Cisco's new "Smart Connected Buildings" is the latest initiative that aims to create tools using IT technology (via IP, the internet networking protocol) to make buildings smart about energy. The company's Network Building Mediator will connect building management functions that were previously disjointed islands of their own, namely HVAC, lighting, security and renewable power systems.

According to Cisco, the application enables companies to "monitor, measure and act on energy systems while adding renewable technologies such as solar, wind and fuel cells as well as energy-efficiency programs such automated demand-response programs to reduce capital and operating expenditures." The focus is on taking proprietary systems and sets of data, and use web applications to enable it to be shared and acted upon. Cisco says it will use industry open-system protocols and converts the building energy data to open XML/SOAP Services so that it can be used by utilities and grid operators.

A key part of corporations and government adding intelligence to their energy management systems is that in addition to reducing a company's carbon footprint, projects are usually expected to be revenue neutral or in many cases profitable. There are concerns that connecting the grid via IP is an invitation to "cyberterrorists," but the banking system has moved online and continues to function. Similar security measures will be taken to ensure that energy data is protected.

Cisco has teamed up with Duke Energy on developing a smart grid communications infrastructure and is working on applications that enable cities to track their carbon emissions.

Cisco is only one of the many large IT organizations aggressively creating applications for integrating building management systems into the smart grid. IBM, SAP, AT&T and GE are all in the mix, as well as energy management companies EnerNoc and Echelon, which are expanding the scope.

Building automation and energy management have been niche industries, but new emphasis on carbon reductions and the financial benefits of energy efficiency are pushing them to the forefront.

It is an interesting paradox that IT is seen in some respects as a savior for energy efficiency when IT departments have paid little to no attention to energy efficiency. That is likely to change soon.

John Gartner is Editor in Chief of Matter Network and an Industry Analyst for Pike Research.