world study building controls spain - lonmark international · •some manufacturers bringing...

World Market for Intelligent

Environmental Building

Controls and Contrasts with

North America

Jeremy Towler

At LonMark Training

Session

31st January 2011

2Excellence in Market Intelligence

BSRIA Worldwide

Germany

France

SpainChina

Italy Serbia

Russia

North

America

Poland

Czech Republic

Japan

UK

Research partnersOfficesHead Quarters

Established as the global source for knowledge for the building industry, serving the whole

building environment chain from supplier to client

More than 50 years of experience in independent , authoritative technical research, product

testing, consultancy and market intelligence.

Some 160 people with depth of expertise across all industry sectors and unique blend of

technical and marketing capability and understanding

Helping clients understand and forecast market sizes, market opportunities and aid strategic

decision making


North American Research

BSRIA Proplan have conducted regular

Intelligent Buildings market research for over

a quarter of a century and in North America

for over a decade

Conducted CABA Market Sizing North

America 2009/10

– Sponsored by 26 leading organisations

– Many more submitted data.

– Encompassed: Environmental Controls -

Lighting Controls - Security Systems - Fire

Detection Systems - IT Convergence

Available to purchase


Political

and legal

• Kyoto Protocol – establishes legally binding commitment for reduction of 4 greenhouse

gases - driving socio-political agendas, environmental legislation and commits rich

countries to cut emissions

• Dec.„09 Copenhagen meeting of UN Framework Convention on Climate Change

(UNFCCC) ended in chaos after countries failed to agree a way forward.

• >190 countries met Nov.‟10 in Cancun under UNFCCC. Agreement not legal treaty, but

commits all countries to cut emissions for the first time under the UN. Targets extend

beyond 2012. Agreed to set up a $100bn/year „Green Climate Fund‟ from 2020 to help

poor countries adapt to climate change.

• Scientists suggest these pledges will get world 60% towards emissions cuts that are

hoped will keep global temperatures from rising >2C this century.

• Environmental protection made a general state goal in constitutions of some countries

• EPBD at different stages of implementation in national building regulations – having a

very measurable impact on IBC(e) sales

• Increasing penetration in Europe of Energy Performance Certificates (EPC) and

Display Energy Certificate (DEC)

• Feb.‟09, ARRA, economic stimulus package signed into law. Plan includes $3.4 billion

investment in the smart energy grid

World Overview


The World IBC(e)* Market Performance

2007 - 2011

* Intelligent Building Controls - EnvironmentalUnit: USD million

Exchange rate: 2008 1€ = 1.47$ , 2009 = 1.39463$

0

5000

10000

15000

20000

2007 2008 2009 2010 2011

Total IBC(e) Business

Total Installed System

Product

Value-Add

Service

CAGR 07-09 -0.4%

CAGR 07-09 -0.1%

CAGR 07-09 -1.9%

CAGR 07-09 0.6%

CAGR 07-09 0.7%

CAGR 09-11 -0.6%

CAGR 09-11 -1.7%

CAGR 09-11 -1.4%

CAGR 09-11 -2.2%

CAGR 09-11 2.8%

• Robust growth to 2008 gave

way to market shrinkage

due to world economic

crisis in all but service and

maintenance sector

• 2010 should see these

markets bottom-out and

turn the corner towards

recovery in 2011

• Service and maintenance

market continues to grow

throughout 2010 and 2011


Econo-

mics and

energy

price

• Recession, impacting most countries in „08, continued thru „09, particularly in West

• A few economies continued to grow in 2009, including China, India, Australia

• Electricity prices vary, even in single region or power-district; fluctuating but momentum

gathering globally towards greener, more sustainable, CO2-reduced solutions

• Confidence in financial markets gradually recovering

Social

• End user awareness of need for energy conservation continues to rise

• End users demanding more information about buildings to reduce energy cost; can help

pave the way for smart grid and demand response. Increasing willingness to invest in

BMS and energy management solutions

• Environmental assessment methods & building rating systems; BREEAM, LEED,

Energy Star programme, GreenGlobes, having a positive impact on IBC(e)* sales

Techn-

ology

• Enhanced legislation/building standards continues to promote technological innovation

• Numerous countries promoting the development of smart grid technologies. US DOE

distributing the smart grid technology development grants of ARRA.

