In the first blog of our FDD series How Fault Detection & Diagnostics (FDD) Software Continues to Solve Building Management Challenges, we introduced Fault Detection and Diagnostics (FDD) – a type of building analytics for mechanical and base-build systems and a staple module in any smart building program. We covered its key features and the value it brings to building operations and maintenance teams.
In this second installment, we dive deeper into the business case, focusing on what FDD means in practice for building engineers and maintenance professionals considering an FDD implementation or transitioning to a preventative maintenance approach.
Part 3 (coming soon) will explore real-world lessons from large-scale deployments and explain why ICONICS is uniquely positioned to integrate FDD technology with other building performance applications.
Beyond the Bottom Line – Building the Business Case
1. Energy Efficiency and Cost Savings
FDD isn’t just another analytics tool; it’s a proven way to cut energy waste, streamline building operations, and support ESG (environmental, social, and governance) goals. Whether it’s referenced in ASHRAE’s Handbook Guidance (Chapter 41, Section 2.1) or cited by energy consultants as “low-hanging fruit” in an energy management strategy, FDD gets results. It moves beyond reporting and portfolio-wide metrics to empower service professionals on the ground to prioritize and fix issues faster. In other words, they can get more done.
Extensive research backs its effectiveness. A recent study (Building Analytics Tool Deployment at Scale: Benefits, costs, and deployment practices), confirms that coupling Energy Information Systems (EIS) with Fault Detection and Diagnostics (FDD) is a proven strategy for sustained energy savings. By year two, organizations using FDD saw a median savings rise to 9%, as users became more adept at leveraging insights and embedding analytics-driven efficiency into their operations.
Figure 1. Second-year energy savings achieved by organizations using Energy Information Systems (EIS) and Fault Detection and Diagnostics (FDD), highlighting the median savings and cost benefits over time. Adapted from Lin et al. (2022).
Additionally, continuous measurement and verification (M&V) enable facility teams to track decarbonization progress, optimize building performance, and support carbon neutrality targets. For example, FDD can identify opportunities such as utilizing free cooling when outdoor temperatures allow or detecting frequent on/off cycling in a boiler—preventing premature equipment wear and inefficiencies.
Here are some proven ways FDD directly improves building performance:
FDD provides both direct savings (real-time alerts to correct control sequences) and indirect savings (reducing excessive cycling and runtime anomalies, extending equipment lifespan, and cutting down on costly repairs and premature replacements).
2. Operational Efficiency – Maintenance-Cost Benefits
Most buildings rely on scheduled maintenance—technicians perform manual checks at set intervals (weekly, monthly, quarterly). When they inspect, say, cooling towers, they follow a predefined A-B-C checklist (i.e., verify float valve operation, measure energy parameters, or clean the heat exchanger surfaces).
Rather than relying solely on manual inspections, FDD enables remote monitoring of HVAC, lighting, and metering systems. This minimizes unnecessary site visits, cutting fuel costs, and technician downtime while keeping maintenance teams focused on high-priority fixes. For teams that embrace this shift, the operational efficiencies gains can be enormous. According to the US DOE O&M Best Practices Guide, Release 3.0, predictive maintenance delivers significant cost reductions and reliability improvements—far outweighing the initial investment.
Figure 2. Graphic adapted from the U.S. DOE O&M Best Practices Guide, Release 3.0 (2010).
3. Improved Indoor Environmental Quality (IEQ)
FDD ensures HVAC and lighting systems maintain optimal performance, directly impacting occupant comfort and health. Consistent temperature control, better air quality, and reliable lighting systems enhance the overall building environment, leading to higher tenant satisfaction and productivity.
Example: In a large commercial skyscraper, an air handling unit (AHU) in a mechanical plant room with a stuck-open outside air damper during winter can result in excessive unconditioned air, temperature fluctuations, increased HVAC loads, and occupant discomfort. While a BMS may flag the damper issue, FDD goes further by:
- Diagnosing the root cause.
- Quantifying the energy impact of the heating system having to compensate (~3-4,000 kWh per day).
- Prioritizing the fault based on real-time conditions.
