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	<title>Navigant Research &#187; Blog</title>
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		<title>Lessons From the Lithium Ion Leaderboard</title>
		<link>http://www.navigantresearch.com/blog/lessons-from-the-lithium-ion-leaderboard</link>
		<comments>http://www.navigantresearch.com/blog/lessons-from-the-lithium-ion-leaderboard#comments</comments>
		<pubDate>Wed, 22 May 2013 23:07:09 +0000</pubDate>
		<dc:creator>Sam Jaffe</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Advanced Batteries]]></category>
		<category><![CDATA[Electric Vehicles]]></category>
		<category><![CDATA[Energy Storage]]></category>
		<category><![CDATA[lithium ion batteries]]></category>
		<category><![CDATA[Smart Energy Program]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52864</guid>
		<description><![CDATA[<br/>With the publication of Lithium Ion Batteries for Stationary Energy Storage, we launched our first Navigant Research Leaderboard report, which is the rebranded version of the Pike Pulse series.  This report looks at the landscape of lithium ion battery vendors in the stationary energy storage space.  To score each market participant, we looked at six [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-51505" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/04/Bikes_web.gif" width="300" height="205" />With the publication of <a href="http://www.navigantresearch.com/research/navigant-research-leaderboard-report-lithium-ion-batteries-for-stationary-energy-storage"><em>Lithium Ion Batteries for Stationary Energy Storage</em></a>, we launched our first Navigant Research Leaderboard report, which is the rebranded version of the Pike Pulse series.  This report looks at the landscape of lithium ion battery vendors in the stationary energy storage space.  To score each market participant, we looked at six elements of strategy and six elements of execution.  Once the results were tabulated, we ended up with a few surprises.  Here are some of the lessons learned from this report:</p>
<p>Entering bankruptcy is a surefire way to damage a reputation.  <a href="http://www.a123systems.com/">A123 Systems</a>, the historical market leader in stationary storage, has placed more than 100 MW of batteries into stationary systems since its inception in 2005.  Its team of engineers, marketing executives, and senior managers is world renowned.  So how did it end up in the Followers category, the lowest quadrant of the Leaderboard?  The answer rests primarily with the fact that it entered bankruptcy after a series of manufacturing setbacks with its automotive batteries.  The company recently emerged from bankruptcy under new ownership.  Now it’s part of Chinese automotive parts manufacturer <a href="http://www.wanxiang.com/">Wanxiang Group</a> and is re-entering the business of manufacturing and marketing batteries.  As the company formulates and articulates its strategy going forward, it will likely recapture its market leadership.  But the immediate after-effects of the bankruptcy severely damaged the company’s scores.  We anticipate that A123 will score significantly higher next year.</p>
<p><b>It Only Takes One Fire</b></p>
<p>Battery fires burn more than just the battery.  Fires struck several battery makers, such as <a href="http://electricalaccidents.wordpress.com/2012/11/27/az-substation-electrical-fire/">Electrovaya</a> and <a href="http://www.bloomberg.com/news/2013-03-29/gs-yuasa-crisis-deepens-with-mitsubishi-car-battery-fire-3-.html">GS Yuasa</a>, driving some to the point of failure.  Unfortunately for the industry, these incidents have received an inordinate amount of media attention, leading to lost sales and severe public relations problems (luckily no deaths or severe injuries have been caused by any of the fires).  In other industries, safety breaches can be tolerated.  In the advanced battery space, however, a single fire event can lead to the company’s collapse.</p>
<p>China is still playing catch-up.  While Chinese lithium ion companies have made tremendous gains in the last 3 years in the consumer electronics sector, they are still market laggards in stationary storage.  <a href="http://www.atlbattery.com/">ATL</a>, <a href="http://en.lishen.com.cn/newEbiz1/EbizPortalFG/portal/html/index.html">Lishen</a>, <a href="http://www.bak.com.cn/">China BAK</a>, and <a href="http://www.byd.com/">BYD</a> (the four horsemen of the Chinese lithium ion industry) have all either avoided the global stationary storage market or failed to make a lasting impression with buyers.  Don’t expect this to continue, though.  All four companies have plans to develop their stationary storage businesses in North America and Europe as soon as they feel an investment is warranted.</p>
<p>There’s more than one way to score highly.  The two market Leaders in the Leaderboard, <a href="http://lgcpi.com/chem.shtml">LG Chem</a> and <a href="http://www.johnsoncontrols.com/content/us/en.html">Johnson Controls</a>, both scored much higher than any competitors.  However, they got their scores for very different reasons.  LG Chem bet the house in 2008 and 2009, building large factories on multiple continents and blitzing customers with an all-out marketing push.  The results have put LG Chem into the driver’s seat in the automotive space and made it a major competitor in the stationary space.  Johnson Controls, on the other hand, kept its powder dry.  It invested heavily in basic research into the <a href="http://nextbigfuture.com/2011/01/new-nickel-manganese-cobalt-cathodes.html">nickel manganese cobalt</a> chemistry that most industry participants agree will dominate the space in the next 5 years.  The company kept its scientists busy while making relatively small investments on manufacturing capacity.  Now Johnson Controls is in an excellent position to invest in manufacturing even as many of its competitors are struggling to keep factory doors open.</p>
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		<title>A Possible Energy Storage Breakthrough</title>
		<link>http://www.navigantresearch.com/blog/a-possible-energy-storage-breakthrough</link>
		<comments>http://www.navigantresearch.com/blog/a-possible-energy-storage-breakthrough#comments</comments>
		<pubDate>Tue, 21 May 2013 21:00:37 +0000</pubDate>
		<dc:creator>Sam Jaffe</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Advanced Batteries]]></category>
		<category><![CDATA[Energy Storage]]></category>
		<category><![CDATA[Research & Development]]></category>
		<category><![CDATA[Smart Energy Program]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52749</guid>
