices manage themselves, they need an economic interface, too. Agent-based home operations should be based on economics.

Combination heat packs, with both heat pump and natural gas, are a well established market segment. Generally, they have an external temperature sensor, and switch from heat pump to gas based upon outside air temperature, set by the installer. Since this switch-over decision is economic, let’s let it be market based. Let's allow a monthly feed from the gas company with natural gas pricing, and an up to the minute electricity price. The unit should make its cut over decision on the margin, in the market.

I could ask my dishwasher to run itself, and manage its own budget for the month. I could also set service standards that the dishes always be clean before dinner the next day. This leads to a relatively simple and consistent user interface.

I could tell my solar panel to sell to the grid whenever the price is above a certain amount, and to store any excess energy. The grid might consistently outbid the dishwasher—and that’s OK. If so, the dishwasher would still run only at night.

I could tell my whole-house storage system to buy power at any price until it has four hours on hand. Thereafter it might buy whenever energy is below a target price. I could even let it take bids from the household systems and devices, or from the neighbor. This system would, of course, need to charge an appropriate mark-up based upon its inefficiency of storage.

If we develop the right sort of abstract business interface between the power grid and our buildings, it can also be used between buildings, or within buildings. Most throw-away cell phones have more computing power than it took to go to the moon. Surely, our embedded systems can do a little day trading…

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