1 00:00:00,000 --> 00:00:10,580 Hi, everyone. Welcome to GreenMonk TV. My guest on the show today is Rich Lechner from 2 00:00:10,580 --> 00:00:15,900 IBM. Rich is VP of Energy and Environment for IBM. Rich, welcome back to the show. 3 00:00:17,840 --> 00:00:19,620 Thanks very much. Glad to be here again. 4 00:00:21,460 --> 00:00:27,060 Second of the monthly installments, Rich. And we wanted to talk today about smart buildings. 5 00:00:27,060 --> 00:00:30,760 I mean, you've done a lot of stuff around the smart planet on a kind of a macro scale, 6 00:00:30,860 --> 00:00:35,840 but you're also working on a more micro scale, helping customers build out smart buildings. 7 00:00:37,280 --> 00:00:41,720 Right. You know, the whole notion behind the smart planet is this idea that things are becoming 8 00:00:41,720 --> 00:00:46,880 more intelligent, more instrumented, more connected. And it's about making systems, 9 00:00:46,980 --> 00:00:52,220 the world's systems, more intelligent, work more efficiently and effectively. So if you think 10 00:00:52,220 --> 00:00:57,940 about a building, it is a complex system of systems. You have the water infrastructure, 11 00:00:58,640 --> 00:01:04,980 the IT infrastructure, the electrical infrastructure, the security systems, the waste management system. 12 00:01:05,100 --> 00:01:12,300 So a building itself is a microcosm of a smart city or a smart planet. And it's fraught with 13 00:01:12,300 --> 00:01:16,400 the potential to make it more efficient and more intelligent. 14 00:01:17,400 --> 00:01:23,080 But buildings to date have been enormously inefficient, haven't they? And they're massive consumers of 15 00:01:23,080 --> 00:01:27,060 energy and electricity and massive producers of CO2. 16 00:01:27,940 --> 00:01:32,900 That's absolutely right. You know, by it's been estimated by 2025, buildings will be the single 17 00:01:32,900 --> 00:01:38,560 in aggregate, will be the single largest consumer of power on the planet. And in the US today, 18 00:01:39,120 --> 00:01:46,120 about 40% of the power is consumed by buildings. They're also in aggregate, the largest emitter of 19 00:01:46,120 --> 00:01:53,100 greenhouse gases. So, you know, there's huge, there are huge power sinks. They're, they're very 20 00:01:53,100 --> 00:01:59,400 inefficient, both in their use of power, you know, from an energy and a thermal perspective, but also 21 00:01:59,400 --> 00:02:04,740 from the, from the utilization of the assets. So there's a, there's a similarity here to the 22 00:02:04,740 --> 00:02:09,780 discussions we've had before around IT, where, you know, data centers are big power sinks, and they're, 23 00:02:10,120 --> 00:02:13,840 they're full of equipment that is lightly utilized. Well, you think about a building, 24 00:02:14,420 --> 00:02:21,380 the utilization rate of a building is, is pretty phenomenally low. On average, workspaces are, 25 00:02:21,740 --> 00:02:29,920 you know, only filled about 23% of the time. So you think about that, you know, the average 26 00:02:29,920 --> 00:02:38,020 occupancy of a building, only 23%. So there's plenty of room to, to improve how the, not only how the 27 00:02:38,020 --> 00:02:46,920 asset works, but how it's, how it is utilized in, in filled. Okay. So is, is, is smarter buildings 28 00:02:46,920 --> 00:02:52,460 looking at, for instance, rates of occupancy and deciding when to turn lights on and off based on 29 00:02:52,460 --> 00:02:58,520 when people are at desks, or does it go well beyond that? Well, absolutely is, you know, it's more than 30 00:02:58,520 --> 00:03:05,080 just motion sensors, right? So that things like motion sensors in offices is a great idea. But 31 00:03:05,080 --> 00:03:11,720 it's also about, you know, sort of intelligent occupancy. So as, as you have more flexible design, 32 00:03:11,820 --> 00:03:16,840 so as, as workers come in, they're not sent to their specific queue, but they're actually, 33 00:03:16,960 --> 00:03:22,660 you fill up the building in a logical fashion so that at 7am in the morning, you don't have these 34 00:03:22,660 --> 00:03:27,620 buildings where you have a, a, a, a one person in one corner on one floor and a different person on a 35 00:03:27,620 --> 00:03:31,760 different floor and a different corner. And that's all that's there, but the lights are blazing 36 00:03:31,760 --> 