To say that thermostats have come a long way since the first of its kind hit the market would be an understatement. Today, thermostats aren’t just thermostats; they are smart. They have capabilities that at one point in time seemed impossible. And it’s a good thing they do because what homeowners today want from their smart thermostats is much more than temperature control — and as smart technology evolves, consumers are only going to want more.
State of the Smart Thermostat Market
Energy efficiency, connectivity, convenience, sustainability, and the desire for a smaller carbon footprint are all factors driving the demand for smart thermostats today.
“Additionally, governmental incentives and regulations aimed at promoting energy-efficient technologies have further bolstered the demand for smart thermostats,” said Tom Lorenz, director, Sensi platform for Copeland. He continued to say that the surge in demand is indicative of a broader societal shift towards sustainability and tech-enabled living, which shapes the future of home climate control.
“You have a couple of things working together: more understanding and awareness of smart products in homes in general … combined with a smart thermostats' ability to help save on energy and utility bills,” said Marissa Kocaman, product manager at Resideo. “That's been a good pairing to open up adoption of smart thermostats more broadly.”
Right now, there’s a market for most types of smart thermostats, whether it’s a basic Wi-Fi model or one that offers full-home integration. Every consumer has a variety of different needs, and what those needs are will decide what type of thermostat is right for that customer.
“What pros and builders recommend depends on the homeowner’s needs — whether they have a very basic system or complex solutions including heat pumps, dual fuel, and/or accessories like humidifiers or air exchangers,” said Adam Welton, senior director, channel marketing, ecobee.
Lorenz said that most homeowners are interested in basic Wi-Fi thermostats that give them the ability to remote control their home temperature and save on utility bills.
There are homeowners who want a really simple, straightforward thermostat that offers energy savings and remote controls. There are also homeowners who are very interested in smart home options and want to integrate more than one device and set up a myriad of different automations.
“That might skew more towards those early adopters and people who are really focused on smart homes, or potentially have more complicated, complex systems that they're setting up,” said Kocaman. “And so you see a variety … It really depends on what are both the home's needs and that homeowner’s needs — certainly, larger homes can have more complicated systems and may have a need for a more advanced thermostat that can control more IAQ systems.”
Lombardi said at the core of it, homeowners want something that is helpful and fits their daily needs.
“Be it adjusting temperatures at the wall, from your phone, or with your voice; saving energy; or giving end users more insights into the health and performance of their HVAC systems, Nest thermostats will continue to be helpful and adaptive,” said Serge Lombardi, Nest Enterprise - strategic partnerships lead.
Important Capabilities
Even though homeowners may have a variety of differing needs, most of them are looking for the same key things out of their smart thermostats: energy and cost savings, integration/connectivity, and ease of use. Thermostats today have the ability to bring in data from sensors into the system, allowing these needs to be met.
A recent Copeland Wi-Fi Thermostat Market Study done in December 2023, found that the most important capability to homeowners with smart thermostats is saving money through lower heating and cooling costs. Ease of use was a close second.
“Homeowners are looking for something to make their lives easier,” Lorenz said. “One example of this is utilizing a top-rated mobile app, like Sensi smart thermostats.”
Manufacturers have long picked up on what homeowners want out of their smart thermostats. For example, ecobee smart thermostats offer remote control via the ecobee app or one of their many integrations. This allows customers to set their comfort settings and schedule on the thermostat or on the app to ensure they are always comfortable when home, and they save energy when they are away. In addition, Welton said that ecobee’s built-in eco+ features offer benefits that help customers save up to 26% on their annual home heating and cooling costs compared to a hold of 72°F.
Full home integration includes indoor air quality (IAQ) controls or IAQ alerts or reminders.
“A good example is that Resideo offers several Honeywell Home smart thermostats that can control IAQ equipment — a humidifier, dehumidifier, ventilation equipment,” Kocaman said. “When you can control all of that from one device, it is a huge benefit to a homeowner because it simplifies their controls.”
The Honeywell Home T10+, the newest thermostat offering from Resideo, can connect up to 20 indoor sensors wirelessly.
“And using the data from those sensors, you can prioritize how you're heating or cooling your home to optimize the comfort in different rooms without zoning,” Kocaman said.
On top of that, some smart thermostats can provide alerts and reminders — things like when it’s time to change the filter or humidifier pad.
“Those types of reminders help simplify the process of owning a home and maintaining an HVAC system for the homeowner,” Kocaman said.
In general, being able to connect and interact with an HVAC system from anywhere is a key value that smart thermostats have, and homeowners want.
“Device compatibility with varying systems and system types is becoming increasingly more important as well,” Lombardi said. “The electrification of the U.S. will drive more and more consumers and HVAC contractors to heat pumps. More recently, being in tune with the health and performance of the HVAC system itself is becoming a clearer consumer need.”
