As Economy Improves is Sustainability Back in Vogue?

Prior to 2008 it seemed every company was talking about sustainability.  It was unprecedented the number of corporations that were putting out sustainability reports or hiring senior executives responsible for corporate "green" strategy.  That changed with the financial crisis.

In a few short months the "green" movement was replaced with concerns about jobs and saving the financial system.  This is is a quote from a blog post I did back in 2008 shortly after President Obama was elected to his first term.

Remember a few months back when oil peaked around $140 a barrel. Of course you do...But do you also remember the momentum behind the green movement due to the reality of limited resources and escalating energy prices. Everything looked possible- a shift to renewable energy, energy conversation, higher gas mileage vehicles, and climate change legislation.

Now, only a few months later and oil is around $60-70 a barrel (I just filled up my gas tank for $1.90 per gallon) We saw an economic meltdown the likes that has not been seen since the Great Depression.

While the economy floundered, so did the green movement.  Environmental issues were an after thought in the two presidential elections.  President Obama slowed down his aggressive push toward climate change regulations.  

Now it appears the economy is on firm enough footing that the sustainability movement is getting back its mojo.   For example, take the recent New York Times Article discussing First Energy's agreement with activist shareholders that want lower carbon emissions from the utility.

As part of an agreement reached with shareholders, First Energy agreed to study and report on what it could do to help meet President Obama's goal of reducing carbon emissions by 80 percent by 2050.  

The Times notes that the agreement "comes as investors are increasingly pressuring corporations into action on climate change."  In the 2013 proxy season, "shareholder submissions grew more than 6 percent compared with the year before, with environmental and social proposals representing the largest category, at just under 40 percent."

As of today, the price of oil crossed back over the $100 per barrel threshold. As the economy improves commodity prices will again rise.  Higher prices for raw materials and energy pushes companies to think more aggressively about conserving resources.

As we head into 2014, my bet is you will start hearing that "sustainability" buzz word more and more.  

Small Business See Benefits of Energy Efficiency Projects

Small businesses are deeply concerned with the economic impacts of the proposed cap-and-trade legislation currently pending in Congress.  Although small businesses will not be covered by the cap, if a price is placed on carbon, small businesses will feel the economic impact through energy price increases.  This is particularly true in the Midwest which is heavily reliant on carbon intensive coal power for its electricity generation.

With the hot national debate over cap-and-trade,  it is understandable that everyone is focused on the potential impacts of climate legislation on the economy.  However, I think this ignores the broader reality.  As discussed on this blog before there are other factors at work driving energy prices higher. (See, Cap and Trade: Job Killer or Call to Action for Coal States)  These include:

  • A new program requiring control of mercury emissions from coal fired power plants
  • Ever tightening federal ozone and fine particle pollution standards that will result in additional compliance costs for utilities
  • A revamped cap-and-trade program for utilities in light of the Court decisions regarding the Clean Air Interstate Rule
  • Potential tighter regulations on ash ponds and other utility wastes

If commodity prices rebound as a result of the economic recovery, price increases will be compounded.

For small businesses who are not prepared, high energy prices could force them out of business.

So, how can small businesses meet this threat through strategic action?  I would submit that any small business that is even moderately energy intensive should aggressively consider adopting energy efficient practices.

Today, the National Small Business Association released a report assessing the value of one practice, called "on-bill financing", that shows tremendous promise in reducing energy usage by small businesses.  According to the report, energy-efficiency programs such as on-bill financing can help the average small business save $4,932—and oftentimes more—every year on its energy bills.

On- Bill Financing- How it Works

Despite the benefits of energy efficiency projects, common barriers exist that prevent many businesses from implementing cost saving measures.  As detailed in the report, these include:

Cash flow: With tight margins and relatively small revenues, many small businesses find it challenging to undertake new capital investments, even if they will save money over time.  Fifty-two percent of small-business owners see cash flow as the primary barrier to investing in energy efficiency.

Up-front capital required: A typical energy-efficiency project might cost from $7,500 up to more than $20,000, with some projects costing a bit less and a few costing far more. 

Energy efficiency is only one priority among many: Small-business owners are heavily focused on the business at hand: managing inventory, maintaining payroll, providing health insurance, etc. They rarely have the time to focus on their energy bills, on energy-efficiency measures, or on their greenhouse gas emissions profile.

On-bill financing overcomes these barriers by: 1) identifying projects for the customer; and 2) providing up-front payment for the cost of the project and favorable repayment terms.

How are projects identified? Utilities identify businesses that may benefit from energy efficient project.  The utilities will use specialty trained contractors to perform an energy audit of the business to identify opportunities to reduce usage and save money.  The customers than elects whether to implement the project.  If the business implements the project it gets financed by the utility and repaid over time on the customers bill. 

