The world is currently in a global energy crisis. One of the biggest reasons is the war in Ukraine that has led to economic sanctions towards the Russian Federation.
The EU and the US have decided to reduce their dependence on Russian gas and oil and stop the import. As Russia is the world’s biggest exporter of gas and the third biggest oil producer, the scarcity of these resources on the market caused rising costs of energy and pushed countries to look for alternatives – both in resources and technology.
The biggest challenge we face is how to use energy more efficiently until we develop the infrastructure for renewable energy, but also beyond that, because we’re also facing climate issues.
It seems technology and engineers might come to the rescue again. Today, we’re talking about a rising tech sector that promises to increase energy efficiency with Nenad Bozic, the CEO of Smart Cat, the brain-powered AI company from Novi Sad, Serbia.
They have been developing PropTech solutions that focus on energy efficiency for 4 years now and have achieved astonishing results.
Nenad, thank you for taking the time to share your experience with us. Could you tell us more about PropTech, and how it emerged as a separate industry amongst other solutions?
PropTech stands for Property Technology. It entails solutions that help you manage buildings more efficiently. They help you optimize space utilization, energy consumption, and sales/renting processes – while bringing you savings and eventually more profit.
Our primary area of focus was energy consumption optimization. If we follow the path of energy distribution, we can see that buildings consume up to 30% of global energy production, and the majority of that energy goes into heating, cooling, and appliances.
The first question in the whole tech industry was if we could somehow optimize that. If we could, we would achieve many goals at once – increased savings, optimized budgets, lower CO2 emissions, environmental benefits…
We love challenges that bend our neurons to make the world a better place. That’s how we started working on it.
Can PropTech protect the environment?
Implementing PropTech solutions to optimize energy consumption indirectly affects the environment. If you increase energy efficiency and lower the consumption, you’ll reduce the level of CO2 emissions.
On one hand, you take less energy from the grid and this in turn reduces the amount of resources needed for production.
On the other hand, when you optimize the operation of appliances, you reduce the levels of CO2 emissions.
PropTech saves your pocket and the planet at the same time. We don’t have to sacrifice one for the other.
Do you believe governments should incentivize the PropTech sector, especially now during the crisis?
Absolutely. Governments across the globe are already doing much by imposing regulations. There are laws in the EU and the US that regulate the level of CO2 emissions from buildings. These measures increase the awareness of solutions and positively impact the market.
Another step could be in offering investments and funds on a national level for innovative PropTech solutions, or giving financial incentives to companies and landlords that implement the infrastructure.
Are there many companies in Europe that work on PropTech in the energy sector?
According to public statistics, in the past 10 years, more than 200 PropTech companies were founded in the EU alone. That number is certainly higher if we consider tech companies that aren’t necessarily PropTech companies but they do work on solutions and ideas in this domain.
To be more efficient in this domain and motivate more companies to participate, we should foster strong collaboration between property owners, energy experts, and IT engineers.
They all have to sit at the same table and discuss solutions. This is the area that doesn’t work in an isolated silo, especially when you add Machine Learning and Artificial Intelligence to it, as we do at Smart Cat.
It’s not enough to have the expertise to build something. You need domain experts who can put a finger on a problem and tell you what to build – and why.
What’s your biggest achievement in the PropTech sector so far?
We achieved many things – from creating solutions that optimized space occupancy by 90% to algorithms that reduced electricity consumption and CO2 emissions for 15%. Our software is now being used to connect everything from appliances to security cameras into one IoT system.
However, since we’re specializing in smart buildings, our greatest achievement is our own solution – Optimus Power. It optimizes the operation of HVAC systems in buildings, while preserving the comfort level for tenants, by using the data from internal and external sensors.
The system detects anomalies, alerts you if something needs to be maintained, turns appliances on and off automatically based on the space occupancy level – and collects all of this data into one dashboard.
The results show great savings on electricity costs and vastly reduced CO2 emissions.
What’s your vision of the future for PropTech and the property management industry in general?
I believe smart buildings will become a standard in 10 years or less. Our devices are already connected in many ways.
For example, you whisper into your phone – “Alexa, I need a new TV”. It connects to your payment processor that sends the data further to the factory. Data from the factory gets automatically delivered to the vendor… With just one whisper, you got a device in 2 weeks delivered to your door, with no contact with the manufacturer.
The same can be done with buildings. It’s just the level of commitment and investment that worries potential adopters.
We’ll connect systems and appliances in buildings and increase possible customizations.
The low hanging fruit that we might cover in the following years are the monitoring of peak hours in hotels, banks, and hospitals and optimization of the workforce presence accordingly.
There’s also a lot of potential in monitoring and shutting down unnecessary energy consumers while a property is empty to save energy.
I can’t wait to see what awaits us!
Thank you, Nenad, for sharing so much valuable information with us and helping us understand more about PropTech and its potential.