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The Inevitable Shift:
Why the Future of Energy Management is API-First
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Introduction
Our homes are changing. With solar panels on the roof, an electric car in the garage, and smart thermostats on the wall, the way we interact with power is getting personal. But this new reality brings up a big question for the tech that ties it all together: what's the best way to connect all these smart devices to the wider energy ecosystem?
For a long time, the answer was a physical 'gateway' box. But as the technology evolves, a simpler, software-based approach using APIs is taking center stage. To understand what this shift means for our homes, we sat down with Sebastian Magri, Podero’s CTO. He explains why moving away from extra hardware isn't just a trend, but a crucial step towards a smarter, more user-friendly energy future for everyone.
For a long time, connecting to energy devices meant installing a physical gateway. Why are we seeing a push now towards an API-first world?
Sebastian: The old gateway model was a fantastic fix for a real problem—it let us connect all sorts of devices that were never designed to speak the same language. But the world has moved on.
The growth in home energy tech is just staggering. Think about it: over 60% of all residential solar in the EU was installed in just the last five years, and we're seeing the same thing with EV chargers and heat pumps. The bottom line is that most new devices are already built using modern, standardized tech.
We're past the 'wild west' phase now. Choosing to install a hardware gateway today is like insisting on a dial-up modem in the age of fiber. It's an outdated step, and it's a cost that usually falls on the customer.
That makes sense, but what about the millions of homeowners who already have older inverters? It doesn't seem realistic to expect them to buy a new one just because it’s not API-compatible. Are we not risking leaving a big part of the market behind?
Sebastian: That’s the big question, for sure. And let's be real: a homeowner isn't going to throw out a perfectly good inverter just because we ask them to. We get it. But the reality is, the market is already moving on its own. Most of the devices that are a good fit for these new energy services are actually pretty new themselves—installed within the last seven years or so.
On top of that, you have governments and utilities offering great incentives to upgrade. In Austria, for example, people can get up to 50% of the cost covered to swap an old inverter for a new one. So, while we can't support every single old device from day one, the problem is kind of solving itself. The financial reasons to upgrade are making it an easy choice for many, and that naturally brings them into this modern, API-ready world.
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We're reading more and more about cyberattacks on energy infrastructure. From a utility's perspective, how does an API-first model stack up against hardware gateways? It seems counterintuitive to some that a cloud connection could be more secure than a box in the house.
Sebastian: It’s true, it can feel a bit counterintuitive. But it really comes down to simplifying the whole security picture and clarifying who is responsible for what.
You're right, any connected device can be a potential vulnerability. But think about what happens when you add a third-party gateway. You're putting another box on the network, with its own software, that someone has to keep updated. If a security flaw is found, who’s responsible for the fix? The customer? The installer? Us? It quickly turns into a logistical nightmare, especially when you have thousands of these boxes out in the wild. Each one is another potential door for an attacker.
The API approach doesn't magically eliminate all risk, but it streamlines the responsibility in a huge way. We're not adding an extra piece of connected hardware. Instead, we're using the secure connection the manufacturer already built for their own apps and services. And they are all moving away from old, insecure protocols and embracing the same battle-tested Web standards that protect things like online banking.
This puts the ownership for security exactly where it should be: with the manufacturer. They have the expert teams and the infrastructure to handle threats under their standard service guarantees. If a vulnerability pops up, they fix it once on their end, and the entire fleet of devices is protected instantly. For a utility, that’s a game-changer. You're not rolling out trucks or chasing down your customers for manual updates. You have a clear line of responsibility and a much smaller “attack surface” to worry about. It’s just a cleaner, more modern way to handle security.
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Subscribe now!That's a very clear argument. So, putting security aside, what about the classic argument that hardware is just more reliable? How do you respond to engineers who are wary of relying on a manufacturer's cloud for mission-critical services?
Sebastian: I understand that perspective, especially from those with backgrounds in industrial control, where physical connections are king. The reality in this space, however, is different. The reliability of an API connection is backed by the Service Level Agreement (SLA) of the device manufacturer. This means they guarantee uptime and performance.
By using their API, we're leveraging their massive investment in infrastructure and reliability. Versus if we installed our own gateway, we'd be the ones on the hook, introducing another potential point of failure - and another support burden for us and the utility.
From a business perspective, going API-first streamlines everything. For us at Podero, it means simpler logistics and letting our engineers focus on building and continuing to evolve great software - not troubleshooting hardware. For the industry, it pushes manufacturers towards open standards like SG-Ready and OpenADR. And for utilities, the difference in their customer onboarding is night and day. With hardware, a customer signs up, and a whole chain of physical logistics kicks off: the utility has to configure and ship a device, the customer has to wait for it, receive it, and correctly connect it to their home network. The whole process can take days, if not weeks. With an API, that same customer can be signed up and connected in minutes. It's almost instantaneous. That speed translates to quicker, cheaper onboarding and a massive reduction in support and compliance overhead.
And wrapping it all up, what’s the final pitch for the end-user? Why should they be excited about this shift?
Sebastian: For the end-user, it boils down to three things: it's cheaper, simpler, and more secure. There's no installation cost for an extrapiece of hardware. The setup is a simple, secure digital handshake they can do themselves in minutes. And as we just discussed, they get peace of mind knowing their data is protected by the experts who built their EV or heat pump, with clear privacy controls they can manage.
Ultimately, this aligns with where the smart home is going. If you want your EV to smart-charge with excess solar power, you need devices that speak the same language. APIs are that language. We're not just connecting a device; we're integrating it into a smarter, more efficient home ecosystem.
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One last technical point. Some have raised concerns that manufacturer APIs might not respond quickly enough to be able to participate in flexibility markets. How do you address that?
Sebastian: That's a valid point for a very specific set of high-frequency services. Our approach is pragmatic. We only deploy use cases that are a good fit for the technical capabilities of a given API. But - more importantly - this is a temporary issue.
We are in constant dialogue with manufacturers, providing them with the data and use cases to demonstrate growing demand for lower-latency (faster, more responsive) connections. As the value of flexibility services becomes clearer, manufacturers are increasingly incentivized to improve their API performance. And if they don’t, their competitors inevitably will.
It's a journey, but the direction is clear. The gateway was the past. The API is the present and the undeniable future.
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