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Expanding the Role of HVAC Manufacturers in a World of Unmanaged Buildings


Today, about 80% of all commercial buildings still need a building automation system. It's time for HVAC manufacturers to seize the opportunity and create plug-n-play solutions for managing their products and associated ancillary equipment, providing the market with a much easier way to acquire integrated Building Management System (BMS) functionality without the cost of custom engineering.

Building transparency

Isn't it odd that you have more transparency and feedback on fuel efficiency when driving your car than energy usage when managing a building? For example, when you drive your car on the highway, you know exactly how many liters per kilometer you've used. But do you have the same level of transparency in your building? Most building owners would say no. And that's surprising because we all know that buildings consume 40% of the earth's global energy. So there are many reasons to care, not just for you individually but also for the impact it has on the planet, the environment, and society.

Building awareness

Going back to the car, I use more fuel per kilometer if I'm speeding down the Autobahn. I know this because, since the early 2000s, cars have provided feedback about the decrease in fuel efficiency when driving fast. If you drive faster, you spend more energy. In commercial buildings, if you increase the amount of heating by a few degrees, do you know how much more energy it costs? Do you know what that means for you and your business? Many don't. Another example of building awareness could be as simple as not knowing a window is open while the heating system is running. This results in a very inefficient use of energy.   

Building efficiency and management

Industry professionals often discuss improving the building shell through better insulation and windows. We also talk about HVAC equipment efficiency a lot, which is essential. Some of this has happened in the last 10-15 years due to the regulatory environment. And that's great. But what we haven't talked much about is actually managing the building.

When I was in France, we ran a field study to uncover the common reasons for building inefficiencies. One of the key findings was that cooling and heating were often on simultaneously. This often happens because a boiler is left on as the season gets warmer, and then cooling is also turned on. This lack of building management is where we have the problem.

This, of course, is not true for all buildings. Many buildings have systems to avoid energy waste, for example, LEED certified buildings, modern airports, skyscrapers, etc. But according to a European Union survey,  roughly 75% of all buildings in Europe are energy inefficient (and not just 3-5% but massive inefficiencies exist). This is a big opportunity for building management. 

Returning to the car analogy, I can view my speed with a speedometer and control my acceleration and fuel usage with the gas pedal. Using these, I can manage my fuel efficiency and overall driving experience. I also know when there's a performance issue with my engine when my dashboard displays warning lights. Unlike cars, commercial buildings without BMS have poor visualization and little control of their energy usage. Behind the scenes, they also have no visibility into the HVAC equipment performance unless it's severe enough to produce comfort issues. 

Engaging building occupants

To summarize, when I drive faster, I use fuel less efficiently, which impacts my costs and the environment. Our behaviors might change if we had a similar mindset in operating our buildings. For example, we can raise awareness that increasing the temperature in the winter and decreasing it in the summer results in dramatic energy consumption. We could then relate how the additional comfort impacts our energy bill and the environment. I believe future BMS will engage the building occupants and provide more continuous feedback on the energy consumed due to our decisions.

The opportunity for equipment manufacturers

So who can help "equip" the other 80% of our buildings with Building Management Systems? The incumbent BMS players are not well positioned because their technology is too complex to engineer and operate, and they do not typically have relationships with small building owners. Another potential player, who is in every small building, is the electrician. However, they don't know HVAC systems and don't have access to BMS technology. One player that has both access to small buildings and extensive HVAC knowledge is HVAC equipment manufacturers. They're just missing one piece: the technology. The good news is companies like J2 Innovations can provide this technology, which helps manufacturers enter this valuable new market segment. 

So what should a BMS provided by an HVAC Equipment manufacturer look like? First, it needs to be easily provisioned; who better to do that than the installer of the HVAC equipment, who also maintains the service contract? Installers need to be able to handle integration without complexity. The BMS would provide a plug-n-play environment to easily configure the system. Second, smaller buildings don't typically have a facility manager and are "managed" by building occupants. So the user experience needs to include simple dashboards that are easy to use. This would raise awareness for energy that is being consumed and help drive positive behaviors for operating the building.

So, in a nutshell, I believe that to tackle the energy crisis, we need to address the 80% of the commercial buildings operating with no steering wheel or speedometer. HVAC manufacturers are in a prime position to make that happen. With FIN technology, J2 Innovations can help OEMs seize this new market opportunity and help small buildings drive toward a better future. 

Alex Rohweder

Alex joined in the summer of 2018 as our Chief Operating Officer. Previously working in Siemens Headquarters in Europe, Alex was the responsible Vice President for Software and IoT at Siemens Building Products. He brings expertise in building automation software, corporate strategy, portfolio management and OEM sales from 10 years with Siemens. He has embraced J2 Innovation’s entrepreneurial spirit and is driving J2's growth and global expansion. Outside of work Alex enjoys skiing, hiking, and traveling. As a foodie, he’s enjoying all the good things California has to offer.

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Topics from this blog: OEM FIN microBMS FIN Framework Industry Democratization

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