Determinants of innovation diffusion in the real estate sector: A case of monitoring building commissioning for existing buildings

Ari Laitala and Kauko Viitanen

ERES from European Real Estate Society (ERES)

Abstract: Building commissioning (abbr. as Cx) is a technical application and a procedure where the functioning of a building is investigated and enhanced in the areas of energy efficiency and indoor climate. Monitoring based commissioning (MBCx) for existing buildings is a sophisticated version of commissioning which uses smart metering and internet technologies to confirm that building automation is functioning properly. The procedure is relatively well known in the US, where approx. 15 % of energy savings are achieved after the implementation of MBCx projects. On the other hand, the payback times of the projects have been only around one year. However, this innovation hasn¥t pervaded e.g. to Europe on a larger scale which raises the question of innovation diffusion. In this study, conducted in Finland, the determinants of innovation diffusion related to building commissioning are researched. In the study the Delphi method was employed. The results of the first two rounds show that most of the criteria of a successful innovation are fulfilled, like relative advantage, compatibility, low complexity and risk reduction. There are anyway further criteria for the innovation to be adopted. An innovation has to be successful in the areas of communication, social system and timing as well. According to the Delphi panel, there is still lot of missing awareness and lack of knowledge even among building automation experts. There are also uncertain views of what could be the appropriate business models. Should MBCx be sold and bought more like a product or a service and should there be some kind of reorganization between the relationships of building owners and tenants. In the conclusion, the preconditions of the innovation diffusion process are summarized and MBCx is compared against the formed framework. Finally there seems to be a reason to ask a question: (retelling Mills, E.) are we losing a golden opportunity for reducing energy costs and greenhouse gas emissions.

JEL-codes: R3 (search for similar items in EconPapers)
Date: 2012-01-01
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