Report: Big growth in building energy management systems (but big hurdles too)

Wed, 2013-08-14 06:10 -- Jesse Berst

I agree with the Navigant report below predicting growth in building energy management systems. But I feel I should warn you of two hurdles that may slow things down. Put another way, growth would be even faster if it weren't for these two roadblocks.

The first is the appalling lack of standards. Yes, it's true that most of the major vendors have now created their own Rosetta Stone to translate signals from devices made by many different vendors. Even so, that process adds a layer of complexity and expense, while reducing functionality. Although most systems can now "listen" to devices from all the major manufacturers, they often have a harder time "talking" back to give them complex commands.

The second is the disconnect between who pays for the system (the building owners) and who gets most of the energy efficiency benefits (the tenants).

Eventually the resistance to standards will crumble and the building management sector will join the 21st century world of open standards along with the rest of us. But realigning financial incentives? That may take some really creative concepts. For a look at two possibilities, jump over to You can read about a program to connect efficiency projects to lenders. And a new financial structure that passes efficiency benefits through to building owners.  -- Jesse Berst

Building Energy Management Systems Will Reach $5.6 Billion in Annual Revenue by 2020

The market for building energy management systems (BEMSs) continues to grow, driven by technology advances as well as a growing familiarity among customers with the benefits that BEMs provide.  A number of new and existing companies are developing software-based platforms to help customers squeeze cost-reducing energy efficiency and operational benefits out of their building portfolios.  According to a new report from Navigant Research, worldwide revenue for BEMSs will reach $5.6 billion annually by 2020, more than doubling from the 2013 level.

“Building energy management systems represent one of the fastest-growing and most promising waves of innovation ever to occur in the building industry,” says Eric Bloom, senior research analyst with Navigant Research.  “Among end users, awareness is growing that BEMSs can help companies not only reduce their energy consumption, but also improve the operational performance of facilities and gain insight into occupancy trends in their buildings worldwide.”

While many BEMS vendors have developed platforms with commercial and government customers in mind, the utility sector is playing an increasingly important role in the BEMS market, according to the report.  Utilities face a growing number of regulations, such as energy efficiency resource standards in the United States, that require them to play a proactive role in reducing the energy consumption of their customer base.  A BEMS deployed by a utility to its customers provides energy efficiency gains that utilities can claim in compliance with such regulations.

The report, “Building Energy Management Systems”, examines the global market for BEMSs, including hardware, software, and service components.  The report details the current state of the market, and provides insight into the future direction of the technology based on emerging capabilities, technical feasibility, and consumer demand.  Forecasts for the global BEMS market, broken down by customer segment, product area, and region, extend through 2020, and key industry players are profiled in depth.  An Executive Summary of the report is available for free download on the Navigant Research website.

The information contained in this press release concerning the report, “Building Energy Management Systems,” is a summary and reflects Navigant Research’s current expectations based on market data and trend analysis. Market predictions and expectations are inherently uncertain and actual results may differ materially from those contained in this press release or the report. Please refer to the full report for a complete understanding of the assumptions underlying the report’s conclusions and the methodologies used to create the report. Neither Navigant Research nor Navigant undertakes any obligation to update any of the information contained in this press release or the report.


Jesse Berst is the founding Chairman of the Smart Cities Council. Click to subscribe to SmartCitiesNow, the weekly newsletter highlighting smart city trends, technologies and techniques.