		<description><![CDATA[<br/>In a recently published paper, Stanford professor Yi Cui revealed a new battery design that could, if it proves durable and effective in the real world, be a significant new technology in the energy storage market.  Like many experimental battery designs, Cui’s battery uses forms of lithium and sulfur.  However, the professor&#8217;s battery uses them [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-52752" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/Bushwacker_web.gif" width="300" height="205" />In a recently published <a href="http://pubs.rsc.org/en/Content/ArticleLanding/2013/EE/c3ee00072a">paper</a>, Stanford professor Yi Cui revealed a new battery design that could, if it proves durable and effective in the real world, be a significant new technology in the energy storage market.  Like many experimental battery designs, Cui’s battery uses forms of lithium and sulfur.  However, the professor&#8217;s battery uses them in a completely novel fashion, sidestepping some of the problems that normally plague lithium sulfur batteries.</p>
<p>To understand why this battery holds so much promise, it’s important to understand the electrochemistry of sulfur.  When sulfur is used in a battery, it sometimes produces polysulfides, which can damage the inner workings of the battery.  When polysulfides collect within the electrolyte of the battery, they cause the other parts to degrade quickly.  That’s why traditional lithium sulfur batteries have such a low cycle life, sometimes lasting only a few dozen cycles.</p>
<p>Cui’s design turns the production of polysulfides on its head: the electrolyte is composed of a lithium polysulfide material.  When the battery is discharging, lithium ions leave a lithium cathode and bond with the lithium polysulfide electrolyte.  When it’s charging, the ions head back to the lithium metal cathode.  The result is a flow battery that, unlike any other flow battery, needs no ion-selective membrane.  Instead, a cheap passive coating of the lithium metal allows the correct ions to pass without leading to degradation of the cathode.</p>
<p><b>Multiple Breakthroughs</b></p>
<p>The Cui lab at Stanford will be familiar to readers who have read about previous battery work done there.  He seems to have an uncanny ability to turn out several new battery chemistry breakthroughs every year, ranging from <a href="http://www.stanford.edu/group/cui_group/papers/Liu_NLett_2012.pdf">yolk-shaped encapsulants</a> to <a href="http://www.stanford.edu/group/cui_group/papers/122%20Matt%20ex-situ%20TEM.pdf">silicon nano-rods</a> to <a href="http://www.navigantresearch.com/blog/feeling-blue-is-sometimes-a-good-thing-for-batteries">dye-based batteries</a>.  It seems inevitable that an innovation from the Cui lab will eventually rewrite the energy storage history books.</p>
<p>There’s reason to be hopeful for this particular concept.  This battery has two features that resonate with anyone who has tried to understand why flow batteries haven’t succeeded so far: the materials involved (lithium and sulfur) are relatively cheap and the absence of a membrane eliminates another large cost factor for most flow battery designs.  If the Cui battery can be scaled up from its <a href="http://www6.slac.stanford.edu/news/2013-04-24-polysulfide-flowbattery.aspx">small laboratory prototype</a> and can withstand thousands of cycles, this concept could lead to a much cheaper form of energy storage than currently exists.</p>
<p>That’s a big “if.”  Many other promising experimental battery designs have proved to be too finicky or too expensive to manufacture to become real-world products.  Cui and his graduate student, Guangyuan Zheng, have shown data that their battery can endure 2,000 cycles without any noticeable degradation, which is a good start.  But the real proof of the system’s success will be in a commercially manufactured, scaled-up model.</p>
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		<title>The Return of Vertical Axis Wind Turbines</title>
		<link>http://www.navigantresearch.com/blog/the-return-of-vertical-axis-wind-turbines</link>
		<comments>http://www.navigantresearch.com/blog/the-return-of-vertical-axis-wind-turbines#comments</comments>
		<pubDate>Tue, 21 May 2013 20:32:58 +0000</pubDate>
		<dc:creator>Dexter Gauntlett</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Renewable Energy]]></category>
		<category><![CDATA[Smart Energy Program]]></category>
		<category><![CDATA[Wind Power]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52754</guid>
		<description><![CDATA[<br/>
Vertical axis wind turbines (VAWTs) appear to be making a comeback after a few dormant decades, but it’s unclear how much legs the somewhat maligned technology will have in the market.  VAWTs are most commonly known in the United States from their days during the 1970s to the early 1990s in California, when Sandia National [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-52755" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/Wetpaint_web.gif" width="300" height="205" /></p>
<p>Vertical axis wind turbines (VAWTs) appear to be making a comeback after a few dormant decades, but it’s unclear how much legs the somewhat maligned technology will have in the market.  VAWTs are most commonly known in the United States from their days during the 1970s to the early 1990s in California, when Sandia National Laboratories and several private companies worked together to design and deploy a number of 500 kW-600 kW utility-scale VAWTs in California.  The units worked fairly well, even if not as well as expected, for a number of years.  But they ultimately ran into mechanical problems that stifled their commercial viability.  By that time, interest had largely shifted to today’s more common three-bladed horizontal axis wind turbine (HAWT) designs, and the industry has never looked back.</p>
<p>VAWTs do potentially offer advantages over HAWTs, including producing power with less wind so they can be located closer together and closer to the ground for easier maintenance and installation.  There are at least 28 active VAWT manufacturers in the world today, primarily producing less than 10 kW units intended for use in urban and building-integrated settings.  Yet, many companies in this sector, such as Helix Windpower and Windspire, have faced significant financial challenges.  Small wind turbines in general have faced increased scrutiny, as there are many cases of both VAWTs and HAWTs <a href="http://www.solacity.com/Docs/Cadmus%20Group%20Report.PDF">not performing</a> as advertised in the urban environment.  The establishment of the Small Wind Certification Council has been a major step forward for a small wind industry that is looking to regain credibility.  Still, only five small wind turbines are currently certified by the council – all HAWTs.</p>
