Smart home appliances aren't so smart about saving energy when they cannot communicate easily with electric meters.

Two weeks ago General Electric released a report stating that ZigBee radios are better for smart appliance communications than WiFi. Yesterday the WiFi Alliance issued its predictable retort: the GE study is “flawed.”

Why does this matter? If appliance manufacturers don’t agree on a single standard, they won’t build the radios into their appliances — which means that the promise of energy savings and peak demand reductions from smart appliances cannot be realized…

For home appliances, the alternative to built-in radio communication is external communication modules — but that option is significantly more costly and far too complicated for consumers.

Eventually the free market will determine who is right, since regulators are unlikely to tell appliance builders which radio they must use. This aspect of appliance manufacturing is unregulated and likely to remain so.

However, regulators do have a major say on one issue that will strongly influence the ZigBee vs. WiFi decision: the home area network (HAN) interface that is built into smart meters which are installed by regulated electric utilities.

For electric meters, ZigBee has become the de facto standard for wireless HAN interfaces. Wireless is the leading HAN technology in North America, Australia, the UK, and Germany. But in many other countries (including most of Europe), power line carrier (PLC) is the leading HAN communications technology. PLC communications uses electrical wiring (instead of radio signals) to transmit signals between the local transformer and the meter, then into the premises.

Over 99% of US smart meters that include a HAN interface use ZigBee — with total installations nearing 10 million meters. Furthermore, utilities have committed to tens of millions more ZigBee-enabled meters.

So: If meters will be sending price and control signals directly to smart appliances and smart thermostats, those devices must include ZigBee radios. Alternatively, the meter can communicate with a gateway that, in turn, communicates with smart devices.

For this, the market (not regulators) will decide.