Smart buildings: the first 'killer app' for smart grid?

New IDC report estimates the energy efficient 'smart building' market will grow 27% a year worldwide, as properties become more interactive with the smart grid.
Written by Joe McKendrick, Contributing Writer on

In demand: buildings that can talk to local and national utilities, to help smooth spikes in demand and moderate energy consumption.

IDC Energy Insights released a market forecast that projects a global compound annual growth rate (CAGR) in spending for smart building technology of 27% between 2010 and 2015, with forecasted sales reaching $10.2 billion in 2015. The annual growth in North America will be about 28%, and 29% in Western Europe.

The forecast includes systems and services for the control and optimization of building operations and maintenance, and IDC says the growth will be driven by energy management requirements:

"Worldwide, smart building systems market growth will be driven by building owners and managers seeking ways to reduce operating costs and increase the uniqueness of their building assets, thereby embracing the complementary objectives of energy efficiency and sustainability. SB systems are a set of intelligent technologies that enable building managers to measure, monitor, control and optimize the operations and maintenance of a building.

"The primary motivating factor behind the emergence of smart building systems is cost reduction through energy savings," explained Casey Talon, a research analyst with IDC Energy Insights' research advisory services focused on clean energy, and one of the authors of the report. "Energy consumption in the building sector is usually one of the leading line items in operational budgets and thus a tempting target for smart building controls. Heating, ventilation and air conditioning plus lighting comprise more than 70% of a building's energy consumption."

In a related report, IDC says smart building systems "have tremendous disruptive potential for the energy and information and communications technology industries," calling the smart building "the first true 'killer app' of the new smart grid infrastructure.'" Development of the market will involve both partnerships and competition between utilities, technology vendors, and building owners. "The smart grid, which has received significant attention, is – in the end – a platform," says Talon. "Advances in energy efficiency and electricity demand management through smart building systems will transform the interaction between commercial buildings and the electricity grid."

(Photo by the author.)

This post was originally published on Smartplanet.com

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