<p>These challenges did not, however, prevent the <a href="http://www.vengerwind.com/press/read/venger-wind-farm-installed-on-roof-of-oklahoma-medical-research-foundation-june-22-2012.html#.UYAYybWceSo">largest</a> building-integrated VAWT installation in the United States from coming online in June 2012.  It uses 18 4.5 kW Venger Wind V2 turbines on the roof of the Oklahoma Medical Research Foundation.  The V2 wind turbines are 18.5 feet tall and are designed to start producing electricity at winds of 8.9 mph, well below Oklahoma City’s annual wind speed average, according to Venger Wind.</p>
<p><b>Packing Them In</b></p>
<p>Making inroads in the utility-scale market is a challenging task for VAWTs, given the formidable competition from incumbent manufacturers that have a long history of commercial viability and strong technical performance.  There is strong, though relatively limited, potential in the medium wind turbine market segment (100 kW-900 kW range) related to rural areas, islands, community wind, schools, and other distributed wind applications.  No known commercially available VAWT product currently exists in that power range – Italy’s <a href="http://www.ropatec.com/">Ropatec</a> offers the largest known VAWT unit at 20 kW.  But a number of universities and companies are taking a closer look at VAWT technology and applications and are seeking to learn from others’ successes and failures.</p>
<p>A <a href="http://phys.org/news/2011-07-wind-turbine-placement-tenfold-power.htm">Caltech study</a> that analyzed the performance of six VAWTs more tightly packed together found that they produced 21 to 47 watts of power per square meter of land area, compared to just 2 to 3 watts per square meter from a similarly sized HAWT farm.  <a href="http://www.sawt.us/">Shanghai Aeolus Windpower Technology</a> (SAWT) currently offers less than 10 kW VAWTs, but has stated plans to develop 50 kW and 1 MW units.  Sandia National Labs received a $4.1 million <a href="http://sustainablebusinessoregon.com/national/2012/07/sandia-labs-working-on-vertical-axis.html">grant</a> in June 2012 to reevaluate VAWTs, including their potential for offshore applications – an opportunity that Japanese, Korean, and Chinese researchers and companies are also examining.</p>
<p>Finally, high-profile projects at <a href="http://www.adobe.com/aboutadobe/pressroom/pressreleases/201003/031510AdobeWindspires.html">Adobe</a> and the <a href="http://www.nacleanenergy.com/?action=article&amp;id=15049">Lincoln Financial</a> Field (home of the NFL’s Philadelphia Eagles) continue to drive interest in VAWTs.  But only actual performance details over time will determine if the resurgence of VAWT interest is based on concrete technical improvements or hype.</p>
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		<title>NIST Inches Toward Cybersecurity Framework</title>
		<link>http://www.navigantresearch.com/blog/nist-inches-toward-cybersecurity-framework</link>
		<comments>http://www.navigantresearch.com/blog/nist-inches-toward-cybersecurity-framework#comments</comments>
		<pubDate>Tue, 21 May 2013 01:06:01 +0000</pubDate>
		<dc:creator>Bob Lockhart</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Cybersecurity]]></category>
		<category><![CDATA[Industry Standards]]></category>
		<category><![CDATA[Policy & Regulation]]></category>
		<category><![CDATA[Smart Grid Security]]></category>
		<category><![CDATA[Smart Utilities Program]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52758</guid>
		<description><![CDATA[<br/>
Executive Order 13636 requires, among other things, the National Institute of Standards and Technology (NIST) to develop a “Baseline Framework to Reduce Cyber Risk to Critical Infrastructure.”  There is a lot of good detail as to what is expected to be in this framework, whose requirements run to a full page.  Recently, NIST hosted its [...]]]></description>
				<content:encoded><![CDATA[<br/><p align="left"><a href="http://www.gpo.gov/fdsys/pkg/FR-2013-02-19/pdf/2013-03915.pdf"><img class="alignright size-full wp-image-52761" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/Taking_Stock_web.gif" width="300" height="205" /></a></p>
<p><a href="http://www.gpo.gov/fdsys/pkg/FR-2013-02-19/pdf/2013-03915.pdf">Executive Order 13636</a> requires, among other things, the National Institute of Standards and Technology (NIST) to develop a “Baseline Framework to Reduce Cyber Risk to Critical Infrastructure.”  There is a lot of good detail as to what is expected to be in this framework, whose requirements run to a full page.  Recently, NIST hosted its first Cybersecurity Framework Workshop to address those necessities.  This particular workshop resulted from the following specific requirement: “In developing the Cybersecurity Framework, the Director shall engage in an open public review and comment process.”  The director of NIST must deliver a framework within 1 year of the publication of the Executive Order (EO); that is, no later than February 19, 2014.</p>
<p>I’m not sure what a framework workshop is, or how many times the word “work” must appear in a meeting title before people will believe that you plan to accomplish something.  At any rate, over 700 people attended the workshop ‑ quite large to qualify as a workshop.  Living in the <a href="http://dallascityhall.com/html/downtown_dallas.html">Dallas</a>-<a href="http://en.wikipedia.org/wiki/File:0011Fort_Worth_Stockyards_Exchange_Ave_E_Texas.jpg">Fort Worth</a> area, I remember years when the <a href="http://texas.rangers.mlb.com/">Texas Rangers</a> could barely get 700 people to attend their baseball games (unless <a href="http://baseballhall.org/hof/ryan-nolan">Nolan Ryan</a> was pitching).  Besides, here in Texas, anything with 700 members is usually called a <a href="http://www.texaslonghorn.com/longhorn_info/steer/Images/1502_19.jpg">herd</a>.</p>
<p><b>Engaged, Considered</b></p>
<p>Whatever you call it, this event was important.  Strictly speaking, the 700 workshop attendees were allowed to comment, but the EO only requires the Secretary of Homeland Security to “engage and consider” their advice.  Based upon past experience, the likelihood of their input being ignored is very low.</p>
<p>I may be a bit skeptical here because I&#8217;ve watched the North American Electric Reliability Corp. (NERC)<a href="http://www.nerc.com/pa/Stand/Pages/default.aspx"> labor</a> to adopt seemingly minor clarifications to the <a href="http://www.nerc.com/page.php?cid=2|20">CIP Reliability Standards</a> (<a href="http://tomalrichblog.blogspot.com/2013/04/the-cip-version-5-nopr.html">which it then invalidates</a>).  It has repeatedly been hamstrung by large attendee lists that include sometimes <a href="http://healthecommunications.files.wordpress.com/2012/05/failure-to-communicate2.jpg">contradictory agendas</a>.  Anyway, quoting the EO, 9 months from now we shall have:</p>
