Key challenges and opportunities in building automation and energy management

BMS, Building management system, controls, BSRIA
Market drivers — Henry Lawson.

As part of its ongoing research into building automation and controls (BACS) and building energy management systems (BEMS), BSRIA has been monitoring some of the key trends that are driving the market. Henry Lawson gives an insight.

BACS is already a fairly mature and lucrative market worth more than US$22 billion globally. While growth is steady rather than spectacular, there are a number of markets, especially the BRIC countries (Brazil, Russia, India and China), where the BACS market is still quite small measured against GDP. So it is hardly surprising that there is a lot of competition and that technology often acts as a catalyst that can disrupt the market while presenting new opportunities.

Air conditioning using variable refrigerant flow (VRF) has overtaken chiller-based systems globally. Because these systems require fewer controls, they are causing concern for some BACS players. As IT and web-based technologies become more central to building systems, companies that weren’t previously associated with the sector are making an impact, especially in the residential market — from Apple and Samsung to Google and Facebook.

Related to this, ‘smart home’ solutions are increasingly attractive to the lower end of the commercial segment who neither need nor want to pay for a complex BACS system. In Germany this now accounts for a majority of the ‘smart home’ solutions sold.

Furthermore, individual components increasingly have a degree of intelligence and can be connected to the Internet of Things (IoT), and BACS systems need to be more ‘open’ to cope with this. In such a crowded field, suppliers naturally tend to seek out ways in which they can differentiate themselves.

Some suppliers achieve this differentiation by looking ‘outwards’ — for example by helping the smart building to integrate more fully into the smart city, including utilities, transport and securities.

Others are focussing on issues like the comfort of the building’s occupants and the dramatic impact this can make on productivity and, hence, profitability.

It is now recognised that connected buildings are potentially highly vulnerable to cyber-attack, the more so because those responsible for commissioning and running buildings will often have little experience of the nature of the cyber threat and how to respond to it. This means that, while more suppliers are offering solutions to help protect buildings, the procedures adopted by building managers will be just as critical.

Indeed facility managers, whether they are part of an internal department or an outsourced function, will be key players and influencers. And BACS systems that integrate with the wider needs of facility managers, such as asset management, and effective co-ordination of multiple sites, will have a corresponding advantage.

When it comes to BEMS the market is smaller and less mature, with a current global value of some US$3.5 billion, but annual growth, at over 10%, is much faster than BACS. Markets like China represent a huge opportunity, especially as the Chinese government is gradually adopting a more proactive position in combatting both pollution and climate change. Not only is China by far the largest emitter of CO2, ahead of the USA and double the total for Western Europe, but it has almost as much building floor space as Europe and North America combined.

We have also been tracking the key functions that make up BEMS. Almost all solutions will analyse the building’s energy-usage patterns, though this varies from simple reporting, perhaps aided with a few charts, to sophisticated analytics and prediction. A key challenge for many building managers is not just understanding all of this analysis but knowing what to do about it. Many solution providers respond to this by offering varying degrees of consultancy and management.

This supports the notion that building energy efficiency is not just a matter of having the right design and tools, but managing it going forward; ongoing commissioning of the building to ensure that it conforms to specification is now a key part of most offerings.

Buildings are also increasingly playing their part in helping to manage the grid, and demand response, which enables buildings to cut down on power usage at peak times, is also now available from many leading suppliers.

As both BACS and BEMS become more interconnected with the IoT (Internet of Things), there is a growing need for standards to evaluate performance and to ensure that different systems can ‘talk’ to each other. International standards like BREEAM and LEED are gaining traction and new initiatives like Project Haystack are emerging to meet the specific needs of buildings, while others like HyperCat address the wider smart world.

Looking forward, building managers are likely to be less interested in selecting a solution that simply manages their building’s systems or their building’s energy consumption in isolation and more in how their buildings interact with the wider world of the IoT. This offers great benefits but it is also an increasingly complex world, carrying its own risks, and companies are likely to need help from suppliers, from financiers and from standards to navigate their way to safety and security.

Henry Lawson is a market research consultant with BSRIA.

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