Navigant Research Blog

What It Will Take to Make Healthy Buildings a Business Priority

— October 19, 2017

Healthy buildings are an emerging hot topic at industry events and in facility trade publications. In September 2017, I participated in the half-day Healthy, Adaptive Buildings Summit at this year’s GreenBiz Verge Conference. The conversations were invigorating, shifting from environmental justice to workplace transformation and back again. I was left with a lingering question: Are healthy buildings the next overhyped trend? Does the movement aim to encompass technology and business but will fail because of a misguided, yet well-intended focus? Not if industry leaders refine their message.

The panelist noted the similar lack of a common lexicon, or a range of definitions that reflect the wide stakeholder groups showing interest in the idea of healthy buildings. The opening panel discussion during the summit reminded me of ongoing conversations I have in the broader building technologies arena on terminology: Is the building smart, intelligent, a structure of connected technologies made up of systems? What threshold defines that next generation space? Panelists shared their differing, yet parallel points of view and these definitions resonate with me:

  • Health is basic, the absence of things wrong.
  • Well-being is how you feel about your health, and how you respond emotionally.
  • Wellness describes the proactive steps you can take to maximize both.

These descriptions clarify health at a personal level, but how can these ideas be extended to buildings? Healthy buildings can describe the effects from equipment operations on energy consumption, sustainability, environmental justice, and even employee productivity. If stakeholders can align their messaging, there is a great opportunity in the movement to make healthy buildings the next umbrella concept for the facilities industry. The answer is adaptability—flexibility in how to deploy and use technology in addressing multidimensional business objectives. The second theme of the summit, which is a valuable dimension that can showcase technology as a means to the wide-reaching goals of the healthy building movement.

3-30-300

JLL’s 3-30-300 Calculator has become the go-to metric for explaining why the intelligent buildings market has pivoted and the focus has moved from energy up the chain to that big 300 number—the cost of people and the aim to improve productivity. This metric is powerful because it speaks to the heart of the business perspective. While sustainability, social responsibility, and other potentially amorphous corporate goals are important from a branding and positioning standpoint, the bottom line still drives investment. If the healthy buildings movement can use technology and the data and analytics from the intelligent buildings market to quantify productivity, the investment is worthwhile. This is no simple task; data is key. There are so many variables that affect the measure of productivity and the industry has failed to create a single equation to measure the 300 just yet.

New Calculation of Adaptability

Thinking of adaptability as a lens on how to select and deploy technology for use in multiple ways may just be the framework the industry needs to make healthy buildings a substantial initiative, meet multiple stakeholder needs, and move away from surface-level buzz. Real-time data on occupancy and movement, indoor air quality, feedback on comfort, and data on business output could be valuable measures for a new calculation of adaptability. The measure of adaptability is also attractive as a way of reframing the conversation in line with the focus on the occupant we hear in the market more and more. Can adaptability describe the healthy building movement and provide the data that key decision makers need to characterize how their facilities are best in class? I would argue this approach can create a common conversation around dynamic systems with automated, ongoing performance improvement and a way to root the soft concept of health in the stiff framework of technology enablement.

 

Data – The Foundation of Value in the Energy Market Transformation

— October 17, 2017

I attended GreenBiz’s annual Verge Conference in mid-September and found a unifying theme throughout the diverse discussions on the intersection of technology and sustainability: data is the key to market transformation. The topics of the conference’s sessions spanned from environmental justice to grid modernization, but in every conversation and demonstration, it was clear that access to, and use of, good data is the foundation for innovation and value creation. An unwavering commitment to environmental justice was the undisputable, yet unofficial, secondary theme of this year’s event. I would argue this important societal goal can be tackled alongside the transformation of the energy industry by using data and technology.

Decentralization Is Coming

Panelists on the plenary session roundtable for day 1 represented the major contingencies in the US utility landscape—a municipal, a retailer, and an investor-owned utility. From three points of view, these industry leaders agreed that decentralization is coming and “the traditional utility business model is obsolete, if not dead.” At Navigant, we have been articulating this time of market disruption as the emergence of the Energy Cloud. We are exploring how various platforms are creating value through business models built around a more dynamic relationship between energy supply and demand. The foundation of this new energy reality is digital transformation, in which data fuels business opportunity. Buildings2Grid (B2G) integration is just one of the platforms that illustrates the power of data in creating new business opportunities for utilities, as discussed in Navigant Research’s Building-to-Grid Integration report.

As one panelist put it, “Markets move at the pace of innovation, grid moves at the pace of regulation,” which can place a significant hurdle in front of a large proportion of our energy providers. So, how can utilities take a seat at the table in a new energy reality? It starts with data. Navigant Research took another look at utility opportunities in the Energy Cloud with a complementary report, Intelligent Building Technologies for Value-Added Services. The connectivity and data-driven insight of intelligent building solutions create the roadmap for redefining how commercial buildings operate and opportunities for new services to optimize energy use and generation. Or, as one of the more memorable lines from that Verge utility plenary put it, “great innovation is where megabits meet megawatts.”

Across the board, electricity suppliers are unified by a fundamental goal to keep lights on—to support reliable and resilient power. Intelligent building technologies provide a digital lens into commercial customer operations and a pathway to new engagement models for ensuring that power is reliable and resilient but also supports broader customer goals such as sustainability and operational efficiency.