<ul>
<li>A prioritized, flexible, repeatable, performance-based, and cost-effective approach, including information security measures and controls, to help owners and operators of critical infrastructure identify, assess, and manage cyber risk</li>
<li>Methodologies to identify and mitigate impacts of the Cybersecurity Framework … on business confidentiality, and to protect individual privacy and civil liberties</li>
</ul>
<p>After that, quoting Section 8(a) of the EO, “The Secretary, in coordination with Sector-Specific Agencies, shall establish a voluntary program to support the adoption of the Cybersecurity Framework by owners and operators of critical infrastructure and any other interested entities.”</p>
<p>In other words, 1 year to develop a framework of non-binding recommendations for the protection of critical infrastructure.  Here in the smart grid world, we already have that.  It’s called the <a href="http://csrc.nist.gov/publications/nistir/ir7628/introduction-to-nistir-7628.pdf">NISTIR 7628</a> series.  So maybe it’s a very good call to have NIST run this play.  But you’d have to accept that critical infrastructure owners will spend money on protection that they are not required to spend.  To date, that trend is <a href="http://www.navigantresearch.com/research/smart-grid-10-trends-to-watch-in-2013-and-beyond">not encouraging</a>.</p>
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		<title>In the West, Big Coal Makes Its Stand</title>
		<link>http://www.navigantresearch.com/blog/in-the-west-big-coal-makes-its-stand</link>
		<comments>http://www.navigantresearch.com/blog/in-the-west-big-coal-makes-its-stand#comments</comments>
		<pubDate>Fri, 17 May 2013 21:57:36 +0000</pubDate>
		<dc:creator>Richard Martin</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Climate Change]]></category>
		<category><![CDATA[Fossil Fuels]]></category>
		<category><![CDATA[Policy & Regulation]]></category>
		<category><![CDATA[Smart Energy Program]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52613</guid>
		<description><![CDATA[<br/>Overshadowed by the debate over natural gas exports, a battle is brewing in the Western United States over exports of coal to Europe and, especially, to the booming economies of Asia.  Buoyed by rising overseas demand for American coal, big coal producers including Arch Coal and Peabody are seeking to build new ports and new [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-52615" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/Stair_Stack_web.gif" width="300" height="205" />Overshadowed by the debate over <a href="http://www.ft.com/intl/cms/s/0/22516820-beca-11e2-a9d4-00144feab7de.html">natural gas exports</a>, a battle is brewing in the Western United States over exports of coal to Europe and, especially, to the booming economies of Asia.  Buoyed by rising overseas demand for American coal, big coal producers including Arch Coal and Peabody are seeking to build new ports and new shipping facilities, particularly along the West Coast, to send U.S. coal from the <a href="http://www.blm.gov/wy/st/en/programs/energy/Coal_Resources/PRB_Coal.html" target="_blank">Powder River Basin</a>, in Montana and Wyoming, across the Pacific.</p>
<p>Those plans have met with fierce resistance from local residents and environmental groups.  &#8221;I want to make it absolutely clear: I am vehemently opposed for a private, for-profit corporation to use eminent domain to condemn my private land for a rail line to export coal to China,&#8221; Clint McRae, a rancher whose family has owned their ranch in the Powder River Basin for 125 years, told a an Army Corps of Engineers hearing in Seattle last December, <a href="http://articles.latimes.com/2013/apr/26/nation/la-na-montana-coal-20130427">according to <i>The Los Angeles Times</i></a>.</p>
<p>Also lining up to oppose the exports are elected officials in Oregon and Washington who don’t wish to see huge coal export facilities built on their coastlines.  Saying that rail links to bring Powder River Basin coal to the West Coast “threaten the health of our communities, the strength of our economies, and the environmental and cultural heritage we share,&#8221; Seattle mayor Mick McGinn announced last month the formation of the <a href="http://www.seattle.gov/mayor/press/newsdetail.asp?ID=13570">Leadership Alliance Against Coal</a>, which includes Native American tribal groups as well as politicians from towns in Washington State.</p>
<p><b>Black Piles</b></p>
<p>Behind the export push are the remaining Big Coal companies, particularly Arch Coal and Peabody, who have largely abandoned their mines in Appalachia and have seen their share prices <a href="http://finance.yahoo.com/echarts?s=BTU+Interactive#symbol=btu;range=2y;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;">drop by as much as two-thirds</a> over the last 2 years as utilities across the United States have moved to burn low-cost natural gas rather than coal.  Peabody actually projects that U.S. coal consumption for power generation will <a href="http://seekingalpha.com/article/1364671-peabody-s-q1-results-and-coal-outlook?source=yahoo">rise in 2013</a>, by 60 million to 80 million tons. Even as coal consumption drops in the United States over the long run, though, demand continues to climb in China, India, and even European countries like Germany, which is phasing out its fleet of nuclear power plants.</p>
<p>U.S. coal exports set a record last year of <a href="http://www.snl.com/InteractiveX/article.aspx?cdid=A-16964701-12588&amp;KPLT=8">more than 124 million tons</a>, topping the previous record set in 1981.  Because of “must-take” contracts signed years ago, some utilities in 2012 literally found themselves with piles of coal they didn’t want, and dumped these supplies of “distressed coal” on the international market. As a result, exports of coal are expected to drop this year, while remaining high.</p>
<p>Of six proposed coal export facilities on the West Coast, three have already been defeated. The battle over the remaining facilities could be Big Coal’s last stand in the United States.</p>
<p>Still, as I’ve written here before, the end of coal is <a href="http://www.navigantresearch.com/blog/coals-long-goodbye">likely to be prolonged</a>.  The Economist Intelligence Unit, in <a href="http://www.eiu.com/public/thankyou_download.aspx?activity=download&amp;campaignid=RockSteady">a report released this month</a>, said that increased overseas demand for the “surprisingly dynamic commodity will drive world coal consumption to more than 8.4 billion tons in 2015.  By far most of that growth will come from China – which puts the United States in the uncomfortable position of cutting its own use of the world’s dirtiest fuel, while feeding the coal hunger of less-developed economies.</p>
