Frost & Sullivan: The Rise of Smart Buildings in Europe


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Smart buildings are the future of building technologies. New innovations are geared towards making buildings greener and more "intelligent". One of the leading platforms of implementing smart technology in buildings is through automation systems.
Though there has been a slump in the building technologies industry across Europe in recent times, the growth prospects of energy efficient and smart systems remain high. In fact, consumers are expected to focus on reducing operational expenses in buildings as they recover from this economic crisis.

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Frost & Sullivan: The Rise of Smart Buildings in Europe

  1. 1. Building Automation: The Rise of Smart Buildings in Europe How Building Automation Can Make Europe Smarter Neetha Jayanth, Senior Research Analyst Building Technology 24th May, 2012© 2012 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property ofFrost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
  2. 2. Focus Points Smart Buildings: The Need for Intelligence Smart Concepts and the Key Enablers for Growth Smart Buildings: Progression towards Smart Buildings Smart Buildings: Key Trend over the decade 2010-2020 Smart Buildings: Major Drivers and Restraints Smart Buildings: Key Market Segments Mega Trend Drivers for Smart Buildings Building Automation Systems Revenue Forecast Integrated Industry – Single Platform for Smart Technology Key Players – Convergence is the way forward The Last Word Next Steps 2
  3. 3. Poll Question Which sector do you believe will see maximum penetration of smart technology by 2020? • Office Complexes • Residential Homes • Multi-Dwelling Units • Retail & Hospitality Sector • Public buildings (like malls) Source: Frost & Sullivan analysis. 3
  4. 4. Smart Buildings: The need for intelligence Smart Buildings Market: Regional Life Cycle Analysis (Europe), 2012 Outlook for Smart Technologies  With electricity demand growing faster Germany than supply, there is an opportunity for Alpine & Benelux The United Kingdom integrating ‘intelligence’ into buildings. France Scandinavia  Energy efficiency drivers are combining Spain Italy with the need to modernise electricity Eastern Europe Central supply networks. Smart technology Europe Development Growth Maturity brings an opportunity to marry energy management with digital communication technology. Smart Buildings Market: Key Interlocking  Smart technology is changing the way Issues (Europe), 2012 users interact with buildings and the Energy Supply way they interact with each other. With Connectivity Construction & Integration and Costs Activity & Regulations the planned EU Directives, it will receive the required impetus  Opportunities are emerging in all Environment Energy sectors as savings in operational costs Demand will be encouraged in the economic recovery phase System Intelligence Source: Frost & Sullivan analysis. 4
  5. 5. Smart Buildings
  6. 6. Smart Concepts and the Key Enablers for Growth 2 Smart Grid Key Features Growth Enablers • Optimised use of • Smart metering capacity • Drive from utilities 1 Utility • Advanced metering infrastructure • Regulation • Energy price signals • Integrating renewables • Energy storage Smart Building System • Digital intelligence • Remote control • Integrated communications • Micro grids • Sensing & • Virtual power plants measurement Building 3 Smart City Key Features Growth Enablers Key Features • Fully automated Growth Enablers • Open architecture Cities • Inter-connectivity • IP networks and between buildings and affordable broadband ‘digital’ buildings • Advanced building communities • Real-time network • Continuous 2-way design • Virtual consumers visualisation communication • Software tools • Shared efficiency • Inter-connected • Micro-generation • Analysis & reporting gains advanced metering • Demand response • Connectivity of • Smart service infrastructure • Smart materials devices delivery (safety, • Buy-in from city • Fully integrated • Networks of health, education etc.) leaders building controls ubiquitous sensors Source: Frost & Sullivan analysis. 6
  7. 7. Progression towards Smart Buildings 1980 1990 2000 2010 2020 Construction IT and Enhanced Functional Micro- Convergence Operational Management Controllers Generation Efficiency Smart Building Low Energy Smart CitiesEvolution of Automation Energy Lighting Management Homes Building Smart Intelligent Micro-Technology Renewables Grids Green Markets Buildings Home Security Intelligent HVAC Control Building Automation Convergence Buildings Management Energy and Control Systems Green Integrated Control Integration Buildings Networking Building Building Building Smart Control Automation Performance Buildings Automated Home Energy Virtual Meter Smart Smart Power Management ConsumersEmergence of Reading Line Windows Metering (AMR) Home Home Smart and Open Carriers Energy Virtual Smart Area Intelligent Protocol Thermostats Monitoring Network Power Sensors in Facility Plants Technology Building Micro- Management Advanced (HAN) Renewables Smart Technology Metering Infrastructure (AMI) Cities/Towns 2000 2010 2020 Source: Frost & Sullivan analysis. 7
