Photo Credit: Photo: SageGlass
Smart glass is everywhere. You just might not ever notice it.
Since the 1980s, automobile makers have used photosensors on rearview mirrors and side mirrors for automatic dimming to reduce light glare. The technology -- also called dynamic glass or switchable glass -- is becoming a ubiquitous feature on cars and trucks, expanding to other features on vehicles like sunroofs and creating a market potentially worth billions of dollars in the U.S.
Just as solar cells were once confined to calculators and space missions, smart glass has been mostly confined to small-scale applications. But it's now increasingly being used for large, building-integrated applications to reduce energy consumption, sparking new interest from both startups and large glass makers.
However, making the technology a ubiquitous piece of the built environment will take a lot more experience in the field and a lot more scale in production through partnerships with major glass manufacturers.
"This market is still very nascent," said Eric Bloom, a senior analyst with Navigant Research. "So far, durability has been pretty good, but we need to see more long term stress testing. We also need to see more high-volume manufacturing to ensure quality control and economies of scale."
There are three main types of smart glass -- electrochromic, thermochromic and photochromic. Electrochromic glass utilizes a thin film of metal oxides that can tint a window when hit with a small amount of voltage. The glass stays clear or translucent on the inside and gets darker on the outside, lowering cooling loads and reducing the need for window shades. Thermochromics and photochromics perform the same basic function by reacting to heat and light, respectively, rather than a jolt of electricity.
The technology is fairly straightforward and seems like an obvious choice for building owners and architects looking for a simple solution to cut energy costs. But the glass is still expensive, has a limited track record and is mostly confined to high-end projects where cost may not be a limiting factor.
"At this point, there's still a bit of product risk, which could hold it back a bit in the broader buildings market," said Bloom, who recently updated his Navigant report on the global smart glass market. Although the industry will grow revenue and production volume modestly through 2016, Bloom expects the value of the market to expand ten-fold from $88 million in 2013 to $889 million in 2022.
Throughout this time period, two companies -- SageGlass and View -- will dominate the market. Both firms are developing electrochromic technologies in partnership with large glass manufacturers.
In 2012, Sage was acquired by the French building materials producer Saint-Gobain, allowing it to scale up to 4 million square feet of production capacity per year. This came after an $80 million investment from Saint-Gobain in 2010 and a $16 million venture round from Applied Ventures, Bekaert Corporation and Good Energies.
View has also received backing from top buildings materials companies, closing a $60 million round in June led by glass maker Corning, and included participation from Khosla Ventures and General Electric. With help from a stimulus loan and an earlier $60 million venture round, View is moving toward 5 million square feet of production capacity annually.
These partnerships with large materials producers don't guarantee an end market for smart glass, but they do provide deep sales channels and invaluable resources for growing manufacturing capacity. They also provide a model for startups looking to step into the market.
Heliotrope is a California-based startup with a new technology that differs from the electrochromics being developed by Sage and View. While "conventional" electrochromics can't filter out light and heat at the same time, Heliotrope is using a material made of indium tin oxide crystals that can do both.
According to a research paper published in Nature this month, the material can absorb more than a third of near-infrared radiation. When those "nanoscale heat sponges" are applied to a layer of niobium oxide on glass, the technology allows for heat and light to be blocked simultaneously or separately, providing an added layer of functionality and potential cost savings.
"We have a new active material that allows you to block the solar spectrum," said Heliotrope co-founder and chief technical officer Guillermo Garcia. "Now we are thinking about the commercialization pathway."
The company, which is being supported by a $2 million seed round, will soon send out samples of its product to glass manufacturers. It is still working on building a prototype skylight in partnership with the Lawrence Berkeley National Laboratory and plans to raise funds for a pilot line in the next couple of years. Heliotrope's Garcia estimated that the company could reduce manufacturing costs by 50 percent through solutions-based processing.
"The technology is a major step forward and is pushing the envelope of what smart glass can do," said Navigant's Bloom. "But it's still a science project at this point. Until you have 5 million square feet of manufacturing, you're not really market-ready."
Becoming market-ready will take a lot more proof that the material will hold up over a ten- or fifteen-year period. Navigant modeled a fourteen-year payback for a 160,000-square-foot building integrating smart windows -- a timeframe that matches up with possible degradation problems. With leading manufacturers still trying to prove the viability of their product, Heliotrope has a long road ahead.
Reaching a meaningful scale will also mean building relationships with big glass companies.
"A company like Heliotrope will need to find the same partnerships," said Bloom. "There are so many middlemen between manufacturers and building owners, they would have to find an open pathway to market."
For now, even with a good channel, smart glass remains a tiny fraction of the global windows market. And with electrochromics costing roughly twice as much as a standard double-paned window, producers will need to show their products hold up over the lifetime of the investment. As a result, most of the smart glass being installed through 2016 is being done without a strict ROI mentality.
"That’s the world that smart glass is playing in right now. The purely business case is still not a major factor," said Bloom. "But that will change as the technology proves itself -- and these partnerships will help build a better product."