Ronald J. Zimmer CAE President & CEO Continental Automated Buildings Association LinkedIn Profile Results of the Latest Market Research on Connected Homes

LANDMARK RESEARCH “State of the Connected Home Market” Emerald Sponsors Diamond Sponsors

U.S. Households with HANS and iREM Nets CABA Connected Home Roadmap 2010

Corning – A Day Made of Glass

Top Connected Home Benefits Total Online Consumers (% Range for US & Canada) Matters most to: Remote control and having an easier way to control are related concepts Remote control from anywhere 44%-47% Those with the most interest in the connected home Women Saving money on energy bills 43%-48% Everyone ( Those least interested in the connected home care most about saving energy) Safety & security 42% Everyone Easier to control 19%-29% Those with the most interest in the connected home Men Summary: Benefits & Barriers Remote control, lower energy bills, safety & security drive interest in the connected home; ease of use matters to those who like the connected home Source: CABA’s State of the Connected Home Market 2011

Among energy consumers, the list of benefits is the same as for the general consumer population—remote access, saving money and safety/security Top-3 Connected Home Benefits Total Online Energy Consumers 18+ US 2011 (n=618) Canada 2011 (n=209) Enhanced safety & security More comfortable/pleasant home environment Reducing the amount of energy your home uses Ability to know when household members have arrived or left Saving money on energy bills Nothing Energy (net) Ability to control locks, alarm, temperature and/or lights while away from home Easier way to control & monitor home systems/devices Access to desired entertainment content on any device More convenient way to control locks, security, temperature and/or lights while at home Simplified management of home maintenance/repairs Control & monitoring (net) Source: CABA’s State of the Connected Home Market 2011

Deadline for submission of presentation for the proceedings: January 14, 2011 Please ensure that you bring a copy of your power-point slides with you on a thumb drive the day of your presentation – if you change your slides please the organizers ASAP with the updated copy Data from 2009 CABA State of Connected Home

Among energy consumers, potential demand for smart appliances is relatively robust Interest in Smart Appliances Top-2 Box; % Definitely Buy At a ‘Reasonable’ Price Online Energy Consumers % 30% US 2011 (n= ) Canada 2011 (n=62-85) Air conditioner Range, cooktop or oven Water heater Thermostat Refrigerator Dishwasher Furnace Washing machine/dryer Home security system 37% 35% 34% 32% 33% 41% 31% 27% 31% 23% 30% 26% 30% 25% 30% 27% Potential demand is roughly even across device types, though furnaces stand out in Canada. Click here for concept description Likelihood to Purchase a Smart Appliance At a ‘Reasonable’ Price, When in the Market, Online Energy Consumers 18+ % ‘Definitely’, Top 2-box US 2011 (n=614) Canada 2011 (n=209) *Discounted Demand Source: CABA’s State of the Connected Home Market 2011

In US, both homeowners and renters, young and old are interested in smart appliances; in Canada, older homeowners have highest interest Summary: Target Markets Those very interested in Home Dashboard/HEMS (US): Have smartphone (73%) and/or tablet PCs (28%). Are more likely to participate in a clean energy (16%) or energy management program (17%) with their electric utility than those not interested (4%, 5%). All consumer types are interested in dynamic pricing– but tablet PCs are more common among those who are (23% in US). Those very interested in smart appliances: Own home (79% US; 97% Canada) Median age (41; 56) Women (54%; 60%) Annual HH income $50K+ (55%; 59%) Have smartphone (66%; 55%) Have tablet PC (23%; 39%) Use/interested in dynamic pricing (55%; 58%) Use equipment maintenance program (18%; 23%) Use fiber-optic Internet (17%-US) Women somewhat more focused on laundry & kitchen Source: CABA’s State of the Connected Home Market 2011

Reducing energy usage is less important than saving money in the US, while in Canada, it is nearly as important. Ability to get maintenance alerts and remote access are of lower importance. –Users of alarmed security systems are the most interested group in maintenance/repair alerts (US).* –Smartphone owners are more interested in remote control and monitoring than other consumers (US)* The top motivator for smart appliance purchase: saving money Smart Appliance Feature Importance Online Energy Consumers 18+ Mean Importance Based on 100-Point Allocation US 2011 (n=618) Canada 2011 (n=209) Ability to get maintenance/ repair alerts Ability to monitor or control remotely Ability to save money on energy costs Rebates or other cost incentives Reduced home energy usage 51.4 Source: CABA’s State of the Connected Home Market 2011

