Microsoft vs. Google: How Ford's Electric Cars Pushed Hohm Ahead of PowerMeter

Microsoft (MFST) has found an unconventional way to compete and even surpass rival Google (GOOG) in the crowded and competitive home-energy management market: include electric cars in the mix. Microsoft's recently announced partnership with Ford (F) may seem like an odd strategy at first glance. After all, electric cars hardly have a significant market share in the U.S.

But consider this: one electric vehicle can double home energy consumption while the vehicle is charging. Imagine what will happen to the electrical grid in 10 years when owners of the estimated 1 million plug-in vehicles come home after work and try charging their cars. Suddenly, the inclusion of electric cars in Microsoft's home-energy management strategy starts to make sense.

Last year Microsoft released Hohm, a free Web application designed to help customers monitor and eventually manage energy use, on the heels of rival Google's PowerMeter. Ever since, Microsoft has worked to distinguish itself in the home-energy management industry with continued improvements to the Hohm tool. But it wasn't until Microsoft branched out into electric cars that the company has been able to set itself apart from the competition.

Under the partnership with Ford, the Hohm tool will be included in the 2011 all-electric Ford Focus and will monitor a car's battery charge and help owners determine the best time to charge their vehicles. Take a day off from work, go on vacation or decide to leave earlier for work, and Hohm will adjust the car-charging schedule. Hohm also will be included in Ford's other battery electric vehicles and plug-in hybrid electric vehicles.

It's a smart move for Microsoft, which already has a relationship with Ford. Microsoft's Sync entertainment system is installed in some 2 million Ford, Lincoln and Mercury vehicles since its launch in 2007. Even better? The partnership with Ford is non-exclusive, which means Microsoft could push Hohm into even more electric cars.

Here's a primer on Microsoft's Hohm and Google's PowerMeter:

• Both PowerMeter and Hohm are free Web tools designed to help customers monitor and (ultimately) conserve energy use.
• PowerMeter works by taking information from a smart meter installed in your home, tracking energy consumption and then sending the data to a customer's iGoogle homepage.
• Microsoft Hohm works differently. It uses advanced algorithms licensed from the Lawrence Berkeley National Laboratory and the Department of Energy to determine energy use. These analytics do the heavy and complex lifting, and turn it into useful, easy-to-understand information for the user. Hohm users can type in a Web ID and zip code to see average energy use in their area. From there, user can drill down even further by answering 200 questions -- like the square footage of your home.
• PowerMeter has partnered with nine utilities in the U.S. and Europe that are deploying smart meters.
• Microsoft is working with four utilities -- Puget Sound Energy, Xcel Energy, Seattle City Light and Sacramento Municipal Utility District -- to allow customers to upload their energy data into Hohm for more accurate, detailed information.
• Google and PowerMeter have partnered with smart meter maker Itron.
• PowerMeter is now accessible even if your utility isn't a Google partner. The search engine giant has partnered with Energy Inc. and AlertMe, companies that make devices that let users track energy usage without cooperation from your utility.