Navigant Research Blog

IoT: Building Awareness – Part 1

— December 12, 2017

Marcus Aurelius once said, “That which is not good for the beehive is not good for the bees.” Conversely, what is good for the bee is good for the hive—a metaphor not lost on Internet of Things (IoT) and smart building integration. A paradigm surrounding the building automation space is developing as businesses begin to focus more on occupant experience. Smart building technologies are widening the building investment landscape to include tenant engagement and satisfaction. Value-generating technologies, like IoT-enabled devices, make it easier to manage energy and businesses. Building owners are able to leverage existing communication platforms, capitalize on energy efficiency, and promote healthier lives with healthier buildings.

Better Building, Better Business

Building automation systems with IoT-enabled sensors can not only increase energy efficiency, but also improve worker efficiency, leading to more productive businesses. Research finds that comfortable work environments enhance business productivity by improving the health and satisfaction of its workers. Advanced sensors, like those in Amsterdam’s building superstar The Edge, have given building managers better information on how building space is being utilized by monitoring occupant behavior. This is important because the more we know about occupant behavior, the more we are capable of creating environments that will optimize worker performance. Studies on the effect of building systems in schools also found that indoor air quality and thermal comfort have a direct effect on concentration. Classrooms that are thermally comfortable with lower levels of pollutants increase student learning, resulting in higher levels of student performance.

Show Me the Money

The advantage of investing in smart building technology is twofold, as these systems are not only more sustainable and energy efficient, but potentially more lucrative as well. Businesses operating within these smart systems are better positioned to make financial gains, as employees are more productive. Reports like JLL’s 3-30-300 rule suggest that prioritizing tenant satisfaction and well-being creates larger payoffs for building owners and investors—more so than savings on monthly utility bills would alone. The study finds that “a 2% energy efficiency improvement would result in savings of $.06 per square foot, but a 2% improvement in productivity would result in $6 per square foot through increased employee performance.”

Work Smarter, Not Harder

The argument stands that smarter buildings make better workers. Smart buildings are attractive from a business perspective, as these technologies enable employees to be more productive and less distracted by time-consuming administrative tasks, such as booking conference rooms or scheduling in-house meetings. The more comfortable the worker, the better work they will produce. This, in effect, raises the value of the business and contributes to the overall value of the building. In terms of ROI on smart buildings, focusing on occupancy satisfaction takes a bottom-up approach that supports greater integration and interoperability, improving bottom lines across the board.

Connectivity Is Key

The paradigm surrounding building management systems is shifting as more attention is being paid to occupancy experience. We know that effective operations and maintenance through IoT-enabled devices improve building performance. Why not apply that same logic to worker performance? The significant effect data analytics continue to have on the uptime of building systems could equally improve the livelihoods of the people operating within those structures. Facilitating better working environments optimizes worker efficiency, adding value to businesses and buildings. What is good for the worker bee is good for the hive (and hive investors), as smart technologies continue to add value to both residents and buildings alike.

 

UK Cities Are Embedding Smart City Principles in City Policy

— November 7, 2017

My previous blog summarized five of the Innovation Awards spotlighted in the UK Smart Cities Index 2017, commissioned by Huawei, which assess the 20 leading smart cities in the UK. Those awards focused on five key smart city service areas: transportation, health, energy, education, and public safety. Equally important are the cross-sector strategies and technology investments that enable innovation across these service areas.

Four other Innovation Awards identify key strategic and technical areas where UK cities are making significant contributions to the development of smart city policies and infrastructure:

Sustainability: Cities are making sustainability the heart of city policy, as they recognize the need to reduce their environmental footprint and contribute to the global reduction in greenhouse gas emissions. Peterborough takes the Innovation Award for its environmental focus and commitment to becoming a circular city, as exemplified in the Share Peterborough programme for resource sharing. Also commended are Bristol, European Green Capital in 2016; London, which has launched an ambitious new environmental policy; and Manchester, which has set a goal of being a zero carbon city by 2050.

Internet of Things (IoT): UK cities are looking to establish a large-scale test bed environment that can support a rolling programme of innovation projects. Bristol Is Open continues to lead the way in terms of its scope and ambition and the contribution it is making to the city’s broader plans. Other leading examples include Manchester’s CityVerve IoT demonstrator, Milton Keynes’ MK:Smart, and Cambridge’s new LoRa-based intelligent city platform.

Data and analytics: All the cities included in this report are looking at how to use data to improve services and boost innovation. London continues to be at the forefront on data innovation with its London Office of Data Analytics and a new Chief Digital Officer accelerating the use of data to improve services across the capital. Leeds also deserves mention as one of the pioneers for open data in the UK with Data Mill North, just one of several data-focused initiatives in the city.

Strategy: The successful adoption of new technologies to improve city services requires cities to rethink the way they design, manage, and operate city services in the digital age. All the leading cities are taking a fresh view on the impact of technology on city policy making, planning, and service design. The Innovation Award goes to Aberdeen for its new Target Operating Model, which seeks to embed smart city thinking into city planning, service design, and infrastructure investment. This will be enabled by new approaches to the provision of digital infrastructure and services.

The 10th Innovation Award is for City Partner and reflects the importance of central government and other agencies in fostering collaboration between cities and supporting follower cities as they develop smart city initiatives. The Future Cities Catapult is having a strong influence across the country by helping cities initiate smart city programmes, share ideas and insight, develop common standards, and accelerate innovation in areas like smart planning.

These Innovation Awards demonstrate the range of activity occurring across UK cities. In my next blog, I will examine some of broader insights to be drawn from Navigant Research’s efforts for the report and its conversations with city leaders.

 

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.

 

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