Ineffective control of energy-using systems such as heating, cooling, ventilation and lighting is endemic in Europe’s buildings. Spaces are heated when it is not necessary, lighting is left on, ventilation operates continuously at maximum capacity and so forth. Proper application of building automated technology and controls (BAT and BACS) has a theoretical potential to save about 9% of all EU energy consumption (about 22% of building energy consumption) and a realistic potential through broad-based programmatic efforts to save up to 2/3rds of this. The cost of such energy savings is estimated at €1.1c/kWh, which is less than half the price of wind energy (even when applying a primary to final energy factor of 2.5 to the value of wind power), and is seven times more cost effective than the expected savings from smart meters. The scale of potential savings is very large and would mostly be in avoided gas demand, and thus brings significant cost-effective energy security benefits. Furthermore, unlike the measures to improve the energy efficiency of building fabrics, deployment can be rapid and does not require major and inconvenient disruption of buildings. With a coordinated programme most of these savings could be delivered within a 15 year period. The cumulative cost of delivering a large-scale and effective programme is estimated to be €136bn to 2035 (i.e. about 2.5 times current planned investments in smart meters), but the value of the energy savings over the same time frame are nine times greater at ~€1200bn. With an estimated annual abatement potential of 419 MtCO2 by 2028 measures to promote savings through BAT/BACS are likely to have a similar impact to the EU ETS but to be fully complementary in that they concern a sector outside the scope of the EU ETS.

1. DISCUSSION PAPER
A TIMELY OPPORTUNITY TO GRASP THE VAST
POTENTIAL OF ENERGY SAVINGS OF BUILDING
AUTOMATION AND CONTROL TECHNOLOGIES
Diedert Debusscher;Paul Waide
March 2015
ECI Publication No Cu0220

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Document Issue Control Sheet
Document Title: Discussion Paper: A timely opportunity to grasp the vast potential
of energy savings of Building Automation and Control Technologies
Publication No: Cu0220
Issue: 01
Release: Restricted audience.
Author(s): Diedert Debusscher;Paul Waide
Reviewer(s):
Document History
Issue Date Purpose
1 29/04/2015 Release to restricted audience.
2
3
Disclaimer
While this publication has been prepared with care, European Copper Institute and other contributors provide
no warranty with regards to the content and shall not be liable for any direct, incidental or consequential
damages that may result from the use of the information or the data contained.
Copyright© European Copper Institute.
Reproduction is authorised providing the material is unabridged and the source is acknowledged.

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CONTENTS
Executive Summary ........................................................................................................................................ 1
1. The policy context....................................................................................................................................... 2
1.1 Energy efficiency is an energy source in its own right......................................................................................2
1.2 Adressing the vast energy efficiency gains in the building sector ....................................................................2
1.3 Need for accelerated energy efficiency gains in buildings ...............................................................................3
2. Value Proposition of Building Automation and Controls............................................................................. 4
2.1 Scope of current technologies..........................................................................................................................4
2.2 Vast untapped energy and GHG emission saving potential .............................................................................4
2.3 Cost Optimality and Quick Wins .......................................................................................................................5
2.4 The missing link in nZEB construction and smart grid deployment..................................................................6
3. Problem analysis......................................................................................................................................... 7
3.1 General problem...............................................................................................................................................7
3.2 Specific problems..............................................................................................................................................7
3.3 Drivers for the problem ....................................................................................................................................8
4. The need for policy action........................................................................................................................... 9
4.1 Market trends...................................................................................................................................................9
4.2 Gaps in the existing policy framework..............................................................................................................9
5. Policy options ........................................................................................................................................... 10
5.1 The ideal policy framework ............................................................................................................................10
5.2 The objectives of an ideal policy package.......................................................................................................10
5.3 Measures to drive demand.............................................................................................................................11
5.4 Measures to improve the quality of delivered savings...................................................................................11
6. The time to act is now............................................................................................................................... 13
Annex – Elaborating on leveraging the existing policy framework................................................................ 14
Energy Performance in Buildings Directive (recast) .............................................................................................14
Energy Efficiency Directive ...................................................................................................................................16
Eco-design Directive .............................................................................................................................................16
Annex – About Leonardo Energy................................................................................................................... 18

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EXECUTIVE SUMMARY
Ineffective control of energy-using systems such as heating, cooling, ventilation and lighting is endemic in
Europe’s buildings. Spaces are heated when it is not necessary, lighting is left on, ventilation operates
continuously at maximum capacity and so forth. Proper application of building automated technology and
controls (BAT and BACS) has a theoretical potential to save about 9% of all EU energy consumption (about 22%
of building energy consumption) and a realistic potential through broad-based programmatic efforts to save up
to 2/3rds of this. The cost of such energy savings is estimated at €1.1c/kWh, which is less than half the price of
wind energy (even when applying a primary to final energy factor of 2.5 to the value of wind power), and is
seven times more cost effective than the expected savings from smart meters. The scale of potential savings is
very large and would mostly be in avoided gas demand, and thus brings significant cost-effective energy security
benefits. Furthermore, unlike the measures to improve the energy efficiency of building fabrics, deployment can
be rapid and does not require major and inconvenient disruption of buildings. With a coordinated programme
most of these savings could be delivered within a 15 year period. The cumulative cost of delivering a large-scale
and effective programme is estimated to be €136bn to 2035 (i.e. about 2.5 times current planned investments
in smart meters), but the value of the energy savings over the same time frame are nine times greater at
~€1200bn. With an estimated annual abatement potential of 419 MtCO2 by 2028 measures to promote savings
through BAT/BACS are likely to have a similar impact to the EU ETS but to be fully complementary in that they
concern a sector outside the scope of the EU ETS.
From a policy perspective there seems to have been a serious under-appreciation of the magnitude of this
opportunity and of the barriers faced (lack of awareness, fragmented supply chains, lack of clarity about the
value proposition, initial cost and risk barriers, quality of design and installation, need for more reliable
diagnostics and trouble-shooting etc.). There are many areas within the EED, EPBD and Ecodesign Directive that
could be adapted to lend some support to realise these savings but the existing measures are mostly of a
horizontal nature and hence only provide indirect encouragement. As a result there is very little that is currently
being done to practically deliver these savings.
Fortunately, the newly announced Energy Union provides an opportunity to consider where measures to
promote savings via BAT/BACS belong in the EU sustainable energy portfolio and to place them along side better
known measures such as those to address renewable energy, building fabric efficiency, smart meters, carbon
capture and storage, the EU ETS, Ecodesign and internal market reform as a key opportunity to make a
substantial contribution to the EU’s 2030 policy objectives for the energy sector.
This paper analyses the current EU policy framework and identifies the gaps that could be addressed to promote
the effective use of BAT/BACS. Specifically, it focuses on the pending/ongoing reviews of the EPBD, EED and
Ecodesing/Ecolabelling Directives and produces recommendations on how these Directives could be
strengthened to better deliver savings from BAT/BACS.

