Navigant Research Blog

On Energy and Buildings, Conventional Wisdom is Fleeting

— May 16, 2013

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 site natural gas import terminals.  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 nuclear power renaissance was effectively promoted as the only carbonless solution with the potential capacity to displace coal.  The dawn of transportation electrification seemed upon us, while the smart grid took a laser focus on peak load reduction.

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 expected to stabilize and volatility decrease.  Planned natural gas import terminals, while still locally controversial, are morphing into export terminalsNatural gas generation is rapidly displacing coal, leading to significant carbon emissions 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 stalled a North American nuclear renaissance while driving Germany and Japan, at least notionally, to nuclear exits.  Home refueling of natural gas vehicles could replace electric vehicle charging stations in consumer imaginations.  Meanwhile, long-haul trucks, fleet vehicles, and even locomotives are adopting natural gas.  And the smart grid is becoming more important as a means of power resiliency in the face of hurricanes and superstorms than as a vehicle for peak load reduction.

Cheap Gas, Smart Buildings

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 Intelligent Buildings Forum in Toronto.  CABA is the Continental Automated Buildings Association, 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 (Cadillac Fairview), utilities (Ontario Power Authority), suppliers (Siemens), and technology researchers (CanmetENERGY).

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.


The Google BMS Hack & What It Means

— May 12, 2013

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 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.

This is not the first time an Internet-connected BAS or BMS has been hacked.  History buffs may remember that when the U.S. Chamber of Commerce was hacked in 2011, 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.

Chaos Scenario

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.

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 building energy management systems will grow to nearly $6 billion by 2020.  Rios and McCorkle claimed they found 25,000 active Tridium systems online, and with customers like ABB, Boeing, Changi Airport, and James Cook University Hospital, the scale of the risk is enormous.

Lynxspring – a leading provider of building automation and control solutions – recently announced a partnership with Netop to develop a cyber security solution for BAS/BMS.  The attention around this week’s event reminded me of a great article by Lynxspring’s Marc Petock on the subject of cyber security for building automation, in which he declared, “Gone are the days of security through obscurity.”  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.


Rembrandt, In a New Light

— April 23, 2013

After an extensive 10-year renovation, the Rijksmuseum in Amsterdam reopened its doors earlier this month to visitors coming to see the work of Dutch masters such as Rembrandt and Vermeer.  In addition to the 17th century masterpieces, those visitors will also be treated to a marvel of the 21st century: LED lighting.  Three-quarters of a million LEDs from Philips now light the museum’s 7,500 works of art and over 100,000 square feet of space.   The Rijksmuseum is joining a rapidly growing number of art museums that have already switched to this light source, including the Louvre in Paris, France, the Kunstkammer Wien in Vienna, Austria, the De An Art Gallery in Zhongshan City, China, and the Museum of Fine Arts in Houston, Texas.  There is even a newly created LinkedIn group focused on LED lighting for art and museums.

When choosing a light source, the two primary considerations for any art museum are the visitor experience and the preservation of artwork.  For both of these considerations, LED lighting is the clear frontrunner.  Light quality and color rendering from LEDs have advanced to a point where Tim Zeedijk, the head of exhibitions at the Rijksmuseum, said that the recent lighting upgrade “allows the art to be viewed in the best light possible to bring out all the colors and details that the artist intended us to see.”

Applications Expand

Regarding artwork preservation, reducing the exposure to ultraviolet light is a key strategy.  Fluorescent, halogen, and high-intensity discharge lighting all emit UV light, forcing art museums to use filters and limit the amount of time that any individual piece is on display.  LED lighting, on the other hand, emits no UV light, relieving a significant concern for curators and giving them new flexibility.  All of the other benefits of LED lighting also apply to museums, including reduced electricity consumption and longer-lived lamps.

Art museums provide another example of a specific application where LED lighting is already the best choice.  Others include cold storage facilities, where the efficiency benefits of LEDs are doubled by the savings in cooling energy, and high-ceiling atriums where the cost of replacing burned out lamps is exorbitant.  As the quality of LEDs continues to improve and the price of LEDs continues to fall, the list of applications where LED lighting is the best choice will continue to grow.  This combination of factors has led Navigant Research to forecast that unit sales of LED lamps will increase worldwide at a compound annual growth rate (CAGR) of 44%, as reported in our recently released study, Energy Efficient Lighting for Commercial Markets.


Wireless Building Controls Standards Emerge

— April 17, 2013

Wireless communications for building control systems have been available for more than a decade.  However, these product lines – focused on specific single building system (lighting, HVAC, etc.) – have achieved acceptance only in small market niches.  Wireless controls have always had what seemed to be a strong business case: reduced labor costs thanks to less wire pulling, more flexible sensor placement, and the ability to adapt as building interiors are rearranged over time.  In practice, however, these benefits were offset by the initial costs, lack of training, and often poor performance characteristics of the proprietary, non-standard market offerings.

This is changing rapidly, as two particular wireless controls standards have emerged with strong multivendor support:  ZigBee Commercial Building Automation (ZBA) and EnOcean.   Our recently published report, Wireless Control Systems for Smart Buildings, forecasts that these two standards will battle each other for share in a growing global market.   Interestingly, these two successful standards evolved from very different approaches.

Wireless Building Controls Penetration Rate by Region, World Markets: 2012-2020


The ZigBee Alliance was founded in 2002 to develop an open standard for wireless sensor networking, with commercial building automation a key application target.  While market attention has focused on an Internet Protocol (IP) version of ZigBee for Smart Energy (i.e., smart meter and home area networks), other groups quietly, steadily, and quite slowly, inched toward a ZigBee implementation for commercial building control systems.  It took more than 10 years and several detours, but the working groups ultimately adapted the popular BACnet building control protocols to the proven ZigBee PRO networking stack to deliver a mesh networking solution that most industry participants are now embracing, including Trane and Schneider Electric, among many others.  Ultimately, a long, multi-vendor effort has produced an acceptable general wireless standard that spans lighting, HVAC, fire & safety, and security & access building controls systems.

The EnOcean specifications have emerged by a completely different path that started from a proprietary single-vendor product set targeting a specific problem; it subsequently opened up to multiple vendors and a broader solution space.  EnOcean GmbH was spun out in 2001 from Siemens AG as a provider of self-powered wireless lighting controls, whereby the energy inherent in physically toggling a light switch is harvested to power wireless communications to the lighting system.  This avoids the battery maintenance problem associated with battery-based wireless switches.   EnOcean the company initiated the creation of an industry alliance, and though the technology has been accepted as a ISO/IEC standard, the underlying technology remains essentially sourced by a single vendor.  Yet, the EnOcean solution has garnered broad industry support and customer acceptance, particularly in Europe – enough to cause the ZigBee Alliance to develop a similar energy harvesting specification.

Despite the very different pedigrees, the stage is set for a battle between ZigBee, EnOcean, and proprietary solutions.  Other standards and semi-standards including Wi-Fi, Z-Wave, and LonWorks will also look for mindshare, but we see these are secondary to the larger battle between ZigBee and EnOcean.  This competition should benefit the consumers of these technologies: building controls vendors, integrators, installers, and ultimately, building occupants.


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