  8. 8. Key Trends over the decade 2010-2020 Management of buildings Growth of through The initiation to renewable Penetrating “smart” Economy in automation existing energy efficiency - and control buildings in all buildings – homes, offices generation Price sensitivity The and other due to economic untapped buildings crisis 2015 potential2010 2020 Smart and 2012-13 Energy Green conservation Lighting to Payback electrical devices periods become – energy Smart Meter shorter Supply-side efficiency is key roll-out and convergence advent of Smart Grid Source: Frost & Sullivan analysis. 8
  9. 9. Major Drivers and Restraints Drivers  Development of technology  Need for energy efficiency in buildings  EU Directives  High initial investment  Return on investment  Economic situation  Risk averseness Restraints across the supply chain  Limited awareness Source: Frost & Sullivan analysis. 9
  10. 10. Key Market Segments Residential Sector Key Building Technologies• Large potential • Home Automation • Smart Meters• Slow penetration • Home Energy Management and• New construction is an important segment, Monitoring Devices but retrofit applications have a growing • Energy Efficient Lighting penetration in Western Europe • Micro-renewable Commercial Sector• High revenue segment Key Building Technologies• Better rate of adoption than residential • Building Automation • Building Management Systems• Slowdown in construction • Fire Safety & Security• Existing buildings remain more difficult to • Energy Efficient Lighting penetrate, while new construction projects • HVAC & Lighting Control Systems provide large revenue opportunities Source: Frost & Sullivan analysis. 10
  11. 11. Mega Trend Drivers for Smart BuildingSmart Buildings Market: Impact of Mega Trends on Key Building Technologies: Europe, 2011-2020 Key Building Mega Smart Beyond Zero Technology Infrastructure Technologies Cities Cities BRIC Emission Smart Meter Building Automation Home Automation Energy Efficient Lighting Micro-renewables Energy Management Lighting Controls Systems Fire and Safety Note: Low Medium High Source: Frost & Sullivan analysis. 11
  12. 12. Building Automation
  13. 13. Building Automation Systems Revenue ForecastThe Building Automation Systems (BAS) market revenues wasestimated at $1.8 billion for the year 2011 and is expected to growwith a CAGR of 2.6% over the period 2011-17 BAS Market: Revenue Forecasts (Europe), 2007-2017 3000.0 10.0 8.0 Revenue ($ million) 6.0 Growth Rate (%) 2000.0 4.0 2.0 0.0 -2.0 1000.0 -4.0 -6.0 -8.0 0.0 -10.0 Year Revenues ($ million) Revenue Growth Rate (%) Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan Analysis 13
  14. 14. Integrated Industry – Single Platform for Smart Technology HVAC and Structural Energy Security and Fire and Life Sanitation Systems Management Alarm Safety Integration of building systems on the consumer end through BAS platforms HVAC & R Energy Efficiency Building Technologies Lighting Integration of suppliers Micro-generation to provide wider and Control and automation Smart better product lines – Buildings moving from products and services to Fire Detection solutions Fire Suppression Fire Alarms Security Integration Fire & Safety Source: Frost & Sullivan analysis. 14
  15. 15. Key Players – Convergence is the way forwardSmart Buildings Market: Key Participantsand the Convergence of Three Industries, Europe, 2011 BT ICT Energy & Microsoft O2 Utilities GE IBM Siemens Oracle Eaton Google Alstom Sharp Honeywell Inc. Cisco Schneider Electric Itron Landis+Gyr Johnson Controls Inc. ABB Bosch Emerson Legrand Philips Lighting Building Note: Technologies XYZ Key Participants Source: Frost & Sullivan analysis. 15
  16. 16. The Last Word Growth of the building technology industry will center around the integration of ICT in buildings – Smart technologies are the key demand segment for growth. Ten years hence, if it’s not smart, it may not have a market. Smart buildings will imply integration of building services on a single platform – Building automation and home automation will provide this platform for non residential and residential buildings respectively Consolidation and highly dynamic competitive scenario – The industry will evolve through mergers and acquisitions and other consolidation efforts as companies strive to build their expertise across product markets Source: Frost & Sullivan analysis. 16
  17. 17. Next StepsDevelop Your Visionary and Innovative Skills Growth Partnership Service Share your growth thought leadership and ideas or join our GIL Global Community Join our GIL Community Newsletter Keep abreast of innovative growth opportunities 17
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  20. 20. For Additional InformationChiara Carella Neetha JayanthCorporate Communications Senior Research AnalystEurope, Israel & Africa Building neethaj@frost.comJohn Raspin Andrew ThorndykeResearch Director Sales ManagerEnergy & Environment 20