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1. THE POLICY CONTEXT
1.1 ENERGY EFFICIENCY IS AN ENERGY SOURCE IN ITS OWN RIGHT
Energy efficiency is one of the most cost effective ways to enhance security of supply, and to reduce emissions
of greenhouse gases and other pollutants. The European Commission described energy efficiency as the EU’s
biggest energy resource1
. It is in that context that the European Council in October 2014 set an indicative target
at the EU level of at least 27% for improving energy efficiency in 20302
. This will be reviewed by 2020, having in
mind an EU level of 30%.
Energy efficiency investments are characterized by their capacity to bring direct energy returns, and additional
value streams to private owners and asset operators, as well as significant public benefits in terms of increased
employment, lower emissions, increased energy security and reduced dependence on foreign energy imports
and improvements to a country’s fiscal balance 3
. Yet, despite the inherent win-win of energy efficiency
investments, we share the Commission’s concern that insufficient public and private investment is flowing into
energy efficiency at present. If this trend continues then the EU Member States are at risk of missing their 2030
energy efficiency targets. The Commission, in its communications about the Energy Union, therefore reaffirms
the necessity “to fundamentally rethink energy efficiency and treat it as an energy source in its own right,
representing the value of energy saved”4
.
1.2 ADRESSING THE VAST ENERGY EFFICIENCY GAINS IN THE BUILDING SECTOR
The role of the building sector in this context can hardly be overestimated. Many studies agree that the building
sector has the largest longer-term, cost-effective saving potential of all energy using sectors. Buildings consume
40% of total final energy requirements in Europe5
and they are the main contributor to greenhouse gas (GHG)
emissions (about 36% of the EU’s total CO2 emissions and for about half of the CO2 emissions which are not
covered by the Emission Trading System)6
.
While there has already been significant effort to improve energy performance in buildings, considerable
potential still remains. Indeed, 75% of buildings standing in the EU were built during periods with no, or minimal,
energy-related building codes7
. Buildings are long-term assets expected to remain useful for 50-100 years and
1 European Commission (2011). Energy Efficiency Plan 2011. COM(2011) 109 final
2 European Council (2014). Conclusions on 2030 Climate and Energy Policy Framework. SN 79/14
3 EEFIG (2014). Energy Efficiency – the first fuel for the EU Economy. Part 1: Buildings (Interim Report). Retrieved from:
https://ec.europa.eu/energy/sites/ener/files/documents/2014_fig_how_drive_finance_for_economy_1.pdf
4 European Commission (2015). Energy Union Package. COM(2015) 80 final
5 Enerdata (2012). Energy Efficiency Trends in Buildings in the EU. Lessons from the ODYSSEE MURE project. Retrieved
from: http://www.odyssee-mure.eu/publications/br/Buildings-brochure-2012.pdf
6 European Commission. Retreived from: http://ec.europa.eu/research/industrial_technologies/eeb-challenges-
ahead_en.html
7 Ristori, D. (2013). JRC Conference on "Scientific Support to EU Growth and Jobs: Efficient buildings, vehicles and
equipment [Introductory Remarks]. Retrieved from:
http://ec.europa.eu/dgs/jrc/index.cfm?id=2470&obj_id=4330&dt_code=EVN

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three quarters of those standing today are expected to remain in use in 2050. With low demolition rates (0.1%
per year), low refurbishment rates (1.2% per year) and moves to highly energy efficient new-build (1% additions
per year)1
, Europe’s energy efficiency challenge in buildings mainly concerns the speed and the depth of
energy efficient refurbishments and investments in its existing buildings stock.
It is laudable that the Commission will dedicate a Commission strategy that addresses the huge efficiency gains
that remain to be captured with regard to heating and cooling of the European building stock. Furthermore, the
Renovate Europe Campaign, initiated by EuroACE, is calling for an ambitious roadmap to triple the annual
renovation rate of the EU building stock from the current rate of 1% to 3% by 2020.
1.3 NEED FOR ACCELERATED ENERGY EFFICIENCY GAINS IN BUILDINGS
But even were these more ambitious renovation rates to be met, the European Union’s goal of an almost carbon-
neutral building stock by 2050 will not be achieved. Indeed, on top of the low renovation rates comes the fact
that only part of the renovations have an effect on the building’s overall energy performance. Furthermore, as
few as 0.1% to 0.4% of the non-residential buildings in Europe undergo major energy-related renovations each
year2
. Measures that improve the efficiency of operation of building energy services equipment can help bridge
this gap and produce quick wins towards the Energy Union objectives. In particular, they can be deployed more
rapidly across a broader mass of the building stock, and because they don’t involve such disruptive intervention
are much more acceptable to building owners and occupiers.
1 EEFIG (2014). Energy Efficiency – the first fuel for the EU Economy. Part 1: Buildings (Interim Report). Retrieved from:
https://ec.europa.eu/energy/sites/ener/files/documents/2014_fig_how_drive_finance_for_economy_1.pdf
2 Schimschar, Sven et al. (2011). Panorama of the European non-residential construction sector. Retrieved from:
http://www.leonardo-energy.org/white-paper/panorama-european-non-residential-construction-sector

