Should you get an energy management system?

At EnergySage, we want to empower everyone to make smart energy decisions that ultimately benefit them. Adding an energy management system can help you do just that: with this technology, you can better understand how, where, and when you use energy, allowing you to maximize your electricity savings and get the most out of your solar–and/or storage–system. 

In this section, we'll help you determine whether or not you should get an energy management system and review some questions to ask yourself before investing in one.

Installing an energy management system can be worthwhile even if you don't have a solar or storage system. However, you'll receive the most significant benefits if you're looking to add energy upgrades to your home. Below, we'll cover some of the different scenarios that may have you considering an energy management system and explain the advantages of the technology in each.

Scenario 1: you plan to install a solar and/or storage system

The best scenario for adding an energy management system is if you're looking to electrify your home. Whether you want to add solar, storage, an electric vehicle (EV) charger, or a combination of all of the above, an energy management system can help you both in designing your system and in controlling your system after it's installed. Using your energy management system, you'll be able to see how much electricity your devices consume, identify how much electricity you actually need, and size your solar panel system accordingly. 

If you're interested in installing a storage system, you'll want to think about when you'll primarily be using your battery (i.e., every night for self-consumption, rate arbitrage during peak hours, or backup power in case of emergencies) and which devices you want your battery to power. Based on these answers, you can use your energy management system to assess how much energy each of these devices uses and size your storage system based on what you need and/or want it to power. Once you've installed your solar and/or storage system, you'll be able to use your energy management system to monitor and control your energy usage, which we'll discuss in the next scenario.

Another important factor to consider is that if you plan to add energy upgrades that help electrify your home, you may need to pay to upgrade your electrical panel, no matter what. A report published in August 2021 by residential electricity research group Pecan Street found that in order to transition from fossil fuels and move towards home electrification, up to 48 million single-family houses in the United States will need to replace or upgrade their existing electrical panels. The Smart Panel component of energy management systems replaces your existing electrical panel with a high-tech, future-proofed product: Smart Panels are optimized for electrical upgrades such as solar, storage, or an EV charger. As an added benefit, smart panels can also negate the need for a critical loads panel if you're installing storage.

Scenario 2: you already have solar and/or storage

In addition to seeing how much electricity you use in your home, you can use an energy management system to assess how much energy your solar panels produce, the amount of energy you pull from the grid, and the estimated power remaining on your battery at any given moment–all from your phone! You'll also be able to control which devices are running and turn off certain appliances that you don't want to draw power.

Energy management systems can also help you protect your battery. For instance, you can set up your system to automatically shed any large, non-essential loads that would deplete your battery's capacity too quickly in the event of an outage, which could damage it.

Scenario 3: you don't have solar or storage and don't plan on installing either

If you don't plan to add solar or storage to your home, energy management systems won't provide you with the same level of benefits. However, you can still use the system to assess and alter your energy consumption, determine the efficiency of your appliances, and remotely turn your appliances off and on from your phone. Overall, these enhancements may still save you money on a monthly basis, but your savings will likely be substantially less than if you already have solar and/or storage or add a system in the future. 

While the financial benefits of installing a solar panel system are fairly straightforward, understanding the monetary incentives associated with an energy management system is a bit more complex. If you use your energy management system to better understand and ultimately cut down your electricity usage, you'll likely see monthly savings from your energy management system–Lumin, one manufacturer of energy management systems, estimates you'll save $100 per year using their technology, even if you don't have solar or storage. 

Additionally, you can also save money on your energy bills if you use your energy management system's monitoring capabilities to identify and fix any device issues before they become large problems. Overall, the cost of an energy management system is not insignificant (prepare to spend a few thousand dollars on an installation), but having insight into your energy usage and the ability to control your devices remotely can make it a very attractive investment.

In our next section, we'll explain how to evaluate energy management systems.