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SMART GRID INSIGHTS
ENERGY MANAGEMENT 3.0:
ADVANCED SYSTEMS FOR
COMMERCIAL AND
INDUSTRIAL USERS
NOVEMBER 2012

1 [PREMIUM] ZPRYME SMART GRID INSIGHTS

Copyright 2012 Zpryme Research & Consulting, LLC All rights reserved. www.zpryme.com | www.smartgridresearch.org

Energy Management 3.0: Advanced Systems for Commercial and Industrial Users | November 2012
Table of Contents

Executive Summary ................................................................. 2
Energy Management System Market Transition ................ 5
Recommendations and Opportunities .................................. 6
Market Overview ..................................................................... 8
State of the Market ................................................................ 8
Technology Definition ............................................................ 8
Market Drivers ......................................................................... 9
Market Barriers....................................................................... 10
Technology Benefits and Segments .................................. 11
Service Delivery..................................................................... 11
Energy Management Market Transition .............................. 13
Energy Management Systems Today ............................... 13
Energy Management Systems in 3-5 years ....................... 14
Energy Management 3.0 (6 - 10 years) ............................. 15
Global Market Value Forecasts............................................ 16
Global Energy Management Systems Market Value
Forecast, 2012 2020 ........................................................... 16
Global Energy Management Systems Market Value by
Technology, 2012 2020 ..................................................... 16
Methodology ........................................................................ 17
Key Players and Solutions ..................................................... 18
Emerging Companies to Watch ........................................ 23
Major Government Initiatives ............................................... 26
Major Regional Projects ........................................................ 27
Keys to Entering the Energy Management Market ............ 30
Zprymes Market Outlook, 2012 - 2020 ................................ 31



Executive Summary

Commercial energy management systems (EMS) allow
firms to reach energy efficiency goals and control energy
consumption company-wide by using proven energy
control techniques to optimize their energy efficiency.

Commercial buildings are a large potential market for
energy efficiency programs, and this includes energy
management systems. To drive this adoption, federal
programs play a key role to encourage the technological
development of enterprise grade energy management
systems for commercial facilities.

Currently, EMS offerings are focused on energy
optimization based on company-specified goals and
preferences. However, in the future, EMS will also integrate
operations optimization, and will automatically adjust
settings for the highest levels of performance, in addition
to providing energy savings.

There are several segments of the EMS market, with each
having specific needs and being at a different stage of
development. As such, vendors will need to provide
solutions specifically suited to the requirements of each
customer. To address that, several small specialized firms
are currently offering customized products suited for the
different segments, and some large firms are also
leveraging their knowledge and market presence to
introduce additional EMS products.

Overall, we expect companies will begin adopting EMS
software in increasing numbers over the next 5 to 10 years,
especially solutions that not only optimize energy
efficiency, but also integrate with other business functions
to provide both energy efficiency and operations
optimization. These systems are an amalgamation of
building management systems and advanced software
solutions that assist in managing the building functions in a
more energy efficient way to provide demand response
controls when situations within the power grid demand it.

To do this, the EMS software measures the energy
consumption and utilization of all network-connected
devices and systems to provide visibility into power usage
across the enterprise. Typical components include work
management capabilities, enhanced demand-response
applications, and analytics and forecasting applications.

Energy management is an evolving market, but we see
several opportunities for growth. Key examples include the
rising significance of social responsibility and managing
climate change; focus on increasing demand efficiency
and operating cost savings; new product offerings;
compliance with energy efficiency regulations; and
increased use of renewable energy all of these are
driving demand for energy management solutions.

This report has been developed by Zprymes Smart Grid
Insights Research Team and Zprymes Smart Grid Advisory
Board.



Key Takeaways by the Numbers

The global energy management system market is
projected to reach $1.70 billion in 2012. By 2020, the global
market is projected to reach $9.98 billion. The market is
projected to grow at a compound annual growth rate
(CAGR) of 25%.

In 2012, North America (40%) and Europe (30%) will
account for about 70% of the global EMS market. Asia
Pacific will account for 15% of the market in 2012. By 2020,
North America and Europe will each account for 30% of
the market, while Asia Pacific will account for 26% of the
market.

North America: From 2012 to 2020, the region will
grow by 21% annually, from $0.67 billion to $3.01
billion.

South America: From 2012 to 2020, the region will
also grow by 21% annually, from $0.09 billion to $0.39
billion.

Europe: From 2012 to 2020, the region will grow by
25% annually, from $0.51 billion to $2.96 billion.

Asia Pacific: From 2012 to 2020, the region will grow
by 34% annually, from $0.25 billion to $2.55 billion.

Rest of the World (ROW): From 2012 to 2020, the
ROW will also grow by 25% annually, from $0.18
billion to $1.07 billion.

Technology Segmentation

From a system technology perspective, communication
networks represent the largest market segment in 2012,
accounting for 20% of the global market. In 2020,
communication networks will account for 18% of the
market. This equates to a projected global market value of
$0.34 billion in 2012 and $1.80 billion in 2020 (23% CAGR).

By 2020, control systems will be the largest technology
segment, accounting for 21% of the global market (vs. 19%
in 2012). This equates to a projected global market value
of $0.32 billion in 2012 and $2.10 billion in 2020 (26% CAGR).

In 2012, field equipment (15%), hardware (13%), software
(10%), and sensors (8%) will account for a total of 46% of
the global market. By 2020, these four technologies will
account for 44% of the market.

Among the six core energy management system
technologies, sensors and software are projected to grow
the fastest (30% CAGR).




$1.70
$2.06
$2.50
$3.05
$3.72
$4.54
$5.89
$7.66
$9.98
$0
$2
$4
$6
$8
$10
$12
2012 2013 2014 2015 2016 2017 2018 2019 2020
Global EMS Market Value Forecast
CAGR = 25%
2012 to 2020 (in U.S. billions)
(figure 1, source: Zpryme)
Field
Equipment, 15%
Hardware, 13%
Sensors, 8%
Software, 10%
Other , 15%
Comm.
Networks, 20%
Control System,
19%
Global EMS Market Segmentation by Technology
2012 - % of Global Market
40%
38%
37% 35% 34% 32% 32% 31% 30%
5%
5%
5%
5%
5%
5%
4%
4%
4%
30%
30%
30%
30%
30%
30%
30%
30%
30%
15%
16%
17%
18%
19%
20% 22% 24% 26%
11% 11% 11% 12% 12% 12% 12% 11% 11%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015 2016 2017 2018 2019 2020
Global EMS Regional Market Segmentation
2012 to 2020 - % of Global Market
ROW
Asia
Pacific
Europe
South
America
North
America
Field
Equipment, 9%
Hardware, 10%
Sensors, 11%
Software, 14%
Other , 17%
Comm.
Networks, 18%
Control System,
21%
Global EMS Market Segmentation by Technology
2020 - % of Global Market




Energy Management System Market Transition
(table 1, source: Zpryme)
Energy
Management
Systems
Description Primary End-use Sectors
Type of Solution Providers
(% of market served)
Key System
Features/Characteristics
Today
EMS mainly employed in large
buildings and facilities to decrease
energy costs by controlling,
monitoring and assessing the
energy use of lighting, HVAC,
machinery, thermostats, and other
areas that use large amounts of
energy.
Large commercial and
industrial customers

Multinational corporations

Large commercial building
and real estate owners and
managers

Federal and State
Governments
Multinational corporations (75%)

Niche solution providers (25%)
Cloud based

Preventive analytic
modeling functions

Control hundreds of
devices across several
locations

Automatic device
start/stop functions
In 3 5 years*
The EMS will integrate energy
efficiency with business processes,
management and operations.
This will enable integration and
control by department,
appliance, equipment, IT
infrastructure, human resources,
etc.

Mid-sized manufacturing
facilities*

Large retail operations*

Mid-sized corporate offices*

Healthcare/Hospitals*

Multi-unit apartments*


Start-ups (5%)

Utilities (5%)
Full energy profile
visualization

Customized to user needs

Micro-level device control

M2M communication

Advanced demand
response capabilities
In 6 10
years**
(Energy
Management
3.0)
The EMS will allow businesses to
align energy efficiency with
business goals, and be able to
integrate and communicate with
energy aggregators, utilities,
distributed energy resources, and
whole sale electricity markets.
Small manufacturing
facilities**

Small and medium retail
operations**

Small offices**


Start-ups (10%)

Utilities (15%)
Plug-n-play

Highly interoperable

Energy-management-as-a-
service (EMaaS)

Control thousands of
devices across multiple
locations

*In addition to the functions, features, and sectors mentioned in Today
**In addition to the functions, features, and sectors mentioned in Today and in 3 5 years



Recommendations and Opportunities

Recommendations

1. Vendors looking to enter the EMS market need to
take a long-term view of the opportunity. The
current global market is only $1.7 billion, but will
grow to $10 billion by 2020. They must also
understand the regional nature of EMS, with 70% of
current expenditures being in either North America
or Europe.