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2. VALUE PROPOSITION OF BUILDING AUTOMATION AND CONTROLS
2.1 SCOPE OF CURRENT TECHNOLOGIES
Modern building automation technology (BAT) brings the electromechanical hardware of sensors, actuators and
thermostats together with ICT hardware such as controllers/outstations, programmers and central facilities such
as personal computers (PCs) and data displays. Collectively these can be combined with appropriate software to
provide building energy management systems (BEMS) for service sector (non-residential) buildings or home
energy management systems (HEMS) for residential ones; however, it is important to understand that varying
degrees of integration and sophistication are used and that the most appropriate system will vary in response
to the building and usage characteristics. In this paper we use the term BAT/BACS when referring to the overall
suite of BACS/BAT/BEMS/HEMS solutions. Its important to understand though that effective BAT/BACS can be
quite simple, for example in homes they principly concern ensuring that as many spaces as are relevant have
their own programmed thermostatic actuator capable of controlling the heat flow to that space (usually by being
integrated into the heat emitter). Programming is done centrally through a HEMS often via wireless
communication. The more spaces where the demand for heat delivery is sensed and controlled individually
rather than as an aggregate the greater the savings. The same systems should also employ optimum start and
weather sensing to avoid heating coming on unnecessarily early or staying on too long. The same principles are
used in service sector building systems but will be more complex and will also control all other energy using
functions (lighting, HVAC, hot water, etc.).
2.2 VAST UNTAPPED ENERGY AND GHG EMISSION SAVING POTENTIAL
According to a recent study commissioned by ECI1
, greater adoption and improved operation of building
automation technologies and controls (BAT/BACS) could progressively result in estimated savings of up to 150
Mtoe (1,745 TWh) per year by 2028. This is 22% of all building energy consumption and ~9% of total final energy
consumption of the entire European Union. Furthermore it corresponds to an abatement potential of up to 419
MtCO2 per year.
However, this Optimal Scenario is predicated on a rational and perfectly functioning market, where all cost-
effective energy savings opportunities are invested in and without serious constraints to effective service
delivery. In a more realistic depiction of the potential to deliver additional savings beyond business-as-usual,
savings ramp up progressively to reach 13% of the building energy consumption by 2035 – still over 5% of the
European Union’s entire energy consumption. This latter Realistic Scenario assumes that all the recommended
actions outlined in the study are implemented and that BAT/BACS are procured, installed and operated
accordingly.
These two scenarios lead to from 1,000 to 2,100 Mtoe of cumulative energy savings to 2035 compared to a
business as usual scenario. This equates to estimated cumulative CO2 savings of from 3.4 to 5.9 gigatonnes over
the same period, with annual CO2 savings peaking at between 260 and 419 million tonnes.
Over the scenario period (2013−2035) of the Realistic Scenario, some €136 billion of extra investments in BAT
and related services are needed to deliver these savings, at an average of €6.2 billion per year. Large as these
1 Waide Strategic Efficiency et al. (2014). The scope for energy and CO2 savings in the EU through the use of building
automation technology. Second edition, 13 June 2014. Retrieved from: http://www.leonardo-energy.org/white-
paper/building-automation-scope-energy-and-co2-savings-eu

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incremental investments are, they are nine times less than the value of the resulting savings in energy bills,
which total €1 187 billion over the period, at an average of €53.9 billion per year.
To comprehend the scale of the opportunity it is informative to compare the value proposition of building
automated technology and controls with other means of delivering energy services which already receive strong
support from EU MS and the Commission.
EU Member States are required to ensure the implementation of smart metering under EU energy market
legislation in the Third Energy Package. MS are currently rolling out smart meters with an average 3% energy
saving per installation1
at a projected investment cost of €55bn by 2020 for a benefit of €69bn, which equates
to a benefit-cost ratio of 1.25. By contrast it is projected that were there to be a broad-based EU-wide
deployment of good quality building automated technology and controls in EU buildings that the expected
savings would amount to €1187bn by 2035 for an investment of €136bn2
. This amounts to average savings of
~20% per installation and gives a benefit-cost ratio of 8.7, i.e. seven times greater than for smart meters.
With support from the Renewable Energy Directive the EU Wind Energy Association estimates that wind power
capacity installed by the end of 2014 would, in a normal wind year, produce 284 TWh of electricity, enough to
cover 10.2% of the EU's electricity consumption3
. The average cost of generation is ~€5.6c/kWh4
. By contrast a
large scale roll out of good quality building automated technology and controls is projected to deliver energy
savings equivalent to 5.2% of EU total energy consumption by 2035 at an average cost of €1.1c/kWh-saved2
.
Even were it to be assumed that all these savings were for thermal energy and a primary to final energy factor
of 2.5 to be applied to the value of wind power, the equivalent cost of wind generated energy would be over
twice as high as the projected cost of energy savings through building automated technology and controls.
2.3 COST OPTIMALITY AND QUICK WINS
Detailled analyses have shown that BAT/BACS solutions are among the set of cost-optimal measures that will
produce economically viable energy savings, almost independently of the quality of the building envelope and
the occupant user profile. Assessments, based on EU Standards and official Cost Optimal Building Performance
requirements, show that intelligent controls and automation technologies result in consistent energy savings in
1 To date, Member States have committed to rolling out close to 200 million smart meters for electricity and 45 million for
gas by 2020 at a total potential investment of €45 billion. By 2020, it is expected that almost 72% of European consumers
will have a smart meter for electricity while 40% will have one for gas.
While cost estimates vary, the cost of a smart metering system averages between €200 and €250 per customer and are
expected to deliver benefits of €160 for gas and €309 for electricity per metering point with, on average, 3% energy
savings. Source: Cost-benefit analysis and state of play of Smart Metering Deployment in the EU-27, Commission Working
Document S WD(2014) 189 final, http://eur-lex.europa.eu/legal-
content/EN/TXT/?qid=1403084595595&uri=SWD:2014:189:FIN%20
2 Waide Strategic Efficiency et al. (2014). The scope for energy and CO2 savings in the EU through the use of building
automation technology. Second edition, 13 June 2014. Available at: http://www.leonardo-energy.org/white-
paper/building-automation-scope-energy-and-co2-savings-eu
3 This is about 3.6% of EU primary energy consumption assuming a 2.5 final to primary energy conversion factor
4 Figures taken or derived from the European Wind Energy Association statistics for 2014, http://www.ewea.org/statistics/