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		<title>In Denmark, Demand Response Powers a Smart City</title>
		<link>http://www.navigantresearch.com/blog/in-denmark-demand-response-powers-a-smart-city</link>
		<comments>http://www.navigantresearch.com/blog/in-denmark-demand-response-powers-a-smart-city#comments</comments>
		<pubDate>Fri, 17 May 2013 20:01:39 +0000</pubDate>
		<dc:creator>Eric Woods</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Demand Response]]></category>
		<category><![CDATA[Energy Efficiency]]></category>
		<category><![CDATA[Policy & Regulation]]></category>
		<category><![CDATA[Renewable Energy]]></category>
		<category><![CDATA[Smart Cities]]></category>
		<category><![CDATA[Smart Industry Program]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52588</guid>
		<description><![CDATA[<br/>Demand-side management must become a significant element of the European energy market if the EU’s ambition to build a low-carbon economy is to be realized.  The latest survey of European smart grid projects by the European Commission’s Joint Research Centre (JRC) points out the importance of this requirement.  Smart Grid Projects in Europe: Lessons Learned and [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-52589" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/Lightshaft_web.gif" width="300" height="205" />Demand-side management must become a significant element of the European energy market if the EU’s ambition to build a low-carbon economy is to be realized.  The latest survey of European smart grid projects by the European Commission’s Joint Research Centre (JRC) points out the importance of this requirement.  <a href="http://ses.jrc.ec.europa.eu/jrc-scientific-and-policy-report"><i>Smart Grid Projects in Europe: Lessons Learned and Current Developments</i> (2012 update)</a>, a follow-up to a similar <a href="http://www.navigantresearch.com/blog/articles/smart-grid-projects-in-europe-a-new-eu-survey">study</a> carried out in 2011, notes that a majority of the 281 projects covered focus on “distributed ICT architectures for coordinating distributed resources and providing demand and supply flexibility.”</p>
<p>One of the latest projects to join the roster of demand-side management pilots is the Danish city of Kalundborg.  The fact that Denmark already obtains 30% of its electricity from wind power – and targets 50% by 2020 – is making such projects an increasingly urgent requirement for the country.</p>
<p><b>Symbiotic System</b></p>
<p>Kalundborg has a population of around 16,000 within a local <i>kommune</i> (or municipality) of the same name extending to 50,000 people.  Its relatively small size belies the fact that it is the second-largest industrial region in Denmark after Copenhagen.  It is also notable for its long established cross-industry program, <a href="http://www.symbiosis.dk/en">Kalundborg Symbiosis</a>.  This program has evolved over several decades as an integrated system for waste recycling within the local industrial system.  Residual products from one industry, such as steam, dust, gases, heat, slurry, or any other waste products, are physically exchanged between enterprises, thereby reducing energy consumption, production costs, and environmental damage.</p>
<p><a href="http://www.cphcleantech.com/ccj2-thepathtoasmartcitygoesviaintelligentenergy">Smart City Kalundborg </a>is a 3-year smart grid pilot with a budget of $18 million.  Launched in November 2012, the project is led by Danish utility SEAS-NVE, Dansk Energi (Danish Energy Association), Spirae, and the municipality of Kalundborg.  Other participants in the project include ABB, CleanCharge, Clever, Danfoss, Gaia Solar, DONG Energy, Gridmanager, and Schneider Electric.  Smart City Kalundborg will look at the integration of energy management across power, water, heating, transport, and building systems.  This entire system will be based on an open, intelligent platform called the Energy Services Hub.  The Hub will enable diverse participants to make specific energy resources available to the system via a publish-and-subscribe model.  An individual enterprise, water utility, or demand aggregator, for example, could use the platform to offer a specified demand response capacity to grid operators looking to manage fluctuations in power supply or reduce the need for network reinforcement.</p>
<p>The technical and market challenges to delivering such a system at a city scale are significant, of course.  However, the biggest question may be who is in the best position to operate such an Energy Services Hub.  One solution would be a joint venture between a municipality, one or more utilities, and a platform operator, but other models are possible.</p>
<p>Smart City Kalundborg is an innovative approach to deepening the connection between <a href="http://www.navigantresearch.com/blog/why-smart-cities-need-smart-grids">smart grids and smart cities</a>.  While Kalundborg has much in common with other market-focused demand management projects in Europe, it differs in its attempt to include a wider range of city operations, including water management, transportation, and district heating.  Kalundborg Symbiosis has provided a synergistic network for the industrial system; Smart City Kalundborg project could provide a similar network for the local energy system.</p>
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		<title>On Energy and Buildings, Conventional Wisdom is Fleeting</title>
		<link>http://www.navigantresearch.com/blog/on-energy-and-buildings-conventional-wisdom-is-fleeting</link>
		<comments>http://www.navigantresearch.com/blog/on-energy-and-buildings-conventional-wisdom-is-fleeting#comments</comments>
		<pubDate>Fri, 17 May 2013 00:32:57 +0000</pubDate>
		<dc:creator>Bob Gohn</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Building Energy Management Systems]]></category>
		<category><![CDATA[Building Systems]]></category>
		<category><![CDATA[Climate Change]]></category>
		<category><![CDATA[Conferences & Events]]></category>
		<category><![CDATA[Energy Management]]></category>
		<category><![CDATA[Smart Buildings Program]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52500</guid>
		<description><![CDATA[<br/>
As the concentration of carbon in the atmosphere reaches a level not seen in human history, it’s worth considering how much the conventional wisdom surrounding energy has changed in the last 5 years.  In 2008, domestic fossil fuel production (other than coal) was considered to be in permanent decline, with local debates on where to [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-52501" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/Shoal_the_Way_web1.gif" width="300" height="205" /></p>
