(Issue: December 2017)

New Definition of Lighting Management Companies

By Jack Curran


Background
The General and Associate Member companies that comprise NALMCO consist of a wide range of lighting related services including firms providing electrical contracts and materials, design and consulting services, lighting manufacturers and distributors. What they have in common is the goal of providing quality lighting equipment, maintenance and services for their clients.

Besides the classic equipment and support functions, some companies have broadened their offerings to provide forms of financing for lighting systems. For example, ESCOs (Energy Service Companies), which trace their origins to the first energy crisis in the 1970s, provide a range of energy solutions including design and implementation, retrofitting, energy conservation, energy infrastructure outsourcing, power generation and energy supply, and risk management. ESCOs offer their clients the ability to improve their energy efficiency while at the same time reducing their energy costs, without the upfront capital expense.  Equipment and maintenance are provided by the ESCO in return takes a portion of the energy cost savings. The typical ESCO company provides comprehensive solutions to its customer’s energy needs, often employing a performance contracting approach. Unlike consulting engineers, who are paid for their suggestions and equipment suppliers, the ESCO takes on the risk if the project does not provide the estimated ROI. 

Recently Lighting as a Service (LaaS) has become popular. LaaS is a subset of the ESCO approach, focused exclusively on the lighting elements for a client. Advantages for a LaaS client are: no upfront capital expenditures, immediate positive cash flow, minimal risk should the energy savings prove less than anticipated and off-loading of lighting maintenance. Of course, the firm is locked into the selection for the duration of the agreement, so any major changes would require renegotiating the contract. Lighting as a Service business is expected to grow at over 45 percent over the next five years.
 
Technology Drivers
What are the major technology elements that will give rise to the changes coming in the lighting industry?  There are four main influences:
  1. LEDs. The complete conversion of lighting applications to LED technology. In addition, the use of color will become more widespread
  2. Lighting Controls. Lighting controls will become commonplace in almost all lighting applications.
  3. Sensors. The use of sensors incorporated into the lighting fixtures will vastly expand the ability of lighting control systems to tailor the environment to the desired parameters.
  4. IoT. IoT combined with sensors of all types will further expand the feedback possible.
Individually each of these elements can change the lighting environment. However, when combined, the applications suddenly grow exponentially and well beyond the typical boundaries of lighting systems. 

Traditionally, the various building control systems such as HVAC, security, fire, lighting and access control have existed someone independent of each other, although with considerable effort interfaces among the various systems can be provided.  

Putting IoT Sensors everywhere totally changes the game. Suddenly new applications are possible, including:

  • Asset tracking.
  • Office space optimization.
  • Environments tailored to individual’s preferences.
  • Task tuning.
  • Real time measurement of electric usage allowing the ability to negotiate utility rates in real time.
However, new technologies usually bring new issues, and IoT Sensors are no exception. In this case the problem is data overload. When large numbers of sensors are distributed with the ability to acquire massive amount of data, a phenomenon known as Big Data occurs. Big Data is defined to be data sets that are either very large, are varied in their content, have very high acquisition rates or various combinations of the three. To put this in perspective, 90 percent of the data in existence today was gathered in the last two years, and every day 2.5 quintillion (2.5 x 1018) bytes of data are created. Such data sets can require entire new ways of analysis, as traditional methods are inadequate and can swamp attempts to interpret the data. Techniques for processing and analyzing these large Big Data sets are unfamiliar and not typically within the experience of lighting management companies.
 
New Applications and New Skill Sets
For hundreds of years, lighting practitioners have had their focus on a couple main objectives: provide the proper amount of illumination to meet building occupant’s needs and provide light that enhances the characteristics of the buildings or objects that are being illuminated. Over time, the tools available to achieve these objectives have expanded and become more complex, but the objective has remained the same. Tomorrow’s lighting objectives will expand vastly beyond the traditional goals of the lighting designer. For example, consider LiFi, the use of light to allow digital communications to devices carried/worn by building occupants, such as smart watches and phones.  