2. EMS solutions consist of several components, namely
hardware, software, sensors and control systems. To
get early traction, vendors need to be
interoperable, plug-and-play, and compatible with
the customers communications network.

3. Vendors must also be careful in targeting the right
types of customers. EMS offers the most immediate
value to large consumers of energy, such as
industrial or commercial facilities and campuses.
While small businesses represent the largest number
of physical sites, the ROI is more difficult to gauge,
and this end of the market will develop later as EMS
costs come down and the track record is more
proven.

4. Utilities need to view the value proposition of EMS
beyond ROI. In the U.S., smart meter stimulus
funding, the Better Building Initiative and the ISO
50001 certification are examples of how
government and industry bodies are working to
promote solutions that make businesses more
environmentally responsible and better global
corporate citizens. These are key value drivers that
utilities can use to get their customers to see benefits
beyond cost savings for EMS.

Opportunities

1. North America and Europe provide the most
immediate opportunities for vendors in the energy
management space, and combined, currently
account for 70% of the market.

2. By region, the U.S., Canada, U.K., and Germany are
four countries that have adopted these
technologies at the highest rate over the past few
years, and are expected to continue leading the
market.

3. While North America and Europe drive short-term
demand, the long-term growth opportunity includes
Asia. During the forecast period, North Americas
market share will decline, Europes will remain
constant, but Asia will steadily grow from 15% share
to 26% of the global market by 2020.

4. In Asia, the most immediate opportunity is Japan,
where industries have been charged with reducing
their energy consumption as a result of the
Fukushima disaster that happened in 2011.

5. Advanced energy management systems will
become more attractive financially when they
enable individual customers to sell power back to
the grid. This capability will emerge as smart meter



deployments reach critical mass, and as
communications networks become more integrated
with the smart grid.

6. Companies with multiple locations stand to benefit
from advanced EMS deployments in terms of
aggregated billing capabilities. Not only will
advanced analytics help optimize power
consumption across all sites, but they will streamline
the data management, making the billing process
simpler and more accurate.

7. On a more granular level, EMS will provide real time
visibility into energy consumption with the ability to
control the usage of any endpoint connected to
the data network. This will provide businesses with
unprecedented capability to proactively manage
energy use, and allow utilities to make better use of
dynamic pricing with customers, which will help
align energy supply with real time demand
conditions.



Market Overview

State of the Market

Deployment of the Smart Grid and smart meters enable
business management to understand their consumption,
as well as take measures to lower consumption and
energy costs. To date, energy management systems have
been adopted primarily in large industrial facilities,
however use in other business settings is increasing as
executives become more aware of the benefits they
produce. In addition, technological advances will drive
adoption by reducing prices and creating products that
will not only optimize energy efficiency, but also optimize
operations. Finally, economic recovery will further propel
adoption, as firms will have greater ability to make
investments in energy efficiency.

Commercial buildings currently consume approximately
40% of all energy or $400 billion per year in the United
States, making them the largest sector of the energy
market. Given the size of the market, reducing
consumption in the commercial market will significantly
increase overall grid reliability.

Technology Definition

One way that a building is able to decrease its overall
consumption is through the deployment of an energy
management system (EMS). It does this through utilizing a
number of proven energy efficiency programs, such as
load shifting, duty cycling, optimal start and end time,
thermal heat utilization, energy storage, response to
weather changes, time of day scheduling, demand
limiting, and renewable energy generation management.
1

The business specifies preferences and goals that govern
automation activities and create cost savings. In addition,
advanced analytics allow management to make more
cost effective and energy efficient decisions.

For the purposes of this report, the term commercial
refers to both commercial and industrial businesses.

Commercial Energy Management Systems (EMS) are a
suite of applications and technologies that enable users to
monitor, control, and optimize their use of energy. The
typical energy management system is comprised of the
core components described below.

EMS Core Components
(table 2, source: Zpryme)
EMS Component Description
Field equipment
Measurement devices installed in a facility, building, or
business. Examples include sub-meters, cameras, power
analyzers, and media gateways
Software
Proprietary software needed to integrate EMS with user
operations/ systems. This includes software that enables
additional functionality to an existing EMS.
Control system
(user interface)
Main system interface that manages, controls, and
communicates with the entire EMS. Users optimize and
program the EMS with the control system.
Hardware
Physical equipment used to integrate EMS such as servers,
user work stations, backup power suppliers, and mobile
monitoring devices such as tablets.
Communications
network
Communication equipment and architecture that
connects and enables the transmission of data and
information in the EMS.
Sensors
Wireless or wired sensors placed throughout an installation
to measure power and/or communicate device data.
Some devices or equipment may come installed with EMS
compatible sensors.

1
www.eisalliance.com/documents/EIS_A_CEMS_WP.pdf



Typically, an EMS comprises of system placed in the
customer's premise, including hardware and software,
designed to control the operation of other energy devices
according to customer preferences and objectives such
as reducing energy costs, or maintaining comfort or
convenience. Controlled devices could include, but are
not limited to, security, thermostats, lighting, HVAC,
appliances, large pieces of equipment, and even IT
infrastructure such as servers, computers, and
communication networks. Among other control inputs, an
energy management system can accept energy pricing
signals from a utility or third party energy service provider.

The EMS of the future will further integrate energy
efficiency with strategic business goals. Because future
business energy management systems will control more
devices, from individual electrical outlets to the individual
lights and pieces of machinery, the EMS will go a step
further than current capabilities to both control energy
and optimize production efficiency.

It will utilize occupancy sensors and scheduling to turn off
individual outlets to reduce vampire energy, shift the
storage of information to maximize server use, while
leaving critical outlets protected and backed up by a
storage system to maintain constant operation. It will even
perform programmable functions like copying and
computer maintenance and updates during non-peak
times. By integrating operations with energy efficiency,
firms will be able to better maintain equipment, reduce
downtime, improve production and maximize overall
profitability.

Market Drivers

Energy management is an evolving market and end users
are investing selectively in energy management solutions.
However, the market provides several opportunities for
growth as new companies focused on the space emerge,
and longstanding IT companies and building
management system companies gravitate to this growing
market. Several factors are driving demand for energy
management solutions including rising significance of
social responsibility and climate change; focus on
increasing demand efficiency and operating cost savings;
new product offerings; compliance with energy efficiency
regulations; and increased use of renewable energy.

By using energy management solutions, firms are able to
respond to government regulations to reduce carbon
emissions; to employee, customer, and community
requests to operate in an environmentally friendly manner;
and to shareholder demands to decrease costs and
produce higher returns. There are several approaches to
reducing the carbon footprint, from promoting eco-
friendly practices to changing energy production methods
to establishing and enforcing carbon emissions limits.

While the U.S. has yet to enact federal carbon regulations
or pricing laws, other government regulations affect future
energy supply strategies. In Pennsylvania, for example, a
new law requires a 4.5 percent reduction in peak energy
demand by 2013. Moreover, by 2015, U.S. stimulus
spending promises to support an additional 50,000
megawatts of renewable energy sources. These types of
energy sources present intermittency challenges: The wind
does not always blow, and the sun does not always shine.



As a result of intermittency, energy management systems
must incorporate rapidly accessible response reserves for
use during power shortages. Furthermore, plug-in hybrid
and all-electric cars, such as the Nissan LEAF and Chevy
Volt, promise to help reduce both carbon emissions and
dependence on imported oil; however, they also lead to
an increase in demand for power. Thus, energy
management systems are required to assist in minimizing
the energy requirement of these vehicles.

The use of energy is the second-largest variable cost in the
manufacturing process after raw material costs. Energy
use changes from one hour to the next depending on
many influencing factors, such as outside temperatures.
Since energy needs can change abruptly, the energy
infrastructure must always have the capability of meeting
the peak demand. Newer, informed demand-response
technologies help shape energy demand, predict
available load, and then precisely shape that load. In
particular, informed demand response enables distributed
intelligence end-points, verifiable results, accountability
and measurement, and comprehensive data analysis.