<p>As the concentration of carbon in the atmosphere reaches a level <a href="http://www.guardian.co.uk/environment/2013/may/10/carbon-dioxide-highest-level-greenhouse-gas?CMP=twt_gu" target="_blank">not seen in human history</a>, it’s worth considering how much the conventional wisdom surrounding energy has changed in the last 5 years.  In 2008, domestic fossil fuel production (other than coal) was considered to be in permanent decline, with local <a href="http://www.orr-reno.com/uploads/pdfs/lng-terminal-dabates....pdf">debates on where to site natural gas import terminals</a>.  Coal-based electricity generation was assumed to be as irreplaceable as it was undesirable.  Increasing energy costs and volatility were unavoidable, while renewable generation cost parity appeared within reach as the bar moved lower.  A <a href="http://www.businessweek.com/stories/2007-10-03/a-u-dot-s-dot-nuclear-power-renaissancebusinessweek-business-news-stock-market-and-financial-advice">nuclear power renaissance</a> was effectively promoted as the only carbonless solution with the potential capacity to displace coal.  The dawn of <a href="http://www.wired.com/autopia/2008/07/electric-cars-a/">transportation electrification</a> seemed upon us, while the smart grid took a laser focus on peak load reduction.</p>
<p>Much has changed since then.  Conventional wisdom has caught up with the gas industry experts (including some of my Navigant colleagues), who foresaw how the shale gas boom would reshape the North American energy landscape.  With domestic oil and gas production up sharply, costs are <a href="http://www.navigant.com/~/media/WWW/Site/Insights/Energy/NG_Notes_Dec2012.ashx">expected to stabilize and volatility decrease</a>.  Planned natural gas <a href="http://www.energybiz.com/magazine/article/250895/lng-ready-export">import terminals, while still locally controversial, are morphing into export terminals</a>.  <a href="http://online.wsj.com/article/SB10001424127887324763404578430751849503848.html">Natural gas generation is rapidly displacing coal, leading to significant carbon emissions</a> reductions, though the enabling fracking technologies trigger new concerns.  Even as the cost parity goalposts keep moving, the cost of renewables continues to decline.  The Fukushima accident <a href="http://articles.washingtonpost.com/2013-03-11/business/37625149_1_unistar-calvert-cliffs-nuclear-plants">stalled a North American nuclear renaissance</a> while driving Germany and Japan, at least notionally, to nuclear exits.  <a href="http://www.navigantresearch.com/blog/doe-funding-targets-natural-gas-issues">Home refueling of natural gas vehicles could</a> replace electric vehicle charging stations in consumer imaginations.  Meanwhile, long-haul trucks, fleet vehicles, and even <a href="http://www.marketplace.org/topics/business/railroad-make-shift-natural-gas-locomotives">locomotives are adopting natural gas</a>.  And the <a href="http://www.scientificamerican.com/article.cfm?id=how-to-build-a-more-resilient-electric-grid">smart grid is becoming more important as a means of power resiliency</a> in the face of hurricanes and superstorms than as a vehicle for peak load reduction.</p>
<p><b>Cheap Gas, Smart Buildings</b></p>
<p>This all came to mind recently when I moderated a panel discussion titled “The Future Direction of Energy in North America and the Impact on the Intelligent Buildings Sector” at CABA’s <a href="http://docs.caba.org/documents/CABA-Forums-Agendas.pdf">Intelligent Buildings Forum</a> in Toronto.  CABA is the <a href="http://www.caba.org/">Continental Automated Buildings Association</a>, a 25-year old organization dedicated to the advancement of intelligent home and intelligent building technologies (I am privileged to serve on CABA’s board).  The panel participants represented the perspectives of commercial property owner/managers (<a href="http://www.cadillacfairview.com/">Cadillac Fairview</a>), utilities (<a href="http://www.powerauthority.on.ca/">Ontario Power Authority</a>), suppliers (<a href="http://www.siemens.com/entry/cc/en/">Siemens</a>), and technology researchers (<a href="http://canmetenergy.nrcan.gc.ca/about/331">CanmetENERGY</a>).</p>
<p>So what do the major shifts of the last half-decade mean for intelligent buildings?  The panelists agreed that demand for improved energy efficiency remains strong, even if all the incentives for deploying the technology to deliver such efficiency are not always aligned.  Local codes and mandates may be drivers, but even lower-cost energy is not free energy.  Building-to-grid technologies and distributed generation may become even more important if natural gas enables local generation, which is becoming an intriguing option for the storm-ravaged Northeast United States.  Most importantly, all agreed that “cheap, abundant” natural gas is unlikely to spur new interest in dumb buildings.</p>
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		<title>Energy Management Meets Facility Management</title>
		<link>http://www.navigantresearch.com/blog/energy-management-meets-facility-management</link>
		<comments>http://www.navigantresearch.com/blog/energy-management-meets-facility-management#comments</comments>
		<pubDate>Fri, 17 May 2013 00:30:21 +0000</pubDate>
		<dc:creator>Eric Bloom</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Building Energy Management Systems]]></category>
		<category><![CDATA[Building Systems]]></category>
		<category><![CDATA[Energy Management]]></category>
		<category><![CDATA[Smart Energy Program]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52494</guid>
		<description><![CDATA[<br/>
As intelligent energy management technology has evolved, it has expanded considerably beyond the initial systems and platforms designed to help enterprises manage energy in their facilities.  We&#8217;ve seen some energy management players – from enterprises to utility customers – reorient their offerings to serve as a demand-side management tools.  Others have decided to specialize in [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-52265" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/FT_Advisory_web.gif" width="300" height="205" /></p>
