Buildings have traditionally been designed as somewhat isolated units protecting occupants from the outside world. While buildings still need to protect people from the elements, like the first buildings were designed to do, the modern world demands more complex relationships between buildings and their urban environment.

Energy no longer just flows into a building but in and out within a dynamic exchange with other buildings and the city itself. In recent years, data has become a new utility and must also flow freely in and out of buildings. Modern smart building can no longer be siloes for energy and data, the value of opening their doors to the smart city is now too great.

The comprehensive report explores all these exchanges that have been made available to buildings by the spread of the Internet of Things (IoT) across our urban landscape. The city has always been just a collection of buildings but in the smart city, buildings are essentially data nodes that can become part of a wider city network in two ways – Energy and Data.

Within the energy sector, utilities have habitually provided both price and risk arbitrage to the end nodes. This double arbitrage has reduced end-node interest in working with the grid, and reduced consumer propensity to offer premium prices to different power generators. While making the urban grid “smart” through increased availability of energy information, technologies can offset part of the growth in demand, it is only half the solution. The other half of the solution must be to make buildings smarter and better integrate them into wider city energy systems.

Utilities are notoriously slow to evolve but the value of integrated smart technology is now too good to ignore. Grid operating margins have become slim as volatile renewable energy sources provide a growing portion of the grid’s power. The need for, and benefits from, end node participation in matching energy supply and demand will only grow in the future. Considering buildings consume over 70% of the total electricity, in the US for example, it is essential that they become part of the transformation to make the grid smarter.

Currently, however, many commercial buildings and most residential buildings lack proper infrastructure to be part of such a transformation. The evolving smart electric utility grid will further increase demands on building systems to automatically respond to time-varying prices and conditions. As the grid is operated at shrinking reliability margins and relies on demand response to manage loads; smart building systems will be essential for meeting these needs.

Smart buildings, within the smart city, and with smart grid interaction are still a relatively new system but allow implementation of innovative control technology in order to save overall energy consumption and reduce costs for all stakeholders. Features such as dynamic pricing of the smart grid leads to smart use of electricity in a building allowing shutdown and start-up of appliances based on high and low peak periods of dynamic pricing, respectively.

Full integration allows a smart building to configure itself as a virtual backup station or as a virtual power plant for better urban grid regulation and balance.

“In energy networks; distributed energy resources, demand response, and building2grid (B2G) are three avenues through which intelligent building technologies can create dynamic assets that reshape the supply and demand paradigm for facility energy use,” explains our report that also highlights even greater value that exists for buildings from developing greater integration of data flow with the city that surrounds it.

Cities, like buildings, are becoming highly intelligent, sensor-rich environments serving their occupants, residents, and visitors. Gathering masses of data in these human environments, then feeding that information into big data and artificial intelligence systems, offers unprecedented control to those managing and governing such spaces. Buildings and their cities can also benefit from each other’s data to create efficiencies and other benefits for each others users – who are often the same people.

Understanding the flow of people into and out of a building will support smart city systems such as parking, traffic, pedestrian flow in the vicinity of the building, for example. Then consider that the city receives such data from every building, the processing of all that big data creates unprecedented insight into urban dynamics and helps the smart city reach a variety of key goals.

“In information flow, intelligent parking and mobility solutions implemented in urban buildings create new nodes and channels for smart city initiatives. These technologies can support smart city traffic, safety, and sustainability goals with real-time data,” our Data-Driven Buildings report highlights. It is not just building data leading us to smarter cities, smart city data can also bring significant benefit to buildings.

The building may still have walls, doors and windows to separate it from the outdoor environment but just like people must come and go, data and energy must also be able to flow freely between the building and the wider city. Huge opportunities lie beyond the building, the focus of smart buildings should be about breaking down the silos and looking for value opportunities rather than just focussing on energy savings.