Building Automation and Controls Market

The global Building Automation and Controls Market is valued at USD 98.2 Billion in 2023 and is projected to reach a value of USD 254.2 Billion by 2032 at a CAGR (Compound Annual Growth Rate) of 11.2% between 2024 and 2032.

Key highlights of Building Automation and Controls Market

• Europe accounted to express largest revenue share of 34.02% in Building Automation and Controls Market in 2023
• Asia Pacific is predicted to obtain fastest Building Automation and Controls Market growth during the forecast period
• In 2023, the Heating, Ventilation and Air Conditioning Control Solution segment dominated the Building Automation and Controls market with revenue share of 32.1%
• The wireless technology segment asserted to mention largest revenue share of 61.2% in 2023
• The Commercial segment is accounted to have a largest revenue share of 49.2% in 2023
• As highlighted by the International Energy Agency (IEA), in areas where traditional biomass is heavily relied upon, buildings' energy consumption can make up an astounding 80% of the total regional energy usage. The increasing prevalence of electrical systems within buildings is compounding energy consumption and carbon emissions. Thus, prioritizing the efficient and sustainable use of energy resources becomes essential.

Building Automation and Controls Market: Regional Overview

Europe dominated the Building Automation and Controls Market with a revenue share of 34.02% in 2023. The increasing awareness and adoption of Internet of Things (IoT) technologies drive growth in the Building Automation and Controls Market. Different European countries have different smart building innovation priorities, for instance, Germany focusing on smart building solutions, the United Kingdom on sustainable practices, France on smart technology integration, and Nordic countries on smart and connected homes. This priority diversity shows the region's commitment to enhancing building management and sustainability practices. As per the Federal Criminal Police Office of Germany, there were more than 1,483,000 reported thefts in 2023, highlighting the significant untapped market potential for security systems in the region. The escalating security concerns are prompting companies to introduce new security products for buildings through both product innovations and acquisitions. For instance, in October 2022, ASSA ABLOY acquired Bird Home Automation GmbH, a German manufacturer specializing in high-quality IP door intercoms for single and multi-family buildings. This acquisition is poised to expedite the company's expansion in the residential segment.

Europe experiences remarkable surge in demand for smart door locks among residential consumers. Established industry leaders leverage this demand by providing sophisticated smart door locks equipped with numerous supplementary features. For instance, in September 2022, Ring unveiled a novel wireless intercom device tailored for apartment residents. This intercom is engineered to integrate seamlessly with the majority of building-wide intercom systems utilized in apartment complexes for visitor screening and access authorization. It promotes automatic verification for Amazon deliveries and authorized guests by enabling them to gain entry without requiring a door code or an additional fob.

U.S. Building Automation and Controls Market Overview

The US Building Automation and Controls market, valued at USD 31.4 Billion in 2023 to USD 70.2 Billion in 2032, is anticipated to grow at a CAGR of 9.4% from 2024 to 2032. The U.S. focuses on smart building solutions by integrating smart technologies for enhanced building management and sustainability practices. For instance, The U.S. Department of Energy's (DOE) Federal Energy Management Program (FEMP) is launching a Federal Smart Buildings Accelerator to design and implement specific approaches to increase the adoption of smart building and grid-responsive technologies that manage electric loads in facilities. This focus drives the requirement for advanced building automation and control systems, thus, contributing to the market's growth. The increase in infrastructure building in the U.S. is another significant driver for developing the Building Automation and Controls Market. The rise in infrastructure building drives the market for integrating building automation and control systems, essential for efficient and optimized building operations. For instance, the U.S. DOE (Department of Energy) invested million in 10 pilot projects that deploy new technology to transform thousands of homes and workplaces into state-of-the-art, energy-efficient buildings in 2021.

The global Building Automation and Controls market can be categorized as Offerings, Technology, Industry Vertical, and Region.

