Despite Recent Unprecedented Growth The Building Controls Market Is Not Fully Ignited 

North America extends its lead as the world's largest single market for environmental controls, now dwarfing even the biggest markets in Europe, as manufacturers' sales in 2000 at engineered and commissioned prices rise to $2.04 billion, having grown at an unprecedented 16% per annum since 1998. These are the findings of the 2nd study of the North American market for Environmental Control Systems in non-residential buildings by i&i limited - Proplan. Edition 1 published in 1998 confirmed that this market was sitting on a powder keg of growth but despite the remarkable performance over the last two years, the business is far from fully ignited, for projects continue to be under specified, resulting in a lower penetration of building controls per capita than developed markets in northern Europe. 

i&i demonstrate through a whole series of benchmarks that the full potential of this market is simply not being realised and that the penetration of advanced controls in North America should be very much larger than it is today. This continent has a larger building stock, a higher spend on building construction, installs more air conditioning & refrigeration equipment, consumes more energy per square foot and has a higher number of heating and cooling degree days than any other developed economy. Nevertheless, it spends considerably less on DDC controls per dollar of construction or per square meter of floorspace than many of the developed markets of northern Europe. 

This market continues to offer the best opportunity in the developed world for sustained growth over the next five years. Growth has been driven in part by buoyant new construction and expanding refurbishment business, but also by factors such as increased demand for improved indoor air quality, optimisation of energy consumption as electricity and natural gas prices escalate, and strong growth in integration and remote control of building services and it is these additional factors that are most likely to sustain demand in the future. For new construction activity is expected to weaken and there is much uncertainty about the economy. Although i&i forecast that ddc systems sales will still achieve around 10% growth in 2001, they will fall back to 5% in 2002. As competition intensifies, margins which have held up well during the last two years, will come under increasing pressure and manufacturers will need to develop innovative strategies to stay ahead. 

The total environmental control systems market which has now reached $3.8 billion, would get an additional boost if third party distribution channels were strengthened for this would open up the small and medium building sector market. Although this channel has grown, it contributes just 30% of the total environmental systems business, which is lower than the European average. 

Even after more than ten years, only a small percentage of projects specify a common communication standard. BACnet and LonWorks are the two most often used and are penetrating the market, albeit very slowly, but the signs are that "interconnectivity" will, for some years, be provided by overlaying manufacturers' proprietary protocols on IT networks using TCP/IP. Technology will continue to drive product development and there will be a migration towards information communication technology and internet protocols for the transmission and management of data from building management systems and its integration within the wider enterprise environment. 

For more information and to read the complete report visit: www.proplan.co.uk 

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