FDD as a Functional Testing Tool (FTT) During Commissioning Phase & Warranty
Facility managers often face difficult decisions on whether to repair or replace aging equipment. FDD provides objective, data-driven insights on asset health, ensuring capital investments are made only when necessary. This way you can prioritize replacements based on actual degradation trends rather than arbitrary age-based schedules.
FDD isn’t just for long-term maintenance though—it’s a powerful tool for new buildings and retrofit projects as well. While its primary function is ongoing commissioning over a building’s lifecycle, its ROI is just as strong in new developments. One major benefit—catching faults within the warranty period.
Example: In a newly opened 750,000 sq. ft. hospital, a high-efficiency AHU was installed to regulate airflow in critical care areas such as operating rooms and intensive care units. Within the first few months, FDD flagged an issue: the variable speed drive (VSD) on the supply fan was constantly running at full speed, even when demand was low.
While the BMS did not generate an alarm, FDD diagnosed the root cause—a faulty control logic sequence preventing the VSD from modulating properly. Because the issue was detected within the equipment’s warranty period, the hospital:
- Avoided a $25,000 fan replacement cost.
- Ensured compliance with ventilation regulation.
- Prevented unnecessary energy waste amounting to 15,000 kWh per month.
Traditional commissioning typically verifies only 10% of building systems, leaving 90% untested. By comparing expected system performance with real-world fault trends, FDD ensures that contractors deliver fully functional systems, preventing post-handover disputes and costly rework.
A Day in the Life: Facility Management with FDD
It’s 6:00 AM on a cold Monday morning. Your office building hums to life after its 5:00 AM warm-up mode—fans ramp up, outside air dampers modulate, and the air handling unit starts at low speed. Gone are the days of blindly ramping up HVAC, lighting, and ventilation at full tilt. Instead, an Automated Fault Detection and Diagnostics (AFDD) system ensures a smooth, data-driven start. Sensors throughout the building relay real-time conditions, ensuring optimal operation. No wasted energy. No unnecessary strain on equipment. Just a perfectly tuned system.
At the same time, in a digital control room a few miles away, building engineers and an operations team oversee tens, if not hundreds, of buildings in real time. FDD consolidates fault detection across every asset, ranking issues by severity and impact on energy, comfort, and cost.
Instead of individual site teams reacting to isolated alarms, a centralized maintenance hub can triage and dispatch engineers only where needed, thereby optimizing manpower and reducing site visits. The ability to identify widespread systemic issues, such as recurring sensor failures across multiple locations, allows for enterprise-level performance improvements.
This multi-site view ensures facilities teams are proactive rather than reactive, preventing failures at scale and driving efficiencies beyond what any single site could achieve alone.
Overcoming Barriers to Implementation
If FDD is so effective, why don’t all buildings have it? Excellent question. Here are the most common objections, and why these don’t hold up:
- “It’s too complex.” → Modern FDD solutions integrate directly with existing BMS solutions and are designed for ease of use. You don’t need to be a software engineer to configure or use a system designed for ease-of-use. While BMS offer extensive control capabilities, configuring analytics at scale can be complicated, proprietary, and noncompliant with modern accessibility guidelines. That’s not usually the case with a supervisory control platform coupled with FDD.
- “It’s expensive.” → One or two major equipment failures prevented by FDD can cover its entire implementation cost. The reality is the annual costs are around $0.12 per square foot, and a similar figure for initial implementation. Of course, costs vary by vendor, functionality, data points, and active users.
- “It’s just another management tool.” → FDD is not just another glorified BI tool—though some powerful FDD tools include that too. It's built for engineers—saving them time by automating routine checks and highlighting real issues before these become costly problems.
Fundamentally, FDD is about empowering change, starting within the control room and cascading outward.
Need Help Building Your Business Case?
FDD isn’t just another piece of BMS software—it’s a game-changer for building operations. Our team of software and smart building experts can help you gather requirements and make the business case for your organization.
Email us today to learn how FDD can transform your building’s performance: buildingautomation@iconics.com
Coming soon: Part 3 of our FDD blog series on lessons learned from deploying FDD at scale, and how ICONICS automation/digitalization software makes implementation easier.