Abstract
High Investment Costs Challenge Manufacturers of Building Automation Systems
The capability of building automation systems (BAS) to monitor environmental conditions within a building and minimize energy consumption has made them increasingly popular with building owners and facility managers. However, market expansion is hampered by the fact that manufacturers are hard pressed to justify the high initial costs. Moreover, while decision makers recognize the potential benefits that are likely to be offered by the system, the actual return on investment is subject only to speculation. Earlier strategies and technologies have proved to be ineffectual, and owners are skeptical of investing in a system that cannot guarantee satisfactory service.
This Frost & Sullivan research evaluates the current and future prospects of the North American building automation systems controls market. It outlines strategies that are likely to assist participants in positioning themselves, and enable them to formulate their future marketing strategies. Additionally, it presents an insight into promising market opportunities and offers suggestions for product improvement.
Enforcement of Energy Codes Drive Growth for BAS Markets
The U.S. is the highest consumer of energy in the world. In a bid to cut costs, the government has been offering proactive support at the federal level to enforce energy codes in all states. "With commercial buildings consuming approximately 17.0 percent of the total primary energy in the country, curbing energy costs has become a major source of concern among legislators," points out the analyst.
As per the federal mandate, by July 15, 2004, all states in the United States must certify that they have energy codes that are at least as stringent as 90.1-1999. Alternatively, they must provide justification for their noncompliance. Energy conservation initiatives have been especially forthcoming from agencies such as the Environmental Protection Agency (EPA) and the Department of Energy (DOE). It is hoped that the enforcement of these codes would boost the BAS market as consumers try to cut down on their energy costs.
Aggressive Move toward Smaller Building Projects Expands BAS Markets
The last few years have witnessed the entry of a number of participants who are focusing on niche end-user markets in retail, financial services, mission critical applications, and highly complex data center applications. This narrow market concentration allows smaller BAS companies to gain recognition and win large clients such as highly visible, upscale public buildings. Although these building facilities are primarily designed to control the HVAC system, lighting, security, and life safety are also managed in greater numbers as the square footage of the buildings increases.
"Small commercial buildings represent almost 40 percent of the total building sectors," says the analyst. "This potential is likely to increase even further as evolving market needs ensure that manufacturers keep pace with the superior technology." In the long term, it is likely that these systems will justify the high installation costs by reducing the requirements for building engineers and maintenance staff. | 
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