August 2013
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Automation Armageddon

How LEDs Could Disrupt the Building Automation Industry

Andy McMillanAndy McMillan
President
BACnet International


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Anyone paying attention to LED technology and its cost drivers knows that LEDs have the potential to thoroughly disrupt the lighting industry.  What’s not so obvious is that the transition to LEDs for lighting may also disrupt the rest of the building automation (BAS) industry.  To understand how that might happen we have to consider the adoption of LEDs for lighting in the context of two other industry megatrends.  The first is the accelerating use of wireless network technology and the second is the rapid migration to web-based applications and services.  These technologies could be woven together in ways that turn three concurrent evolutions into one large revolution … disrupting current business models for many players and perhaps even leading to the end of the BAS industry as we know it. 

The End is Near?

The “end of the BAS industry as we know it” sounds pretty dramatic but before dismissing it out of hand, let’s take a closer look.  We can start by considering four significant characteristics of the current BAS industry model.  They are:

  1. Automation projects tend to be HVAC centric
  2. Energy savings is often the key driver for retrofitting controls into existing buildings
  3. Controls are typically complex and require trained staff to implement
  4. The cost of controls hardware and installation is significant relative to near-term savings

Now imagine, if you can, a world where none of these are true.  Would that qualify as a significant enough change to justify a little dramatic license?  I think so!  And, if you have a hard time seeing how the adoption of LEDs for lighting could lead to all of these changing over next 5-10 years, let me offer a few clues.

Lighting in the Driver’s Seat

To understand the chain of events we have to get beyond the idea that LEDs are just more efficient light sources.  They are, of course, but that is not the end of the story.  Beyond being more efficient they are also more dynamic.  LED solutions can readily provide intensity variation, color temperature variation and even absolute color variation.  As LED lighting marches down the semiconductor cost curve we’ll find that taking advantage of LED dynamics adds little to the cost of light sources.  With that in mind, suppose some company with deep knowledge of light and how it affects people, creates “light recipes” designed to have specific impact on behavior or task performance.  The combination would create an irresistible rush to implement automation projects where the focus is dynamic LED lighting with or without energy-based ROI.  Think this is a little far-fetched?  Maybe – but it could be that it’s already started.  Philips SchoolVision is a dynamic lighting solution for education that seems to be headed down this path.  If more suppliers and industry segments head this way we will soon see a dramatic increase in automation projects that are not HVAC centric and are not driven by energy ROI.  And when that happens it will be lighting controls (and companies) that drive automation projects rather than HVAC controls (and companies).  That would be a radical change with far-reaching implications.

The Rest of the Story

Reliable Controls So we have at least a plausible path to the demise of the first two characteristics of the current industry model.  But, how about the third and fourth characteristics?  Controls today are complex and require trained staff to implement useful systems.  Consider, though, what would happen if controls implementation was so simple anyone could do it and so compelling that everyone wanted to?  How many companies would have to adjust their business model if most customers did not need specialized controls development?  How many product lines would become obsolete if meaningful controls could be implemented without programming or sophisticated configuration?  And, how far down would that drive the cost of controls hardware and installation?  And most importantly, how can LEDs play a pivotal role in bringing all this about?  I addressed these questions (and more) in a seminar with research staff members at Lawrence Berkeley National Labs last fall and I will address them for you in a future column.  But, you don’t have to wait for that.  I will dig deeper into this topic, including these questions in a session at the BACnet International Annual Conference in September.  Stop by at 9:00am on Tuesday, September 17th for session T2JF at NFMT in Las Vegas.  The session is titled “Automation Armageddon” and it could be a turning point in the ongoing conversation about the future of our industry.

A Postscript
I can already anticipate a couple of arguments people might make against the idea that we could be witnessing the beginning of the end for the current model of building automation.  The first argument is that the industry has existed in its current form for years, represents billions of dollars in business and serves an essential need for customers.  All of which is true – but the same could have been said about the office automation industry in the early 1980’s when minicomputers were king.  But that did not prevent the complete restructuring of the industry and the demise of most minicomputer manufacturers in the following decade.  A second argument could be made, no doubt, around the idea that the building automation industry “moves slowly” and thus no significant change can overcome us in the near term.  For those who take comfort in this thought, I would point out that LEDs, wireless networking and the web are all incredibly fast moving industries that could easily breed suppliers who bypass the “slow moving” by doing new things and/or using a new approach.

As always, the views expressed in this column are mine and do not necessarily reflect the position of BACnet International, ASHRAE, or any other organization.  If you want to send comments to me directly, feel free to email me at andysview@arborcoast.com.

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