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Market Sizing North America Intelligent & Integrated Technologies Excellence in Market Intelligence 1 Market Sizing North America Intelligent & Integrated Technologies Overview for CABA IIBC at AHR2010 Jan 25, 2010 Market Sizing North America Intelligent & Integrated Technologies Level sponsors Level sponsors Excellence in Market Intelligence 3 Experienced Project Team Andrew Giles, MA General Manager BSRIA - World Market Intelligence (WMI) Jeremy Towler, BBA, HTEC, dipl Oek Senior Manager Intelligent Building Technology Lone Hansen Senior Manager I.T Cabling and Associated Technologies Gambi Chiang, MSc, BEng, MCIM, Charter Marketer Senior Manager Special Projects Sukant Rout, BEng(Telecom), MBA Senior Market Research Consultant: Intelligent Building Controls / IT Cabling & Associated Technologies Ianire Cobeaga, MBA Market Research Consultant Intelligent Building Technology Allan McHale, CEng, MIMechE, MIst Energy, MBIM Independent Consultant Excellence in Market Intelligence 4 Study Objectives Purpose  Detailed assessment of current and future markets around intelligence in non-domestic buildings in North America  Quantitative and qualitative market assessment, segmentation, competitor analysis, routes to market  Size markets for principle applications plus integrated and ITconverged solutions Scope IT Convergence Environmental Controls Lighting Controls Security Systems Fire Detection Systems Timetable  June – Dec 2009 Excellence in Market Intelligence 5 Key Findings Environmental (HVAC) Building Controls  The market will compete in applying BAS to tackle climate change issues  Companies need to obtain and disseminate both controls and IT knowledge Lighting Controls  Huge savings and market potential  Consolidation to provide total lighting solutions and more integration  LED lighting is a growing market but controls required for better efficiency Security Systems  CCTV / Video surveillance setting the pace, followed by access control  Strong movement towards IP systems and integration of security systems Fire Detection and Alarm  Robust, growing market, driven (and constrained) by codes & regulations  Demand for better evacuation solutions will drive integration of nascent mass notification / voice evacuation market Excellence in Market Intelligence 6 $20 Billion Systems* Market 2009 $8.5 Billion Market for Products* (incl cable & cabinets) 2009 * * Systems = Product + Value Add (Engineering, Commissioning, Installation) excluding maintenance Products = Hardware, Software, Cable and Cabinets at first point of distribution prices Excellence in Market Intelligence 7 End-user Sectors  Top vertical markets: Education 13% Offices 12% Central / Local Government 11% Health Excellence in Market Intelligence 9% 8 IBC Markets will Rebound     Depressed economy, lack of credit, increasing building vacancies Fall in new construction, delayed refurbishment and retrofit However, IBC* markets have outperformed Economic stimulus will help boost demand – particularly public sector IBC* markets expected to return to growth late 2010/early 2011 USA US$ Bn  Source: Economist/ US Census Bureau Canada Source: StatCan * Intelligent Building Controls Excellence in Market Intelligence 9 Definition Convergence Convergence is to bring together autonomous systems onto a common communication platform within the business enterprise and create a single unified solution Network = Ethernet Cat 5/5e/6 and/or fibre IT network/ backbone BMS structure Excellence in Market Intelligence 10 10 Building Controls Product Trends Sensor     Better automatic control require more sensors Demand for smart sensor Demand in CO2 sensor Demand for all-in-one sensor Controller  42% are web-enabled controllers, mainly automation level controllers  End-users demand for standard protocol controllers  Multi-protocol controllers Wireless     Still a very small market, mainly for sensors, < 5% Industry sees the potential in room solution Standards: Zigbee, 805.12.4, 6LoWPAN, EnOcean Key issues: energy demand, data transmission capacity Excellence in Market Intelligence 22 22 Trends in the Installed Building Controls System Market  Growing demand for integration of various building controls system to a centralized one  Increased share of smaller scaled contract  Reduced contract size due to OEM packaged supply  BACnet will continue to challenge LON’s share  Proprietary system will continue to diminish  Penetration of LON in smart meters Excellence in Market Intelligence 23 23 Development of Integrated Building Management Systems (IBMS) Integrate with sub-systems Integrate with other systems Integrate with other BAS Integrate with other enterprises systems Open Standards Enabling Convergence Excellence in Market Intelligence 24 24 Development of IBMS Integration with sub-systems is the norm Centralized monitoring and control more common Integrated systems are mostly IT converged Share information to improve building and enterprise performance  Integrate for the purpose of energy saving  Driven by end users and ROI is the critical factor  Better recognition of the benefits of integration in:     – Banking, transportation, education, health, high-tech manufacturing, life science, communication and data centre sectors Excellence in Market Intelligence 25 25 Number of Projects How Quickly will Integration Grow? Hurdles: • Too much customization • Lack of standard applications • Ability to demonstrate and convince the clients on ROI Time Excellence in Market Intelligence 26 26 Key Market Drivers and Trends Current drivers Energy management – More function to reduce energy consumption – Data visualization software and enterprise dashboards – Integrate smart meters – Energy monitoring, reporting and analysis service LEED and Energy Star Label Energy Legislation and codes Government stimulus Long term driver Smart grid development – Monitor consumption and track and peaks – Automatic demand response – Demand modeling Excellence in Market Intelligence 27 27 Key Market Drivers and Trends  Energy saving applications  Open system  Integration and IT convergence  Increase in energy retrofit  Consolidation will continue  Compete in the knowledge in buildings and BAS applications  Controls contractors migrate to system integrators Excellence in Market Intelligence 28 28 Lighting Controls Conclusions  Huge potential for lighting controls in the North American market  Integration of lighting controls with other building systems will increase - lots of push from manufacturers and end users are beginning to understand the returns  The transition to skilled and trained people with knowledge and understanding of energy management products will take time Excellence in Market Intelligence 29 29 Lighting Controls Trends         DOE will play major role in driving control (and LED) standards Energy regulations through ASHRAE standard is big controls driver Standard open communication protocols is growing trend mostly driven by integration with other systems Integration and IP-Convergence growing but apart from HVAC adoption low Consolidation – Acuity/Philips/Cooper Controls acquiring companies to provide total lighting solutions Wireless - ENOCEAN in commercial, Zigbee in residential Dimming Ballasts ~10% of total ballasts market in North America LED is growing market - still require controls for better efficiency Excellence in Market Intelligence 30 30 Fire Detection/Alarm Market Penetration Excellence in Market Intelligence 31 31 Fire Detection/Alarm Communications and Web Enabling          Majority of fire systems sold with proprietary protocol Some BACnet equipped panels but penetration marginal – using to integrate fire panel with the HVAC system Strict fire codes make fire system integration to non-fire systems rare However, more end users insisting manufacturers make comms protocol details available to enable integration by independent integrators IP being used to connect fire panels with mass notification systems