Building Automation and Controls Market: Offering Overview

In 2023, Heating, Ventilation and Air Conditioning Control generated a significant revenue share of 32.1%. The Offerings segment is divided into Solution and Services. The HVAC systems are crucial for different types of buildings and are expected to contribute significantly to the Building Automation and Controls Market's growth in the coming years. The transformative shift towards Smart HVAC management systems provide comprehensive management and optimization of cooling, heating, and ventilation systems in buildings. These advanced systems offer real-time insights into individual system performance, including chiller plant efficiency, pump performance, energy consumption, and cooling load demand forecasts with the help of ML technologies. Smart HVAC management systems drive energy efficiency, cost savings, and occupant comfort by enabling proactive monitoring, analysis, and optimization of HVAC operations. As a result, it is propelling the growth of the HVAC segment in the broader Building Automation and Controls Market.

Building Automation and Controls Market: Technology Overview

The wireless technology segment held a significant market share of 61.2% in 2023. The Technology segment covers Wired and Wireless. Wireless technology offers various advantages driving its growth in the Building Automation and Controls market. These advantages include enhanced mobility, cost savings, simplified installation (especially in existing buildings), reliable network connectivity through security algorithms, scalability, link reliability, real-time capabilities, and energy independence when used with energy-harvesting devices. These features make wireless technology a preferred option for building automation systems, contributing to its growth. Countries like India and China are increasingly investing in smart city initiatives, where building automation systems plays a crucial role in achieving energy-saving goals. According to USCC.gov, China's government has invested over 9.9 billion in smart city pilot projects, equivalent to more than RMB 1 trillion in 2022. The integration of wireless technology in building automation systems is fueling the demand for wireless solutions in the market.

Building Automation and Controls Market: Industry Vertical Overview

The Commercial segment held a significant market share of 49.2% in 2023. The Industry Vertical segment is classified into Residential, Industrial, and Commercial. Building Energy Management Systems(BEMS) are becoming increasingly important for commercial building operators to oversee energy consumption. These systems not only alert building operators about deviations in energy consumption but also furnish actionable insights for energy conservation. Companies like Schneider Electric, Siemens AG, and International Business Machines Corporation are among those offering building energy management software, contributing to the market's growth. For instance, At Light + Building 2024, Siemens Smart Infrastructure will spotlight the innovative products, software, and services and the collaborations needed to drive true sustainability impact for customers and societies.

Key Trends

• The integration of Internet of Things (IoT) technology with cloud computing is transformative shift in the growth of the Building Automation and Controls Market. It utilizes IoT enabled services in order to access real-time data analytics, remote monitoring, and predictive maintenance capabilities.
• Growing environmental issues asserted the requirement for energy efficiency and sustainability solution in building automation systems. Thus, various companies are developing technologies to optimize energy usage, reduce carbon emissions, and meet green building standards.
• Integration of AI and ML technologies into building automation help in augmenting predictive analytics, fault detection, and autonomous operation. For example, Johnson Controls offers AI-driven algorithms analyze data patterns, identify anomalies, and optimize real-time building performance to improve energy efficiency, and cost savings.
• Due to the increasing connectivity of building automation systems, cybersecurity has become a top priority. For example, ABB offers cybersecurity solutions for building automation, including firewalls, encryption, and intrusion detection systems to safeguard against cyber-attacks and unauthorized access to building systems.

Premium Insights

The high energy consumption and carbon emissions associated with buildings are accelerated the requirement for advancement in Building Automation and Controls (BAC) systems. Buildings currently use 40% of the country's energy and 75% of its electricity, while contributing 35% of annual carbon emissions, according to the U.S. Department of Energy. This means that energy-efficient and sustainable building solutions are essential, rather than optional, as clients, tenants, and occupiers now demand green building practices. Developers are now expected to integrate active emission mitigation technology into their projects from the beginning. A recent study by the DOE predicts that by 2030, grid-interactive buildings could save up to billion annually in power system costs and reduce 80 million tons of carbon emissions each year. This is equivalent to greater emission reductions than the combined annual emissions of 50 medium-sized coal plants or 17 million cars.

