(I’ve known Unity Systems for many years, on both personal and professional level. They are my principal resource for insights into home automation and related topics. The following summary was prepared with their help, to introduce you to them. EB)

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| ** UFTO ** Edward Beardsworth ** Consultant
| 951 Lincoln Ave. tel 650-328-5670
| Palo Alto CA 94301-3041 fax 650-328-5675
| http://www.ufto.com edbeards@ufto.com
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Focus Shifts from Home Automation to Small Commercial Energy Management
— Unity Systems, Inc.

Home automation hasn’t turned into the big market that many expected. Unity Systems is finding better applications with small commercial and industrial customers.

Unity made its start in home automation in 1986, controlling heating and cooling, security, lights and appliances in high-end homes. Unity was relatively successful. With systems in over 4,000 homes, its installed base exceeded all other players, including Honeywell. But the total market was limited to expensive new homes, less than 1% of the residential market.

Like many others (especially utility research groups), Unity was intrigued by the possiblity of using the powerline for communications to address one of the biggest obstacles to home automation: labor to install wiring, especially in existing homes. Unity joined the Home Automation Advisory Board of Echelon (Lonworks) and sent engineers through its training program. They also started working closely with Intellon (developers of the EIA’s CEBus standard). Based primarily on feedback from utility customers, Unity chose to develop several products incorporating the CEBus powerline carrier (“PLC”) protocol. Introduced in 1995, the CEBus Controller Card won the Home Automation Association award for the best network product. Over the next two years, Unity’s CEBus Controller and a number of related products were used by over 20 utilities in residential trials throughout North America.

Then, one by one, a majority of utilties terminated their trials and plans for major residential roll-outs. Utilities started to get feedback on customer interest and willingness to pay. They also started cranking in “real” costs, not optimistic estimates. The conclusion: at one fifth the cost, this stuff would be fantastic. It gives the customer automation and control, and gives the utility cheap AMR and a platform for additional services. But what to do for now?

Enter small commercial industrial customers, the “overlooked” part of the market. Generally they are diverse and hard to reach, but as a group they represent a significant energy market. Plus, for the most part, they’ve been paying top dollar for their energy. These are the kind of customers ENRON will be going after, not Mr. and Mrs. Smith. Plus, their energy bills are higher, typically 5 times that of the residential customer (which takes care of the 1/5 cost goal mentioned earlier).

Fortunately, Unity had already been working with its dealers and Honeywell to come up with a low cost modular controller for both residential and commercial applications (dubbed the Universal Controller, or UC). To communicate with devices on the premises, the UC can use low cost wiring when appropriate, and it can also use CEBus powerline. Moreover, the UC can be used with any kind of user interface (touchpanel, PC, smart phone, etc.) and with virtually any wide area communication to and from the customer’s premises — they have experience with RF (CellNet and ITRON), cable, and standard telco networks.

A key strength that Unity brings is expertise in cost-effective “smart” energy management. This includes the use of outside air, occupancy, carbon dioxide levels, utility time-of-use rates, and other key variables to minimize heating and cooling costs. It’s dubbed “smart” because it goes well beyond the limited logic of the typical thermostat. An example is using a fan to bring in cool evening outside air in lieu of running the air conditioning equipment. Another example is using a CO2 sensor to sense occupancy in a McDonald’s playland area, setting back temperatures when it’s unoccupied. The UC can even take utility rates into account to decide when and how to meet heating and cooling demands.

Unity’s easy-to-use Windows 95 setup software allows an authorized contractor to incorporate not only smart algorithms, but precise scheduling of temperature based on day of the week, time of day, holidays, and so on. A Unity study published in the ASHRAE Journal (Oct. ’89) documents the effectiveness of their zoning algorithms. Safeguards in the logic prevent excessive cycling of equipment, pressure build-up, or other detrimental conditions, based on detailed equipment models that are built into the software.

Standard thermostats are eliminated by using UnityÕs own flush-mounted temperature sensors that can be painted or covered to “disappear” into the wall. This is more pleasing aesthetically and does away one of the largest headaches especially for public facilities: fiddling by customers or well-meaning employees. The on site control is a simple touchpad, typically located in the manager’s office, passcode protected from unauthorized use. The system also offers extensive remote monitoring and control capabilities.

Unity’s installations to date include schools, churches, fast food restaurants, light industrial manufacturing operations, car dealerships, retail stores and warehouses. Hard data is starting to come in, and it’s pretty impressive, including a 36 percent savings from a car dealership in California and a whopping 61 percent from an office in Arizona.

Unity is now focused on the small commercial market, offering utilities and other distributors smart energy management and a platform for additional services such as remote monitoring and control and extended maintenance. They are working with unregulated utility subsidiaries (ESCOs, ESPs, etc.) who bundle the Unity products with energy and related products and services.

Contact: Tom Riley, President, Unity Systems, Inc.
650-369-3233 x100, riley@unitysys.com
(Relocating from Redwood City to Sunnyvale, CA in July)
(new number effective July 6 — 408-530-0500)

Additional information is available on the company’s website at http:// www.unitysys.com