Navigant Research Blog

Smart Building Startups Continue to Flourish

— November 17, 2014

Like the “Harvard of the [insert region here],” “the Next Silicon Valley” is a term so trite that it has become meaningless.  You may have heard of the Silicon Hills, the Silicon Strip, Silicon Wadi, or even the Silicon Valley of the East.  It seems that anyone with a pulse is trying to woo tech entrepreneurs into the next Silicon cluster.  Nevertheless, tech activity is not limited to Northern California.  A recent analysis by the Financial Times found that 60% of “unicorns” (tech startups that reach a $1 billion valuation) were created outside of California’s Bay Area.

Indeed, many local governments are trying to establish startup ecosystems to rival Silicon Valley, including the government of Washington, D.C.  Recently, Mayor Vince Gray announced the awarding of grants to tech startups totaling over $800,000.  Several of these companies represent the wave of innovation occurring in smart buildings.  Aquicore, a real-time energy management software for commercial real estate and industrial facilities, received $122,500.  And Azert, the developer of Smart(er) Socket, wall sockets integrated with Apple’s iBeacon technology and Wi-Fi, also received $122,500.

Other People’s Stuff

It might seem strange to think of wall sockets communicating, and even stranger to think of any building infrastructure using an Apple technology.  What’s more, the idea of a software startup that relies entirely on building controls hardware made and installed by other vendors was until recently unthinkable.  In the past, building systems were specifically designed not to work with other vendors’ products in order to ensure a long-term market for replacements and upgrades.  But the convergence of building technology and information technology, the adoption of open protocols, and greater integration between building automation systems have lowered the barriers to entry in the smart building market.

These startups demonstrate that the competitive landscape of smart buildings is changing.  It’s easier than ever to get building data, meaning that a wider pool of competitors are emerging.  What’s striking, and hopefully indicative of future trends, is that these companies are springing up in Washington, D.C., away from the established tech hub of Silicon Valley and away from established global building controls manufacturers.  Future innovation in smart buildings can be driven by anyone, anywhere.

 

Wireless Power Promises New Capabilities for Smart Buildings

— November 11, 2014

Power_Paddle_webIn the science fiction universe, transmitting power over great distances is remarkably easy.  A shield generator could be placed on, say, the forest moon of Endor and beam its power to an orbiting space station.  Lamentably, in the real world, such extensive wireless power transfer remains elusive.  But, 2015 is poised to be a pivotal year in wireless power.

Current wireless power solutions focus on charging mobile phones and electric vehicles, and both are gaining momentum.  On the mobile phone front, the first commercially available products based on the Alliance for Wireless Power’s Rezense standard will soon hit the market, while the Wireless Power Consortium’s competing Qi standard continues to expand around the globe.

In the auto industry, wireless technology represents the future of plug-in electric vehicles and could be a factory option as early as 2017.

Smart Building Applications

The promise of wireless power extends beyond these early adopter markets — particularly in smart buildings.  The proliferation of the Internet of Things in buildings is currently hindered by limitations in power and communication capabilities.  University of Washington professors Joshua Smith and Shyam Gollakota have an innovative approach to tackling both problems wirelessly.  The two have started Jiva Wireless to develop the solution and plan on taking a leave of absence in 2015 to focus on bringing products to market as early as 2016.

Their approach is to harvest ambient energy in the form of Wi-Fi, TV, and cellular transitions.  As detailed in Navigant Research’s report, Energy Harvesting, these types of systems are already gaining traction in a variety of applications.  What’s novel about the Jiva Wireless approach is the use of ambient backscatter communication, which selectively absorbs and reflects radio frequency (RF) signals, effectively combining power and communication into one function.

Landscape Without Wires

The launch of Jiva Wireless adds to an already crowded field of wireless power solutions.  Many of these solutions, as promising as they may be, have yet to make it to the real world.   Funding of these companies does not appear to be a challenge, though.  Energous, a company developing a wireless power solution using radio waves, raised $24 million in an initial public offering in March, despite not having a commercially available product.  Similarly, uBeam, which has a prototype that uses ultrasonic waves to transfer power, just received $10 million in Series A funding, bringing the total amount of capital raised to $12 million.

Wireless power incumbents are shifting, as well.  Duracell, an early adopter of wireless charging for mobile electronics and the pioneer of Powermat technology, is being split from its parent company, Proctor & Gamble, as part of a strategy of divesting non-core businesses.  Meanwhile, JVIS and d-Wired are attempting to resurrect conductive wireless charging by licensing intellectual property from FliCharge.  The shifting landscape of wireless power providers indicates an interesting road ahead in 2015.

 

Building Automation Shifts to Integrated Controls

— October 12, 2014

Building automation system (BAS) controls have long acted as a cash cow for vendors.  Historically, they were built on closed, proprietary communications protocols, virtually guaranteeing steady revenue from future maintenance and upgrades.  Now, though, customers are migrating to control systems with open protocols, such as BACnet and LonWorks, to gain greater flexibility and interoperability.  The emergence of these standards is changing the landscape of building controls.