• Open protocols established a major share yet still too many proprietary protocols

• Integrating diverse systems now frequent + growing demand to converge building

technical infrastructure with Ethernet infrastructure of the business IT systems

World Overview

* IBC(e) - Intelligent Building Controls - environmental


Constr-

uction

• 2009 saw continued non-residential construction decline in

most countries

• Forecasts for 2010 in Western Europe and North America are

generally as depressed as 2009 or worse...

• Forecasts for 2011 generally for a slowing of the decline and

/or return to growth, albeit generally modest in Western

Europe and North America

• Eastern European and Russia forecasts more optimistic than

Western Europe

• Emerging markets such as Brazil, China, India all forecasting

strong growth

• Japan and Australia forecasting stable growth at around 5%

• Refurbishment and Renovation have proven a little more

robust than new construction throughout the economic crisis,

even when in decline

• Maintenance market has proved most recession-proof, even

growing in numerous countries at a time when products

markets and new installed systems markets declined

World Overview


North America

27%

BRIC7%

Europe43%

Middle East8%

Rest15%

Geographic breakdown of the World Building

Controls Product Market

• Europe has biggest

product and

installed systems

market

• America has

biggest service and

maintenance

market


Comments

• Controllers remain the largest group of the products

• Sensors have gained share

• “Other” products (includes software), have gained 4 percentage points share

Product

trends

• Open protocols continue to gain share; BacNet and LonWorks the most popular

• Some manufacturers bringing multi-protocol controllers to the market place

• Web-based solutions now very common - penetration expected to continue

• Slow, growing trend towards wireless communications, predominantly in individual

room control

World Products Market by Product TypeMarket Size 2009

Controllers48%

Valves11%

Actuators15%

Sensors10%

Others16%


Controls

market

drivers

• Environmental issues, energy regulation, energy cost, energy efficiency, retrofit and

energy management projects

• Obligatory energy performance building directives, legislation and certification programs

for design, construction and operation of high performing and green buildings

• Government economic stimulus funding refurbishment and maintenance of existing

public sector buildings

• Increasing momentum of smart grid and demand side management initiatives

• Increased sophistication of specifications for more measurement and metering of

building services and systems including increasing demand for room automation

• Re-commissioning / refurbishment of existing systems to meet new standards

Controls

market

threats

• Possibility that economies fail to recover as anticipated, leading to slower recovery of

construction output for 2010/11 from either public and/or private sector

• Competitors from the IT and software world (Cisco, IBM, Tridium etc.) establishing

positions in the intelligent buildings business; can be both a threat or a partnership

opportunity for the traditional building controls companies

• Limited availability of skilled and qualified industry experts persists

• Low cost imported control devices

Industry Trends and Drivers


Trend in

product

market

• Sharp decline in product sales as new construction and major refurbishment

projects have been cancelled or put on hold during world economic recession

Trend in

valued added

market

• More advanced solutions having a bigger influence on value add; requiring a

greater amount of design/engineering and commissioning

• Integration of systems becoming more popular - can result in increased value

add, however benefits are realised in form of savings down the line

• Increased share of smaller scale contracts

• Reduced contract size due to OEM packaged supply

Trend in

service market

• Service business most robust of all during the recession, followed by retrofit sales

• Well established suppliers have taken advantage of their installed base to grow

their service business

Market Trends

Product - Value-added - Service


Building Controls Product Trends

Sensors

• Better automatic control requires more sensors

• Demand for smart sensors

• Demand in CO2 sensors

• Demand for all-in-one sensors

Controllers

• Nearly half are web-enabled - mainly automation level controllers

• End-user demand for standard protocol controllers

• Multi-protocol controllers

Wireless

• Still a very small market, mainly for sensors

• Industry sees potential in room solutions

• Standards including: Zigbee, 805.12.4, 6LoWPAN, EnOcean

• Key issues: energy demand, data transmission capacity


Smart Grid

Source: NIST Framework and

Roadmap for Smart Grid

Interoperability Standards Release 1.0

(Draft), September 2009.

