Building energy Management hits the cloud / Co-opetition is on the rise in the building industry / Targeted acquisitions help key players deliver end-to-end monetized energy services / Demand for smart building products in Asia Pacific will soar, driven largely by China / U.S. energy service companies turn to the federal sector /Building communication protocols are converging in more ways than one / Demand response (DR) is shifting into automatic / Submeters find new opportunities in smarter buildings / Building information modeling is transforming the design process / The interface between smart buildings and the smart grid is blurring

1. M A R K E T I N T E L L I G E N C E • A N A LY S I S • B E N C H M A R K I N G
Smart Buildings:
Ten Trends to Watch in 2013 and beyond
©2013 Navigant Consulting, Inc. Notice: No material in this publication may be reproduced, stored in a retrieval system,
or transmitted by any means, in whole or in part, without the express written permission of Navigant Consulting, Inc

2. Section 1 - Building energy Management hits the cloud
Section 2 - Co-opetition is on the rise in the building industry
Section 3 - Targeted acquisitions help key players deliver end-to-end monetized energy services
Section 4 - Demand for smart building products in Asia Pacific will soar, driven largely by China
Section 5 - U.S. energy service companies turn to the federal sector
Section 6 - Building communication protocols are converging in more ways than one
Section 7 - Demand response (DR) is shifting into automatic
Section 8 - Submeters find new opportunities in smarter buildings
Section 9 - Building information modeling is transforming the design process
Section 10 - The interface between smart buildings and the smart grid is blurring
Ten Trends in Smart Buildings
2

3. Section 1
Building energy
Management
hits the cloud

4.  Global BEMS market projected growth from $1.9 billion in 2011 to $6.0 billion in 2020
 Big data generated by buildings stored into the cloud - basis for rich software-as-a-
service (SaaS) offering…valuable decision making tool for top management
 Building energy data - benchmarking tool to identify areas of inefficiency and poor
performance.
 BEMS as an App - a platform that pulls together data from disparate building systems
Building Energy Management Hits the Cloud
4

5. Building Energy Management Hits the Cloud
5

6. Section 2
Co-opetition
is on the rise
in the building
industry

7. 7
Current state: Building industry - highly fragmented.
Need: Demands for BEMSs require considerable integration between disparate
building systems and its vendor solutions.
Solution: Consolidated vs. Fragmented:
 High performance building product marketing
 Vendors combined capability of two systems - is often greater than the sum
of the parts
Co-opetition is on the rise in the building industry

8. Section 3
Targeted
acquisitions
help key
players
deliver
end-to-end
monetized
energy
services

9. Intense market acquisition levels driven by:
 Rapid sector growth - driving decisions towards buy vs. develop
 Industry leaders looking to add new capabilities to secure strong
position in competitive RFP environment.
 Monetized energy services
 Retrofit
 Optimize providers
Targeted acquisitions help key players deliver
end-to-end monetized energy services
9

10. Targeted acquisitions help key players deliver
end-to-end monetized energy services
10

11. Section 4
Demand for
smart building
products in
Asia Pacific
will soar,
driven largely
by China

12. Asia pacific represents 40% worlds building space – By 2025
China will build over 200 cities with population over 1million
 Smart building technology still represents small portion of new
construction:
 Only 25% of the global market for controls
 Only 20% for BEMSs
 17% intelligent lighting and controls
 6% for DR services
Demand for smart building products
12

13. Asia Pacific strong position:
 LED – 50% of global sales annually
 Untapped market will represent future growth
 Current Smart Technology market is growing at a double
digits pace outperforming North America and Western Europe
 Chinese Government is a driving force (5 year plan to reduce energy
consumption by 16%)
13

14. Demand for smart building products
14

15. Section 5
U.S. energy
service
companies
turn to the
Federal
sector

16. Current state of ESCO (Energy Service Companies):
 U.S. – market belongs to MUSH (Municipalities/Universities/ Schools/Hospitals)
 Western Europe –commercial / public building sectors
 China – Commercial / industrial sectors
U.S. Future State of ESCO
 Over 500,000 buildings under government control – great potential for energy
improvements via ESCO
 U.S. ESCO revenues from the federal sector will grow from $1.2 billion in 2012 to
$4.0 billion in 2020 (CAGR of 18%)
U.S. energy service companies turn to federal sector
16

17. U.S. energy service companies turn to federal sector
17

18. Section 6
Building
communication
protocols are
converging in
more ways
than one

19. Current State: Existing building stock speak many languages
ICT- enabled building devices - are becoming ubiquitous, leading to a complete landscape
of smart devices that can be integrated into a single system.
Need: Synthesizing building energy data
ICT with BMSs and other systems within buildings need to create BEMSs that feed BMS-
related data into centralized servers and software applications.
Future state: BASs will grow to $146.4 billion in 2021 from $72.5 billion in 2011:
Shift to IP networks for new buildings, doing away with the polyglot automation world of
today.
Building communication protocols are converging
19

20. Building communication protocols are converging
20

21. Section 7
Demand
response
(DR) is
shifting into
automatic

22. 22
 The total market for DR services is growing rapidly and will reach $6.1 billion by 2016
at a CAGR of 37.2% over the 2010-2016 timeframe.
 U.S. market will represent the largest portion of this market
 Western Europe and Asia Pacific will further accelerate the growth.
 Increasing portion of this market to be fully automated, as utilities and CSPs look to
deepen the ability of DR to manage the grid ever more efficiently and reliably.
Demand Response (DR) is shifting into automatic

23. 23
Demand Response (DR) is shifting into automatic

24. Section 8
Submeters
find new
opportunities
in smarter
buildings

25.  The worldwide market for submetering technology and services totals $771 million and
will grow to $1.58 billion in 2020 at a CAGR of 9.4%.
 North America, Western Europe, and Asia Pacific collectively amount to 85% of the
global market
 15% is spread between the Middle East, Latin America, Eastern Europe, and Africa.
 This split will remain consistent over the next 8 years as demand for submeters and
their associated services surges in the largest three regions.
Submeters find new opportunities in smarter buildings
25

26. Submeters find new opportunities in smarter buildings
26

27. Submeters find new opportunities in smarter buildings
27

28. Section 9
Building
information
modeling is
transforming
the design
process

29. Current state: Poorly coordinated construction industry professionals
Need: BIM software that houses design and construction documents with scenarios
modeling function in a central repository accessible via cloud
Future state: BIM ecosystem that will include thousands of BIM consultants to help
smart building construction from inception to execution via innovation.
Building information modeling is transforming
the design process
29

30. Building information modeling is transforming
the design process
30

31. Building information modeling is transforming
the design process
31

32. Section 10
The interface
between
smart
buildings and
the smart grid
is blurring

33. Smart buildings and Smart Grid
Situation:
 BEMS - intelligence from commercial and industrial buildings creates a bird’s eye view of aggregations
of buildings – utilities are starting to pay attention.
 Grid operators are changing rules and providing market mechanisms that allow and incentivize DR.
Trend:
 EMS targeting utilities as a means of achieving higher energy efficiency targets
 Building industry leaders are eager to tie buildings with the grid through an intelligent
network
 Products designed to make buildings grid-aware by integrating disparate BASs and
enabling them to respond to real-time grid conditions
The interface between smart buildings and the
smart grid is blurring
33

34. Thank you