According to our latest study on "Building Automation System Market Size and Forecast (2021-2031), Global and Regional Share, Trend, and Growth Opportunity Analysis - by Component and End Users," the market was valued at US$ 76.75 billion in 2023 and is expected to reach US$ 167.40 billion by 2031; it is estimated to record a CAGR of 10.2% from 2023 to 2031.

Consumer IoT, IP-based Devices, SaaS, and Other Technological Developments to Provide Lucrative Opportunities for Building Automation System Market Growth During Forecast Period

IoT, machine intelligence, and new networking capabilities play important roles in advancing building automation systems. Advanced fault detection and diagnostics, energy analytics, and grid integration are crucial aspects as building owners and facility managers prioritize increased energy efficiency and cost savings. The demand for consumer IoT-based devices, such as smart alarms, home appliances, security systems, and thermostats, is increasing worldwide. These devices will also help building owners and occupants gain extensive data on temperature, humidity, and indoor air quality, as well as greater control over indoor settings, particularly in HVAC systems in commercial buildings. In addition, the integration of IP-based devices to the building network in modern building automation systems (BAS) can provide increased scalability without the need to connect more fiber or Cat6 cables or reprogram individual devices to free up IP address ranges. Further, integrating IP-based devices in BAS can help eliminate operational challenges such as expensive reprogramming, incompatibility of devices and automation systems, and the time-intensive process of laying cables.

The growing adoption of cloud-hosted BAS is raising the demand for software-as-a-service (SaaS) solutions. This shift to SaaS-based solutions reduces operating expenses because building owners no longer need to maintain expensive software or manage application-specific programmers. With SaaS-based solutions, the owner can easily forecast their monthly operating budget without having to commit to a long-term service agreement. Simple integration of new building equipment, feature deployment, and cloud-hosted automatic upgrades are achieved through the cloud-hosted, SaaS-based BAS platform. SaaS-based BAS solutions also provide contractors with remote access and control, so they do not have to visit the site. Thus, the growing adoption of advanced technologies such as consumer IoT, IP-based devices, and SaaS is expected to facilitate the expansion of the building automation system market during the forecast period.

Key Findings of Building Automation System Market Study:

According to Clean Energy Manufacturing Analysis Center (CEMAC), in the US, nearly 60% of commercial buildings that are larger than 50,000 square feet use a building automation system (BAS) to manage heating, ventilation, air conditioning, lighting, and other functions. However, only 13% of smaller to medium-sized buildings (less than 50,000 square feet) have adopted this technology, leaving a significant opportunity for improvement in over 75% of all commercial buildings in the country. To encourage widespread adoption of these systems, the National Renewable Energy Laboratory (NREL) and Joint Institute for Strategic Energy Analysis (JISEA), through the CEMAC, have studied the obstacles and incentives. They have also created a breakdown of the costs involved, including hardware and various installation labor costs.

In the US, several companies are collaborating to bring out new and innovative solutions in the market. For instance, in 2024, Honeywell and Analog Devices, Inc. at the CES 2024 announced that they had inked an agreement to investigate the digital transformation of commercial buildings by implementing advanced digital connectivity technologies without the need to replace current wiring. This initiative aims to lower expenses, minimize waste, and decrease operational downtime. The collaborative partnership is poised to introduce this innovative technology to building management systems for the very first time. Overall, the collaboration between Honeywell and Analog Devices, Inc. represents a significant step toward driving transformative innovation in building automation and addressing the challenges associated with outdated and inefficient commercial buildings. Thus, such initiatives and collaborations are expected to boost the building automation system market growth in the US.

In Germany, the implementation of building automation systems is essential for enhancing the sustainability, comfort, and energy efficiency of different buildings and facilities. Building automation systems are specifically designed to centrally monitor and manage critical building systems, including heating, ventilation, air conditioning, lighting, and security. These systems are focused on improving energy efficiency in facilities by promoting sustainable energy usage and seamlessly integrating Industry 4.0 applications. Companies such as DEOS AG provide a compatible array of products and cutting-edge IoT and cloud solutions for rapid integration and user-friendly operation, with a specific emphasis on heating, ventilation, and air conditioning control. Moreover, The University of Paderborn in Germany is leveraging building automation systems to ensure enhanced sustainability and comfort, highlighting the need for intelligent buildings.


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