Smart buildings make intelligent energy decisions

May 11, 2011
From smarter to sustainable, from sustainable to efficient.

In today’s building management environment, owners are stretching capital improvement projects and delaying upgrades. Yet, they still must maintain their aging assets and ensure customer satisfaction. They are looking for opportunities to consolidate space and improve space planning. Facilities operations costs represent one of the more significant operational cost elements for building owners and operators.

At the same time, energy costs are rising. When it comes to building management, these problems are particularly acute. Buildings consume 40% of all electricity — more than any other type of physical asset or structure and they generate approximately 10% of all greenhouse gas emissions. Excluding staffing costs, energy costs alone represent about 30% of an office building’s total operating costs, according to the Energy information Agency of the U.S. Department of Energy.

Recent developments enable building owners and operators to collect real-time energy and building equipment information from multiple building management systems centrally, where it can be analyzed to identify energy and facilities operational efficiencies. By integrating building systems with IT technology to provide building analytics, improved enterprise asset management and visibility through real-time alerts and dashboards, building managers can significantly improve energy, facilities operations and space management.

One can demonstrate that smarter buildings are more sustainable than conventional buildings. And more sustainable buildings are, by definition, more efficient and higher performing.

The underlying principle that drives the connections between smart technology, sustainability, and efficiency is the access to better information that enables more effective decision making, which in turn results in more efficient operations and fewer resource requirements.

To illustrate this point, consider the Smarter Building initiative at IBM’s Center of Excellence in Burlington, Vermont, and a few real-world facts that demonstrate a more sustainable building does in fact result in better performance.

The foundation of a smarter program is surveillance, the ability to collect sufficient data in real time or near real time. We refer to this fundamental capability as “instrumented” because it depends upon the right infrastructure and instrumentation to gather and collect the data.

The second element is the need to begin the transformation of that source data into useful information with interconnected devices and software tools that enable multidirectional communications. We call this step “interconnected” because it represents the spoke and hub network of “consumption devices” and centralized information systems that gather and assess the various data sources.

The third step begins the progression from data to information and from information to action through the use of advanced analytics, intelligent controls, and automatic event detection and handling. This is the point at which performance optimization becomes the defining program principle. We call this element “intelligence.”

Finally, the highest level of a smarter initiative is the application of innovative business solutions, which transform the way we operate through the application of new technologies, new processes, and virtual teams.

The two resources being considered from the Burlington, Vermont, case study are energy and water.

By installing power system monitoring devices such as meters and sensors, and interconnecting them through simple networking, IBM established a control framework based on advanced data analysis and improved decision making on matters such as peak load management, power factor corrections, and load shedding. This framework enabled the migration from instrumented devices to interconnected networks to intelligent systems, while recognizing a rapid return on investment.

The progression from an instrumented to an intelligent building resulted in more than $10 million in energy cost savings and a sustained reduction in consumption of more than 4% per year. Furthermore, while both fuel and electricity consumption was down substantially as a result of program execution, plant output was up during the same period. This is the definition of doing more with less.

The same evolution — progressing from detailed monitoring and networking to advanced analytics and decision management support — was applied to water consumption. Millions of dollars in savings on water bills were realized even while plant output increased.

One note of caution: a “smarter building” requires much more than a few meters and sensors. In fact, if done well, it’s a transformational journey that affects and improves an organization’s processes, policies, governance, and business model. And, of course, successful organizational transformation requires the buy-in from and support of the highest levels of leadership.

As with most journeys, this one begins with developing a common vision and strategy and obtaining agreement on the tactics, milestones, and metrics that will guide the path to success.

Smarter buildings are more sustainable, and sustainable buildings are higher-performing.

IBM has taken on the challenge of building a smarter planet internally and has a number of impressive results to show for it.

Joe DellaTorre is senior managing consultant — sustainability strategy, and Joe Phillips is Smarter Buildings/Smarter Cities, sales and delivery, at IBM (

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