Whirlpool Smart Device Network Architecture

Willingness To Pay For several high opportunity areas, many of those dissatisfied with their current situation are willing to pay for improved capabilities – Programmable lighting controls – Eliminating phantom energy drain – Individual room temperature and lighting control You appear to be most dissatisfied with your ability to perform the following activities. How willing would you be to pay for a better solution to each? Base are those very/somewhat dissatisfied with their current ability to perform each capability Very Strong Willingness >75% Strong Willingness >65% Mild Willingness >50% Weak Willingness <50% = Solid Opportunity Score CABA Connected Home Roadmap 2010 JLA Strategic Research

Smart Grid Video Consolidated Edison Co. of New York

Smart Meter and HAN

Dynamic pricing and smart meters are more familiar to energy consumers in both the US and Canada than other smart grid concepts. Canadians are generally more familiar with dynamic pricing and smart meters than Americans—though most still know little if anything about HEMS or HANs Smart Grid Familiarity Total Online Energy Consumers 18+ US 2011Canada 2011 Dynamic Pricing (n=618) Demand Response (n=618) Smart Meter (n=618) Home Energy Management System (HEMS) (n=309) Home Area Network (HAN) (n=309) Never heard of it Heard of it, but not much else Know something about it Know a lot about it (n=99) (n=209) (n=110) Never heard of it Heard of it, but not much else Know something about it Know a lot about it Source: CABA’s State of the Connected Home Market 2011

US: Energy & Green Living Opportunity Landscape There is a substantial market opportunity for energy reduction products/services: Systems that track where and when energy and water is being consumed Products that schedule and control appliance usage Products that allow users to centrally control room temp and lighting Table Stakes Limited Opportunity Solid Opportunity >10 High Opportunity >12 Extreme Opportunity >15 Eliminate phantom drain Individual room control Programmable lighting controls Analyze appliance efficiency Monitor/ track electricity consumption Water conservation/ monitoring system Off-peak appliance scheduling Energy management program Allowing energy provider to remotely adjusting temps Automatic maintenance notification Programmable window covering Over-Served Appropriately Served Under-Served Percent top 2 box Satisfaction and Importance scores CABA Connected Home Roadmap 2010 JLA Strategic Research

CABA’s Energy as a Managed Service Study Member Participants 1.3M Company 2.Bell Canada 3.Best Buy 4.Direct Energy 5.Freescale Semiconductor 6.Honeywell International 7.Ingersoll Rand/Trane/Schlage 8.Intel Corporation 9.Landis+Gyr 10.Microsoft Corporation 11.TELUS 12.Tyco Electronics 13.Whirlpool Corporation Research Supplier: POCO LabsProject Manager: Direct Energy

CABA’s Energy as a Managed Service Research Consumers would change behavior based on TOU. TOU pricing on consumer behavior compared. Preferred data sampling rate was cost/day. Consumption behavior would change if energy savings were met. EMS adopters are also into “green” behavior. Five key segments of consumers were identified.

The Home and Beyond from a Telecom perspective Courtesy: ZigBee Alliance

Broadband Enables Intelligent MTUs

Space Cooling 3% Space Heating 18% Receptacles 15% Lights 12% Energy Savings 35% Domestic Hot Water 5% Fans & Pumps 12% The Verve High Rise Condominiums – Energy Savings Model Source: CABA’s Convergence of Green and Intelligent Buildings 2008

Source: Evaluation of the Impact of Sub-Metering on Multi-Residential Electricity Consumption and the Potential Economic and Environment Impact on Ontario

Lighting Systems Proportion of Projects by overall integration Multi- occupancy residential, 0% Source: CABA’s Intelligent and Integrated Buildings Technologies: Market Sizing in North America 2011

Fire Detection Systems Market size by end user vertical market High end multi- occupancy residential, 6%

Security Systems Market share distribution by end user, 2008 High end multi- occupancy residential, 1% Source: CABA’s Intelligent and Integrated Buildings Technologies: Market Sizing in North America 2011

Environmental Controls Integration by building type in the North America 2008 High end multi-storey residential Source: CABA’s Intelligent and Integrated Buildings Technologies: Market Sizing in North America 2011

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