Software companies in the building efficiency space are popping up everywhere.
A recent Groom Energy taxonomy identified more than 200 software vendors providing energy management solutions for buildings. That number is likely to grow further before it eventually starts shrinking as startups fail to get traction in a crowded landscape and thus drop out of the market or get acquired by mature energy management companies with more experience.
In many cases, dashboards and energy management software platforms are being developed by IT professionals who may not have a clear understanding of how people manage buildings or their businesses. As a result, they may be selling a solution in search of a problem. Or, if they have an interesting product, they may not be pitching it to the right person at a company.
"Do not be enamored with glossy dashboards and analytics in vendor demos. All vendors now have these. Focus instead on data acquisition, usability, and vendor expertise," concluded Groom's Paul Baier in his vendor landscape report.
Of course, having experience in buildings, industry or energy management doesn't necessarily translate into a useable product. But it's crucial for breaking through the noise at a time when customers are having a hard time picking through the vast number of software "solutions" they're being pitched.
GTM recently looked at two software packages from companies taking uniquely targeted approaches to energy management. We not making an editorial judgement on how these products compare with other software out there -- we are simply using them as examples of how firms are targeting customers in different ways.
Lightapp: Using supply-chain management techniques for industrial efficiency
Lightapp is an Israeli company founded in 2009, before the recent surge in efficiency software began. It tracks electricity, fuel and water use exclusively in industrial facilities where real goods are manufactured. The company's co-founders are former employees of Oracle, where they focused on supply chain management.
Lightapp has 40 customers, including Coca-Cola and other plastics suppliers, for which it claims to be offering 6 percent to 15 percent energy savings.
"We focus on bringing in methodologies from supply chain management to industry," said Elhay Farkash, CEO of Lightapp. "The software organizes data on energy use so we can see how it is divided up between production lines to show the customer how to more effectively utilize their facility."
Rather than just focus simply on the energy use of equipment, Farkash said Lightapp is able to monitor how materials input, maintenance routines and other factors impact production efficiency. Understanding those factors -- and creating actionable plans to address poor performance -- translates into energy efficiency.
Take the energy comparison of a customer site shown in the screenshot of the Lightapp software below. It shows a 35 percent difference in energy use among different production lines. This information allows the customer to use more efficient lines while figuring out a way to improve the energy-consuming line.
By crunching data from electric meters, production rates and an enterprise resource planning database that tracks company resources, Lightapp was able to show that the worst production line wasn't using more energy; it was simply producing fewer goods per kilowatt-hour of electricity consumed. By finding the most efficient production line and adjusting the equipment to match its throughput, the customer was able to save over $140,000 annually.
In the case of another customer, Lightapp compared equipment performance on production lines with seasonal electricity rates and found that by changing routine maintenance shifts to winter months, the customer could save thousands of dollars per shift. The customer ended up saving $3,000 per line during maintenance periods.
Rather than start at the top of a company to sell its solution, Lightapp targets plant managers, shift managers and engineers: "Our work is bottom-up, not top-down. There can be multiple users on the production floor using their own benchmarks," said Farkash.
It takes eight to sixteen weeks to implement the product, a fast turnaround in the manufacturing sector: "We were very surprised that the customers picked up so quickly on the solution," said Farkash. So far, no customers have left the company after purchasing the software.
Lightapp has deeply experienced competitors in the field, including Siemens and Schneider Electric. But Farkash said he doesn't think of the company as a startup, nor does he want to merge with a bigger company: "Our goal is to keep growing and not to be acquired."
BuiltSpace: Making operational efficiency as important as energy efficiency
BuiltSpace is a Vancouver-based startup with a dozen employees that has only been around for a year. In the '90s, founder Rick Rolston worked at Ingenium Technologies, a partner of McGraw-Hill, where he helped develop a very early software-as-a-service offering that helped architects and construction firms collaborate on projects.
Rolston said his new company's software takes a "collaborative approach to facilities management" in order to improve operational efficiency. Much like Lightapp does in the industrial sector, the BuiltSpace software looks at building energy use in a more holistic context.
"People-controlled decisions are crucial. When you take a look at buildings holistically, you soon realize that energy is just one piece of running a building," said Rolston. "Energy efficiency is about business processes."
BuiltSpace uses building information modeling to track equipment suppliers, building service histories, equipment performance history, energy consumption, space use and everything else that once required a paper trail to manage within a building.
The company has a dozen projects so far. It is currently working with Johnson Controls to integrate its offering into the Panoptix platform, and is also working with Pacific Gas & Electric to build a Green Button application for commercial buildings.
"With four questions, we can navigate to the energy use of any piece of equipment in any building," said Ralston.
BuiltSpace offers a Quick Response Code system that a facilities manager can use to instantly track the performance history of any piece of equipment, from an HVAC unit to an elevator.
"We start with a simple model of a building and build out relationships with tenants, suppliers and equipment. When you scan the QR code, you can use it to figure out what room you’re in, what the problem is and if there's a history of problems," said Rolston.
The QR system costs customers two cents per square foot annually. BuiltSpace also offers it for individual assets within a building for a dollar per year. With only a short history of deployment, Rolston didn't readily have customer case studies available about its effectiveness.
A recent study of 60 million square feet of buildings performed by FirstFuel found that more than half of efficiency opportunities can be realized through operational changes, which suggests that the potential for energy savings through this approach could be significant.
BuiltSpace pitches the product to people working in facilities management and operation. The company is up against some major incumbents in building information modeling -- Archibus, IBM and FM Systems being some of the biggest.
"Everyone has a system of some sort, and it's difficult to get them to change. When you put a million dollars into software, you don't want to just throw it out," said Rolston. "So we tell them not to throw it out, and use our software for better collaboration on the front end."
Rolston argued that many of these facilities management solutions came out of paper-based systems, which can make them clunky and "task-centric." And rather than give service contractors access to the information, much of the recordkeeping can be based on "after-the-fact recording" of spreadsheets and PDFs. "It could be anything," said Rolston.
As a brand-new entrant into the space, BuiltSpace still has a long way to go before it proves itself. But Rolston has found a unique way to talking about energy efficiency within an operational efficiency context.
"I have a better service record for my car than most buildings do," said Rolston. "If we can address the bigger piece of operational and occupancy costs, the potential energy savings are much higher."