How to reap the benefits of grid-connected smart buildings

How to reap the benefits of grid-connected smart buildings

Editor's note: To learn more about the intersection of smart buildings and the smart grid, be sure to check out [email protected], coming this fall to San Francisco, November 12-13, 2012.

Connecting the smart grid to efficient building management holds significant opportunity for commercial building owners and utilities.

Yet, today, these economic and energy benefits are far from realized. In a new report, we outline how technology adoption and business process change must go hand-in-hand for companies to take advantage of the smart grid.

Smart technologies are improving system operations and delivering quantifiable benefits to stakeholders on both sides of the meter. Despite this infusion of intelligence and automation in buildings and the grid, the reality today is that the development of smart buildings and the smart grid is happening almost entirely independently.

Corporations have the potential to yield enormous efficiency gains, manage costs, improve operations and achieve a range of strategic business and sustainability goals through smart building technologies. And smart grid developments generate value for utilities by promoting stability and reliability improvements, and offering a significant opportunity in demand-side management.

What's holding back the integration of smart buildings with the smart grid?

One of the biggest hurdles today is getting utilities and building owners on the same page. Currently, there are separate and distinct decision-making groups shaping investment and defining the development of a "smart buildings-smart grid" reality. The utility and building owners have distinctly different drivers for investment, but both stakeholder groups face similar challenges in deploying intelligent technologies for optimizing asset performance.

So what will drive the convergence of technology and business practices between these two key stakeholders to enable interoperability? We have outlined two crucial steps that can help bring the smart buildings-smart grid paradigm to life.

1. Customer Engagement: On the business side of technology adoption, vendors and utilities must understand the demand for energy management opportunities of potential customers to develop programs that can generate economies of scale.

Utilities have traditionally focused engagement efforts on two customer groups -- the residential segment and the largest 1to 3 percent of their business customers. Account representatives have built relationships with the very largest customers to coordinate demand side management efforts and leverage the most significant centralized loads in times of stress on the grid.

On the hottest days of the summer for example, a utility could call on these largest business customers to increase the temperature in their building or shut down a line of production for a limited amount of time to avoid a brownout or blackout in a particular location because of the excess demand for energy coming from all of their customers due to the heat.

As we look to the smart technologies available today, there is a significant opportunity for utilities to work with a broader set of customers and engage them in more dynamic and real-time demand management activities. A recurring message heard in our research is that customer awareness and education is a major hurdle to broader participation.

Utilities must explore new models for communication and learn from leading examples of market education such as energy management portals and websites that provide educational resources available on demand and accessible on the customer’s time.

2. Technology Alignment & Coordination: Aligning devices and capabilities for energy management between the grid and building is an important logistical hurdle that must be overcome to make the integrated smart building - smart grid a reality. Smart controls and automation solutions are delivering value to end users by streamlining operations and maintenance in a way that saves money through energy conservation and streamlined business processes.

In order for both the building owners and utilities to reap the benefits of smart technologies, it will be important that objectives are aligned and the enabling technologies are fully utilized. Vendors and utilities will need to recognize the maturity of existing buildings and align engagement efforts with opportunity in terms of savings or resources represented by the load profile of the facility and how much infrastructure existing to build on and balance costs.

Building owners’ need to manage costs and utilities’ need to ensure reliability make the effort and investment in technologies and transformation of business processes worthwhile. A Smart Buildings-Smart Grid reality can come to fruition if key stakeholders clearly understand the value of collaboration and commit to evolving exiting frameworks.

Be sure to check out IDC Energy Insights for more information about the report, "Smart Buildings and the Smart Grid – Strategy for an Integrated Future."

3D Building photo provided by jl661227 via Shutterstock