So, in this new lighting environment what skill sets could be required by those in the lighting management arena?
  • Human Factors. Knowledge of how light illumination levels and colors can affect building occupants’ health, mood and productivity. Particularly where productivity is involved, the financial impact on a company is many times higher than the energy/maintenance savings typically considered when evaluating return on investment.
  • Data Analysis. As mentioned previously, the potential for large arrays of sensors to overwhelm traditional data analysis techniques is highly probable. Processing Big Data requires entire new methods of analysis, and very few analysists are familiar with these techniques.
  • Programming. Familiarity with system programming is not high on the list of capabilities processed by the typical lighting management company today. However, it will be critical knowledge for tomorrow’s practitioner.
  • Communications. The ability to design and install the proper means of transmitting data and other signals to building occupants. Positioning fixtures in a way that they can provide proper light levels for occupants, while at the same time providing signal paths via light to communicate with smart phones and tablets as well as being located in the proper position to sense temperature/humidity/occupancy/etc.
  • Installation. Today’s lighting management company has a good working knowledge of traditional AC wiring systems and techniques. However, the rapid expansion of alternative methods of wiring and controlling lighting control systems will require continuous monitoring of the types of systems available including wired, wireless, and PoE (Power over Ethernet). These different systems are also likely to be installed by contractors with different backgrounds (e.g. licensed electricians, unlicensed electricians, IT contractors).


So, what does tomorrow’s lighting management company look like? Whatever it is called, it will be responsible for far more than just traditional lighting needs. Consolidation which has been ongoing in some of the elements of building management, such as combining HVAC, fire and security companies will continue. As shown in Figure 1, today’s building systems are often independent of each other with limited communications between systems (HVAC being the exception as that segment of the industry has done a lot of work developing a communication protocol for intercommunications via BACNET). In the near term, tomorrow’s building control systems will still have individual components but with one central controller able to communicate with all elements as shown in Figure 2. It is still a recognizable configuration with the addition of a communication and control backbone. Each component talking to all the other components through a communication channel such as BACNET. A lighting management company can still participate as they have in the past as long as they remain up to date on the changes brought about by solid-state lighting in terms of color and potential effects on health, mood and productivity of building occupants.

Longer term, the addition of IoT Sensors and distributed processing (not putting all the smarts at one point in the system) completely changes the ballgame for a Building Control System (note the singular “system”). As shown in Figure 3, the Central Control has been replaced with a Central Monitoring function, because the control has been distributed throughout the system. The overall system is now a mesh with multiple pathways between all the elements of the system. Why send information back to a central location when most often, decisions can be made locally. For example, the temperature and occupancy sensors in the light fixture know when the room is occupied (maybe even how many people are in the room) and what the temperature is. According to programming in the local microprocessors, the HVAC and Lighting elements can respond to this information and provide the proper illumination and heating/cooling. Systemwide crashes become less likely and responsiveness improves.

Another consideration involves the ceiling of the facilities managed by the lighting management companies. The ceiling in a building is very valuable real estate and has mainly been the purview of the lighting industry players. However, as mentioned previously, the days of the individual players remaining in their respective silos is over. I see an upcoming battle for the ceiling among today’s equipment providers including new players already familiar with the required skill-sets. The closer tomorrow’s building control systems mimic Information Technology issues and solutions, the more likely that major players from the IT world will want a piece of the action. It will be important for the survival of lighting management companies to follow this battle and make sure they have forged relationships with the ultimate winners of this war.

Within the next decade, the building management world (and the lighting portion of it) will not be based on equipment sales, but software and services—similar to what occurred a number of years ago in the computer industry. While energy and maintenance savings will still be relevant, the big ROI factor will be productivity improvements. For lighting management companies, growth will come by providing unique services and programming elements, that support the health and productivity improvements that environmental changes (including lighting) can create for building occupants. At the same time, it will be critical for these companies to avoid being stomped on while the giant corporations merge and jostle for position and control of the building environment industry.

Jack Curran is President of LED Transformations, LLC. Jack is a regular LM&M contributor. You may reach Jack at jcurran@ledtransformations.com