Organizations require enterprise-level reporting for
hundreds of thousands of devices across their highly
distributed offices and data centers worldwide. Therefore,
there is an increasing demand from global enterprises for
more depth and breadth to their energy management
solutions. This allows them to seamlessly scale to and
support multiple locations around the world. Rapid energy
modeling, app stores, energy kiosks, cloud computing, big
data, online communities, and continuous optimization
are now required in the vocabulary of market players.

In the U.S., for example, BuildingIQ (an energy
management software company) and Schneider Electric
(a global specialist in energy management) announced in
April 2012 that they were collaborating to provide
commercial building owners with a next generation
solution for energy management. This partnership provides
customers with a cloud-based energy management
system that automatically and continually reduces
Heating, Ventilation, and Air-Conditioning (HVAC) energy
use and connects commercial buildings to the Smart Grid.

Market Barriers

Getting consumers to understand that the use of energy
management systems can empower them to do
something about their energy costs is the biggest market
barrier for the energy management system market. Most
companies and customers realize there are means to
reduce energy costs, but they lack information about
what is happening within their energy systems. Energy
management systems can provide a window of how the
equipment in their buildings is operating, monitor
performance, and identify areas of potential savings.

Financing installations is a problem. Vendor providers cant
provide up-front costs, and equity leasing firms are not
interested in entering the market. If they would, its
predicted that the applications would explode.

Last, a burdensome regulatory environment, a lack of
standards, and acceptance of modern communications
networks are also holding back the potential of the energy
management systems market.



Technology Benefits and Segments

Businesses that deploy an EMS first benefit from reduced
energy consumption, which leads to reduced energy
costs, reduced GHG emissions, and reduced pollution.
Our research finds that peak energy demand (load) can
be reduced 10% to 20% through the use of advanced
energy management systems. In addition, the firm will be
more knowledgeable about consumption and better able
to identify the high consumption areas, as well as plan for
the future. Modeling also lets the firm try out decisions
before they are implemented, allowing the firm to
determine the optimum settings and prevent potential
problems.

Any areas performing out of range can be quickly and
automatically scheduled for maintenance. In addition,
energy optimization can increase the utilization of
equipment, and coordinate energy efficiency programs
across multiple locations, thus reducing overall energy
costs for a business.

The EMS market has several segments. First, the large
industrial, commercial, and government segment has
been implementing EMS for some time as energy
accounts for a significant portion of their operating costs.
In the near future, the large industrial market will
implement improvements, especially as technology
enables further integration with operations management.

The Mid/Medium commercial segment includes retail
facilities, manufacturing facilities, and hospital and
medical buildings. These mid-sized facilities are not as
dependent on energy consumption as large facilities and
are more affected by the cost of the energy
management system. Although there is considerable
interest in energy management systems, widespread
adoption will not be possible until the cost decreases and
the size becomes more scalable and customized.

The office business market is the largest segment of the
commercial building market. Offices have very specific
needs and critical equipment, such as servers, that must
be continually on. Energy waste can be significantly
reduced through implementation of an energy
management system. The segment is poised for
widespread adoption, however the cost must be reduced
and the energy management system must control all
devices, while insuring the continued operation of others.
Finally, small businesses (those with under 500 employees)
represent a huge portion of the commercial market. In
2009, there were nearly 27.5 million small businesses in the
United States, representing 99.9% of all businesses. In 2008,
21.4 million firms had no employees. The size of the market
is enormous, however facilities and capital are very
limited, and ROI is extremely important. For that reason,
energy management systems for small businesses must be
relatively inexpensive and extremely customizable.

Service Delivery

Initially advanced energy managed systems and services
will be provided and managed by technology vendors,
third-party aggregators, and eventually utilities.
Management of these systems will take place under one
of the three scenarios below.



Vendor or third-party managed: The solution provider
will manage the users system from a central location
(off-site). They are typically the least expensive solution,
as they have the lowest capital investment and a
monthly management fee. This EMS is cloud-based
and business executives can link remotely to modify
preferences.

User managed: In this case, a building or company will
manage the solution on site or from a central location.
The executives directly input preferences and
parameters, and staff monitors the system to perform
overrides or manual operations. These systems typically
have a significant initial capital investment, and require
continued maintenance costs. In addition, human
resources are also utilized to manage the EMS.

Utility managed: The utility will manage the
solution/service for the user (commercial/residential
building or facilities). However, it is extremely costly due
to extensive deployment costs and could lead to
significant problems, such as customer equipment
failure due to duty cycling. In addition, the utility would
manage numerous clients, decreasing customization
by businesses and preventing individual efficiency.

Prices for advanced energy management services vary
significantly. Companies that work with smaller entities
such as residential homes, grocery stores, hotels, and
telecom applications charge as little as $1,500 for
upgrades of existing customers, $5,000 - $7,000 for most
installations, and up to $50,000 to $100,000 for large
customers. The average ROI time frame is 2 4 years for
such systems. In addition, customers are normally charged
a monthly subscription fee that is determined by the
overall size and number of locations each customer has.
Initially, utilities will not be interested in providing these
services unless they are reasonably progressive. Due to the
regulatory landscape, utility decision-makers are keen on
keeping the status quo due to potential liabilities. They are
ultra-cautious and hesitant to engage in programs and
services that might disrupt their operations.

They are open to looking at utility rebates but wont be
openly receptive to discussing the alternatives being
offered by these companies until they can demonstrate
critical mass, which is normally considered to be a
successfully installed base of at least 300 units.

Overall, next generation services will be delivered and
managed through the Internet cloud. However,
progressive utilities seeking new revenue streams will
eventually enter the market.



Energy Management Market Transition

As energy management systems become more
advanced, they will go through a series of changes. First,
the users that utilize energy management systems will
expand to comprise a larger section of the small to
medium sized business market. In addition, as adoption of
energy management systems increase, benefits to users
and the overall electric grid will also increase. Next, the
technology will advance significantly, enabling the
potential to control thousands of devices across multiple
of locations. Finally, seamless integration with the electric
grid, distribute generation resources, and whole sale
electric markets will become a key feature of the energy
management systems of the future.

Energy Management Systems Today

Currently business scale energy management systems are
employed in facilities large enough to consume a very
high amount of energy, operate many pieces of high
consumption equipment, coordinate multiple buildings, or
where energy availability, reliability, and security are a
priority. Industrial facilities frequently utilize energy
management systems because they employ a number of
very high energy consuming devices. Large automotive,
food production, and other energy intensive industries also
utilize energy management systems. Universities frequently
utilize energy management systems to manage energy
consumption in multiple buildings across their entire
campus. Finally, government facilities also employ
enterprise energy management systems, both due to the
size of their facilities, and their security and efficiency
requirements.

Several benefits of employing corporate energy
management systems are being experienced by its users.
The primary benefit of utilizing an energy management
system is reducing energy consumption. Reducing energy
consumption provides a number of secondary energy
benefits including reducing the energy cost, reducing
greenhouse gas emissions, and reducing the carbon
footprint for the firm. Because the firm would reduce
energy consumption, it would require less energy from the
grid, thus creating a more reliable grid. Another benefit
firms experience is increased knowledge about its energy
consumption. Finally, this increased knowledge also
improves documentation and compliance of
environmental and other regulatory requirements.

Several key pieces of technology enables business energy
management systems to integrate disparate systems to
offer energy reduction for the firm. Energy sensors can be
attached to energy consuming equipment, allowing the
energy management system to monitor and control the
devices. These sensors are becoming integrated with new
equipment, as in smart appliances, such as air
conditioners, water heaters, and security systems. In fact,
the motion sensors employed by security systems become
more important as they provide valuable information
about occupancy and feedback about facility use. The
more devices that can be connected to the energy
management system, the more valuable the system
becomes for the firm. Energy management system
software is exceedingly important, as it takes the
information obtained from the multitude of devices and
sensors and analyzes it to monitor and manage energy
facility-wide. Also, additional features are being added,



such as GIS integration, modeling and renewable energy
integration. Of course, renewable energy integration
includes solar panels, wind turbines, and all other
equipment associated with renewable energy generation.
Finally, energy management systems require a dedicated
computer terminal or control center to manage its
network of connected devices. Increasingly, cloud based
systems are being deployed to allow remote monitoring,
control, and utilization.