 

How the IoT and Big Data Make Cities More Efficient

— September 8, 2017

The delivery of city services is being transformed by smart technologies that are providing city managers with new insights into operational performance and providing platforms for new forms of personalized and responsive services. Central to this transformation is the availability of real-time data from a growing range of intelligent devices that can monitor city operations. Sensors, communications networks, and the real-time data cities collect can enable more intelligent, efficient, sustainable, and interactive public services. The new technologies are helping cities make the most of limited budgets while adding additional value to the services provided to their communities. These innovations have the potential to drive a revolutionary change in the way city services are delivered in term of the quality, efficiency, and responsiveness of services.

Digital Technologies and City Services

Examples of how digital technologies are changing the way city services are provided can be found across a variety of key sectors:

  • Transportation: Real-time data collected from sensors and other devices can optimize connections between modes of transport for faster travel times, reduce the costs of operation, and increase convenience through improved information services for users on parking and transit availability in cities. Real-time data on traffic and transit services is providing new tools to city managers for both operation optimization and the delivery of new services to users. In Helsinki, for example, the bus service operator Helsingin Bussiliikenne Oy (HelB) worked with CGI to use improve its competitiveness through the use of sensors and data analytics on service performance.
  • Waste: Waste collection in cities is being transformed through the use of sensor technologies to improve collection. Companies like Enevo are providing real-time data and predictive analytics on the fullness of waste bins, enabling optimization of the collection process. These technological advances address the inefficiency of traditional waste collection, which is carried out by emptying containers according to predefined schedules and routes that are repeated at a set frequency.
  • Water: Droughts and population growth around the world have made water an increasingly important issue for cities. Intelligent devices, communications networks, and advanced IT systems are helping the water industry transform the way they deliver water services for cities. Veolia, for example, is working with the City of Lille, France to transform its water infrastructure. Working in partnership with the city, it deployed 1,000 sensors across the water network to identify leaks, as well as water meters and probes to test water quality.

Innovative Smart City Projects

The smart city market continues to expand, as city leaders across the globe are heralding innovative projects and laying out a vision for how cities can use technology to meet sustainability goals, boost local economies, and improve services. The importance of smart cities is being recognized at national level, as well. Canada is the most recent country to launch a national program, joining a list that includes Australia, the United States, China, India, Japan, Singapore, South Korea, and the United Kingdom. The Canadian federal government announced in early 2017 the launch of a Smart Cities Challenge Fund, proposing $300 million over 11 years for Infrastructure Canada to implement the program.

Intelligent Cities Summit

The myriad of ways in which this funding can utilize the power of big data and the Internet of Things (IoT) to deliver improved services in Canadian cities will be discussed at the upcoming Intelligent Cities Summit in Toronto (October 24-25). The conference speaker lineup features C-level municipal executives from cities such as Toronto, Vancouver, and Calgary, among others. See the conference website to download the brochure and register for the summit.

 

Advanced Energy Market Hits $1.4 Trillion: Part 1

— April 21, 2017

Each year, Navigant Research partners with Advanced Energy Economy (AEE) to quantify the size of the US and global advanced energy market and publish the Advanced Energy Now Market Report. AEE is a national association of businesses and business leaders that share in the vision of “making the global energy system more secure, clean and affordable.”

The report presents revenue data across seven major segments and 41 different subsegments that pulls from 60+ Navigant Research market reports. This is the 6th year the report has been published. In this two-part blog series, some of the most important findings in the report are summarized:

  • Advanced energy is a $1.4 trillion global industry, almost twice the size of the global airline industry, and is nearly equal to global apparel revenue.
  • The US advanced energy industry generates nearly $200 billion in revenue, nearly double beer sales, equal to pharmaceutical manufacturing, and approaching wholesale consumer electronics.

In addition to quantifying the 41 advanced energy subsegments that make up the advanced energy market (each with multiple product categories), the report features 17 trend stories across the seven market segments. These can be rolled up into five overarching trends that are shaping the future of advanced energy. Two of these trends are featured here; the other three are summarized in part two of this blog series:

  • The rise of big data analytics: The use of software engines and algorithms to process and analyze large quantities of data and provide insights into how customers behave is changing the way companies do business across the economy, and energy is no exception. The section, “Big Data Drives Demand-Side Management Innovation,” discusses how, in recent years, utilities and energy efficiency providers have used new data tools (home energy reports, web portals, and mobile apps) to unlock cost and energy savings for customers. The “Energy Use? Yes, There’s an App for That” section profiles energy applications that are targeting the $2.3 billion global residential home energy management systems market. Meanwhile, amid the digitization of energy—which has offered up the Internet of Things, connected devices, smart grid, and even automated vehicles to consumers—new challenges have arisen, including cybersecurity. This is discussed in the “As the Grid Goes Digital, Cybersecurity Gains Importance” section.
  • Hardware cost declines: Advanced energy technology deployment continues to exhibit dramatic growth rates, enabled in large part by cost declines in hardware such as solar PV modules (see “Solar PV Sets New Records Nationally and Globally”), LED lighting, and increasingly, battery technology—with gigafactories being built around the globe to produce these items at scale. The extreme pace of these cost and commensurate price declines have restrained market revenue growth, as outlined in this report. In response to increasing market maturity and tight margins, advanced energy companies in many sectors are undergoing a shift to services, as discussed in the “Lighting as a Service” section. Market consolidation and vertical integration, scaling of manufacturing, and fierce competition are expected to drive further cost reductions in the future.
 

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