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a residential house1
. In service buildings, energy consumption reductions by 10, 20, or even more than 50
percent are reported2
. These assessments show that enhancing the automation, control and supervision
functions in a building with one efficiency factor level (as defined in EN 15232) will often improve the EPBD
building energy performance certificate classification by one class. However, few of the MS cost-optimality
submissions to the EPBD for the derivation of cost optimal building codes have included any proper assessment
of the opportunities presented by BAT/BACS – rather, very aggregate numbers have been used if at all.
On top of being a cost-optimal measure, BAT/BACS require relatively low investments and can be implemented
without the need for the buidling to be taken out of service. Building owners that find themselves constrained
to postpone major energy-related renovations (for reasons of occupation or budget constraints), can already
benefit from investing in improving the operation efficiency of their energy services equipment. These BAT/BACS
will still provide a valuable function and deliver energy savings if at a later stage the owner decides to completely
renovate the building envelope. Needless to say that importantly BAT/BACS provide a cost-optimal alternative
whenever the envelope cannot be transitioned to state-of-the-art performance levels, for example when
cultural of historic factors prevent intrusive actions.
2.4 THE MISSING LINK IN NZEB CONSTRUCTION AND SMART GRID DEPLOYMENT
Next to the energy saving potential, other studies clearly identify BAT/BACS as a missing link in the successful
implementation of nearly zero-energy buildings (nZEB) and the deployment of the European smart grid.
1. BAT/BACS complement the extra functionality provided by smart meters and are the principal means
of actioning the savings potential they offer.
2. BAT/BACS facilitate the use of renewable energy sources. The expected increase of total coverage rate
of renewable energy on site (mainly photovoltaics) by building automation without additional storage
is estimated to be up to 5% in southern European regions3
.
3. BAT/BACS also increase the overall grid stability, by providing the building stock with massive load
shifting and storage management capabilities. The challenge to maintain grid stability will become
larger with increasing penetration of renewable energies.
1 De Deygere M. et al. (2014). Impact of user behaviour and intelligent control on the energy performance of residential
buildings. Retrieved from: http://www.leonardo-energy.org/white-paper/impact-user-behaviour-and-intelligent-control-
energy-performance-residential-buildings
2 Baggini, A. (2012). Application Note – Building Automation and Energy Efficiency: the EN 15232 Standard. Retrieved from:
http://www.leonardo-energy.org/good-practice-guide/building-automation-and-energy-efficiency-en-15232-standard
3 Offermann, M. (2014). Role of Building Automation related to Renewable Energy in nZEBs. Retrieved from:
http://www.leonardo-energy.org/white-paper/role-building-automation-related-renewable-energy-nzeb%E2%80%99s

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3. PROBLEM ANALYSIS
3.1 GENERAL PROBLEM
Ineffective control of energy-using systems such as heating, cooling, ventilation and lighting is endemic in
Europe’s buildings. Spaces are heated when it is not necessary, lighting is left on, ventilation operates
continuously at maximum capacity, etc. The resulting energy wastage is vast, and thus a considerable potential
for savings is presented.
In principle, modern building automated controls comprise a significant part of the solution, providing the
possibility to control each of these elements individually and as a whole. Furthermore, they can respond to
demand (need), and via information and communication technology (ICT) they can analyse building energy-using
systems, diagnose problematic control issues as they occur and make intelligent responses to rectify them.
This is the promise − but reality has yet to match it fully.
On average, building automated control technology when it is deployed saves much less than it should on
account of numerous design, installation, commissioning, monitoring and operational failures.
There are a variety of reasons for this, but the key theme is the need for control solutions that work better with
people and the way they use and operate buildings.
3.2 SPECIFIC PROBLEMS
ECI has identified various market barriers and failures that limit the opportunity for effective BAT/BACS adoption
in both residential and service buildings. Moreover, most BAT/BACS that are installed are poorly managed and
not working as well as they should, such that overall it is thought that about 90% of commercial and public
building floor space is inadequately or poorly controlled.It is important to appreciate that these two problems
are related, since disappointing quality and reliability does not add to the confidence in the value proposition of
BAT/BACS and is therefore a barrier for uptake in its own right.
MARKET BARRIERS AND FAILURES AFFECTING BAT/BACS UPTAKE
The building services controls industry in Europe has developed relatively slowly compared with other industries
that use microprocessor-based technologies and communications. This is due to a number of reasons, of which
the principal ones are:
• A lack of general awareness, understanding and appreciation of the options and the value
proposition of BAT/BACS
• Slow response from HVAC equipment manufacturers to incorporate advances into their packaged
controls and communications
• A lack of common standards enabling BMS/BEMS suppliers to develop more universal products
• A poor standard of client briefing and technical specification, resulting in lowest-cost solutions
regardless of the effect and leading to selection on the basis of lowest capital cost rather than
highest value in operation
• The economic situation depressing demand, although perversely the economic situation would
result in greater uptake of BAT/BACS if clients were aware of the cost-benefits that can be achieved
POOR QUALITY OF THE DELIVERED SAVINGS
BAT/BACS often fail to deliver their full potential because those specifying the system have limited
understanding of how it will be operated and have little experience of operating the systems they have specified.
In general, there is a need to move to a market where consultants, contractors and suppliers are selected on the

