January 2006

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Blazing a new trail to Intelligent buildings…
The value proposition in building automation is no longer in installing, programming, maintaining or even integrating building systems. Rather, as with the pervasive internet, the opportunity is in creating services and value propositions that can be offered by using the power of the systems that are installed.


John J. "Jack" Mc Gowan, CEM
Energy Control Inc
Contributing Editor

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The concept of blazing new trails conjures up many images. Having lived in and around Santa Fe for more than three decades, it often crosses my mind that little more than 100 years ago pioneers braved many unknowns to blaze a trail to that city’s lights. At the GridWise™ Constitutional Convention, an embodiment of Benjamin Franklin reminded attendees of another such momentous journey that many made to a new country seeking freedom.

GridWise Architecture Council The new energy trail that is being blazed by GridWise is not as harrowing as the journey to America or to the West. Yet it was clear from the quality of individuals and companies in Philadelphia this past December that this event kicked off a significant pursuit. Among those attendees were the GridWise Architecture Council shown here with Ben. The full list of names and affiliations for Council members may be found at www.gridwiseac.org and they are accompanied here by Eric Lightner, Department of Energy (DOE) Program Manager for GridWise and Steve Widergren and Mia Bosquest of Pacific Northwest National Labs (PNL), who manage the program for DOE.

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This event has gotten a reasonable amount of press, thanks to Ken Sinclair and others who have pointed out its’ significance. My goal here is not to share what happened, but why I believe it is important. If you think about it, energy has always been a significant driver for building automation; in fact we used to call smart building technology by another name, “energy management system.”  The importance of energy costs to operating buildings has become even more apparent recently, with the cost of natural gas and the impact of fuel use charges on electricity. With the growing convergence of building automation and internet services in buildings, the idea of controlling cost through technology goes beyond energy and is taking on more significance.

Perhaps the most telling thing about the GridWise Constitutional Convention was the corporate attendance, not the topic itself.  Many in our industry have been somewhat sceptical about the rate at which intelligent building and web service technologies will become a reality, but these companies obviously see it happening. This view may be supported by looking at the corporations who acted as sponsors for this event. Though there was not direct sponsorship by a control manufacturer, LonMark and the OPC Foundation were there from the systems standards world. Beyond the direct controls world, sponsors included Energy Service Companies (ESCOs) like Energy Solve. ESCO’s as an industry make up as much as 25% of the control volume in North America. In addition to the integrators present as attendees, sponsors included integration companies like Tridium and Gridlogix, as well as Enterprise Energy Management players like Infotility. Another sponsor, Cimetrics could fit in either of those categories. From the IT world IBM was a major sponsor along with AREVA and software specialists like EnerNex and the Drummond Group.

The point here is not to drop names but to point to a simple fact; all of these successful companies see something in GridWise. What is it they see and how will it affect automated buildings? I believe that these companies recognize that their businesses rely on value propositions. Harbor Research has predicted the pervasive internet. What was more exciting to me was the idea that Harbor says the real business opportunity is not in selling the web appliances that create the pervasive internet infrastructure, but in offering services that rely on the existence of these devices. The same principal will apply for automation. The value proposition in building automation is no longer in installing, programming, maintaining or even integrating building systems. Rather, as with the pervasive internet, the opportunity is in creating services and value propositions that can be offered by using the power of the systems that are installed. In other words a “Building Killer Ap”. We hear about killer aps in the IT world all the time. In IT everyone is in search of the next killer ap, like the spreadsheet.

My point here is that I believe GridWise will spawn the next generation of killer aps in the building space. These will be high powered information based tools that leverage the power of building automation along with access to information from a variety of sources through the internet. We have already seen a hint of this potential with the Automated Demand Response (ADR) test projects. By now everyone has heard about how the Demand Response Institute at UC Berkley used an XML based price signal and automation systems in five buildings to shed 250 kW of electrical load with no human interaction. If you do some simple math, this means that it would be possible to shed a megawatt of load with around twenty automated buildings!  When you consider that DOE, projects a 40% increase in electric demand by 2025, utilities may be in great need of this capability to avoid blackouts. ADR is a simple way to leverage the power of automation to create a cooperative sequence between the building and the utility that saves money and relieves load on the electric grid. GridWise takes this concept to a whole new level. With GridWise, I expect interoperability aps to start with ADR, but to also utilize automation to shift load, integrate combined heat and power, leverage merchant power and even change the way that a company does business.

[an error occurred while processing this directive] An example of how GridWise may manifest itself is one action coming out of the Constitutional Convention, to implement a demonstration project. This project will be a cooperative effort by a major university and an investor owned utility. The idea is to leverage a multi-million investment made by the university in smart metering and sophisticated campus-wide building automation systems. The university has also recently implemented a software-based tool that takes data from the smart meters, which interface down to the electrical panel. They are able to model and shift electrical load across a 200+ building campus, with a $15 million per year energy bill, on a real time basis. They can shift load from panel to panel, or substation to substation, and they can sequence approximately 8 megawatts of distributed generation (DG) on different feeders. The utility is interested in GridWise to increase the reliability of their distribution system and to meet growing demand. The killer aps to be developed here will likely include ADR, but other options could be pricing incentives to sequence DG at peak periods. It is even possible that the university could respond to electricity opportunities by integrating campus scheduling software. If the event occurred at a time when one of the classroom buildings was scheduled lightly, the system could initiate a VOIP or text message to student PDA’s or cell phones informing them that the class is being moved to another building or out to the lawn.

Building automation integrators have staked out the high ground in system technology over the past decade. They work with the most complex building systems and as an industry have been quick to embrace new skills in IT, data networking and internet technology. It stands to reason therefore that this is the next wave of business opportunity for our industry. By the way, that is what it is all about… business. It is no new concept that the control business is migrating toward the sale of commodity products. So building control companies must embrace new business models that allow them to maintain the overhead associated with running an integration business. GridWise is a key development that will allow control integrators to build on an old strength, energy management, and blend it with a new strength, system integration, to establish a sustainable competitive advantage in the automation industry.

About the Author

Mc Gowan is President of Energy Control Inc., an Energy Service Company and System Integrator. He is an author and has published 5 books including “Direct Digital Control” on Fairmont Press. The Association of Energy Engineers named him “International Energy Professional of the Year” in 1997 and admitted him to the “International Energy Managers Hall of Fame in 2003. Mc Gowan sits on the Department of Energy’s GridWise Architecture Council, as well as the Energy & Power Management Technical Advisory Board.  He is a contributing editor for www.automatedbuildings.com.


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