Energy Management Systems in 3-5 years

In 3-5 years the enterprise grade energy management
system will have expanded beyond the large industrial,
manufacturing, government, and university market. At this
time it will have expanded to offices, large retail stores,
global conglomerates, building and apartment operators,
and the primary education sector. In addition, hospitals
and medical buildings will also begin to utilize facility
energy management systems, as they are highly
dependent on energy reliability, especially during
emergency situations.

In addition to benefits currently experienced by firms
utilizing energy management systems, numerous other
benefits will be experienced. The energy management
systems will be controllable to the individual device level.
In addition, systems will be able to suggest opportunities
for additional savings, such as opening windows, and
cycling the air conditioner. This will provide additional
energy efficiency and cost savings, further lowering
operational costs, increasing profits, and increasing cash
flow. These energy management systems will also offer
integration with natural gas, water and cable systems,
creating an integrated total energy management system
capable of optimizing all resources. Automation will also
be key, as firms will receive automatic notifications of any
equipment performing outside the normal range, and the
energy management system will also schedule
maintenance and repairs, thus automatically reducing
downtime and increasing production. This will also
increase the lifetime of the equipment and minimize
equipment failures. The main focus of energy
management systems in 3-5 years will be integrated
energy efficiency with business management and
operations. The firm will benefit from being able to
prioritize devices, thus maintaining consistent operation of
critical systems while minimizing energy costs, such as
moving data to one server while shutting down a
secondary server when it is not needed.

The energy management systems will evolve to integrate
business information by department, appliance,
equipment, IT infrastructure, human resources, etc. The
system will use advanced analytics and modeling to make
predictions, detect patterns, and manage systems based
on this information. Because the firm will be able to
control energy to the individual device level, most new
building and office equipment will have to be produced
with sensors allowing control by the energy management
system. Next, commercially produced sensors will be
available to integrate with older appliances, such as
computers, copiers, fax machines, phones, etc. Finally,
advanced weather devices will also integrate with
renewable energy generation and modeling technology
to optimize the load profile of business users. Examples of
this weather technology include thermostats, barometers,
and hygrometers. In conclusion, technological



advancements integrating all areas of business
information, advanced analytics, sensors, storage, and
weather devices will enable both manufacturing firms and
large office and retail facilities to experience the
numerous benefits of utilizing business energy
management systems.

Energy Management 3.0 (6 - 10 years)

Within the next 10 years, small businesses will realize the
potential benefits of employing an energy management
system and will look for suitable options to meet their
needs. The use of energy management systems will
expand to include small to medium size businesses such as
small retail facilities, restaurants, and small offices. These
systems will be smaller, inexpensive, and highly
customizable.

The benefits firms experience by employing a business
energy management system will be based on
customization and integration. Again, business operations
will be of primary focus, and will allow businesses to align
energy efficiency with business goals. One way the
energy management system achieves this benefit is
through the ability to prioritize energy functions by business
impact. The energy management system will evolve to
the extent that the operational goals can be input into the
energy management system and the system will be able
to discern patterns, and make predictions to guide energy
management efforts. This will result in the energy
management system warming up equipment, turning off
outlets to reduce vampire energy, and optimize staff
deployment. In addition, the energy management system
will extend the life of equipment by detecting irregularities,
utilize the most efficient equipment first, and even perform
routine maintenance automatically. In addition, the
system will be able to integrate and communicate with
energy aggregators, utilities, distributed energy resources,
whole sale electricity markets, and across thousands
devices located at different locations.

For these benefits to be realized, technology must be
enabled. First the energy management system will
become scalable with customization features that allow
both pre-set programs and a high level of individualization.
The energy management system will also develop plug-
and-play capabilities that offer the ease of set-up for all
users. One key development in the energy management
system will be the ability to integrate data from every
business segment, including inventory, purchasing, human
resources, billing, IT, maintenance, etc. Another
technological step will be the ability to enter operational
goals and then translate those goals into an appropriate
and optimum course of action. The software will be able
to utilize real-time data to make instantaneous corrections
to meet said goals and optimize energy. The software will
also be able to offer different options to obtain the goals,
as well as suggest improvements to achieve better results
across systems or departments.



Global Market Value Forecasts

Global Energy Management Systems Market Value Forecast, 2012 2020
(table 3, source: Zpryme, in U.S. billions)

Region 2012 2013 2014 2015 2016 2017 2018 2019 2020 CAGR

North America $0.67 $0.78 $0.92 $1.07 $1.26 $1.47 $1.87 $2.37 $3.01 21%
South America $0.09 $0.10 $0.12 $0.15 $0.18 $0.21 $0.26 $0.32 $0.39 21%
Europe $0.51 $0.62 $0.76 $0.93 $1.13 $1.38 $1.78 $2.29 $2.96 25%
Asia - Pacific $0.25 $0.33 $0.42 $0.55 $0.71 $0.93 $1.30 $1.82 $2.55 34%
ROW $0.18 $0.23 $0.28 $0.35 $0.44 $0.55 $0.69 $0.86 $1.07 25%
Total $1.70 $2.06 $2.50 $3.05 $3.72 $4.54 $5.89 $7.66 $9.98 25%

Global Energy Management Systems Market Value by Technology, 2012 2020
(table 4, source: Zpryme, in U.S. billions)

Technology 2012 2013 2014 2015 2016 2017 2018 2019 2020 CAGR

Field Equipment $0.25 $0.28 $0.35 $0.39 $0.43 $0.47 $0.59 $0.77 $0.90 17%
Hardware $0.22 $0.27 $0.30 $0.34 $0.41 $0.45 $0.59 $0.77 $1.00 21%
Software $0.17 $0.23 $0.28 $0.37 $0.45 $0.59 $0.77 $1.00 $1.40 30%
Communication Networks $0.34 $0.41 $0.50 $0.58 $0.71 $0.86 $1.06 $1.38 $1.80 23%
Control System $0.32 $0.39 $0.50 $0.64 $0.78 $1.00 $1.30 $1.61 $2.10 26%
Sensors $0.14 $0.16 $0.23 $0.27 $0.33 $0.45 $0.59 $0.77 $1.10 30%
Other $0.25 $0.31 $0.35 $0.46 $0.61 $0.71 $1.00 $1.38 $1.70 27%
Total $1.70 $2.06 $2.50 $3.05 $3.72 $4.54 $5.89 $7.66 $9.98 25%



Methodology

Zpryme utilized secondary research sources, publicly
available sources, government announced plans, and
Smart City, Smart Grid, and Building Efficiency plans to
analyze the Energy Management Systems (EMS) Market for
commercial and industrial users. In-depth industry
interviews were also conducted to better understand the
market drivers, demand, and opportunities. Qualitative
assessments were made by Zprymes research team that
take into account both the primary research
(meetings/interviews) and secondary research findings to
assess the market segments of interest.

Finally, time series forecasting was used to project market
values from the baseline data obtained from primary and
secondary research methods. Other variables accounted
for in our models include but are not limited to:

Energy demand
Energy/fuel prices
Economic growth (GDP growth)
Government stimulus
Government goals
Renewable generation targets
Private sector capital investment.



Key Players and Solutions

Currently, Energy Management Systems for businesses are
offered by a group of specialty firms, as well as
multinational firms offering a range of services.

IBM: IBM has recently introduced its Smart Building and
Power Systems Energy Management Program. IBM
integrates a building's diverse systems including security,
lighting, doors and windows, CO2 sensors, and even
badge readers into an illustrative analytics program
capable of making predictions and modeling decisions.
The solution provides visualization of key benefits and goals
including reliability, efficiency, performance and
availability. IBM has been named one of the top four firms
leading the way in Enterprise Energy Management
Systems, and the firm's establishment in diverse sectors of
the energy industry makes IBM one of the most trusted
firms in the field and its product is suitable for large firms
already utilizing IBM products.
2

Another solution offered by IBM is IBM TRIRIGA. IBM TRIRIGA
provides a single system to manage the life cycle of
facilities. It delivers business analytics, critical alerts and
automated processes to increase visibility, control &
automation of real estate management, capital projects,
space management, facility maintenance and energy
management. IBM TRIRIGA provides an integrated
workplace management system to increase operational,
financial and environmental performance of facilities.
3

2
www-03.ibm.com/systems/power/software/energy/solutions.html
3
www-01.ibm.com/software/tivoli/products/ibmtrir/index.html
IBM TRIRIGA Energy Optimization combines real-time
systems monitoring with facilities and event management.
It helps analyze and optimize facilities operations, reduce
energy expense, and improve asset management and
reliability.

