The terms "cleantech" or "green technologies" have been applied to a wide array of processes, technologies and services. Within this overall market space, there exist a number of specific target market segments for green technologies -- transportation, energy development and manufacturing are just some examples -- that are undergoing an innovation boom as a result.
The buildings and facilities segment ranks as one of the largest potential markets for cleantech, and shows the kind of changes that new technologies can bring about, changes both beneficial and disruptive. Given the size and projected growth of the market for green buildings around the world, there are plenty of opportunities and potential players seeking ways to leverage new technologies for use in new construction and renovations.
The building and facility industry is undergoing radical change today as owners demand more project visibility, lower costs, better risk management (scheduling and costs), and increased use of these new technologies in projects. The potential from these changes are overall highly beneficial: they will allow for less waste, more efficient energy consumption, and ultimately lower costs over the lifecycle of the facility, from design and construction to operations.
The changes occurring are quite similar to the changes that the aerospace and manufacturing industries went through approximately 25 years ago: disparate and isolated work groups and "point solution" technologies were not efficient. The introduction of external market drivers in the form of international competition forced dramatic efficiency improvements via new technology adoption, and spawned new collaborative work processes.
The Basics of BIM
The rapid, if uneven, adoption of Building Information Modeling (BIM) in the buildings industry has changed the way facilities are designed, constructed, and even operated. Simply put, BIM is a digital rendering of the physical and functional characteristics of a facility. More than just the lines and arcs associated with traditional computer-assisted drawing (CAD) tools, BIM includes the "intelligent objects" of a structure, such as spatial data (3D), un-structured data (text), and structured data (databases, spreadsheets), as well as new views like scheduling and cost information (termed 4D and 5D, respectively).
This type of technology, with its associated benefits of visualization, built-in intelligence and simulation is a dramatic step forward from 2D CAD, the current technology used for design and construction. Patrick Suermann, a testing team leader for the
National Building Information Modeling Standards Committee, described BIM as "the next evolution of CAD maps," explaining that it allows for the design of a fully functioning, virtual model of facilities of all sizes.
Why is the BIM adoption trend important for green technology companies to understand and incorporate into their market strategies? The use of BIM -- both the technology and changes in increased collaboration -- allows for significant exchange of information by all stakeholders involved over the lifecycle of the facility: owners, architects, engineers, contractors and operators. This information includes that associated with green technology adoption: efficiencies in energy use, increased emphasis on environmental health and the drive to generate less waste.
"Not only can BIM optimize building performance via less waste generation during construction, and improved energy management during operation, it can accelerate certification for LEED status," explained Buddy Cleveland, senior vice president of applied research at
Bentley Systems, a leading technology provider in the architecture, engineering & construction (AEC) market.
BIM and Green Tech Benefits to Owners & Operators
BIM allows provides the following benefits to stakeholders, with opportunities for green technology to add value:
- Risk Management: BIM may provide more visibility into projects and allow owners to manage risk through a collaborative and inclusive process. The inclusion of green technologies allows stakeholders to collaborate as well in this process.
- Materials Management: Developing bid quantities and verifying them in a BIM process allows for more efficient material use, as well as opening opportunities to use more energy efficient and environmentally friendly materials. BIM may align scheduling and material quantities for better cash flow analysis as well.
- Marketing & Branding: BIM provides a visual representation of a facility, and encourages collaborative review and discussion by stakeholders and public alike. Inclusion of greentech furthers the visual representation, by illustrating energy saving concepts and adherence to key green certifications, such as LEED. Green branding is thus improved as well
- Portfolio Management: For owners of multiple facilities or enterprise level owners, BIM allows for the re-use and purposing of models to standardize design and construction; thus driving down material use and costs, as well as technology applications across a portfolio.
- Optimization of Building Performance: BIM allows for integrated facility management, so that energy use, occupant health & comfort, and space planning may be monitored and improved upon.
According the 2007 Green Index Study conducted by Autodesk and the American Institute of Architects, 44 percent of architects surveyed are already using BIM in projects. The report went on to state that architects incorporating BIM are more likely to adopt green building design software practices such as HVAC energy analysis, energy modeling, and also the evaluation of more environmentally friendly building materials.
But across the AEC industry, the general interpretation, use, and even terminology of BIM are still in an early phase. "People are defining BIM as whatever they want it to be," Cleveland said. BIM training, cultural acceptance (in the AEC sector), and business process modifications are all unique challenges that companies will have to overcome for continued adoption in the marketplace.
Green Technologies in the Buildings & Facilities Industry
General categories of green technologies that apply to the buildings and facility market have been documented in many periodicals; for the building & facility industry, the key technologies of interest are:
- Energy & Resource Efficiency (HVAC systems, daylighting, water management and re-use)
- Alternative Energy Development (self-contained solar, wind and other power sources)
- Advance Material Use (for insulation, walls, windows, structural)
- Information Management (energy modeling, sensors, life cycle assessment)
- Environmental / Health (occupant health & comfort, waste reduction, carbon emissions management)
John Kennedy, the CEO of
Green Building Studio, a web-based energy analysis technology firm, agrees with Buddy Cleveland that of all the green technologies available today, carbon emissions management has the highest potential for growth. Public awareness of greenhouse gases (GHGs) and associated climate change have created unique growth opportunities in the greentech market.