That’s where something like the Nest HVAC Monitoring plays an integral role in giving homeowners more insight into system performance and health.
“Now homeowners can get notifications of heating/cooling degradation and/or failures, and from there, seek out diagnosis and service from a local skilled Nest Pro,” said Lombardi.
One standout feature offered by today’s smart thermostats is remote temperature sensing.
“Another noteworthy capability with the growth of heat pump adoption is utilizing outdoor temperature, where thermostats intelligently use the balance point settings to maximize the heat pump systems efficiency while minimizing the supplemental heat, ensuring personalized comfort and helping maximize energy efficiency,” said Lorenz. For Copeland, this is achieved by the Sensi dual fuel logic, a proprietary algorithm that tracks and monitors system performance, determining the ideal time to stage to the gas furnace.
Future of Smart Thermostats
Looking ahead, manufacturers expect smart thermostats to feature additional advancements in the controls they already offer.
“We believe in doing more with fewer devices, and adding more value to the ecobee experience,” Welton said. “When we launched our new Smart Doorbell Camera, we also launched a live view feature, meaning customers can see a live feed from their doorbell directly on their Smart Thermostat Premium screen. We also launched a new keypad integration so customers can arm or disarm their homes, and an automatic siren, directly in our smart thermostats, making them an all-in-one home monitoring hub.”
Smart thermostats will also see more advancement in their analytic capabilities, based on the data the thermostats collect.
“We're starting to see more popularity of voice control, which also brings more compatible products,” Kocaman said. “We’re starting to see this already in the smart home world, and homeowners are bringing their smart devices all together in that smart home system, and thermostats are a very large part of that because they control the comfort in the home, and for many people that is the most important part.”
Smart technology will continue to evolve and become increasingly intelligent, intuitive, and integrated, added Lorenx.
“Copeland envisions smart thermostat advancements such as enhanced predictive capabilities, seamless integration with renewable energy sources, and interoperability with emerging technologies like AI-driven automation,” he said.
Evolution of the Thermostat
In 1620, the first thermostat was invented by Cornelis Drebbel, a Dutch inventor who was looking for a way to reliably regulate the temperature within his chicken incubator. And though Drebbel had one specific need for this thermostat, it set into motion the thermostat market consumers know today.
Nearly 200 years later, in 1830, Scottish chemist Andrew Ure patented the bi-metallic thermostat he used to keep steam boilers warm, but the invention never caught on. That is, until Warren Johnson, founder of Johnson Controls, took it a step further. He invented a bi-metal thermostat that proactively rang a bell when it was time for the furnace damper to be adjusted. In 1885, Johnson made thermostat history when he filed for a patent for the first multi-zone thermostatic control system.
That same year, inventor Albert Butz filed a patent for his “damper-flapper,” which was the first electric and automatic thermostat. The damper-flapper, which regulated furnace heat by lifting the damper on the furnace with a pulley system when indoor temperature became too cold, had three components: a thermostat, a battery, and a motor. The invention would go on to serve as a predecessor of modern thermostats and established the technology that proved to be the foundation for the automated control industry. Butz was awarded the patent and formed the Butz Thermoelectric Regulator Company, which would eventually become Honeywell International Inc.
In 1906, after Mark Honeywell, founder of Honeywell, purchased Butz’s patent and company, Honeywell introduced to homeowners their very first programmable thermostat, the Jewell. It featured a built-in clock and allowed users to turn down the heat at night and automatically adjust it to a pre-set temperature in the morning. An updated, analog version can be seen in the Smithsonian Museum, and the smart versions have seen an uptick in adoption.
Over a hundred years later, the thermostat market arguably experienced the biggest adaptation it had seen since 1906. After a winter getaway with his family, ecobee founder Stuart Lombard returned to find his home at a brisk 50°F. Lombard had set a personal goal to reduce his environmental footprint by making changes to his daily life, and one of those changes included programming his thermostat to conserve energy. At the time, the world was just beginning to embrace iPhones, and smart home technology didn’t exist. In 2008, this all changed when ecobee introduced the world’s first Wi-Fi connected smart thermostat.
Since then, and especially in recent years, the demand for smart thermostats — and what they are capable of — has experienced quite the increase.
“Ecobee has since released new models every few years, and now has millions of customers across North America,” said Adam Welton, senior director, channel marketing, ecobee.
The main selling point of ecobee’s first smart thermostat was the ability to remotely control the thermostat via an app and to save money on energy bills. Shortly thereafter, in 2011, Google Nest released the Nest Learning Thermostat.
Since then, smart thermostats have continued to evolve, introducing new connected features.
“While we still offer the remote control and energy savings customers are looking for, we now also offer wide-ranging features that can help customers keep an eye on their air quality, use a smart assistant, and arm or disarm their home security, all from their smart thermostat,” Welton said.