Smarter Rebuilding in New Orleans

Tulane University's School of Architecture, a program
distinguished by its focus on community engagement and
environmental sustainability, has turned to IBM Intelligent
Building Management and Johnson Controls to advance
its own smarter buildings evolution in the wake of
Hurricane Katrina's destruction six years ago. As the largest
private employer in the City of New Orleans, Tulane
University has made significant advances in rebuilding in
more environmentally sustainable ways.

The first IBM project is helping to transform the home of
Tulane's School of Architecture, the century-old
Richardson Memorial Hall, into a "smarter building living
laboratory," using IBM Intelligent Building Management
while maintaining respect for its historic status. The school
aims to arm a new generation of architects with
techniques that will allow historic buildings to be more
efficiently adapted for modern use.

The IBM project will bring together building technology for
heating, cooling, lighting and water to act in a more
holistic fashion for better results. The building will have
intelligence to monitor itself and communicate how it
should be most efficiently operated, significantly reducing
the natural resources it currently uses.
4

4
www-03.ibm.com/press/us/en/pressrelease/34694.wss



IBM to Monitor 50 Federal Buildings

IBM has won a contract to develop and install smart
building technology in 50 of the U.S. federal governments
most energy-consuming buildings, and the resulting data
could help reduce operating costs across the General
Service Administrations entire inventory of nearly 182
million square feet.

The GSA says this initiative will save taxpayers up to $15
million annually by connecting building management
systems to a central cloud-based platform. In the first year,
50 buildings will be integrated on this building
management system. As additional federal buildings are
constructed and other facilities are upgraded, the
platform will manage those buildings, too.

Under the terms of the contract, IBM will develop a system
to monitor building performance nationwide and stream
data to a central facility. The technology will link major
building controls, and when the system is fully integrated,
tenants will be able to view the performance of their
buildings on dashboards with real-time metrics on energy
savings. They will also see recommendations on how to
further increase efficiencies.

GSA says it will then use the data and analytics to save
energy and reduce costs across its entire fleet of buildings.

The contract is part of GSAs larger smart building strategy
to reduce energy use. The agencys plan to meet the
requirements of President Obamas Executive Order 13514
goal of reducing energy consumption in federal buildings
by 30 percent by 2015, using fiscal year 2008 as a baseline.
Emerson: Emerson Process Management, an Emerson
business, is a leader in helping businesses automate their
production, processing and distribution in the chemical, oil
and gas, refining, pulp and paper, power, water and
wastewater treatment, mining and metals, food and
beverage, life sciences and other industries. The company
combines products and technology with industry-specific
engineering, consulting, project management and
maintenance services. Its brands include PlantWeb
,
Syncade
, DeltaV
, Fisher
, Micro Motion
, Rosemount
,
Daniel
, and AMS suite.

Emersons Ovation system with SCADA technology
integrates all processes, not only the control of
mechanical equipment such as turbines, boilers, pumps
and mills, but also the control of electrical equipment, all
performed from a common platform. The Ovation
controller combines technologies and Ethernet networking
which enables an interface with multivendor equipment in
the low and medium voltage arenas. It includes
capabilities for the automation, monitoring and control of
actuators, variable speed drives, automatic voltage
regulation, transformers and generator protection.

Ovation also supports specific protocols designed for the
power industry for data exchange between generating
facilities and dispatch centers, and can be installed in new
or existing enclosures. Emerson also provides a CSI 6500
Machinery Health Monitor which combines protection and
prediction, with real-time performance monitoring and
process automation. Integrated with Ovation, it provides
the enterprise-wide information needed for real-time
decision making.



Barking Power LTD., one of the largest independently
owned generation plants in the UK, successfully installed
Emersons Rosemount wireless acoustic transmitters to
identify failed steam traps, leaking valves, and boiler tube
leaks to improve the efficiency of its Combined Cycle Gas
Turbine Power Station in London. Using the wireless
networks already in place, additional devices can be
added at a much lower cost than if they had to be wired-
in individually.

Johnson Controls: Johnson Controls provides equipment,
controls and services for heating, ventilation, air
conditioning, refrigeration and security systems to increase
energy efficiency and lower operating costs in buildings.
Their Metasys building management system, with IT-
based infrastructure, software and wireless capabilities,
provides monitoring and control of all building systems,
including comfort controls for temperature and humidity,
lighting, fire safety, and security equipment. In addition,
one of their strategies is to play a significant role in the
growing market for demand response services by enabling
smart buildings to interface seamlessly into the grid.

To enhance their position in this market, the company
acquired EnergyConnect Group, Inc. to create a new
level of building intelligence. EnergyConnects demand
response technology and service platform provides
energy managers and facility operators with real-time
energy information and access to energy markets to
manage their energy use.

Johnson Controls engineered a $3.8 million facilities
upgrade for Pioneers Memorial Hospital in Brawley,
California to improve operational efficiency by reducing
the cost of natural gas, electricity and water that will pay
for itself in 10 years. The upgrades included low-flow
fixtures to conserve water, enhanced lighting, retrofitted
heating, ventilation and cooling systems, and a new 630
panel photovoltaic system, all linked by the Metasys
building management system to monitor and control the
performance of Pioneers facilities.

Siemens: Siemens Totally Integrated Automation (TIE)
concept for energy management offers the integration of
all types of products and solutions, including the
manufacturing systems of other vendors. Their product
spectrum extends from automation and drive
technologies to system integration using industrial software
to technology-based customers. Their products allow
companies to digitally plan and simulate entire production
plans and manufacturing processes to optimize them prior
to commissioning.

Their SPPA-M3000 is an energy management suite of
modules for power plants and fleets which provides
precise detection analysis along the entire workflow
processes. The suite consists of five modules: Plant
Management, Early Fault Warning, Generation Planning
and Monitoring, Business Performance Monitoring, and
Process Information Management.

Their b.data Energy Management product creates
transparency in infrastructure processes, making
heterogeneous system landscapes easier to navigate, due
to the provision of a source-related energy cost allocation
and the ability to transfer data into an accounting system.



Schneider Electric: Schneider Electric provides a product
called StruxureWare which is comprised of platform of
applications and software suites that allows companies
visibility into energy, other resource usage and business
needs across buildings, industrial plants, and data centers.
Each suite delivers seamless integration with third-party
offers and legacy systems, as well as a scalable platform.

Their Resource Advisor module is an online carbon and
energy reporting portal. This enterprise level software-as-a-
service (SaaS) tool allows end-users to visualize energy cost
and resource usage data, capture and report carbon
emissions accurately, and manage all energy efficiency
projects in one location.

The Energy Operation module is also a SaaS tool which
transforms data into essential energy information to
identify areas of continuous improvement to reduce
operating expenses. The Building Operation module
provides integrated monitoring, control and management
of energy, lighting, fire safety, security and HVAC.

The Power SCADA Expert module is a real-time monitoring
and control software solution for large facility and critical
infrastructure operations. It provides real-time data
intelligence for power distribution through alarming and
graphical interface functions. The Process Expert module is
the software that integrates the control application, the
supervision, and the field devices in a single environment.
In the fourth quarter of this year, Schneider Electric will
release the Security Expert module to encompass video,
access control and building management, as well as the
release of an Asset Operation module in 2013.

Honeywell: Honeywell provides energy and emission
management solutions to help manufacturers monitor,
report, analyze, and reduce greenhouse emissions.
Honeywell experts combine their knowledge of radio
frequency fundamentals and wireless networks with their
experience in process control networks and cyber security
to provide the most secure and high performance wireless
network for a facility.

Their Energy Dashboard product provides a complete
integration with the overall information and work
processes of a manufacturing facility.

Their SentientSystem is an integrated suite of modules
specifically designed to address boiler, boiler cleaning,
turbine cycle and unit optimization to provide asset
management to utility companies.

Honeywells Experion PKS transforms process control
beyond traditional DCS functionality by unifying people
with process variables, business requirements and asset
management. Integrated with the Experion PKS, their
Digital Video Manager (DVM) product presents video as
the next generation process sensor to automate the
detection of events and improve the speed and accuracy
of operator response to process upsets.

