International. The building automation systems market is projected to reach $148.6 billion by 2027 from $86.8 billion in 2022; the sector is expected to grow at a CAGR of 11.4% between 2022 and 2027.
The growth of the building automation systems market is driven by the growing need for energy-efficient facilities with improved security systems. In addition to this, advances in wireless communication technologies have reduced the complexity and cost of installing building automation systems in existing buildings. The combination of IoT and building automation has also enabled the exchange of information between various electronic devices and the cloud without the need for direct human intervention that makes buildings smart. This factor has also accelerated the growth of the building automation systems market.
However, key constraints faced by companies operating in this market include the false notion about the high installation costs of building automation systems and the technical difficulties in their implementation. Growing global concern for energy conservation and rising energy costs are fueling the demand for building automation systems to make buildings energy efficient. This is one of the key factors driving the growth of the market. The growing demand for building automation systems for use in commercial applications can be attributed to the ability of these systems to reduce the operating costs of buildings. The easy maintenance of temperature and lighting levels, coupled with the improved safety levels offered by building automation systems, also drive the growth of the market.
Driver: Increased focus on the development of energy-efficient and green buildings
The building sector is one of the largest consumers of energy and typically accounts for more than a third of total energy consumption worldwide. It is an equally important source of carbon dioxide (CO2) emissions. According to the International Energy Agency (IEA), energy use in buildings accounts for up to 80% of total energy use in specific regions that rely heavily on traditional biomass. The number of electrical systems used in buildings is increasing, which increases energy consumption as well as CO2 emissions. Therefore, the sustainable and efficient use of energy is crucial.
The demand for building automation systems is increasing with the increasing focus on reducing energy consumption and maintenance costs of buildings. Building automation systems play an important role in optimizing energy use and reducing energy costs. Lighting and climate control systems consume maximum energy.
According to the IEA, air heating and cooling, together with water heating, currently account for ~60% of global energy consumption in buildings. Therefore, they represent a great opportunity to reduce your energy consumption. Building automation systems also help automate lighting and HVAC systems, saving between 5 and 30% of total energy consumption. In addition, they help reduce the overall cost of building maintenance by providing operators with an early diagnosis of operational problems in the equipment, if any. This helps prevent losses and inconvenience due to unexpected breakdowns.
Restriction: False notion about the high installation costs of building automation systems
End users and building owners are still reluctant to these systems due to their false perception that the installation costs of these systems are high. They are not aware of the fact that the cost depends mainly on the complexity of the integration related to a specific application. End users demand affordable building automation systems, but they don't realize the extent of energy savings and the associated benefits of long-term cost savings.
On average, lighting accounts for about 25% of a building's energy use. With lighting control systems, the cost of lighting can be reduced by 30-60% while improving lighting quality and reducing environmental impact. In addition to this, the initial investment in building control and automation systems can be easily recovered in a few years, as it helps reduce energy costs, maintenance costs, and repair and replacement costs. The perception of the high cost of building automation systems and lack of knowledge about their benefits in terms of long-term cost savings may hinder the adoption and growth of the building automation systems market globally.
Source: Markets and Markets.