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Thwarting the Power Threat: Smart Buildings and Grids

Smart-grid technologies could not only prevent or alleviate outages, but also save companies money while capturing and marketing wasted energy.

Q2 / Spring 2013
"Connected City" Economic Performance Comparison: The ten cities were identified by U.S. News & World Report as “Connected Cities”
with smart grid technologies in place. Economic data comparison is provided by Jones Lang LaSalle.
"Connected City" Economic Performance Comparison: The ten cities were identified by U.S. News & World Report as “Connected Cities” with smart grid technologies in place. Economic data comparison is provided by Jones Lang LaSalle.
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Making It Work: System Compatibility & Other Factors
The past few years have seen tremendous gains in smart-building technology. In the past, buildings with control systems by different manufacturers could not “speak” a common language, but recent breakthroughs now make it possible for entire portfolios to be monitored from a single remote location, with smart technology performing continual commissioning on buildings, making adjustments to keep buildings running at peak efficiency, and alerting the command center staffed by smart people when a maintenance or repair call is needed.

Retrofitting an automated system with this analytical capability has been shown to save 18 to 24 percent on energy cost alone in buildings where it has been implemented. That’s not including the savings from longer equipment life, or the much larger potential benefit of enhanced system reliability. As companies rely more on data centers and other mission-critical facilities — and as these facilities use an increasing share of electricity — the cost of power failure and the value of reliability and resiliency are increasing geometrically.

The cost of wasted energy is significant as well. The EPA’s ENERGY STAR program estimates that the country’s 4.8 million commercial buildings spend about $108 billion on energy, and 350,000 industrial plants use another $85 billion. ENERGY STAR also notes that about 30 percent of that energy is wasted. That’s potentially $65 billion a year that could be gained from better monitoring and management of energy in commercial buildings.

Portfolio monitoring systems enhance efficiency in ways that are similar to smart grids. Part of the cost reduction comes from the system’s ability to conduct continual commissioning and to shift energy usage to nonpeak periods. Identifying equipment in need of maintenance or repair extends its useful life, reducing the owner’s capital cost and helping to guide capital planning. And just as regions with smart grids can reduce truck rolls, smart building systems make facility management staff more productive, by conducting menial tasks automatically, and by pointing professionals to likely causes of energy waste.

Smart grid infrastructure can supercharge the benefits of site-level energy strategies. The two-way communication and energy transmission of smart grids means that surplus power from on-site solar installations and co-generation plants could be sold to utilities rather than wasted. And an integrated smart grid/building system would facilitate demand response, the mechanism by which a building gets cheaper energy by agreeing to reduce or shut off grid power during peak times at the utility’s request.

Lost in Transmission
Creating a market for excess energy generated at the site level would also reduce the amount of energy lost in transmission. It is estimated that about 10 percent of energy from power plants is lost on the way to its destination, but the loss factor rises as the distance between the source and the end-user increases.

For cities and states, smart infrastructure attracts businesses that want more affordable and more reliable energy. A big bonus for state and municipal governments is the reduction in greenhouse gas emissions, an issue that continues to move to the forefront of public agendas.

It’s almost hard to imagine that the electrical grid holding together our digital world is not itself digital. The risk to business and economic development is huge and getting bigger. Meanwhile, companies are recognizing that similar technology pays for itself within a year or two through energy savings in buildings. Although the simple payback is longer for infrastructure grids, it’s still a compelling case. And we have only started to imagine the opportunities that an integrated smart grid/smart building platform will bring in the coming years.
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