00:03:37,520 across all of it. So it's about, you know, more intelligent occupancy. It's about, um, harnessing 37 00:03:37,520 --> 00:03:42,180 the environment more effectively. So, you know, it's not uncommon today to have irrigation systems, 38 00:03:42,320 --> 00:03:47,340 you know, sputtering away in the middle of a rainstorm, right? So, because, because the 39 00:03:47,340 --> 00:03:52,820 irrigation system is not tied to the environmental conditions. Uh, it's not uncommon to have, um, 40 00:03:52,820 --> 00:03:58,480 you know, air conditioners blowing when, uh, when, when it's colder outside than it is inside, 41 00:03:58,480 --> 00:04:03,240 but the, but the windows don't open. So, uh, it's about harnessing the environment, not just 42 00:04:03,240 --> 00:04:10,080 coexisting, but, but harnessing the environment. Um, what are the, what are the drivers for, uh, 43 00:04:10,080 --> 00:04:16,440 people to roll out smart building, uh, programs now? Well, first of all, there are, um, of course, 44 00:04:16,480 --> 00:04:21,360 the energy cost savings is, is a, is a primary driver. There's also lots of evidence that says 45 00:04:21,360 --> 00:04:27,740 that you can improve occupancy rates. We, we work with a, um, with a hotel, the St. Regis in China, 46 00:04:27,740 --> 00:04:34,440 and, um, not only, and I, and I want to just check the, to get the fact here. So I have it right. Um, 47 00:04:35,000 --> 00:04:41,680 the energy cost, the revenue is below 5%. Now that compares to an industry average of greater than 48 00:04:41,680 --> 00:04:49,120 8% for other five-star hotels. So they've improved their energy costs, but they've also relative to 49 00:04:49,120 --> 00:04:54,360 the revenue and the occupancy have, have had a significant effect. There's also evidence that, 50 00:04:54,360 --> 00:05:01,000 uh, from other surveys that show that 10, that tendency rises in smart buildings or more intelligently 51 00:05:01,000 --> 00:05:07,600 designed buildings or green buildings, uh, and that you have higher occupancy rates, um, and happier 52 00:05:07,600 --> 00:05:14,080 tenants as a, as a result. So less of the sick building syndrome that we've heard a lot about over 53 00:05:14,080 --> 00:05:18,860 the last couple of decades. Right. In fact, one of the customers we've had the chance to work with 54 00:05:18,860 --> 00:05:24,000 is a company called green spaces in India and in new Delhi. And they're, uh, they haven't 55 00:05:24,000 --> 00:05:28,400 an existing office park, but they're building and they start construction this year on a new 56 00:05:28,400 --> 00:05:34,240 office park. What they believe will be the greenest building and office complex in the world is so 57 00:05:34,240 --> 00:05:40,560 be a super platinum leads rated building, but not only that, it'll have, um, support for electronic 58 00:05:40,560 --> 00:05:46,960 plug-in electric electric vehicles in its, in its, uh, parking lot. It'll have, um, uh, complete 59 00:05:46,960 --> 00:05:55,680 100% recycling of all gray water, uh, zero waste emission, and it will, um, they are growing their 60 00:05:55,680 --> 00:06:01,280 own air. So they will, uh, um, and they have demonstrated in their existing office park that, 61 00:06:01,280 --> 00:06:07,040 you know, spending five hours in one of their buildings will increase your blood, blood oxygen 62 00:06:07,040 --> 00:06:13,760 level by 1%. And they actually go around and sample the oxygen levels of, uh, with a little finger device, 63 00:06:13,760 --> 00:06:20,080 uh, of, uh, of the, uh, you know, volunteer tenants. So, uh, and, and they have evidence again, 64 00:06:20,080 --> 00:06:26,880 that it really improves the, uh, the mood and the, and the health of the tenants. It is relatively, 65 00:06:26,880 --> 00:06:33,200 um, inexpensive to do so. And, and, um, it's about a five to one ratio in terms of number of plants 66 00:06:33,200 --> 00:06:34,560 required per occupant. 67 00:06:36,160 --> 00:06:42,720 Wow. I, I saw a, a TED video on that recently about, uh, a certain triad of plants that were, 68 00:06:42,720 --> 00:06:47,200 uh, uh, that, that could increase your blood oxygen level by something like five percent. 