Honeywell also provides a highly scalable, integrated,
multi-server SCADA solution that incorporates applications
for human machine interface (HMI) to address complex
remote automation requirements. They also provide a
specialty quality control solution, the HC900, for the pulp,
paper and rubber industries.



In the latter regard, Honeywell was selected on May 16,
2012, by Mitsubishi HiTec Paper Europe GmbH, a leading
European specialty paper manufacturer, to replace its
current quality control systems with Experion MX at its
production facility in Bielefeld, Germany.

Power Measurement Limited: The company has been
awarded a $3 million grant from the Government of
Canada to participate in a pilot project at the British
Columbia Institute of Technology. The company installed
Ion Enterprise, an enterprise energy management system
with advanced forecasting, emergency power systems,
functionality allowing load side management and robust
security. Total consumption is forecasted to decrease
energy 10-25%, and illustrate the extent in which business
customers will decrease consumption based on energy
management system usage, as well as the ability of
integration with dynamic pricing models, and is a suitable
option for multi-building facilities, such as universities.
5

JouleX: JouleX offers the JouleX Energy Manager that
offers a scalable solution for businesses. The sensorless
system integrates office equipment including VOIP
phones, copiers, servers, as well as distributed facilities into
a central system. Through cloud computing, the product
offers remote management, real-time feedback, demand
response, and green initiative support. Their primary
customers are large office buildings.
6

C3 Energy: C3 Energy offers its Energy and Emissions
Management Software as a part of a portfolio of services
for business clients. C3 Energy's product monitors,

5
www.nrcan.gc.ca/energy/science/programs-funding/2050
6
www.joulex.net/enterprise-energy-management/
analyze, visualize, and benchmark energy consumption
across operations, including offices, data centers, plants,
equipment, and other assets.
7
The product offers
advanced analytics and modeling features, as well as
offering real-time interaction and facility-wide analysis. C3
has won numerous awards, including Company of the
Year from Going Green Global 200 and Platts Global
Energy Award's Award of Excellence.
8

CA Technologies: CA Technologies offers the CA Enterprise
Energy and Sustainability program to help firms manage
and track their energy consumption to meet company
goals, including sustainability, carbon footprint, resource
management, government compliance, water usage,
and waste generation. One key feature is the CA
ecoDesktop, which reduces the energy consumed by
computers. The product is scalable and able to identify
consumption from the entire firm to the smallest asset,
relying on advanced metrics and analytics to make
predictions. CA Technologies has also won numerous
awards, including being named one of the four leaders in
the Enterprise-Scale Energy Management System field.

Carbon Systems: Carbon Systems has also been named
one of the top four leaders in the Energy Management
System field, deploying their Enterprise Sustainability
Platform in over 45,000 locations worldwide. The web-
based platform analyzes and reports information on
energy, environmental, and carbon consumption as well
as progress on social responsibility goals. In addition, it
provides detailed information on return on investment and
energy cost reduction.

7
www.c3energy.com
8
Ibid.



Verisae: Verisae offers its Energy Information System to
enable upgrades and support firms that are already
involved in energy management and have already
experienced the cost savings that basic, low cost
improvements bring. The second level of improvements
focus on energy supply and demand, and optimization of
energy projects, as it suggests opportunities for
improvement and potential energy savings. The energy
solutions primary components include utility bill processing
and meter data management for energy spend analysis,
energy alerting and review through flagging data
anomalies, energy analytics, executive dashboards for
reporting and performance scoring, and energy validation
for exception management.
9
Their solution is uniquely
suited for the large scale industrial customers that have
implemented previous improvements, thus looking for
upgrades to existing systems within the next 10 years.

Emerging Companies to Watch

Retroficiency: Retroficiency is a start-up firm founded from
MIT. They focus on expanding the capabilities of the
energy management for businesses, including managing
several buildings from one location. The on-site program
allows access to every energy consuming area, and
partners with utilities to not only strengthen business energy
management, but also the Smart Grid as a whole. The
solution is best suited for firms with many locations.
10

eCurv: eCurv is a privately-held start-up company based
in Cambridge, Massachusetts. The company focuses on

9
www.verisae.com/energy-information-systems/Energy-Systems-Overview/
10
energy.aol.com/2012/07/23/building-energy-efficiency-options-in-a-dynamic-
environment/
niche industries, but primarily mobile telecom operators
with cellular shelters. Their patent-pending IP-based system
optimizes peak and non-peak power consumption by
using proprietary algorithms. eCurv reports utility cost
reductions in excess of 11% without the costs or impact of
a major infrastructure overhaul, and savings of over
$2,000/month for each megawatt under their
management. The company has future plans to market to
commercial customers with large footprints and large
fleets of appliances, including hotels, hospitals,
government buildings, universities, institutional buildings,
and eventually, EVs.

OutSmart Power Systems: OutSmart, based in Natick,
Massachusetts, is the latest company launched by
Manifold, a firm that spins off tech start-ups to
commercialize products developed by outside investors
and its own engineers. It consists of a network, including
hardware and software that monitors energy usage,
building occupancy, and other activities in each room of
commercial properties. The network includes nodes
designed for installation in electrical breakers, outlets, and
switches. The nodes are equipped with electronics that
calculate electricity consumption and use existing wires in
a building to feed that information into a controller. The
controllers are linked to servers, where the information can
be accessed and viewed over the Internet. The company
also plans to sell sensors that connect with the existing
electrical infrastructure in buildings to detect motion,
temperature, and other conditions. In addition to owner
occupied commercial properties, their current marketing
and sales efforts focus on the domestic food vertical
markets including grocery stores, cold storage and



distribution facilities, data centers, and pharmaceutical
laboratories.

Powerhouse Dynamics: Powerhouse Dynamics, based in
Newton, Massachusetts, is the developer of the eMonitor,
a hardware solution that provides circuit level monitoring
of all uses and sources of energy while controlling energy
intensive equipment by way of a cloud-based user
interface to provide energy management systems for
small commercial entities such as schools, restaurants,
food and convenience stores, and residential homes. On
August 6, 2012 it was announced that Ingersoll Rand has
made a strategic investment in Power Dynamics. The
integration of Power Dynamics eMontior into Ingersoll
Rands Nexia Home Intelligence that leverages the
advanced technologies of Trane and Schlage will
enhance customers ability to control their energy usage.

VCharge: VCharge, founded in 2009 and headquartered
in Cranston, Rhode Island, provides high-efficiency, low-
cost heating with its SmartBricks Thermal Storage
technology. The SmartBricks system connects electric
thermal storage heaters to local electricity markets,
transforming the thermal storage into a resource for
renewable energy integration. Their mission is to prepare
for 70-80% wind, nuclear, and solar generation through
economic improvements in managing Transactive Loads.
VCharge uses decentralized, market-based principles to
enable residential electric thermal storage heaters, EVs,
and other Transactive Loads to respond dynamically to
grid conditions and demand response. The company is
currently active in the energy and ancillary services
markets in New England, the Mid-Atlantic, with a special
focus on serving retail customers in Pennsylvania.
In May of 2012, Pennsylvanias Public Utilities Commission
approved an application from VCharge to become an
Electric Generator Supplier (EGS) within PPLs service area,
allowing VCharge to provide electricity to up to 250
customers in PPL territory.

Zome Energy Networks (Changing name to ColorPower):
Zome Energy Networks, based in Cambridge,
Massachusetts, provides a software and hardware
platform for utilities and energy suppliers to forecast,
simulate, monitor and ultimately control real-time energy
demand and supply conditions on the distribution network.
Zomes product offerings utilize algorithms which operate
under a framework known as engineered self-
organization computing which uses distributed,
probabilistic, and spatial computing paradigm (Proto-
amorphous) to achieve response times a fraction of
todays Demand Response systems, while simultaneously
reducing Automated Metering Infrastructure (AMI)
network traffic by an order of magnitude. The algorithms
and computing framework together serve as the optimum
energy applications, such as Demand Response, EVs, and
distributed storage and generation integration, layer for
use over constrained smart metering infrastructures

SCIenergy, Inc: SCItrack is a cloud-based energy
management solution that provides real-time actionable
insights into building performance through benchmarking,
automated monitoring and targeting, data visualization,
and reporting. Building operators and owners can
leverage SCItrack to capture energy data across
disparate metering technologies to visualize and
demonstrate building and portfolio performance.
Customers often achieve up to 5% energy savings simply



by gaining clarity into building performance and working
hand-in-hand with a dedicated energy analyst.

