Internet of Things

How to use IoT to save money on your office bills

Companies can explore different options for smart lighting, HVAC, and security systems to cut down on operating costs.

The Internet of Things (IoT) has spread to office buildings around the world: 35% of companies said they are currently gathering or have plans to gather data on their building about lighting, HVAC, and system controls, according to 451 Research.

The no. 1 priority for building-level IoT is optimizing operations (76%), including through preventative maintenance and reducing downtime, 451 Research found. The second priority is reducing risk (61%), through compliance or security, perhaps with security badges, video cameras, and field analytics.

The top IoT project in professional buildings is lighting, according to Christian Renaud, research director of the IoT practice at 451 Research. Companies looking to move to LED lights often come across smart lighting options, such as lights that turn on with motion detection, or those that interact with an employee's phone so that when they enter their office, a certain light setting comes on, Renaud said.

SEE: The Power of IoT and Big Data (Tech Pro Research)

HVAC, building management systems, and security access control IoT projects are also common in offices. Security might include location tracking for safety, or offering company network access that differs depending on where you log in from, Renaud said.

Other projects depend largely on industry; for example, many grocery store chains have added IoT sensors to refrigerators, which are costly to keep running.

Oxford Properties Group installed smart meters in its office management platform at its commercial 480,000-square-foot property in Washington, DC, and discovered a small error that had compounded into a larger problem over time, according to property manager Rachel Sinaiko. Three cooling tower meters were being measured in gallons, but employees were reading them in cubic feet, distorting their costs. By fixing the verification system that's carried out on the back end, they immediately identified a $30,000 savings.

Despite the potential for cost savings, "we're in the very early stages of smart buildings," said Mark Hung, research vice president at Gartner. "Companies are still exploring the right technology to employ, but also the right business model."

Again, consider smart lighting, Hung said. From a business model perspective, there are several ways to approach it: A company can invest in revamping their lighting infrastructure and recoup the costs in energy savings over a number of years. Or, some vendors offer a pay-as-you-go model, wherein the vendor pays at least part of the cost of deploying the smart lighting solution, and then gets a portion of the savings your company sees from that solution.

"People generally are not optimizing their energy expenditures," Hung said. "There's probably always ways to save, whether on lighting or heating or cooling—it's just a matter of how much the reductions would be compared to the initial outlay. That's the kind of spreadsheet work that organizations need to do to figure out the payoff."

SEE: Green tech initiatives: Best practices and breakthroughs (free PDF) (TechRepublic)

IoT for productivity

Office IoT initiatives break down into two categories, according to Michele Pelino, a principal analyst at Forrester: Building management (which includes HVAC and electricity), and office management (which includes conference room booking and temperature management).

"When you think about the office context in IoT, some projects are more related to the billing and the infrastructure itself, and being more efficient and using those resources more effectively within the building," Pelino said. "Then there are applications that are locations kinds of services, and productivity-enhancing applications that will help employees be more efficient in their day-to-day jobs."

The starting point for most office environment IoT enabled capabilities comes from the building structure, Pelino said. "There's a benefit that can be tangibly identified, 'If I save X amount of energy, that's going to account for X dollars,'" Pelino said. "But over time, proactive companies are thinking about their building environments more strategically."

SEE: What is the IoT? Everything you need to know about the Internet of Things right now (ZDNet)

Some companies—especially those with multiple locations—are turning to IoT to differentiate the employee experience from their competitors, Pelino said.

For example, Deloitte's Amsterdam location is called the Edge Building, which is an IoT enabled space that allows employees to control lighting and temperature, among other things. "That has been a differentiator for in this case Deloitte, who say they're getting more people that want to work there," Pelino said. "They're using it as a differentiation for employees existing, but also for recruiting purposes to say this is a different, unique experience if you come here."

Most companies start with resource efficiency IoT projects, such as lighting and HVAC, Pelino said.

"Once the traditional thought process around cost efficiencies is used, the more proactive way of thinking about the value proposition of the building does come into play, and we're getting more questions in that area," Pelino said. "Once you have that kind of infrastructure in place—like if you have smart lighting in your office building—you can add more sensors into that lighting infrastructure to then monitor things like location, and where are people walking."

Tips for IT admins

Companies who may be interested in adding in IoT to save on costs should examine their current bills in terms of lighting and HVAC, and research what new systems cost and what efficiencies they bring.

"It's all about the ROI curve," Renaud said. "Some people want to do this because of the novelty, but when you talk to people who run these buildings or large commercial companies, they're looking at how they can get costs out of the bottom line. Ultimately that's what this does, because it gives them insight into the data of how their buildings are consuming energy and how that breaks down, and allows them to implement policies across buildings."

SEE: Internet of Things policy (Tech Pro Research)

Companies building a new office from the ground up have a larger chance to incorporate IoT enabled smart capabilities, Pelino said. Incorporating these solutions into older buildings can be more complicated and costly.

Those interested in adding IoT capabilities to their building or office should first think through their current office environment and industry, in terms of how your building is used by employees and visitors, Pelino said.

"Make sure you have the right folks in the conversation early on," Pelino said. "It's not just about the facilities team. You have to have the technology team to help figure out how you're going to implement these new kind of connected environments within the building, and understand back end systems. You may need to have someone from the HR team, or somebody that's looking at the strategic value as we talk about this building environment to our potential employees as a differentiation factor."

Also see

istock-813765660.jpg
Image: iStockphoto/zhudifeng

About Alison DeNisco Rayome

Alison DeNisco Rayome is a Senior Editor for TechRepublic. She covers CXO, cybersecurity, and the convergence of tech and the workplace.

Editor's Picks

Free Newsletters, In your Inbox