Navigant Research Blog

A New Year and Newfound Potential for Data-Rich Buildings

— December 28, 2015

The perfect storm to realize the promise of the intelligent building is upon us. New policies on climate change and stakeholder demands for sustainability that will redefine best-in-class standards for commercial buildings have arrived, and building owners now have an opportunity to invest in intelligent building solutions that can transform their facilities and meet these changing demands. The result is a new set of competitive differentiators wherein dynamic facility operations optimize energy consumption and maximize comfort, along with a new market outlook for Class A commercial buildings in which owners and investors can realize economic benefits alongside stakeholder satisfaction.

Climate Change Pressures

At the end of 2015, the international convention on climate change orchestrated by the United Nations, or COP21, started a new chapter for the intelligent building history books. The Paris Agreement calls on 195 countries and the European Union to execute a global strategy for greenhouse gas (GHG) emissions reductions. So how does this trickle down to the commercial facility, and what does it mean for intelligent buildings? According to the U.S. Environmental Protection Agency (EPA), commercial and industrial buildings contribute about 45% of the total GHG emissions generated in the United States. As a result, energy efficiency represents a tremendous opportunity for climate change mitigation.

Stakeholder Demands

Policymakers, shareholders, activists, and forward leaning corporations are taking the helm in directing transparency on climate risk disclosures. At the end of October, 32 members of Congress sent a letter to the Securities and Exchange Commission (SEC) urging stronger enforcement and commitment to the 2010 SEC release 33-9106, “Commission Guidance Regarding Disclosure Related to Climate Change.” During that same month, 81 companies signed the American Business Act on Climate Pledge to showcase their commitment to climate change mitigation with goals as ambitious as up to 50% emissions reductions. In addition, to link back to the intelligent buildings market specifically, the evolving workforce is increasingly demanding sustainable and technology-driven workspaces. According to the Pew Research Center, 2015 marked a generational tipping point, with Millennials now representing the largest share of the U.S. labor force. This next generation in leadership brings a mind shift in priorities and expectations. Hosts of surveys have highlighted Millennials’ innate reliance on technology for all aspects of their lives and how this translates into expectations in the workplace. These workers also prioritize sustainability when evaluating career opportunities. This combination of a technology and sustainability mindset is expected to drive facilities industry leaders toward investment in intelligent building systems.

Economic Benefits

Economics are still the bottom line, and Navigant Research suggests that investment in advanced sensors, analytics, and services will help transform facilities into intelligent buildings, meet growing stakeholder pressures, and deliver economic benefits. The increased proliferation of the Internet of Things (IoT) is enabling the cost-effective deployment of intelligent building solutions that create a data-rich environment for improving facility operations. In addition, the intelligent building is optimized in terms of energy consumption for significant reductions in GHG emissions; these buildings also provide unprecedented transparency for monitoring sustainability, measuring cost savings, and integrating technology into facility management and the occupant experience.

Want to know more about our expectations for building innovations the coming year? Check out the new Navigant Research report, Intelligent Buildings: 10 Trends to Watch in 2016 and Beyond.

 

Intelligent Buildings as a Bridge to Climate Resilience

— October 21, 2015

On October 6, the Environmental Defense Fund (EDF) showcased the benefits of intelligent building technologies outside the facility walls. The business case for investment in intelligent building solutions can be amplified by the capacity to support grid reliability and resiliency in addition to direct economic and performance benefits. The Federal Energy Regulatory Commission (FERC) has ruled that demand response (DR) and energy efficiency resources must be allowed to participate in the PJM market on equal footing with other capacity resource. In fact, in Chicago, a collaborative pilot with the PJM Interconnection known as the Combined Capacity Asset Performance Project is demonstrating this opportunity. After the fallout of the polar vortex of 2014, PJM established these requirements to ensure that capacity resources would be immediately responsive at any time year-round. These requirements move away from PJM’s former model, which allowed for summer-only DR participation; the Chicago pilot is poised to show just how well intelligent buildings can fare in these circumstances.

“Demand response has demonstrated its potential to cut peak electricity demand, help balance the grid, and save customers money. The project offers an inventive way to preserve and grow this valuable resource in the PJM market. The collaboration will serve as a strategic model for buildings, which will be able to combine their demand response potential to enter the market where they wouldn’t be able to participate on their own,” explained Andrew Barbeau, president of the Accelerate Group and senior clean energy consultant for EDF.

Sounds Great, but What Gives?

The development of the DR market has not been a smooth ride. Three months following the FERC ruling in July 2015, the Supreme Court debated DR’s validity for generating revenue while maximizing grid reliability. As Penn State professor Seth Blumsack explained, “The case, however, ultimately goes far beyond demand response. The issue at hand is all about the ability of the federal government to set market rules for local power systems—that is, the portion of the grid that reaches individual homes and businesses—versus the regional grid that transports power over long distances across the United States.” It is yet to be seen how the court will rule on the issue.