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Market Dynamics

Development of Smart Cities in Emerging Countries Drives the Building Automation and Controls Market

Growing demand for smart homes and buildings is one of the reasons in the development of the Building Automation and Controls Market. For instance, Barcelona Smart City 2020 strategy focused on sustainability, innovation, and citizen engagement. The city has deployed advanced technologies such as smart sensors and data analytics platforms to monitor various aspects of urban life in real-time, from air quality to traffic patterns. Additionally, the Smart City Mission is making significant strides in India, with 57 out of 400 projects nearing completion and Madurai leading by accomplishing 100% of its projects by December 2023. This remarkable development highlights the potential of smart cities and the effectiveness of building automation solutions. With the government support, these projects utilize electronic methods and sensors to collect data for improving essential services such as garbage collection, utility supply, traffic management, environmental monitoring, and social services.

Integration of Internet of Things (IoT) technology in Building Systems Drives the Building Automation and Controls Market

Integration of Internet of Things (IoT) technology into building automation systems is a revolutionized trend in the growth of the Building Automation and Controls Market. These technology offers improved monitoring and control capabilities over essential systems such as lighting, HVAC, security, and energy management. It also helps in collecting real-time data and giving valuable insights. IoT applications in BACS include smart lighting systems, energy-efficient HVAC control, and predictive maintenance for building equipment. This integration is expected to drive significant advancements in the BACS market. Honeywell's recent launch of Advance Control for Buildings in January 2024 is a prime example. This innovation represents a groundbreaking platform and signifies one of Honeywell's most significant strides in building controls. It integrates cutting-edge technologies with decades of innovation and domain expertise, positioning it as a pivotal advancement in shaping the future of Building Automation and Controls.

Competitive Landscape

Within the Building Automation and Controls Market, innovators like Fr. Sauter AG and Daikin Applied are at the forefront, showcasing their latest product releases. Fr. Sauter AG's introduction of the next generation of IoT-capable actuators in July 2022 has set new standards for building automation. These smart actuators enable heating, ventilation, and air conditioning systems to operate autonomously or partially autonomously, streamlining control processes. On the other hand, Daikin Applied's launch of Site Line Building Controls in January 2022 highlights their commitment to delivering scalable, cloud-based solutions for building management.

The key players in the global Building Automation and Controls market include - ABB, Beijer Electronics, Control4 Corporation, General Electric Company, Honeywell International Inc., Hubbell Incorporated, Johnson Controls International, Legrand SA, Lutron Electronics Co. Inc, Schneider Electric SE, Siemens AG among others.

Recent Market Developments

• In January 2024, Honeywell introduced Advance Control for Buildings, a revolutionary platform representing a significant advancement in the company's building controls innovation journey. Engineered to automate building management and lay the groundwork for enhancing a building's energy efficiency, Advance Control seamlessly integrates cutting-edge technologies with decades of innovation and domain expertise.
• In January 2024, Legrand® has disclosed its acquisition of ZPE Systems, Inc., a provider of essential solutions and services aimed at ensuring resilience and security for customers' critical business infrastructure. This encompasses serial console servers, sensors, and service routers facilitating remote access and management of network IT equipment from data centers to the edge.
• In October 2023, Hubbell Incorporated has revealed its definitive agreement to purchase Northern Star Holdings, Inc. for $1.1 billion in cash. Systems Control, renowned for its production of substation control and relay panels, as well as comprehensive substation control building solutions, will be acquired through this transaction.
• In January 2023, ABB introduced its ABB Cylon Smart Building Management Systems (BMS) tailored for the Middle East market during the Light Middle East and Intelligent Building Middle East 2023 event. The ABB Cylon Smart Building Management Systems range encompasses scalable automation and energy control solutions suitable for a diverse array of commercial or industrial buildings, irrespective of their size.