Smart Cities

A Critical Moment of Opportunity Demands an Open Smart Buildings Market

Governments around the world are committing to a green recovery from the economic challenges presented by the COVID-19 pandemic. Despite the fact that global energy demand actually dropped by an estimated 5% in 2020, resulting in a 7% drop in total energy-related CO2 emissions, the global nature of this crisis has brought the world together. Understanding that a unified global response was the only solution to the new problem currently disrupting our society, we seem to have found a new appreciation for the global response required for the other existential crisis facing our planet - climate change. During his first 100 days in office, President Biden made bold actions to re-establish the US as a leader in the fight against climate change. He re-signing the COP21 Paris agreement, issued an executive order to achieve a carbon pollution-free power sector by 2035, put the US on an “irreversible path” to a net-zero economy by 2050, and even released a ​​Grid-interactive […]

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Governments around the world are committing to a green recovery from the economic challenges presented by the COVID-19 pandemic. Despite the fact that global energy demand actually dropped by an estimated 5% in 2020, resulting in a 7% drop in total energy-related CO2 emissions, the global nature of this crisis has brought the world together. Understanding that a unified global response was the only solution to the new problem currently disrupting our society, we seem to have found a new appreciation for the global response required for the other existential crisis facing our planet - climate change.

During his first 100 days in office, President Biden made bold actions to re-establish the US as a leader in the fight against climate change. He re-signing the COP21 Paris agreement, issued an executive order to achieve a carbon pollution-free power sector by 2035, put the US on an “irreversible path” to a net-zero economy by 2050, and even released a ​​Grid-interactive Efficient Buildings (GEB) Roadmap. China, meanwhile, had already pledged to go carbon neutral by 2060 before COVID-19 and is proceeding with business-as-usual, partly due to its earlier exit from the worst effects of the pandemic. However, there are signs that Covid-19 may have slightly accelerated Beijing’s green policymaking.

The European Union’s (EU) Green Deal has been described by Bloomberg as the “biggest green stimulus in history”. The EU announced its plan for a €750bn ($880bn) “Next Generation EU” recovery fund, declaring that all spending would be guided by a “sustainable finance taxonomy” and “the green oath to ‘do no harm’”. While in the UK, the green recovery plan targets specific problems and solutions, such as off-shore wind, green hydrogen, EVs, and especially buildings. Billions have been allocated to improving efficiency of the UK’s inefficient building stock; buildings are also point seven in the UK’s Ten Point Plan for a Green Industrial Revolution.

“We will put our homes, workplaces, schools and hospitals at the heart of our green economic recovery, supporting 50,000 jobs and building new supply chains and factories in the UK. We will go with the grain of behaviour, and set a clear path that sees the gradual move away from fossil fuel to more efficient alternatives,” states the 10 point plan. “To future-proof new buildings and avoid the need for costly retrofits, we will seek to implement the Future Home Standard in the shortest possible timeline, and consult shortly on increased standards for non-domestic buildings so that new buildings have high levels of energy efficiency and low carbon heating.” 

If we believe the promises and the guidelines of stimulus packages from major governments around the world, we will bounce back from this pandemic stronger and greener than ever. Our buildings, that currently represent 40% of total global carbon emissions, will finally be a major part of governmental climate change efforts. This will lead to stronger green building regulations, driving greater adoption of smart technology, for new and retrofit projects, that will accelerate growth in the smart building market. It will also lead to a sustainable decline of carbon emissions to support climate change. If we are to believe the promises.

When the UK reopened after its first lockdown in the summer of 2020, the UK Treasury published its Plan for Jobs, which announced a £3 billion stimulus package for measures focused on green homes and buildings - but that part of the plan was soon abandoned due to overestimation of supplier capacity. Even the £12bn 10-point plan for a green industrial revolution, quoted above, is said to be an environmentally unambitious plan that depends on a skilled workforce that is yet to be developed in the country. We were struggling to tackle climate change before the pandemic, now we expect to do it while still battling the virus and facing a deep global recession.

“It is easier to talk about a green recovery than deliver one. The economic recovery and the net zero transition are very different goals that will not automatically be aligned – not all measures that would support one will naturally support the other. There may be tensions between ‘building back greener’ and ‘building back quicker’ or tackling other legacies of the pandemic,” explain Rosa Hodgkin and Tom Sasse in a recent institute for government report. “Politicians will face calls to return quickly to the status quo, rather than risk more difficult structural changes. The Covid recession is also fundamentally different from previous recessions, making it hard to draw lessons from experience.”

We are in uncharted waters but we arrived here together, the post-pandemic unity behind green recovery goals is real, even if the promises made are sometimes unrealistic. We know that politicians tell us what we want to hear, especially when their futures are at risk, but the green movement is bigger than politicians. More people than ever support environmental goals, that is why politicians make these promises but also why the private sector is increasingly finding value from going green, and that often starts with making their own buildings more energy efficient.

The smart buildings market is at a critical point of opportunity, where substantial green funding, green building regulation, increasing green brand value, and the green demands of a unified global society have converged. To seize this opportunity the smart building industry must come together to collaborate on the development of open standards, protocols, and ontologies that provide the consumer flexibility to drive the market forward. As the public sector lays the regulatory foundation and the public maintains the environmental pressure, the best thing smart building’s private sector can do is liberate data infrastructure in buildings.

“We should develop decentralised publishing initiatives which would serve as industry-wide collaborations that involve organisations accessing, using and sharing specific types of data across an industry. We have already seen examples of these initiatives in open banking and open energy,” says Volker Buscher, chief data officer at Arup. “Rather than confine the process to a few individual companies, it is imperative we broaden this out. It is time to start thinking of data infrastructure in the same way we do physical assets: dedicating resources to maintaining and upgrading it, and making sure it can support our economic and net-zero ambitions.”

Net-zero is no mean feat but is a necessary goal for our buildings to reduce their collective impact on the environment. Currently responsible for 40% of global emissions, the decarbonization of the buildings sector has long been seen as one of the most effective ways to mitigate the worst effects of climate change. The reality, however, is that very few buildings today can truly claim to be fully net-zero over their entire lifecycle. Achieving net-zero goals across a large portion of our building stock will require every tool in the industry’s toolbox, including and especially, openness and collaboration on the technology infrastructure in buildings. 

“It is not just the technologies that need to change, it is the knowledge, culture and practices involved too. The value of cleansing and refining data to make it usable is currently being taken on by individual companies which makes it prohibitively expensive. There are still very few global examples of infrastructure assets utilising efficient data value chains,” says Buscher. “Data infrastructure for market openness is within our reach and the benefits of leaving the old system behind are seemingly endless. Now we need to take the first crucial step and start building towards a better future for our planet, unlocking innovation with data at scale.”

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