Industrial Internet and energy efficiency in the Middle East


Industrial Internet and energy efficiency in the Middle East

When a car’s fuel is running low, a little dial will let you know, and on the average car you can bet you’ve got about 40km at most to go before you are truly out of juice.

Now, imagine having a dial or a light alert a building manager or homeowner that one of their air conditioning units is entering the first stages of a problem, getting to the AC unit in enough time to prevent it from using excess electricity to keep going.  

As the Middle East region grows so too does their consumption of energy. Currently the energy consumption of the MENA region is second only to that of CIS. In a 2013 report from the World Energy Council, it is predicted that energy consumption in MENA will rise by as much as 114 percent by 2050.

In the UAE, buildings consume twice as much in energy as they should, according to Taka Solutions, an energy services company based out of Dubai. Utilities account for as much as 40 percent of operational costs for buildings in the Emirates.

In MENA and Turkey more broadly, the consensus among startups spoken to by Wamda is that most existing buildings could easily reduce their energy consumption by 25 percent - with very short payback periods - simply by implementing several energy saving measures.

Buildings should be more compatible with environment. (Image via iStock)

Three reasons stand out when it comes to a building wasting/over using energy:

  1. “The mis-operation of a building’s HVAC system is a typical reason why a building will be wasting money on energy,” says Turkey’s Reengen cofounder Şahin Çağlayan. “This could include the use of preset schedules to run the units. A building is dynamic, it’s like a living being, you cannot actually predict always how it’s going to work each day.”

  2. Malfunctions in mechanical systems. If they are not properly managed they will consume 10 to 30 percent unnecessary energy.

  3. Where the energy is being procured from. “Buildings don’t normally have an holistic approach when it comes to where say the electricity is coming from,” says Çağlayan. A mis-matched tariff can result in wasted money.

Management consultants Oliver Wyman conducted a study looking at how the region could potentially reduce costs and they found that consumption could be cut by 25 percent, or even up to 50 percent, by 2030.

Part of the solution for managing these issues and cutting consumption is the Industrial Internet.

What is it and what does it do?

Described by General Electric’s chief economist Marco Aunnunziata as the “third metamorphic change” that is occurring in the lives of humans, the Industrial Internet comes in the wake of the industrial revolution and the internet revolution.

Put simply as the ‘marriage of minds and machines’, the Industrial Internet  is the converging of industrial machines and the internet. Industrial machines - airplanes, trains, power grids, or turbines - are equipped with thousands of sensors that allow them see, hear and feel, generating huge amounts of data.

With the evolution of machine intelligence, and machine to machine communication, the way machines are used has become more efficient. These machines include those found in buildings, such as HVAC (heating, ventilation and air conditioning) units. The communication then between machines and engineers allows for more efficiency when it comes to maintaining them and in turn, the building and its energy consumption can be better managed.

Startups are part of the solution

Startups usings big data and analytics software, alongside Internet of Things (IoT), all part of the Industrial Internet, are increasingly important when it comes to optimizing industrial and energy infrastructure.

Companies across the region are working in similar ways, with software and sensors, to evaluate a building’s true energy expenditure, to see where they are wasting energy and then to provide models for those buildings that will help the owners better manage them.

Founded in 2012 Reengen have already managed to open offices in Istanbul, Ankara and California, and have operations in Mexico and the Dominican Republic, and soon they will be working in the Congo, Uganda and France.

Reengen's Provolta.

With their four energy apps - energy analytics, energy optimization, predictive maintenance and on-demand site management - they are creating a solution for saving energy.

Using an existing building management system (BMS) - the computer controlled system installed in most buildings that looks after mechanical and electrical equipment, such as the ventilation, lighting, and security - Reengen is able to adapt their bespoke software Provolta to integrate with, and start collecting data from the building straight away.

According to Çağlayan wasted energy is not an infrastructure problem, simply a software problem. He  believes any building can be adapted to become energy efficient.

Of course, the older a building is the harder and more expensive it is going to be to address efficiency. An electricity panel can be changed, says Çağlayan, and then the infrastructure of the building would be looked at.

Dependent on a building’s size, Çağlayan says this can initially cost between $1,000 and $3,000. They can install wireless sensors, wired sensors and indoor air quality sensors into the building and collect the data, “learning the building’s behavior, zone by zone, as a whole, and then in less than one month we have developed a model of (it) ”, says Çağlayan.

Even larger structures, like airports, are not out of the reach of startups. Satchnet, operational since 2003 and based in Jordan and Palestine, works with Queen Alia International Airport. Wanting an upgrade on their out-of-date BMS system, one of their top requirements was that different temperature levels in different parts of the airport not cost them the world.  

