Smart-building biz to grow to $2.4 billion

Quick return on investment will make building energy management systems popular over next five years, says Pike Research.

The Empire State Building in conjunction with the Clinton Climate Initiative is attempting to set an example when it comes to energy retrofits and management. Empire State Building Company

As more companies realize the savings involved in running large commercial buildings more efficiently when it comes to energy, sales of automated building energy management systems are poised to soar.

The U.S. market for such systems will grow to $2.4 billion annually by 2016 compared to seeing $900 million in revenue for 2010, according to the "Building Energy Management Systems" report released today by Pike Research.

Products include optimization software for a particular building's needs , as well as analytics that tap in to smart grids to predict peak supply and demand scenarios and adjust internal systems accordingly.

"Commercial building efficiency in general, and the building energy management systems market more specifically, are emerging as hot growth areas due to the strong return on investment that such deployments can bring to building owners and managers," Jevan Fox, research analyst at Pike Research, said in a statement.

While the average homeowner might have to wait years to see a return on certain types of energy efficiency investments, large commercial buildings because of their scale see a quick return for relatively little outlay, according to Pike Research.

The report also predicts that health care, university, and commercial facilities will be the three biggest areas of growth, and that as contracts for existing building management systems come up for review or renewal most companies will choose to switch to a BEMS.

The report directly coincides with a Lux Research report released earlier this month that predicted a wave of acquisitions with regard to building management and IT.

The Lux report predicted major building management companies will continue to acquire smaller companies with BEMS products, while tech heavyweights like Microsoft and IBM will develop their own systems and try to pick up business in the space.

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About the author

In a software-driven world, it's easy to forget about the nuts and bolts. Whether it's cars, robots, personal gadgetry or industrial machines, Candace Lombardi examines the moving parts that keep our world rotating. A journalist who divides her time between the United States and the United Kingdom, Lombardi has written about technology for the sites of The New York Times, CNET, USA Today, MSN, ZDNet,, and GameSpot. She is a member of the CNET Blog Network and is not a current employee of CNET.



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