GridNavigator: GridNavigator Energy Management
System (EMS) is a highly sophisticated metering and
modularized control system designed to help monitor,
analyze and control facilities to optimize efficiency and
minimize cost. The cloud based platform consists of a
combination of real-time benchmark alerts, dynamic
reports and control capabilities, connecting different
facilities and multi-site energy endpoints for continuous
energy savings opportunities. The typical payback period
for most GridNavigator customers is within 18 to 24 months,
resulting in operational savings of 20% or more annually.

By offering integrated software and hardware solutions,
they allow clients to create smart electricity networks that
can monitor and control anything from heavy-load
machinery to a single light switch. They also offer remote
facility management services, and can monitor
consumption levels at the individual appliance level to
guarantee clients maintain optimal energy performance
and undergo minimal expenditures at all times.

The GridNavigator integration server (GridXchange Server)
is a turn-key solution for real-time read and write from
BACnet data points. This approach eliminates the
unnecessary sub-metering endpoints that are already
monitored by the Building Management System (BMS) and
lowers the overall metering and monitoring cost.

Telkonet: Telkonets EcoSmart offers a product suite
capable of creating an in-room energy management
network that can be configured to meet the requirements
of most building environments. Telkonet can provide and
install any combination of intelligent thermostats,
occupancy sensors, door contacts, and plug load control
devices. All products can be networked to enhance
energy efficiency and provide remote monitoring
capability.
11

Panoramic Power: Panoramic Powers P3E energy
management system provides users with real-time
granular, asset-level energy measurement, anomaly
detection, and failure prediction through customized
alerts.
12
The solution combines miniature, wireless sensor
technology with a powerful cloud-based analytics
platform, offering complete visibility regarding the energy
consumption of individual assets. The solution detects
hidden inefficiencies and waste, and identifies problems
and risks early, before they lead to high energy costs and
unexpected equipment failures.

Panoramic Power has partnered with AtSite, which will use
Panoramic Powers P3E to provide its clients including
the U.S. Green Building Councils headquarters in
Washington, DC with real-time energy usage feedback.

AtSite says it has deployed the EMS at restaurants,
supermarkets and retailer facilities. Its clients include
Adventist HealthCare, which AtSite says is on target to
reduce its expenses by $2.9 million by 2014, while reducing
its carbon footprint by 16 percent, by collecting and
analyzing energy data streams.
13

11
www.telkonet.com/datasheets/EcoSmart-Quicksheet.pdf
12
www.panpwr.com/company.php?nodeID=10
13
www.environmentalleader.com/2012/06/13/panoramic-and-atsite-monitor-us-green-
building-council-buildingiq-and-nv-energy-trial-commercial-hvac-efficiency/



Major Government Initiatives

Fuji Electric Co., Ltd., DENSO Corporation, Toyota Tsusho
Corporation, FamilyMart Co., Ltd., Takamiya Corporation,
and Yamato Transport Co., Ltd. have collaborated to
conduct a demonstration test in Kita Kyushu City, Fukuoka,
Japan. The project focuses on the development of a
Building Energy Management System (BEMS), which will
help realize smart stores that will contribute to leveling
regional electric load, creating a low-carbon society, and
using energy more effectively. The demonstration test was
planned to start in June 2012 and end in December 2014.
In Japan, Kita Kyushu City is designated as an
experimental city for next-generation energy sources and
social systems. The program is being promoted by Japans
Ministry of Economy, Trade and Industry since April 2010.
14

In 2010, it was announced that Power Measurement Ltd., a
subsidiary of Schneider Electric, will receive up to $3 million
through the Government of Canadas Clean Energy Fund,
to demonstrate a Smart Grid electricity system. The energy
management business intelligence platform will determine
the ability of a Smart Grid electricity system to optimize
energy resources, including renewables, in an institutional
building complex at the British Columbia Institute of
Technology (BCIT). The project will also determine the
ability of commercial customers, at sites in Calgary and
Toronto, to voluntarily reduce their demand based on real-
time price signals.
15

In February 2012, under a strategic alliance, Siemens and
Boeing, together with a team of partners, were awarded a

14
DENSO Europe
15
NRCAN
project funded by the U.S. Department of Defense (DOD)
under its Environmental Security Technology Certification
Program (ESTCP). Using Siemens and Boeing's cyber-secure
energy savings technology, the DOD will realize up to 40
percent savings in energy costs at this one installation. The
team, which also includes the University of California at
Berkeley and KEMA Services Inc., will implement intelligent
energy-management solutions that include integrated
controls for cooling and heating systems, lighting,
ventilation and plug loads. The upgrades will help improve
DOD infrastructure energy security and reduce its facility
energy costs. Siemens and Boeing have formed a
strategic alliance for DOD energy modernization. Under
the alliance, the companies will develop and market
"Smart Grid" technologies to improve energy surety and
security for U.S. military installations.
16

In the U.S., President Obama created the Better Building
Initiative, which encourages companies to reduce energy
consumption by 20% by 2020.
17
Also, the U.S. D.O.E. has
encouraged business to participate in the ISO 50001
certification program, internationally established standards
that serve as best practices and aim to benchmark
energy efficiency of commercial facilities. In addition, the
mandatory California's Energy Efficiency and Co-Benefits
Assessment Regulation has encouraged the performance
of an energy audit, as well as the identification of high
energy consumption areas, and includes the possible
installation of energy management systems.
18

16
www.prnewswire.com/news-releases/siemens-and-boeing-strategic-alliance-secures-
dod-contract-140536583.html
17
www.whitehouse.gov/sites/default/files/bbi_factsheet_final_clean_12-1-2011.pdf
18
enhesa.wordpress.com/2011/08/18/from-voluntary-to-mandatory-energy-
management-systems-in-the-united-states/



Major Regional Projects

Governments and businesses are focused on finding and
implementing energy management solutions that can
reduce energy usage and the amount of carbon dioxide
in the atmosphere. Following are some of the projects
have been undertaken in this regard:

North America

In May 2012, nine Japanese companies Shimizu
Corporation, Toshiba Corporation, Sharp Corporation,
Meidensha Corporation, Tokyo Gas Co., Ltd., Mitsubishi
Heavy Industries, Ltd., Fuji Electric Co., Ltd., Furukawa
Electric Co., Ltd. and The Furukawa Battery Co., Ltd.
launched a demonstration study for the Albuquerque
Business District Smart Grid Demonstration Project. This
project was consigned to them by the New Energy and
Industrial Technology Development Organization (NEDO),
to be carried out as part of its Japan-U.S. Collaborative
Smart Grid Demonstration Project. The project will be
completed by March 2014. Shimizu Corporation will focus
on providing a building energy management system
(BEMS). Toshiba Corporation will also work on the design,
establishment, and performance verification of a Smart
Grid energy management system (utility side).
19

In 2010, BuildingIQ, an energy management software
company, announced its first Predictive Energy
Optimization pilot project in the U.S. at the U.S.
Department of Energy's (DOE) Argonne National
Laboratory. The BuildingIQ pilot installation, together with

19
Shimizu Corporation
Argonne's expertise in optimization and modeling, is
expected to improve energy performance at Argonne's
Theory and Computing Sciences (TCS) building as well as
enable the further collaboration and development of
sustainable innovative technologies between BuildingIQ
and leading researchers at the facility.
20

The Menlo Business Park project in the U.S. is focused on
creating both energy savings and reducing greenhouse
gas emissions. Several companies (such as Pacific Gas
and Electric Company, EnerNOC, Global Energy Partners
and Progressive Lighting & Energy Solutions) have
collaborated to make the building energy efficient
through automation and integration of lighting control, the
building management system, data collection capabilities
with HVAC systems and demand response solutions.
21

Menlo Business Park is managed by Tarlton Properties Inc.
of Menlo Park, CA in the U.S.