Hop over to the UAE, and a group of American engineers have founded Taka Solutions. Much like Reengen they are able to highlight systems that are not energy efficient and use software to identify and solve the problems.  

In 2012 Charles Blaschke and some friends decided they would look to tackle the energy wasted by what seemed to be a rising number of poorly constructed, unhealthy buildings in the UAE.

“We did think of going to Europe or the US, and then eventually coming back here,” he says.

Using building management systems, building information modelling (BIM) and energy modelling, they take real time energy data and make precise forecasts on energy and its cost.

Blaschke, a Missouri native who’s been in the region eight years, wants to reduce the world’s consumption of energy by 10 percent.

“Buildings consume 40 to 50 percent of energy worldwide,” says Blaschke. “And we know with current tech available you can reduce a building’s energy use by 30 percent, so we have the ability to [make an] impact.”

Tracking temperature, humidity, wind and visibility across our building sites and officially registered weather stations (airports etcetera).  We use this to see macro weather patterns and their impact on buildings and their energy use.

Blaschke says money is a huge barrier for building owners, even for the ones that have the financial resources, this is why his teams use performance contracts to reach their consumption reduction goals.

Tackling the homeowner

When it comes to the energy consumption equation, the 30-story building isn’t the only one guzzling energy that could be saved. Private homes and the local business are also guilty of energy theft. According to Oliver Wyman up to 70 percent of the demand from consumers is for cooling in the residential and commercial sectors.

And if a cafe or a commercial fleet of trucks can make savings on their consumption, Tunis-based Chifco will find a way.

Tackling the home and the individual, Chifco’s solution Smart Life is their product that helps the consumer, with the use of sensors, cut their energy use with a single piece of hardware, supplied by the major telecom partner that they are soon launching with.

With the use of a box that controls all the other devices in the home, smart plugs and multi-sensors, Chifco can give users information in real time on the app.

“We specialize in IoT, first and foremost,” says Chifco’s chief marketing officer Rim Zouabi. “It is clear Smart life has a green edge as it helps the consumer follow their energy consumption in real time and consequently diminish it.”

Chifco has other products available that enable the collection of big data and lead to efficiency for users. They have a digital surveillance camera for the home; a WiFi hotspot, largely for service structures, enabling clients to collect information about customers through available WiFi connections; Gfleet, Chifco’s commercial fleet management solution, allows businesses to track how long their drivers take to complete tasks and better manage the fleet’s performance.

Establishing an academic side to their business they’re working with the World Economic Forum, to research the causes of energy peaks in Tunisia and ways in which to avoid them by creating solutions at a consumer level.

Planet data

As well as using IoT to reduce the cost of energy consumption, all four companies are using big data and the internet to solve fundamental problems with the way these buildings and the people inside them - use energy. But they’re also trying to use that data to tackle bigger, region-wide issues.

SatchNet is in the early stages of a partnership with a US company, using the analytics they are currently gathering from buildings they’re working on, to better predict how they can maintain the infrastructure and its energy consumption. They hope to start using the data for predictive and condition based maintenance.

Chifco use their Smart Life and Gfleet data to also look at how to tackle wider energy consumption and pollution problems.

“The potential of big data to alleviate the energy/pollution crisis […] by collecting the data from all the cars and observing fleets conduct, we can [find ways to] avoid pollution peaks,” Zouabi said. “The possibilities to do good with big data are endless.”

“Once we collect the raw data, which our clients have access to after they install the product, we can treat the data and give it to our customers,” she says.


Blaschke says the quality of the parts, say sensors for monitoring movement and heat, they need, is not always up to scratch: “There is a problem with quality suppliers and those that actually do the work…across the board.”

“What we do isn’t rocket science,” says Blaschke. The ideas are not new and he says they are able to access pretty much any part needed within eight weeks.  

Taka Solutions have not managed to hire locally either, going to Australia, South Africa and the US to find those who can do what they do.

But probably the biggest challenge? Education. Blaschke and Obeido agree that people not understanding the environmental issues are a hurdle.

“It’s high-tech and people are reluctant,” says Obeido. “They understand light bulbs […] the market is still not mature enough for that.”

For Taka Solutions, the time it takes for someone to sign a contract “is crazy”. According to Blaschke it can take 12 to 18 months, and once that is done, it’s about two more years until they get paid. That said, typical contract lengths are five to seven years, and within four months of launching Taka Solutions was actually turning a profit.

Despite its oil-rich history, the Middle East cannot rely solely on its remaining reserves. According to OPEC numbers in 2013 there were approximately 815 billion barrels available in the MENA region, across different countries.

Saudi Arabia and the UAE, as examples, do have energy efficiency plans, as well as investments in green technology, but looking to the startups such as these mentioned, is the way forward.

Blaschke adds: “We’re not trying to sell smoke and mirrors.”

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