An advanced power grid

for the 21st century ...

adding and integrating many

varieties of digital computing

and communication

technologies and services

with the power-delivery

infrastructure.

Bi-directional flows of energy

and two-way communication

and control capabilities will

enable an array of new

functionalities and

applications that go well

beyond “smart” meters for

homes and business Six Chief Characteristics:

1. Enables informed participation by all parties

2. Accommodates all generation and storage options

3. Enables new products, services, and markets

4. Provides the power quality for the range of needs

5. Optimizes asset utilization and operating efficiency; and

6. Operates resiliently to disturbance, attacks, and natural disasters


The changing market landscape

New Range of Services

• Energy monitoring /

management

• Demand Response

• Time-of-use pricing

• Micro-generation / Storage

• Electric vehicle integration

(vehicle to grid power)

• Etc. Etc...

Generation Transmission SubstationsDistribution Consumption

• New hardware, Communications

and Networks

• Smart Metering / Automated

Metering Infrastructure

• Grid Optimisation

• Etc. Etc...

Services

Renewables

Many new suppliers will

enter this market...


Definition of Smart Home / Home

Automation

• Automation of homes, housework, household activity.

• Can include centralized control and integration of:

• lighting, HVAC, appliances, and other systems

• to provide improved convenience, comfort, energy

efficiency and security

• Increased quality of life for elderly and disabled

• May connect devices through a personal computer

network - may allow remote internet access

• Best fitted to a new home during construction

• Can use wireless in existing homes

• These can communicate with a central controller

through the existing power wiring, radio, or infrared

signals

• Network sockets may be installed in every room like

AC power receptacles

Environmental

control

Smart

appliances

Consumer

electronics

Lighting

control

Building

component

control

Security

system

Safety

alarm

Individual System Control

Level

Home Energy

Management

Smart Home


The Face of Home Energy Management


Forthcoming BSRIA Smart home

market study - North America

• Contraction in „08 and ‟09 due to economy and loss of new home construction.

• Three out of every four dealers anticipate good revenue and profit growth in 2011

• Moderate volume increase but lower costs - enable higher sales to provide modest market growth

• By 2012 many more smart appliances available to connect to home network

• Widespread deployment of smart meters and energy data

• Will support energy management devices - including sensors and load controls - and is forecast to be one of the

largest growth areas.

• Study Available to purchase

1350

1400

1450

1500

1550

1600

1650

1700

1750

1800

2010 2011 2012 2013

Total product & system integration

CAGR 5.3%

USD million


World Vertical Market Overview

by Building Type

20.2%

9.1%

2.4%

14.3%

14.6%

15%

14.6%

9.8%

0 500 1000 1500 2000 2500 3000

Offices

Commercial (retail)

Storage buildings

Education

Health

Other public

Industrial

Miscellaneous

US$ million

Top vertical markets:

Offices

Central / Local Government

Industrial

Education

Health


Product Distribution Channels

World

ROUTE 1 MECHANICAL CONTRACTOR

23%

ROUTE 2 (ENERGY SERVICES/FM COMPANY)

4%

ROUTE 3 (CONTROL CONTRACTORS)

28%

ROUTE 4 (RESELLER - WHOLESELLERS OR

DISTRIBUTORS)

12%

ROUTE 5 (OEM)9%

ROUTE 6 (DIRECT WITH END

CUSTOMER/

BUILDING OWNER)24%


BSRIA Contact Information

Jeremy Towler

Principal Consultant

Intelligent Building Technology

BSRIA HQ

Old Bracknell Lane West

Bracknell - RG12 7AH

England - UK

[+ 44] 1344 465 573

[email protected]

www.bsria.co.uk

Alex Detre

VP Business Development

BSRIA North America

Ottawa, ON

Phone 613.218.8849

[email protected]

blocked::blocked::outbind://22/www.bsria.co.uk

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