69 00:06:47,840 --> 00:06:52,880 That's exactly right. And there's certain plans for, uh, for, uh, taking, um, you know, 70 00:06:53,440 --> 00:06:58,000 negative contaminants out of the air, others for oxygen in the air, et cetera. And it was that 71 00:06:58,000 --> 00:07:03,680 gentleman who was at the TED conference, who is, uh, the, the person responsible for the green 72 00:07:03,680 --> 00:07:07,440 spaces project. And IBM is the technology partner for that project. 73 00:07:08,160 --> 00:07:12,240 Fantastic. And what, what are the barriers to people rolling out, um, green or sorry, 74 00:07:12,240 --> 00:07:13,680 smart building programs right now? 75 00:07:14,480 --> 00:07:18,080 Well, so there's a, there's a few, first of all, it's the technology, right? So, 76 00:07:18,640 --> 00:07:24,320 and this idea of increasing the instrumentation, um, and the connectedness of devices is certainly 77 00:07:24,320 --> 00:07:29,520 going a long way towards helping that we're doing a lot to deliver integrated building management 78 00:07:29,520 --> 00:07:34,560 systems so that you can have a single console or command center where all these systems interact 79 00:07:34,560 --> 00:07:40,640 and can, and you can see the interoperability of them. So technology is one. Standards, though, 80 00:07:40,640 --> 00:07:46,720 is, is critical here because there's a real lack of standards. Um, and they're just now being defined. 81 00:07:46,720 --> 00:07:52,080 So the IT industry, again, has an opportunity to take a leading role here because we have, um, 82 00:07:52,080 --> 00:07:57,760 you know, solved many of these issues in our own scope. And, and IBM is active, along with many 83 00:07:57,760 --> 00:08:04,320 others actively participating in defining standards, uh, for smart buildings at, at every level of the 84 00:08:04,320 --> 00:08:08,640 infrastructure. And the third though, and the, perhaps the most challenging is the incentives, 85 00:08:08,640 --> 00:08:15,120 because it's a classic case of the, the, um, the, the people building and constructing the, 86 00:08:15,120 --> 00:08:21,120 the buildings are, are not the owner occupiers of the buildings in many cases. So, so there's a 87 00:08:21,120 --> 00:08:26,640 a mismatch of incentives. Now, um, work is progressing in many, uh, countries around the 88 00:08:26,640 --> 00:08:32,480 world to provide the incentives for businesses to, to make it, uh, financially attractive for 89 00:08:32,480 --> 00:08:35,840 businesses to create and, and run these smart buildings. 90 00:08:35,840 --> 00:08:40,960 It's been, uh, with, with, with the stimulus package coming out of the U S there's been 91 00:08:40,960 --> 00:08:45,520 a series of, um, um, um, incentives for people to roll out these kinds of programs. 92 00:08:46,880 --> 00:08:50,480 That's right. Yeah. I'm very familiar with the ones in the U S it's not just U S I should 93 00:08:50,480 --> 00:08:55,120 add, because in China and other places, there is stimulus money, uh, tagged this way. But in 94 00:08:55,120 --> 00:09:00,720 the U S for example, the GSA, which is the, uh, so the government administration responsible for 95 00:09:00,720 --> 00:09:06,400 all of the various government buildings, whether they be military bases or federal courthouses or 96 00:09:06,400 --> 00:09:12,320 what have you, um, has earmarked three and a half billion dollars of stimulus money for upgrading 97 00:09:12,320 --> 00:09:16,720 those buildings and making them more efficient. And that's everything from the data centers to 98 00:09:16,720 --> 00:09:23,760 the buildings themselves. Um, the, uh, uh, the second piece of, uh, stimulus money in the U S is 99 00:09:23,760 --> 00:09:29,760 about $5 billion for energy efficiency programs. And these are aimed at commercial properties, 100 00:09:29,760 --> 00:09:36,400 trying to drive demand reduction, uh, in those spaces to take load off the grid to do peak 101 00:09:36,400 --> 00:09:42,160 shaving, uh, and to make the infrastructure more efficient. Um, these, this stimulus money is, 102 00:09:42,160 --> 00:09:48,480 is, you know, just adding more incentive, uh, to businesses to embrace the notion of green or smart 103 00:09:48,480 --> 00:09:54,240 buildings. Superb. Great. So we'll, uh, hopefully see a lot more smart buildings being rolled out in 104 00:09:54,240 --> 00:09:58,800 the next couple of years. Super rich. That's been great. Thanks for coming on the show. Thank you. Bye. 105 00:09:58,800 --> 00:10:28,780 We'll be right back.