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What's Driving the Growth of Smart Buildings?

August 29, 2022 Digital Workplace
Siobhan Fagan
By Siobhan Fagan

The number of buildings globally deploying smart building technologies will reach 115 million in 2026, from 45 million in 2022 according to a March 2022 report by Juniper Research.

The increase was, perhaps, foreseeable with the increased adoption of the internet of things (IoT) in recent years. After all, through its connectivity, IoT enables organizations to glean insights into building infrastructure — lighting, heating, water, etc. — and realize economies of scale, particularly amid rising energy costs.

But if technology and energy prices are helping fuel the emergence of smart buildings around the world, their growing popularity also appears to be driven by social pressures, as an increasing number of workers who are returning to the physical workplace demand safe, comfortable and sustainable work environments.

The Smart Buildings Market

The move toward smart buildings and, by extension, smart workplaces is clear from Juniper's Future Market Insights research. According to the report, the rising need for lower operating costs, scarcity of energy resources and lower CO2 emissions have led to the higher demand for smart building solutions across the globe. In fact, the research found that regardless of the rise in intelligent IoT technology, energy efficiency remains a top priority for eco-conscious organizations.

As energy-efficient systems gain traction, three conclusions stand out:

  1. The sales of smart building solutions are driven by the electronic security and safety segment due to increasing demand for CCTV and biometrics-based security systems in the buildings.
  2. High demand for thermostats, zone and climate controls, sensors and keypads in the heating, ventilation and air conditioning (HVAC) sector is also rising.
  3. The introduction of 5G technology and rapid development of the smart city movement has uncovered numerous growth opportunities for key players in the smart building solutions market.

Related Article: What's Driving the Move to the 'Eco' Digital Workplace?

What IoT Brings

Throughout the '90s and until very recently, there's been a general assumption that digital would save the planet by reducing things like paper usage. Yet, between server farms and silicon chip fabs, the digital economy has led to greater energy consumption, higher levels of emissions and the end-of-life challenge of recycling chemical, mineral and plastic waste. 

"It is all a great chimera; just like the idea that plastic bottles can be recycled," said Mike Moran, chief risk and sustainability officer of Philadelphia-based smart building data solutions firm Microshare. "In fact, only by monitoring, controlling and reducing energy and water consumption can we mitigate what the digital economy has wrought. Energy monitoring and submetering sensors have moved far beyond the simple utility bill scraping that formed the first wave of the industry."

Moran went on to describe how IoT sensors could be used to offer real-time data on energy use, with potential applications for how business could use the sensors to: "identify equipment that is malfunctioning (by measuring cycles) and also highlight times when large equipment is running at peak hours for no good reason." 

The combination of IoT sensors with occupancy sensors can help businesses to identify where to dim lighting, moderate heating or cooling, and better plan cleaning crew shifts to avoid unoccupied spaces, Moran concluded. "Leak detection can save thousands of gallons of water a month (not to mention mitigating the risk of a major flood)."

Related Article: What Is an Occupancy Analytics Platform?

Out With the Old

The foundational step to an eco-friendly digital workplace is increasing efficiency of building data and smart automation under one API. According to Shaun Cooley, CEO of Los Angeles-based IoT startup Mapped, having more IoT touchpoints in buildings to track the use of resources is supporting this shift.

Sounds like a no-brainer, but many building owners and operators face a common integration challenge to roll out new applications and services across their portfolio: Because of old building systems, integrations must repeat at every location and every building system.

Most commercial or industrial environments have been automated by a system integrator at some time over the past 50 years with whatever bag of tools was available at the time. Over the years, this complexity has caused software vendors and service providers to not collect or use the data as efficiently as they should, decreasing eco-friendliness.

However, with advances in technology, organizations are resolving the problem by replacing weeks and months’ worth of manual integration efforts, offering the capability for a convenient and elevated experience within those physical spaces.

The system/source types of data that can be managed better include BAS/BMS, HVAC, lighting controls, elevators, 3D mapping/BIM, access controls, air quality monitoring, calendaring systems, IWMS, digital signage, energy management/monitoring, fire safety systems, indoor positioning, guest/visitor management, parking systems, security systems, telepresence units, WiFi and many more.

“Better data discovery, ingestion and normalization in all of these will make for a better and more eco-friendly future for all workers,” Cooley said.

Related Article: Eliminate These 8 Types of Waste From Your Digital Workplace With Lean Management

Responsive Environments

To Nisar Ahamad, VP and head of energy, utilities and chemicals (EUC) at New York City-based Capgemini Engineering, the growth in the market is not surprising. After all, data from the US Department of Energy shows the buildings sector accounts for 76% of electricity use and 40% of all US primary energy use and associated greenhouse gas (GHG) emissions.

“These numbers prove that it's necessary to find a better, more sustainable solution to improve building efficiency, such as smart buildings and digital workplaces,” Ahamad said.

The connectivity provided by smart buildings can transform today's workspaces into responsive environments by capturing and analyzing real-time data about their energy usage and consumption. With this predictive data, leaders can make early improvements to provide a positive human experience — increasing wellness and productivity — while ensuring energy conservation that can meet sustainability targets and reduce overall emissions.


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