<p>As <a href="http://www.navigantresearch.com/research/building-energy-management-systems">intelligent energy management technology</a> has evolved, it has expanded considerably beyond the initial systems and platforms designed to help enterprises manage energy in their facilities.  <a href="http://www.pulseenergy.com/pulse/new-pulse-platform-helps-utilities-deliver-energy-insight-to-all-commercial-customers/">We&#8217;ve seen some energy management players – from enterprises to utility customers – reorient their offerings to serve as a demand-side management tools</a>.  <a href="http://www.enernoc.com/for-businesses/demandsmart">Others have decided to specialize in certain high-value applications such as demand response</a>.</p>
<p>One of the newer frontiers in intelligent energy management is the integration of energy management and facility management technology.  At first, it might appear that these two services have little to do with one another.  <a href="http://www.nweei.org/what-is-energy-management.html">The former is concerned primarily with monitoring and reducing energy consumption and consumption</a>, while <a href="http://www.ap.joneslanglasalle.com/asiapacific/EN-GB/Pages/FacilityManagement.aspx">the latter is focused on a range of issues affecting interior spaces (such as space planning, mail management, catering, janitorial services, and security)</a>.  However, several of the IT systems used to monitor and govern many of these facility management services also create data relevant to energy management.  Thus, they create opportunities to build additional applications onto the same IT backbone.</p>
<p><b>Yin, Meet Yang</b></p>
<p>One of the best examples of this integration is <a href="file:///C:/Users/rmartin/AppData/Local/Microsoft/Windows/Temporary%20Internet%20Files/Content.Outlook/WJ53F5A2/joneslanglasalle.com">Jones Lang LaSalle’s</a> <a href="http://www.joneslanglasalle.co.uk/Pages/IntelliCommand.aspx">IntelliCommand offering</a>, which is a <a href="http://www.pacificcontrols.net/news-media/Jones-Lang-LaSalle-launches-IntelliCommand.html">white-labeled version</a> of <a href="http://www.pacificcontrols.net/">Pacific Controls’ energy and operations management software</a>.  The tools provide Jones Lang LaSalle’s commercial real estate customers with a suite of applications, such as energy visualization, energy management, and <a href="http://www.navigantresearch.com/research/smart-industry/demand-response">demand response</a>, that help reduce energy costs while maintaining (or improving) building operations and the quality of the interior environment.  In addition, the system ties directly into Jones Lang LaSalle’s existing workflow management system, which its customers are already familiar with, an advantage over similar offerings that have independent user interfaces and functionality.  Meanwhile, <a href="file:///C:/Users/rmartin/AppData/Local/Microsoft/Windows/Temporary%20Internet%20Files/Content.Outlook/WJ53F5A2/ibm.com">IBM’s</a> <a href="http://www-01.ibm.com/software/tivoli/welcome/tririga/">acquisition of facility management software firm TRIRIGA in 2011</a> and <a href="file:///C:/Users/rmartin/AppData/Local/Microsoft/Windows/Temporary%20Internet%20Files/Content.Outlook/WJ53F5A2/ameresco.com">Ameresco’s</a> <a href="http://www.ameresco.com/press/ameresco-canada-inc-acquires-fame-facility-software-solutions-inc">acquisition of FAME Facility Software Solutions in 2012</a> also demonstrate the rapid integration of facility management with business operations and energy efficiency offerings.</p>
<p>The Jones Lang LaSalle model, which integrates energy management into a broader facility management offering, would appear to be the inverse of the IBM/Ameresco model, which adds facility and asset management capability to energy management systems that offer a multitude of energy-related applications.  Rather than arguing that one or the other is the “right” model, I will say that both models will likely coexist within the building industry for years to come.  This yin-yang effect – with facility management nested into energy management and vice versa – will ensure that customers have options that suit their priorities, budget, and existing building IT infrastructure.</p>
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		<title>On Every Dream Home a Solar Panel</title>
		<link>http://www.navigantresearch.com/blog/on-every-dream-home-a-solar-panel</link>
		<comments>http://www.navigantresearch.com/blog/on-every-dream-home-a-solar-panel#comments</comments>
		<pubDate>Wed, 15 May 2013 19:45:55 +0000</pubDate>
		<dc:creator>Lee Hamilton</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Home Energy Management]]></category>
		<category><![CDATA[Policy & Regulation]]></category>
		<category><![CDATA[Residential Solar]]></category>
		<category><![CDATA[Smart Energy Program]]></category>
		<category><![CDATA[Solar Power]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52488</guid>
		<description><![CDATA[<br/>
Traditionally, when someone buys a house, they receive a card from their realtor that says, “Thanks for your business,” and a gift basket with some thoughtful housewarming gifts.  Now, thanks to new zoning codes in Lancaster, California, new homebuyers will also receive a brand-new solar photovoltaic (PV) system (though “receive” is probably a misnomer, as the cost of [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-52489" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/Weatherman_web.gif" width="300" height="205" /></p>
<p>Traditionally, when someone buys a house, they receive a card from their realtor that says, “Thanks for your business,” and a gift basket with some thoughtful housewarming gifts.  Now, thanks to <a href="http://labusinessjournal.com/news/2013/mar/27/lancaster-require-solar-panels-new-homes/">new zoning codes</a> in Lancaster, California, new homebuyers will also receive a brand-new solar photovoltaic (PV) system (though “receive” is probably a misnomer, as the cost of the system is presumably built into the home price).</p>
<p>Lancaster changed its zoning code in March 2013 to require a 1.0 to 1.5 kW PV system for every new home built on lots larger than 7,000 square feet or 1.5 kW systems for rural homes up to 100,000 square feet.  Builders will also have the option of building distributed systems for new developments.  For example, a builder could install a single 20 kW system for a 20-home development.  (Note that Sebastopol became the second California city to enact a solar requirement for new homes in May.)</p>
<p>Lancaster is the first city in the United States to require PV systems for new residential construction.  This regulation marks a significant win for solar companies, the renewable energy industry, and the state of California.  The advantages for the PV industry are obvious: the regulation will drive the market as new homes are built, creating revenue and jobs.  Widespread installations will also improve installation techniques and develop a base of skilled installers.  For California, this change will help relieve an already stressed electric grid that funnels power from the northwest to southern California (Lancaster is about 65 miles north of Los Angeles).</p>