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basis of their ability to demonstrate that they understand how the BAT/BACS will be used in operation, rather
than just on their design experience.
Problems may arise because of:
• An inadequate potential for the building energy system to be properly controlled, i.e. the system
is not controllable
• The different control systems applied to specific components or elements not being interoperable
and having conflicting control regimes
• The wide range of user interfaces available, and situations where users have no access to the
control systems, often resulting in systems being overridden manually
These problems are compounded by a lack in training for building operations and maintenance teams with
respect to the operation of building service engineering systems and the BAT/BACS that is intended to control
and monitor them.
Addressing these issues is not principally a hardware issue: in many cases, especially for the more complex non-
residential buildings, the whole manner in which controls are procured, designed and specified, installed,
commissioned and managed within building services is in need of improvement, with the right incentives to
deliver appropriate technical and organizational capacities, resulting in better facilities management for energy
efficiency. The effective deployment of controls will thus be as much an organizational challenge as a technical
challenge.
3.3 DRIVERS FOR THE PROBLEM
EFFICIENCY EFFORTS ARE FOCUSED ON BUILDING FABRIC AND INSTALLED EQUIPMENT, NOT CONTROL
Energy renovation of existing buildings is not an easy task. Buildings, and the stakeholders involved with them,
are complex. This introduces additional barriers beyond those that would apply to the adoption and use of any
standard energy-efficient product. Split incentives may separate the economic incentive for energy savings from
those that procure services.
This split incentive moves the focus for renovations towards improving the efficiency of the building fabric
and the installed equipment – neglecting the real energy performance of the building in use.
POOR IMPLEMENTATION OFTEN GOES UNDETECTED
For example, if heating and cooling set-points are too close, such that air conditioning cools a space
while it is simultaneously being heated, users will not necessarily be aware of what is happening and
are unlikely to complain unless thermal comfort is also affected. This all-too-common situation
illustrates just one of the many implementation and operational failures that can occur and remain
undetected with building energy controls, no matter what their degree of sophistication. Monitoring
real performance and running diagnostics to detect faults and waste is a key need, requiring both
(i) the installation of appropriate technology and
(ii) the organisational structures and capacity to monitor faults and follow up with remedial
action.
The process of continuous commissioning, one example of the type of structures that are needed,
implies a more profound service delivery than the simple installation and commissioning of building
automated controls.

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4. THE NEED FOR POLICY ACTION
4.1 MARKET TRENDS
Penetration of modern BAT and management systems is projected to rise from 26% of all service sector floor
area today to 40% by 2028 without further policy intervention. In the residential sector, penetration of HEMS is
projected to rise from 2% of homes today to 40% by 2034 without additional intervention. This business-as-
usual scenario leaves a vast potential of energy savings and CO2 emission reduction untapped.
4.2 GAPS IN THE EXISTING POLICY FRAMEWORK
ECI has identified gaps in the existing policy framework that could be addressed to help realise the potential
savings from effective BAT/BACS implementation and uptake. The focus of ECI’s analysis was on the Directives
which most concern BAT/BACS and/or are (soon) under revision: the Energy Performance of Buildings Directive
(EPBD), the Energy Efficiency Directive (EED), and the and Ecodesign Directive (ED). What follows in chapter 5 is
only a brief summary of the findings; the detailed analysis can be provided upon request.
Overall the analysis clearly shows that the existing EU policy framework contains plenty of levers and
opportunities that could be applied to the promotion of BAT/BACS and that could treat almost all the ideal
policy package needs. In practice though very little of this has actually been applied to the realization of cost
effective savings from BAT/BACS.
This is mostly because these policy levers are aimed at addressing a number of horizontal energy savings
opportunities of which BAT/BACS is but one (albeit one with a very large unexploited savings potential). In
principle the approach taken with the existing measures might appear to make sense i.e. a policymaker might
ask why one should be prescriptive about the means of reaching a savings objective if any number of measures
are eligible and could meet the objective. However, the reality is that the vagueness about how to address the
savings coupled with the lack of appreciation of the scale of opportunity posed by BAT/BACS means that the
topic simply hasn’t received the attention it deserves, neither in Community-wide policy packages nor in MS
implementation plans.

