M A R K E T I N T E L L I G E N C E • A N A L Y S I S • B E N C H M A R K I N G

Smart Buildings:

Ten Trends to Watch in 2013 and beyond

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Section 1 - Building energy Management hits the cloud

Section 2 - Co-opetition is on the rise in the building industry

Section 3 - Targeted acquisitions help key players deliver end-to-end monetized energy services

Section 4 - Demand for smart building products in Asia Pacific will soar, driven largely by China

Section 5 - U.S. energy service companies turn to the federal sector

Section 6 - Building communication protocols are converging in more ways than one

Section 7 - Demand response (DR) is shifting into automatic

Section 8 - Submeters find new opportunities in smarter buildings

Section 9 - Building information modeling is transforming the design process

Section 10 - The interface between smart buildings and the smart grid is blurring

Ten Trends in Smart Buildings

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Section 1

Building energy Management hits the cloud

Global BEMS market projected growth from $1.9 billion in 2011 to $6.0 billion in 2020

Big data generated by buildings stored into the cloud - basis for rich software-as-a-service (SaaS) offering…valuable decision making tool for top management

Building energy data - benchmarking tool to identify areas of inefficiency and poor performance.

BEMS as an App - a platform that pulls together data from disparate building systems

Building Energy Management Hits the Cloud

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Building Energy Management Hits the Cloud

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Section 2

Co-opetition is on the rise in the building industry

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Current state: Building industry - highly fragmented.

Need: Demands for BEMSs require considerable integration between disparate building systems and its vendor solutions.

Solution: Consolidated vs. Fragmented: High performance building product marketing Vendors combined capability of two systems - is often greater than the sum

of the parts

Co-opetition is on the rise in the building industry

Section 3

Targeted acquisitions help key players deliver end-to-end monetized energy services

Intense market acquisition levels driven by:

Rapid sector growth - driving decisions towards buy vs. develop

Industry leaders looking to add new capabilities to secure strong position in competitive RFP environment.

Monetized energy services Retrofit Optimize providers

› Level 2‒ Level 3◦ Level 4▫ Level 5

Targeted acquisitions help key players deliver end-to-end monetized energy services

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Targeted acquisitions help key players deliver end-to-end monetized energy services

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Section 4

Demand for smart building products in Asia Pacific will soar, driven largely by China

Asia pacific represents 40% worlds building space – By 2025 China will build over 200 cities with population over 1million

Smart building technology still represents small portion of new construction:

Only 25% of the global market for controls Only 20% for BEMSs 17% intelligent lighting and controls 6% for DR services

Demand for smart building products

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Asia Pacific strong position:

LED – 50% of global sales annually

Untapped market will represent future growth

Current Smart Technology market is growing at a double digits pace outperforming North America and Western Europe

Chinese Government is a driving force (5 year plan to reduce energy consumption by 16%)

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Demand for smart building products

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Section 5

U.S. energy service companies turn to the Federal sector

Current state of ESCO (Energy Service Companies):

U.S. – market belongs to MUSH (Municipalities/Universities/ Schools/Hospitals) Western Europe –commercial / public building sectors China – Commercial / industrial sectors

U.S. Future State of ESCO

Over 500,000 buildings under government control – great potential for energy improvements via ESCO

U.S. ESCO revenues from the federal sector will grow from $1.2 billion in 2012 to $4.0 billion in 2020 (CAGR of 18%)

U.S. energy service companies turn to federal sector

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U.S. energy service companies turn to federal sector

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Section 6

Building communication protocols are converging in more ways than one

Current State: Existing building stock speak many languagesICT- enabled building devices - are becoming ubiquitous, leading to a complete landscape of smart devices that can be integrated into a single system.

Need: Synthesizing building energy dataICT with BMSs and other systems within buildings need to create BEMSs that feed BMS-related data into centralized servers and software applications.

Future state: BASs will grow to $146.4 billion in 2021 from $72.5 billion in 2011:Shift to IP networks for new buildings, doing away with the polyglot automation world of today.

Building communication protocols are converging

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Building communication protocols are converging

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Section 7

Demand response (DR) is shifting into automatic

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The total market for DR services is growing rapidly and will reach $6.1 billion by 2016 at a CAGR of 37.2% over the 2010-2016 timeframe.

U.S. market will represent the largest portion of this market

Western Europe and Asia Pacific will further accelerate the growth.

Increasing portion of this market to be fully automated, as utilities and CSPs look to deepen the ability of DR to manage the grid ever more efficiently and reliably.

Demand Response (DR) is shifting into automatic

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Demand Response (DR) is shifting into automatic

Section 8

Submeters find new opportunities in smarter buildings

The worldwide market for submetering technology and services totals $771 million and will grow to $1.58 billion in 2020 at a CAGR of 9.4%.

North America, Western Europe, and Asia Pacific collectively amount to 85% of the global market

15% is spread between the Middle East, Latin America, Eastern Europe, and Africa.

This split will remain consistent over the next 8 years as demand for submeters and their associated services surges in the largest three regions.

Submeters find new opportunities in smarter buildings

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Submeters find new opportunities in smarter buildings

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Submeters find new opportunities in smarter buildings

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Section 9

Building information modeling is transforming the design process

Current state: Poorly coordinated construction industry professionals

Need: BIM software that houses design and construction documents with scenarios modeling function in a central repository accessible via cloud

Future state: BIM ecosystem that will include thousands of BIM consultants to help smart building construction from inception to execution via innovation.

Building information modeling is transforming the design process

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Building information modeling is transforming the design process

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Building information modeling is transforming the design process

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Section 10

The interface between smart buildings and the smart grid is blurring

Smart buildings and Smart GridSituation:

BEMS - intelligence from commercial and industrial buildings creates a bird’s eye view of aggregations of buildings – utilities are starting to pay attention.

Grid operators are changing rules and providing market mechanisms that allow and incentivize DR.

Trend: EMS targeting utilities as a means of achieving higher energy efficiency targets Building industry leaders are eager to tie buildings with the grid through an intelligent

network Products designed to make buildings grid-aware by integrating disparate BASs and enabling

them to respond to real-time grid conditions

The interface between smart buildings and the smart grid is blurring

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