<p><b>National Impact</b></p>
<p>Extrapolating numbers across the United States paints an even more ambitious picture.  The National Association of Home Builders forecasts that 647,000 new homes will be built (or at least started) nationwide in 2013.  Imagine that each of these homes comes with a 1.0 kW PV system installed; by the end of 2013, we would have a new 647 MW power plant distributed across the country.  It’s not quite that simple, but the point is this: a seemingly innocuous zoning change like Lancaster’s could have a tremendous impact once it scales across the country.</p>
<p>Furthermore, this would mean more good news for a growing North American PV market.  Navigant Research’s report, <a href="http://www.navigantresearch.com/research/distributed-solar-energy-generation/"><i>Distributed Solar Energy Generation</i></a><i>,</i> forecasts that 220 GW of distributed solar PV will be installed worldwide from 2013 to 2018, representing $540.3 billion in revenue, but the majority of that growth will come from Europe.  Extrapolating again, adding 647 MW of PV capacity each year in the United States would increase distributed PV capacity by approximately 15% to 20%.</p>
<p><b>Builders Object </b></p>
<p>Of course, there are numerous hurdles standing in the way of widespread adoption of anything similar to Lancaster’s zoning laws, and not everyone is applauding this move.  While there has been relatively little opposition from Lancaster residents, the homebuilders clearly object to the new codes.  Specifically, they feel that this change puts their product at a disadvantage when compared to the resale market.  Regardless, it will be interesting to see if other cities follow suit, making the new regulation a boon for the PV industry, or if Lancaster and Sebastopol prove exceptions in an already growing market.</p>
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		<title>The Google BMS Hack &amp; What It Means</title>
		<link>http://www.navigantresearch.com/blog/the-google-bms-hack-what-it-means</link>
		<comments>http://www.navigantresearch.com/blog/the-google-bms-hack-what-it-means#comments</comments>
		<pubDate>Mon, 13 May 2013 04:45:19 +0000</pubDate>
		<dc:creator>Lee Hamilton</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Building Energy Management Systems]]></category>
		<category><![CDATA[Building Systems]]></category>
		<category><![CDATA[Smart Buildings Program]]></category>

		<guid isPermaLink="false">http://www.navigantresearch.com/?p=52307</guid>
		<description><![CDATA[<br/>The building automation world was rocked last week by the news that Google’s Wharf 7 building in Australia was hacked.  The building management system (BMS), built on the Tridium Niagara AX platform (Honeywell acquired Tridium in 2005), was compromised by security researchers Billy Rios and Terry McCorkle, who used a backdoor to access the system [...]]]></description>
				<content:encoded><![CDATA[<br/><p><img class="alignright size-full wp-image-52308" alt="" src="http://www.navigantresearch.com/wp-assets/uploads/2013/05/Keyman_web.gif" width="300" height="205" />The building automation world was rocked last week by the news that <a href="http://www.wired.com/threatlevel/2013/05/googles-control-system-hacked/">Google’s Wharf 7 building in Australia was hacked</a>.  The building management system (BMS), built on the Tridium Niagara AX platform (<a href="http://www.tridium.com/galleries/pr-archive/PR-CORP-20051129-HONEYWELL.pdf">Honeywell acquired Tridium in 2005</a>), was compromised by security researchers Billy Rios and Terry McCorkle, who used a backdoor to access the system and gain access to the building automation system (BAS) – and all the equipment it controls – as well as the other systems running on the same network.</p>
<p>This is not the first time an Internet-connected BAS or BMS has been hacked.  History buffs may remember that when the <a href="http://online.wsj.com/article/SB10001424052970204058404577110541568535300.html?mod=rss_whats_news_us&amp;utm_source=feedburner&amp;utm_medium=feed&amp;utm_campaign=Feed%3A+wsj%2Fxml%2Frss%2F3_7011+%28WSJ.com%3A+What%27s+News+US%29">U.S. Chamber of Commerce was hacked in 2011</a>, they discovered that a thermostat in a Chamber of Commerce-owned property was communicating with a computer in China.  However, this is certainly the most high-profile breach of a building’s automation system to date, and it emphasizes the fact that, as the industry grows and embraces the Internet’s capabilities, it must also embrace the Internet’s challenges.</p>
<p><b>Chaos Scenario</b></p>
<p>The threats are very real.  In this case, the hack was orchestrated for demonstration purposes, so there was no real risk involved.  But think about the individual systems controlled by a BAS/BMS: fire and life safety, security, elevators, etc.  It’s not a far leap to consider worst-case scenarios where fire suppressant systems are de-activated or unwarranted persons are allowed into sensitive areas of secure buildings.  Chaos could be induced if control of the BAS/BMS landed in the wrong hands.</p>
<p>Everyone involved in the building automation industry should be working to improve BMS security.  The magnitude is huge – Navigant Research forecasts that the market for <a href="http://www.navigantresearch.com/research/building-energy-management-systems">building energy management systems will grow to nearly $6 billion by 2020</a>.  Rios and McCorkle claimed they found 25,000 active Tridium systems online, and with <a href="http://www.tridium.com/cs/case_studies/case_study_tobyhanna_army_depot">customers like ABB, Boeing, Changi Airport, and James Cook University Hospital</a>, the scale of the risk is enormous.</p>
<p>Lynxspring – a leading provider of building automation and control solutions – <a href="http://www.lynxspring.com/news-netop-battles-cyber-threats.html">recently announced a partnership with Netop</a> to develop a cyber security solution for BAS/BMS.  The attention around this week’s event reminded me of a <a href="http://www.automatedbuildings.com/news/mar13/articles/lynxspring/130218033505lynxspring.html">great article by Lynxspring’s Marc Petock</a> on the subject of cyber security for building automation, in which he declared, &#8220;Gone are the days of security through obscurity.&#8221;  Now it’s time for all stakeholders in the industry to come together to protect its customers, their assets, and most importantly, the people within these buildings.</p>
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