The shift to open protocols largely benefits building owners (and has unsurprisingly been driven by the demand of building owners).  Competition is increased, as all vendors are on equal footing, which drives down prices.  Naturally, controls vendors are now exploring alternatives to gain a competitive advantage and regain steady revenue.  One emerging strategy is integrating more intelligence and more controls into HVAC equipment.  Even though more vendors can compete with open systems, the more intelligence that is shipped with HVAC equipment, the less there is available for controls companies to install, thereby protecting revenue from the increased competition.

Rapid Adaptation

Johnson Controls seems to be adapting to the changing environment rapidly.  The company made two important announcements in September.  First, it is reorganizing its building efficiency business to separate the North America branch from the global products business.  This will enable the company to focus on high-margin HVAC product lines, notably air distribution and ventilation solutions and variable refrigerant flow (VRF) systems.  The second announcement signaled plans to divest Johnson Controls’ Global Workplace Solutions business.

As I noted after Johnson Controls’ acquisition of Air Distribution Technologies, the move was not about products but about controls.  Johnson Controls’ joint venture with Hitachi to provide VRF systems follows the same strategy.  VRF systems represent lower potential revenue for controls suppliers because controls are typically provided by the equipment manufacturer.  Moreover, because VRF systems use refrigerant as the heat transfer medium instead of air, the need for complex air-side control of supply air temperature and humidity is obviated.  By shifting its focus to HVAC products, Johnson Controls is ensuring that its controls stay relevant.

 

Wireless Power Could Transform Smart Building Nanogrids

— October 6, 2014

From mobile phones to Wi-Fi, wireless communications have fundamentally changed human behavior.  As the much hyped era of the Internet of Things looms, the dense, rich communication networks needed seem to only be possible using wireless networks.  Moreover, big data requires ever more data to be collected and shared.  In buildings, this means more sensors and more communications to enable better efficiency.  Though wireless communications are poised to facilitate this transformation, the shift remains tangled in the wired status quo.

In addition to communications, building networks need power to create what Navigant Research has defined as nanogrids, which are, in essence, single-building microgrids capable of aggregating and optimizing distributed energy resources (DER) while increasing resilience thanks to their ability to island during utility power grid outages.  Running power wires to sensors is costly in new construction and prohibitive in most existing buildings.  As a result, it’s not done unless absolutely necessary.  Wireless makes the communication side of the equation easily scalable.  The incremental cost for connecting more sensors is small.  But, if a sensor needs wired power, why would anyone invest in wireless communications?  Power remains the key to unlocking greater data density in smart buildings, and thereby, expanding near-term opportunities for nanogrid applications.

Get Low

One approach to reducing the cost of sensors is lowering the cost of power wiring rather than eliminating the wire all together.  This is accomplished by using low-voltage direct current (DC) power for sensors, controllers, actuators, and even LED lighting.  Low-power DC wiring doesn’t need to be installed by an electrician, reducing the installation cost.  Also, many electronic devices are natively DC-powered.  So alternating current (AC) power must first be converted, resulting in an efficiency loss.  Moreover, onsite generation of power through solar PV panels or wind turbines is typically DC (as are battery storage devices).  So, DC distribution within buildings helps match energy supply with loads (since according to some estimates, 80% of building loads such as LED lighting, laptops, and cellphone chargers are all natively DC).  Low-power DC in buildings can serve as building blocks to nanogrids that tailor energy services to the precise needs of end users.

The push for DC power is being led by the Emerge Alliance, an industry association developing DC power distribution standards for commercial buildings.  A competing solution can be found in Power over Ethernet.  Both solutions can be cheaper to install than a traditional system.  But, though low power is less intrusive than the status quo, wires remain a limiting factor.

Power from High Frequencies

Eliminating all wires is the most elegant solution to enable the transition to more data-rich buildings.  Currently, this is being done either by installing batteries or by harvesting ambient energy to power devices.  Batteries require replacement and, when examined on a cost per kilowatt-hour basis, are very expensive.  They just don’t provide enough benefit to eliminate power wires.  Energy harvesting, on the other hand, eliminates the maintenance requirement but is restricted by the ambient light available.

However, a shift from energy harvesting to wireless power transmission is on the horizon.  Ossia, a tech startup, has demoed its Cota wireless power technology and expects to have commercially available products by the end of 2015.  Cota works by broadcasting radio waves over the 2.4 to 2.485 GHz ISM band (the same as Wi-Fi, ZigBee, Bluetooth, and others) and is capable of transmitting about 1W of power up to 10 meters – enough for a sensor, but not much else.  Even a decade from now, it’s unlikely that wireless power transfer or energy harvesting will be able to provide enough power for anything more than a sensor.  But leveraging big data in buildings requires more sensors, many more than are currently deployed.  Wireless power could be the building block that brings the Internet of Things to smart buildings and hasten the spread of nanogrids.

For a more detailed look at the nanogrid market, please join our free webinar, The Expanding Business of Nanogrids, on Tuesday, October 14 at 2 p.m. ET.  Click here to register.

 

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