"There are no significant players yet in the carbon reduction technology market yet," Kennedy said. "The building industry is a major contributor to green house gas emissions, and only 10 percent of those carbon emissions are from the materials and construction; the majority is from actual operations over the lifecycle of the building."
"The need to measure and manage the carbon footprint is significant," added Cleveland. "We need better tools to estimate emissions, as current approximations are very rough."
The Role of Federal Owners
The U.S. government is a primary driver of BIM adoption: The General Services Administration (GSA) has created the
National 3D-4D BIM Program, designed to allow for advanced and superior cost effective management of federal buildings and facilities. Currently, GSA has over 35 projects utilizing BIM, and has mandated that every new facility and major modification project should utilize a BIM model for spatial validation.
Along the lines of green technologies, GSA's Office of the Chief Architect is currently encouraging, documenting and evaluating the implementation of Building Information Modeling (BIM) technologies to assist energy performance analyses and operational practices.
Signed on June 3, 1999,
Executive Order 13123 is a national initiative to reduce the average annual energy consumption of the GSA's building inventory. With the use of BIM, more complete and accurate energy estimates earlier in the design process, improved life-cycle costing analysis, increased opportunities for measurement and verification during building occupation, and improved processes for gathering lessons learned in high performance building should result. In general, advancements from BIM may increase the role energy modeling and alternative materials play during both design and building operation, leading to an overall reduction in energy consumption by GSA buildings.
Patrick Suermann of the NBIMS has conducted a number of BIM projects for the
U.S. Army Corps of Engineers (USACE). He estimates that the USACE has allocated approximately $24 billion in military construction for upgrades and new facilities. The USACE also will spend an additional $15-20 billion for upgrades and base reconstruction efforts, creating a broad market for BIM adoption, and as a consequence, BIM add-on applications in the green tech area.
Why should green tech vendors monitor the GSA's BIM program as well as other agencies like the USACE? Suermann explains: "Federal agencies have to compete against each other to be the most efficient constructor and manager of assets, which lead to higher budget allocations from Congress. Cleantech firms should pitch to both agencies and their prime contractors to assist them in successful deployment of BIM."
Strategies to Leverage BIM
BIM is not just the adoption of new technology, but also incorporates new collaborative workflow. There is more emphasis on collaborative design and planning in the beginning phases of a project, so that costs and risks in later stages like construction and operations (where most of the costs are incurred) may be managed and contained. Green tech vendors should be involved in these early planning stages, so that a realistic assessment of cost savings and improved environmental performance are identified. Also, they can add value to the optimization process (conducting "what if" scenarios), which may lead to additional savings and benefits that may not have been readily apparent.
International markets are proving to be quite viable for BIM deployments and green tech as well. Increasing awareness of global warming, green house gas emissions, and sustainability have driven significant market opportunities in international markets of Europe and Asia Pacific as well. John Kennedy of Green Building Studio concurs, and provides advice to green tech start ups: "Look outside the U.S. to both the E.U. countries as well as to Australia."
Buddy Cleveland of Bentley Systems mentioned that the U.K. facilities market is farther advanced than the U.S. market, in terms of green certification tools. "New regulations for improving building performance require quantitative assessment of carbon emissions; not just a qualitative assessment," he explained. In this market, it is conceivable that green technologies may assist to "pull" the growth and adoption of BIM, given the regulatory climate.
"Go to Market" strategies should also reflect the importance of leveraging established companies in the AEC space for sales, branding, and deployment channels. A key component to this strategy: identify a technology partner who may bring brand awareness, marketing, and channels access. "Plan to partner in order to scale your business," said Kennedy, who has partnered with a number of leading AEC software companies.
It should also be noted that the "exit strategy" for successful green tech start ups could be acquisition by a larger established software provider in the space. Kennedy's Green Building Studio was recently acquired by Autodesk, and Bentley Systems acquired a smaller software firm last year that it had partnered with called Hevacomp, which provides MEP (Mechanical, Electrical & Plumbing) and energy analysis modeling. Both Autodesk and Bentley are advocates of BIM adoption, and one would assume that these new acquisitions will allow them to integrate green technologies into BIM software platforms.
Similarly, green technology start ups should evaluate partnering opportunities with leading architectural, engineering & construction (AEC) firms, especially those with prominent BIM practices. These companies are consistently searching for competitive differentiators, as well as identifying new business lines, especially those that may generate higher profit margins. Some of global firms are also creating sustainability consulting practices, which can be separate from their building design practices. A potential strategy for green techs in this case may be identifying client and market opportunities where both BIM and sustainability practices may be utilized; driving more revenue to the AEC firm, and thus more opportunities to partner with them.
While targeting larger AEC firms to partner with, Kennedy also felt that the small, niche AEC firms should be approached as well. "Smaller AEC firms are transitioning to BIM more easily than the larger firms," he mentioned. "Bigger AEC firms have some built-in redundancy in terms of 2D and 3D tools; many rely upon 3D for modeling and design, but use 2D for actual construction."
Scott Boutwell is a former AEC executive from URS Corp and Oracle, providing technology commercialization & strategy services to IT and cleantech firms as well as to global AEC firms. His blog covers anecdotes and growth strategies in the sustainability and engineering design sectors.