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5. POLICY OPTIONS
5.1 THE IDEAL POLICY FRAMEWORK
An ideal policy package on the one hand needs to drive demand for effective BAT/BACS installations to overcome
market barriers and failures. On the other it needs to stimulate improvements in the practical design,
specification and operation of BAT/BACS to ensure they deliver the savings potential in practice. It is important
to appreciate that these two aspects are related, however, as addressing the quality and reliability of savings
delivered through BAT/BACS will also help drive future demand by building market confidence in the value
proposition of BAT/BACS. There is therefore a feedback between these two objectives.
5.2 THE OBJECTIVES OF AN IDEAL POLICY PACKAGE
Table 1 summarizes the needs that the ideal policy package needs to address as identified in the barrier and
needs analysis by ECI.
Table 1 - Measures needed to support energy savings from BACS/BAT within an ideal legal framework
Enhancing visibility a) Standardisation - ensuring currency and adequacy of all BAT/BACS
technical and professional standards
b) Product labelling based on quality/functionality and whether or not
performance is certified so that no controls system can be installed
without the procurer knowing its impact on the building energy
performance and the potential to save energy from adoption of the best
BAT/BACS systems and that no building ownership/occupation transfer
can occur without the impact of the BAT/BACS being made clear to the
new party
c) Accreditation & certification of services - giving visibility/recognition to
high quality BAT/BACS services (design, specification, installation,
commissioning and re/continuous commissioning)
Promotion of awareness
and value proposition
Awareness raising among: Policy makers (at EU/MS level), FMs, Building owners,
Company boards, BSE sector
Capacity building a) training and certification of accredited controls engineers
b) development of continuous commissioning markets for more complex
buildings and portfolios
c) development of continuous/regular re- commissioning services
Enhancing useability a) ensuring controllability of HVAC, lighting
b) ensuring interoperability of all HVAC, lighting and controls
c) ensuring user friendliness of BAT/BACS
d) ensuring products are available for all needs e.g. that are sympathetic
with traditional building furnishings and styles as well as modern
systems
e) ensuring products/services include automatic failure alerts (e.g.
simultaneous heating/cooling of the same space)
f) improving the automatic diagnostic capabilities of BAT/BACS and the
systems they are designed to operate

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Minimum requirements a) ensuring that the BAT/BACS in all new build, major renovation or
replacement of the BAT/BACS meet minimum energy performance
requirements
b) ensuring BAT/BACS professional parties meet minimum quality
requirements
Funding, finance and
incentives
a) Ensuring adequate programmatic funding is available to fund all the
programmatic activity needed (i.e. the steps outlined above)
b) Ensuring incentives and finance are in place to raise capacity in the
BAT/BACS supply chain
c) Ensuring incentives/finance mechanisms of an adequate scale are in
place to help remove the incremental first cost barrier associated with
good quality energy savings BAT/BACS equipment and services - at least
in early years of market development
5.3 MEASURES TO DRIVE DEMAND
Driving demand can be done through a mixture of mandatory provisions, procurement specifications, incentives
and awareness raising measures, see Table 2. Demand can also be raised by improving the reliability of delivered
savings which is addressed separately in the next paragraph.
Table 2 – Measures to drive demand
Mandatory measures  Building codes
 Ecodesign regulations
 Energy performance certification
 Mandatory inspections
 Sub-metering or monitoring requirements
 Professional qualification requirements
 Installed system requirements
Incentives  Support through utility EE financed programmes
 Tax incentives
 Direct state incentives
Procurement
specifications
 Binding public sector requirements
 Strong encouragement for private sector requirements
Awareness raising  National/EU communication campaigns
 Professional services networks
 CSR networks
5.4 MEASURES TO IMPROVE THE QUALITY OF DELIVERED SAVINGS
Equally important to measures aimed at driving up demand are those aimed at improving the reliability of
savings from BAT/BACS. Indeed the two are strongly related as the autonomous market demand for BAT/BACS
will rise if the quality (reliability) of assured savings increases. Part of the process to raise the quality of delivered
savings through BAT/BACS involves measures to raise the technical capacity of those involved in the supply and

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delivery of the savings i.e. of: the BAT/BACs systems specifiers, the HVAC and lighting systems specifiers,
installers, commissioners and operators (e.g. facility managers). Just as important are the management cultures
and systems put in place among end-using facilities. In order for investment in such services to increase,
however, the value proposition of investing in a reliable system to manage and verify energy savings through
BAT/BACs needs to be clearly articulated among decision makers so that sustained resources are made available
to ensure this occurs. Addressing the organisational cultural challenge this implies is therefore also a key need.
Policies are required that will help address these issues as summarised in Table 3.
Table 3 – Measures to improve quality of BAT/BACS energy savings
Trouble shooting  Continuous commissioning
 Regular audits
 Improving automatic diagnostics
Certification  of BAT/BACS components and systems
 of specifiers and installers
Training • of facility managers
• of building service engineers
Increase organisational
prioritization
Raising awareness:
• of the value proposition of BAT/BACS including at board level
• of the need to monitor and verify actual performance
Strengthen
standardization
• Complete standards and check/improve applicability
• Increase usability and awareness of the standards

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6. THE TIME TO ACT IS NOW
In its Energy Union Package1
, the Commission sets out clear intentions regarding energy efficiency, with special
attention to the building sector – where huge energy efficiency potential is still untapped and where quick wins
are possible.
To achieve its aims, the Energy Union proposes to:
• Review the EED, the EPBD, and the ELD/Ecodesign Directives (Action item 9)
• Introduce new legislation to meet the Community’s 2030 energy efficiency target based on the
revision of the energy efficiency and energy performance of buildings directives
• Develop a ‘Smart Financing for Smart Buildings’-initiative to make existing buildings more energy
efficient, facilitating access to existing funding instruments and propose a Commission Strategy on
Heating and Cooling to facilitate investment in heating and cooling (Action item 10)
These intentions of the Commission present a timely opportunity for Europe and the Member States to fully pin
their policies on the accelerated uptake of home and building automation and energy management
technologies. The planned reviews of the four existing energy efficiency Directives is valuable and welcome.
However, they must be undertaken with a mind to strengthen their effectiveness and comprehensiveness with
respect to the magnitude of energy savings they produce.
It is clear that a lack of focus on BAT/BACS in the current building energy performance policies is a missed
opportunity. Regardless of whether other energy savings opportunities are realized or not, the cost effective
potential from BAT/BACS alone will remain of the order of 10% of EU final energy consumption and could
have a direct bearing on strategically important issues such as the dependency of the community on imported
gas.
A shift in focus from the ‘fabric and services’ to the ‘building in use’ would create an enormous gain in energy
efficiency of the European building stock. Central in this thinking is the proper design, implementation and
operation of monitoring, control and automation technologies, and energy management systems. In other
words, making the building more intelligent.
From the findings of an analysis commissioned by ECI, there’s already a considerable part of the estimated
BAT/BACS savings potentials that could be grasped through adaptation and more targted implementation of the
current set of legislation. Current policies all seem to touch on the barriers, but they don’t seem to really catch
the potentials. Necessary adaptations relate to establishing a coordinated vision across the different Directives
involved and to supporting Member States in their proper implementation.
1 European Commission (2015). Energy Union Package. COM(2015) 80 final