Asia

As one of the largest cities in Japan, Yokohama aims to
build a smart city model that maximizes CO2 reduction.
On completion of the project, the Yokohama-model
solutions will be exported to cities overseas. A community
energy management system will be installed at the site to
absorb power output fluctuation from renewable energy
sources by integrating stationary battery with the Home
Energy Management System (HEMS) and the Building
Energy Management System (BEMS). BEMS will be used to
ensure optimum energy management at each business

20
www.reuters.com/article/2010/09/21/idUS137012+21-Sep-2010+BW20100921
21
www.businesswire.com/news/home/20120327006509/en/500000-square-foot-
Advanced-Lighting-Control-Installation



building, and CO2 emissions will be reduced through the
efficient use of energy. Buildings will also be grouped
together and optimum energy management will be
conducted for each group of buildings.
22

As a consortium partner of KEPCO (Korea Electronic Power
Corporation), Nuri Telecom will be providing energy
management systems for the Smart Grid test-bed project
in Jeju Island, a self-governing province of South Korea.
The Jeju Island Smart Grid project is a $58 million (64.5
billion KRW) Korean government initiative to build a Smart
Grid community to test and demonstrate the viability of
the Smart Grid.
23

Australia

In August 2010, BuildingIQ, an energy management
software company, successfully completed its Demand
Response (DR) application trial with Western Power, an
Australian utility, and the City of Perth (a local government
area and body, within the Perth metropolitan area, which
is the capital of Western Australia). BuildingIQs DRiQ
application was also installed in Perths historic Council
House building. The system uses Predictive Energy
Optimization for Demand Response events. The trial with
Western Power and the City of Perth was run at the end of
its successful pilot of the BuildingIQ system in Perth Council
House, and reduced peak energy loads by up to 30
percent during event days.
24

22
Yokohama
23
Nuri Telecom
24
www.businesswire.com/news/home/20100831006031/en/BuildingIQ-Completes-
World%E2%80%99s-Optimized-Demand-Response-Trial
In 2011, it was announced that the Queensland
Government is investing $1.5 million to support the
development of a $7.75 million solar photovoltaic project
(1.2 megawatt MW) at the University of Queensland. The
project is considered the largest roof top solar power
panel installation in Australia. The solar project will be built
at the Universitys St Lucia Campus, and will save around
1,750 tonnes of greenhouse gas emissions annually. The
projects will help research into new solar power
breakthroughs, by providing researchers with real life data
on energy management and the impact of solar on the
electricity network.
25

Europe

In October 2011, it was announced that Siemens together
with a number of European companies and universities is
participating in an EcoGrid EU demonstration project.
Within the framework of the EU-sponsored project, a
prototype Smart Grid will be installed and put into
operation on the Danish island of Bornholm in the Baltic
Sea. The project will run until 2015. Siemens will contribute
an intelligent control system for energy loads in domestic
and commercial applications. A solution for smart
utilization of electrical energy will be implemented through
the networking of the decentralized energy management
system (DEMS) and components from the Siemens building
technologies portfolio.
26

European project KnoholEM is a knowledge-based energy
management project for public buildings through holistic
information modeling and 3D visualization. KnoholEM
includes five demonstration projects in Spain and the

25
GBCA
26
Siemens



Netherlands. The objective of the project is to test an
intelligent energy management solution for energy
efficient buildings and spaces of public use. The solution
will considerably reduce energy consumption, both by
systematically avoiding energy wasting in buildings and by
knowledge-based holistic optimization of energy
consumption. It will be applicable and configurable for a
broad range of building types from any EU region.
KnoholEM is co-financed by the European Commission
within the scope of the 7th Framework Programme. The
project began in 2011 and is expected to be completed
by 2014.
27

In May 2012, it was announced that twenty six partners of
the Smart Energy Collective (one of the largest sector-
transcending initiatives in Europe for the concrete
development of Smart Grids and services) have signed a
renewed cooperation agreement for the approval of the
second phase of its Smart Grid initiative, which involves the
development of five large-scale Smart Grid demonstration
projects in the Netherlands. The projects will be
implemented at Schiphol airport, in a few offices of ABB
and Siemens, and in residential districts in Gorinchem,
Heerhugowaard, and Goes. The demonstration projects in
the offices will primarily investigate how the flexibility in the
energy demand of these offices can be exploited by
energy management systems, and the introduction of
commercial generating sets with a complete portfolio of
offices.
28

27
Steinbeis Europe
28
www.prnewswire.co.uk/news-releases/the-smart-energy-collective-initiates-design-of-
five-smart-grid-projects-151091715.html
Schneider Electric has collaborated with Cisco Systems to
provide energy management solutions at the Cisco House
in UK. Through its role at the Cisco House, Schneider
Electric is helping to demonstrate how energy costs can
be reduced by implementing simple solutions and new
business models across the entire energy lifecycle. The fully
integrated building and energy management systems
provided and installed by Schneider Electric allow the
Cisco House teams to make better decisions with regard
to the energy consumption of sub-systems providing for
more sustainable operations and an improved visitor
experience.
29

In December 2011, it was announced that Toshiba
Corporation and Toshiba Solutions Corporation were
selected by Japan's New Energy and Industrial Technology
Development Organization (NEDO) as lead contractors for
a Smart Community demonstration project in central Lyon,
France's second largest city. The project was to start in
January 2012 and run through to the end of March 2016.
The companies will supply Building Energy Management
Systems (BEMS) and Home Energy Management Systems
(HEMS) for the project.
30

29
Energy Management
30
CLN



Keys to Entering the Energy Management Market

1. Vendors must recognize that conventional utilities
make investment decisions that best serve their true
customer PUCs rather than paying customers
who consume their power. Initially, EMS may appeal
more to market-driven utilities who are prepared to
try new solutions that help customers save money
and reduce energy consumption. Conventional
utilities are more likely to deploy EMS for regulatory
compliance purposes and in that regard they will
behave like followers rather than leaders.

2. Over time, the delivery model for EMS will evolve,
and vendors need to develop solutions that reflect
where the market is going. Essentially, EMS will move
towards the cloud, in which case costs come down
but remain flexible enough for customers to
customize around which endpoints they want a
centralized system to control. In terms of
components, this means solutions will be based less
on hardware and costly field equipment, and more
on software and sensors that provide real time
connectivity between endpoints and the
communications network driving EMS.

3. Both utilities and vendors need to understand the
preferences of customers for EMS deployments.
Larger businesses will want to own and manage the
solution. They have the resources to do that, and in
return they maintain full control over setting
preferences to manage energy usage. Smaller
businesses will prefer either a utility-managed or a
vendor-managed solution, which will be less costly
but also less flexible in terms control and
customization. This is also where cloud-based EMS
will find a home, likely managed by a third party
vendor with expertise in providing hosted solutions.

4. Given the regional nature of this market, it will be
important for vendors to understand local initiatives
that drive the need for EMS. The regulatory climate
and public policy priorities will vary by region, with
some initiatives being focused on reducing
consumption and promoting energy independence,
while others will be driven more by environmental
considerations such as global warming, renewable
energy or sustainable growth.



Zprymes Market Outlook, 2012 - 2020

Over the next five to eight years, the advanced energy
management system market will mature to the point
where large customers industrial facilities, commercial
sites, campuses, etc. realize energy consumption
reductions in the range of 10%-20% on a consistent basis.

During this timeframe, we expect that smart meter
deployments will be widely adopted and sensors
affordable enough to enable customers to capture and
sell excess capacity back to utilities to make EMS a more
complete solution. This will also allow them to more
accurately predict peak load times, and from there take
precise actions to scale back power consumption, as well
as tap into renewable and distributed energy sources
when weather conditions are favorable.

As communications networks become upgraded to
support end-to-end smart grid capabilities, we also expect
the role of EMS will expand beyond electricity to integrate
with other utility modes, namely gas and water. This would
create a complete resource management system for
businesses to run in a centralized manner.

By 2020 we anticipate that EMS solutions will largely be
cloud-based, setting the stage for mass-market adoption
that is both affordable but also flexible enough for
businesses to easily customize for their specific energy
needs. This model will likely be essential to support the
millions of small businesses that simply do not consume
enough energy to warrant investing in their own systems.
For this end of the market, the potential savings are
incremental, but collectively this represents a substantial
opportunity for utilities to reduce their overall demand
load.

By this time, the Asia EMS opportunity will be on par with
both the U.S. and Europe. This opens up new markets for
Western vendors to serve, but it also means that Asian EMS
vendors will likely become global players. We see this
coming about as they gain valuable deployment
experience with the underlying technologies as well as
gaining economies of scale by serving customers in their
fast-growing home markets.



About Zpryme Smart Grid Insights:
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Zpryme Smart Grid Insights Contact:

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www.smartgridresearch.org (Zpryme Smart Grid Insights)
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