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ICT and Big Data
Lux Analyzes Winners in Growing Field of Energy-Use Monitoring

As new companies find their niche helping building designers, owners and managers lower energy consumption, the measurement and verification (M&V) industry is rapidly moving toward real-time performance-tracking, according to a new study by Lux Research. The report also analyzes these new players, both the ones focusing on sub-metering hardware and other specializing in data analytics, as they improve building energy management systems (BEMS) and making M&V tools that give a continuous picture of performance.

As new companies find their niche helping building designers, owners and managers lower energy consumption, the measurement and verification (M&V) industry is rapidly moving toward real-time performance-tracking, according to a new study by Lux Research. The report also analyzes these new players, both the ones focusing on sub-metering hardware and other specializing in data analytics, as they improve building energy management systems (BEMS) and making M&V tools that give a continuous picture of performance.

“Today, sub-metering devices are now available to measure all types of building utilities, such as electricity, water, fuels, and heating or cooling input, with very high precision – but with a high cost to match,” said Alex Herceg, the lead author of the report “Proof in Performance mdash; Improving BEMS (Building Energy Management Systems) through Measurement and Verification.” "Still, as real-estate managers slowly adopt a data-driven approach, the demand for the devices that can deliver actionable insights will grow."

Companies are responding to the need to create cost-effective M&V systems for smaller buildings, structures smaller than 50,000 square feet, according to the study. A European Union directive calling for energy services aimed at this segment could lead to a new model for servicing small structures.

At the same time, companies such as Sefaira and Retroficiency are giving smaller players access to modeling tools. Sefaira uses a cloud-based tool to rapidly prototype a building and assess energy impacts of design decisions, while Retroficiency's "Automated Energy Audit" is a rapid-modeling tool to help engineers find opportunities for energy savings.

Lux analyzed two types of M&V providers — those that focus on pre-implementation (gathering baseline energy consumption information for modeling) and those that provide post-implementation (verifying and troubleshooting to ensure that conservation features work as designed). Analysts considered technology value, business execution and maturity, aggregating those factors into one score they called the Lux Take.

“Just as M&V providers use rigorous calculations to determine the projected performance of (energy conservation measures) in a building, would-be partners, customers, and investors in this space also need concrete data and logic to measure the performance of start-ups,” Herceg points out in the report.

In the pre-implementation group, Retroficiency and Sefaira led the way, followed by First Fuel with the only other positive rating. The Lux scoring advised a wait-and-see approach to kWhOURS, EcoInsight and Skyline Innovations, and did not favor Sagewell, Essess or Energent. In a more crowded field of post-implementation providers, Vigilent took the highest score for the three factors, while SCL Elements, Optimum Energy and SmartCore also did well.

In the look-ahead for companies tapping this M&V market, Lux predicted that the ones that serve the smaller buildings (less than 50,000 square feet) will see little competition, but also will have to have large client lists to make a profit with a small margin on each. Also, since M&V data comes from different sources in different forms, the companies that can sort data into usable information will be poised to succeed. The report also urged energy services companies to reach beyond large institutions and find creative ways to enable smaller companies and buildings to afford sub-metering, which has been largely cost-prohibitive in the past.

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