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ANNEX – ELABORATING ON LEVERAGING THE EXISTING POLICY FRAMEWORK
This section summarizes the EU policy framework analysis from a more extended study commissioned
by ECI. It has a focus on the directives which most concern BAT/BACS and/or are (soon) under revision.
It considers the current EU framework and identifies gaps that could be addressed to promote the
effective use of BAT/BACS. Specifically, it focuses on the pending/ongoing reviews of the EPBD and
the EED and produces recommendations of how these Directives could be strengthened to better
deliver savings from BAT/BACS. It also considers whether measures are applicable within the
Ecodesign Directive.
ENERGY PERFORMANCE IN BUILDINGS DIRECTIVE (RECAST)
PROVISIONS FOR BAT/BACS IN BUILDING CODES
From a first analysis of the national building codes it seems likely that overarching whole building energy
performance requirements combined with minimum functionality prescriptions for individual BAT/BACS options
will result in surer delivery of cost-effective energy savings from BAT/BACS than simply relying on a whole
building energy requirement.
COST OPTIMALITY ASSESSMENT
As for the cost optimality assessment process in the EPBD, case studies clearly show this method is currently not
being applied properly by MS and as a result cost-effective energy savings options using BAT/BACS are either
not being considered at all when assessing the cost-optimality of energy performance codes or are being
aggregated with other options in such a way that the true benefits are not properly accounted for. This results
in both, a reduced appreciation of how much BAT/BACS can contribute to energy savings objectives and in sub-
optimal building codes. Both issues should be addressed in greater depth in future assessments.
ENERGY PERFORMANCE CERTIFICATES
It should be viable to determine Energy Performance Certificates (EPCs) both through asset and
operational ratings and then use the difference between the two to determine the adequacy of the
control strategy. If a large gap is found (i.e. the operational rating is significantly worse than the
occupancy adjusted asset rating) it would imply a failure in the control strategy. Several MS already
use EPC determinations based on both asset and operational energy ratings so in this case it would be
a simple step to add this additional aspect. This in turn would allow direct recommendations to be
given to the building owner/occupiers with respect to the control strategy. At present this is a very
limited, or non-existent, focus of the recommendations given via the EPCs of how to improve building
energy performance via BAT/BACS so there is clearly an opportunity to improve the quality and
usefulness of the EPCs in this regard.
FINANCIAL INCENTIVES AND MARKET BARRIERS
Without having assessed each of existing MS schemes in detail the evidence indicates:
• There is a patchwork of incentive schemes in place and many EU states have no measures
• The scope of application of the existing schemes varies considerably in terms of building types so
that very few economies have measures in place for all types of new and existing buildings
• The scope of application with respect to BAT/BACS is often (usually) unclear and would require a
more detailed investigation to assess; however, many of the schemes would appear not to apply
to BAT/BACS
• None of the schemes are explicitly targeted at BAT/BACS as their primary focus.

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HOW SHOULD MS IMPLEMENT THE EPBD WITH RESPECT TO BAT/BACS?
Given the above it would be helpful were MS to:
a) Ensure BAT/BACS are included in the calculation of whole building (or renovation) energy
performance in a sufficient level of detail to capture the diversity of outcomes and to reward
good practice so that their contribution can be properly accounted for in delivering prescribed
whole building or renovation performance levels
b) Ensure BAT/BACS are also properly taken into account in the determination of rankings for
energy performance certificates and that BAT/BACS options are included and proposed
among the set of options recommended to improve performance
c) Ensure whole building (or renovation) energy performance requirements are complemented
by minimum requirements for BAT/BACS to ensure that building services are deploying cost-
effective control strategies
d) Ensure that the cost optimal methodological assessment used to define or justify the codes in
place includes a proper assessment of BAT/BACS differentiated by their various levels of
functionality and that these are not aggregated with other options that might be less cost
effective to implement
e) Consider amending the application of EPCs to analyse the difference between asset and
operational ratings and using this to provide direct guidance on the need to improve the
BAT/BACS/control strategy (as discussed in the EPC section above)
HOW SHOULD THE COMMISSION IMPLEMENT THE EPBD WITH RESPECT TO BAT/BACS?
Most of the potential power of the EPBD to produce cost-effective savings through BAT/BACS is
currently untapped. To help address this it would be helpful were the Commission to:
a) Ensure BAT/BACS are included in MS calculations of whole building (or renovation) energy
performance in a sufficient level of detail to capture the diversity of outcomes and to reward
good practice so that their contribution can be properly accounted for in delivering prescribed
whole building or renovation performance levels
b) Encourage MS to take BAT/BACS properly into account in the determination of rankings for
energy performance certificates and to include BAT/BACS options among the set of options
recommended to improve performance
c) Encourage MS to complement whole building (or renovation) energy performance
requirements with minimum requirements for BAT/BACS to ensure that building services are
deploying cost-effective control strategies
d) Ensure that the cost optimal methodological assessment used to define or justify the codes at
MS level includes a proper assessment of BAT/BACS differentiated by their various levels of
functionality and that these are not aggregated with other options that might be less cost
effective to implement
e) Develop guidelines regarding the design of programmatic actions to stimulate savings through
BAT/BACS as an alternative means of complying with Article 14 requirements
f) Develop guidelines on how best to treat BAT/BACS within EPCs
g) Encourage MS to consider partially satisfying Article 10(2) requirements regarding financial
support measures with measures that target effective BAT/BACS deployment
h) Encourage MS to amend their application of EPCs to analyse the difference between asset and
operational ratings and using this to provide direct guidance on the need to improve the