DR-Enabling Technology Expected to Overcome Regulatory Uncertainty

If anything can pull the brakes on market development, it’s market uncertainty. Luckily, in this market, the enabling technology is expected to continue selling. On the commercial building side, the critical layer is the software and services that orchestrate load management. Navigant Research follows these solutions through its Building Innovations program. The future is bright for building management systems; not only do these systems provide the software analytics and services that can not only support DR, but they also provide load management for the customer to generate internal financial benefits. For example, a customer may integrate a software solution that provides insight into energy consumption across their portfolio. The information can direct change in equipment operations that can deliver new revenue streams formally (through DR participation), or informally by actively shifting the energy load to reduce peak demand charges. In the end, the building energy management system investment is a win-win. This kind of benefit underscores the optimistic outlook for intelligent buildings that will be grid-ready as the DR market prevails over regulatory uncertainty.

 

Climate Risks Provide More Validation for the Energy Cloud

— October 19, 2015

The U.S. Department of Energy (DOE) just released a new interactive map and report highlighting the risks to resilience and reliability of energy supply at a regional scale across the United States. The report highlights projected climate change impacts across seven regions to direct climate change resiliency and mitigation efforts on the most vulnerable components of our energy infrastructure.

The climate projections and potential impacts span across nine segments of the energy sector, including oil and gas exploration and production, fuel transportation, thermoelectric power generation, hydropower, bioenergy and biofuel production, wind energy, solar energy, electric grid, and energy demand. This comprehensive view of climate change impacts across the energy. The threats are prioritized for each region based on the DOE’s analysis, as illustrated in the map below.

Projected Climate Impacts on the U.S. Energy Sector by Region

Casey Oct. Blog

(Source: U.S. Department of Energy)

The climate change-related threats to fuel transport, the grid, and energy demand underscore the importance of investment and commitment to transforming how we think about and use energy. Navigant Research characterizes this necessary revolution of the energy sector as the energy cloud. Profound changes in the technologies that support our use of energy will also transform the nature of the grid, energy assets, and even buildings.

The rapid increase in investment of distributed energy resources (DER), the technology enablement for demand response, and the growing volumes of data associated with the Internet of Things (IoT) is changing the character of buildings. The intelligent building is the framework that helps building owners leverage technology and services to use the expansive data on facility equipment, operations, occupancy behaviors, and other business systems to optimize energy consumption.

Intelligent building solutions are enabling greater integration of control and automation across systems, from HVAC to plug loads, to deliver more strategic and coordinated energy management. The insights from these building energy management systems and industrial energy management systems direct changes in when and how much energy our buildings use.

As climate change impacts continue to threaten our traditional energy industry, intelligent building solutions can usher in a new era in building management. The opportunity is two-fold; first, the technology can restructure building system operations, and second, the software and services can support the change management of people investing in and operating building systems. The technology is available and capable of delivering sophisticated energy management strategies, and the future will be shaped by how software and services help change the mindset and procedures on the human side of the equation.

 

Proposed ASHRAE Standard Enables Smart Facility to Smart Grid Communication

— August 24, 2015

The Facility Smart Grid Information Model devised by the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) and the National Electrical Manufacturers Association (NEMA) is open for public review until October 6, 2015. The purpose of the standard is to define an information model to enable building automation systems and appliances in commercial, industrial, and residential facilities to manage electrical loads and generation sources in response to communication from a smart electrical grid. As a result, utilities and electrical service providers also receive information about electrical loads and distributed generation production. The standard is also under consideration for adoption as an international standard by the International Organization for Standardization.

The Benefits

An improved information model can be extremely beneficial to facilities. If energy characteristics of a facility’s energy consuming, storing, or producing systems can be tracked and communicated between the grid, facility managers will better understand what factors are affecting their energy consumption. They can then find ways to effectively reduce the energy consumption of their facility. The facility also gains the ability to receive information from the grid; information on supply shortages, real-time energy pricing information, or demand response signals can be received and adjusted for by facility operators. Enhanced grid communication will allow for operators to be more aggressive with energy management.

For utilities and energy providers, the information model enables communications with various facility types through a common protocol.  The energy providers can then more accurately forecast energy demands and responses to any energy supply constraints.

Interoperability

Smart grid cyber security and interoperability are challenges of great significance. Under the Energy Independence and Security Act (EISA) of 2007, the National Institute of Standards and Technology (NIST) is primarily responsible to develop the standards for information management to achieve interoperability of smart grid systems and devices. To generate the requirements needed for interoperability standards, a Smart Grid Interoperability Panel (SGIP) was formed by experts from the fields of communications technology, power and transmission, renewables, transportation, energy storage, regulators, consumers, and smart buildings. The Facility Smart Grid Information Model is a supporting effort by ASHRAE and NEMA to help the SGIP.

Enabler for Technologies

An approved and standardized information model will allow for enhancements to enabling technologies. Building automation system manufacturers can then enhance product offerings to better monitor and manage facility equipment with received information about supply shortages or real-time energy prices. Generation or storage systems can also be optimized for potential weather impacts or supply shortages. The Facility Smart Grid Information model is an important step toward information exchange between facilities and the grid. Looking ahead, it can drastically change the landscape of building energy management.

 

Blog Articles

Most Recent

By Date

Tags

Clean Transportation, Digital Utility Strategies, Electric Vehicles, Energy Technologies, Policy & Regulation, Renewable Energy, Smart Energy Practice, Smart Energy Program, Transportation Efficiencies, Utility Transformations

By Author


{"userID":"","pageName":"Intelligent Building Management","path":"\/tag\/intelligent-building-management","date":"12\/16\/2017"}