Berkeley-Haas Partnership Yields $5 Million for Unprecedented Energy Efficiency Study

Berkeley-Haas researchers have partnered with colleagues from the Massachusetts Institute of Technology and the University of Chicago to conduct the largest-ever demonstration of advanced energy monitoring in industrial facilities.

The initiative, part of the cross-school E2e project, has just received a $5 million research grant from the California Energy Commission (CEC) to test an “intelligent energy management” system at 100 factories throughout the state. The system is produced by startup Lightapp Technologies, which is partnering on the project.

The goal is to provide reliable evidence on whether giving factories real-time data and analysis about their energy use spurs them to reduce waste and save power. If successful, the findings could be used to encourage thousands of California manufacturers—and even more worldwide—to deploy similar systems to save energy, lower costs, and reduce carbon dioxide emissions.

“Policymakers are looking to energy efficiency to reduce the world’s dependency on fossil fuels, yet our understanding of how business behavior influences energy use is still poor,” says Berkeley-Haas Professor Catherine Wolfram, Faculty Director of the E2e Project and Energy Institute at Haas and one of the principal investigators on the project. “This project will give us empirical evidence on what motivates businesses to save energy.”

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Lightapp Technologies, based in Israel, has developed software that gathers data from low-cost sensors set up throughout factories. The software allows facilities to track down hidden inefficiencies, and then analyzes the data to identify ways to use less energy. Initial deployments in Israel have helped cut energy costs by 5 percent to 27 percent, according to Lightapp.

The project will focus on compressed air systems, which do everything from running bottling lines at breweries to powering tools in automotive factories. “In some plants, compressors use more electricity than any other kind of gear—with a leaky compressor valve, money is literally disappearing into thin air,” says Elhay Farkash, Lightapp CEO.

The grant is part of CEC’s Electric Program Investment Charge (EPIC), a program to develop and demonstrate the next generation of technologies to address the state’s clean energy goals. The four-year project will be conducted as a randomized controlled trial and factories will be recruited from a randomly-ordered list of the state’s facilities.

The successful grant application was the result of a far-reaching collaboration across the Haas alumni network. Boaz Ur, MBA 09, who was working for Lightapp, had reached out to Wolfram to explore the possibility of collaborating, and the two decided to work together on the proposal. Early in the project’s development, three Haas alumni who work as energy efficiency business leaders at Pacific Gas and Electric Company—Karen Zelmar, MBA 99, Mangesh Basarkar, MBA 13, and Siva Sethuraman, MBA 12—provided important input to the project team. Then, in identifying an industrial facility to demonstrate the technology, they turned to Sean Lavery, MBA 10, who was then the senior brewmaster at Anheuser-Busch’s Los Angeles brewery. Lavery helped bring the company on board as a demo site.

E2e is a group of economists, engineers, and behavioral scientists focused on understanding the energy efficiency gap. Formed in 2013, E2e was funded by the Alfred P. Sloan Foundation. In addition to Wolfram, the principal investigators are Michael Greenstone of the University of Chicago, and Christopher Knittel of MIT.

Read more on the research project here.