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BAT/BACS/control strategy (as discussed in the EPC section above). If necessary, trial this
concept and support the development of analytical tools to support this process.
In general it can be said that while provisions requiring the use of adequate controls in new buildings
and renovations are necessary to stimulate uptake of energy-saving controls, there needs to be much
greater reflection regarding how they should be framed and specified to ensure that they are clear,
usable and encourage good practice. It is therefore recommended that an expert task force be
established to prepare guidelines on these specifications and to review/critique existing specifications.
To ensure that the recommendations reflect real application, the task force should include review
from practitioners who would be expected to use the requirements and not just from experts in the
control industry or researchers. Once clarity on the optimal regulatory specifications has been
established, EU Member States should move to implement them fully in their building codes and to
monitor implementation experience to ensure desired results are being achieved, making informed
adjustments if not. The European Commission could facilitate coordination of this process.
ENERGY EFFICIENCY DIRECTIVE
The EED has a great many articles that could be applied to strongly promote energy savings through
BAT/BACS but at present there is very little evidence in MS submissions via the NEEAPS or other
documents that they are applying these provisions to the realisation of savings through BAT/BACS. In
particular, the provisions for Energy Efficiency Obligation schemes under Article 7 could be
implemented to provide the necessary funding for training, certification/accreditation and for
BAT/BACS deployment.
ECO-DESIGN DIRECTIVE
While it is correct that the majority of BAT/BACS savings potentials are not achievable via measures
that could be implemented under the Ecodesign Directive, however, only the most miniscule fraction
needs to be for BAT/BACS to leapfrog other products on the 2015-17 plan shortlist.
Under the current scrutiny rational the following elements are considered:
a) The potential for design-related improvement options;
b) The degree of differentiation between products;
c) Whether the product group is strongly integrated into a system, such that its performance
depends on the design of the system, so instruments that target the system are more suitable.
With respect to points a) and b) there are clearly functionality and performance differences between
different BAT/BACS and as the potential for energy savings related to these is contingent on these
design differences there is a significant savings potential related to the product design.
With respect to point c) it is more true to say that the performance of the system (in this case the
building energy services) depends on the quality of the BAT/BACS it is controlled/managed by than
the other way round. Policy instruments that target BAT/BACS as a system are certainly needed in
addition to any Ecodesign measure and will most likely lead to substantially greater savings, however,
the criterion that should be applied to assess the eligibility for BAT/BACS under Ecodesign is: will the
inclusion of BAT/BACS within the 2015-17 plan lead to a process or measures that produce greater
savings than products currently in the top of the list?
On this point one can anticipate that the simple action of including BAT/BACS within the Ecodesign
process will help to clarify to the EC’s satisfaction what potential there is for savings under BAT/BACS
and what part of these could be realised by actions directly on the product (via Ecodesign policy
measures) as opposed to what part needs to be addressed under other directives or instruments.
Explicit Ecodesign measures that could apply to BAT/BACS products directly include:

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 Requirements on interoperability (i.e. to ensure or encourage products to use open
communication and control standards so that they can work with the maximum proportion of
HVAC and other energy services equipment)
 Requirements on functionality (i.e. to ensure or encourage products to have sufficient
functionality to enable significant savings to occur)
 Requirements on usability (i.e. to ensure or encourage products to be more user friendly,
perhaps through adoption of common user interface templates in line with industry best
practice, but also (depending on the product type) to provide alerts when extreme energy
losses occur (e.g. when the same zone is being heated and cooled))
 Development of a common performance classification scheme leading to requirements on the
disclosure of the classification perhaps via labelling or a rating disclosure process (either as
components or within a larger system classification scheme)
 Requirements on the sensitivity and permitted tolerances of BAT/BACS
 As a stimuli to repeat commissioning via a requirement for an inbuilt alarm when a set period
has passed since the last system commissioning
Each of these would be expected to lead to energy savings, either directly or indirectly, that would
comfortably exceed the savings projected for other product groups currently considered. Were it
possible to develop a mandatory EU-wide energy performance classification scheme for BAT/BACS,
under either Ecodesign information requirements or energy labelling requirements, this would greatly
foster dissemination of awareness regarding the distinction in performance between different
BAT/BACS solutions and could greatly foster promotion of the value proposition and good practice in
the market.

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ANNEX – ABOUT LEONARDO ENERGY
Leonardo ENERGY1
, the Global Community for Sustainable Energy Professionals, aims to accelerate the transition
to a more sustainable energy economy through education and advocacy.
Leonardo ENERGY provides free education and training and promotes the exchange of expertise. It publishes
Good Practice Guides, tutorials and e-learning courses to equip professionals around the globe with the
necessary skills to make the energy transition.
Its webinars offer regular briefings on sustainable energy technology, policy and economics. They have enabled
over 15,000 participants to keep up to speed with this fast-evolving field and to exchange views with colleagues
around the world – all from the comfort of their own desk.
To codify best practices into standards, the Leonardo ENERGY team is active in a multitude of EU and
international standardisation committees. It also provides regulatory advice to bridge the gap between
technology and policy.
The community is managed by the European Copper Institute2
, in close cooperation with its international
partners.
1 See website: www.leonardo-energy.org
2 See website: www.copperalliance.eu