The cost savings and the ability to reduce the impact of increasing energy prices are tremendously important to the vitality of small businesses.  There are also major environmental benefits as well. The report concludes that small business could collectively reduce greenhouse gas emissions by 259 million tons each year if they improved their energy efficiency by just 25 percent. 

A strong push for robust on-bill financing programs seems warranted. 

Ohio Federal Building LEEDs Controversy on Certifications

The New York Times reported on the controversy surrounding the energy performance of LEED certified buildings.  Studies have shown that many LEED building receiving certification actually poorly perform when it comes to energy efficiency. 

The Article points to a federal building in Youngstown, Ohio which would have failed to obtain U.S. EPA's Energy Star rating even though it was LEED certified:

The building’s cooling system, a major gas guzzler, was one culprit. Another was its design: to get its LEED label, it racked up points for things like native landscaping rather than structural energy-saving features, according to a study by the General Services Administration, which owns the building.

As documented, the latest version of LEED starts taking a major step toward addressing these two major issues:

  1. Energy Performance- Should all LEED building perform to a certain standard
  2. Decertification-  Should LEED plaques be removed from buildings if they fail to demonstrate performance over the life of the building

My reaction is that perhaps there is too big of a focus on the energy performance of a building.  As mentioned in the article, the building actually achieved its LEED status by performing in other areas. 

So should a building that does all the following be deemed not worthy of "green" status:

  • Redevelops a contaminated brownfield property
  • Reduces water use by 50% from basic standards
  • Uses waterless landscaping
  • Uses solar panels for energy
  • Recycled materials from the prior building
  • Purchased regional construction materials
  • Has a plan for tenants to utilize ride-sharing and public transportation
  • Other non-energy related enhancements

Aren't there significant environmental benefits to a redevelopment project that achieves all of these objectives?  Perhaps we need a different certification for these projects- Leadership in Environmental Design (LED) projects. 

I see the argument that buildings (and the energy they use) are one of the largest sources of greenhouse gas emissions due to their electricity use.  How can you say there is leadership in energy design when buildings don't actually perform well when energy audits are performed?  

But I come back to the same point- there are multiple ways to have environmental benefit.  Perhaps there needs to be different certifications for buildings that don't perform as well from an energy usage perspective.  However, stripping buildings of their "green status" when they may have had a host of environmental benefits seems extreme.

Observations on Sustainable Cleveland 2019

The Sustainable Cleveland 2019 summit was unlike any other conference or summit I had attended.  I have been to plenty where the goal was simply to raise awareness-  Typically a parade of talking heads followed up by urgent pleas to do something in the future. 

The Cleveland Summit was much different.  It took some 700 attendees who represented a cross-section of the community and put them to work on development of an strategic plan to build green jobs in Northeast Ohio. 

The process used was called "Appreciative Inquiry" (AI) which was developed by Professor Cooperrider at Case Western Reserve University.  AI has been used by businesses and even the United Nations.  AI's basic concept is that small groups put limits on development of a strategic plans. For that reason it is much better to tap into the knowledge of a large group.   

I have to say I was skeptical of the process going in.  But I was continually amazed at the number of talented people in my working groups that represented a cross-section of the community.  Here are some examples of people who sat at my tables:

  • CEOs
  • Non-profit representatives
  • Small business owners
  • Sustainability experts
  • Advocates
  • Students
  • City and County Government Officials
  • Attendees from other cities and countries

It was a great mix and cross-section of the community.  I would be lying if I didn't find some of the ideas and opinions offered to be "wild" or out of touch with reality.   There were also times when the Summit got to be a bit too much cheer-leading and not enough specific action.  However, there was no denying the energy and purpose of the group. 

There was an excellent advance briefing paper that was given to participants.  The Sustainable Cleveland briefing paper includes good information as to groups, initiatives and progress to date in Northeat Ohio on sustainability.  There were also notable speakers at the Summit.  Here are a couple thoughts or observations that I found interesting that were offered by some of the speakers:

  • Mayor Jackson's opening remarks:  He said Cleveland had made the mistake in the past of waiting to change course until the economy had improved.  He said "Cleveland won't make that mistake again" and that Cleveland will "emerge first in developing a green economy."  My comment:  I like the sentiment of not waiting, but Cleveland is already behind many other cities in moving this direction.  We have to be realistic in our assessment of where we are now to get some place in the future...
  • Van Jones of the Obama Administration:  He made the observation that everyone points to China as the example of a dirty or old style industrial economy.  He said China has seen the direction of the future economy and is spending $12 million dollars an hour on development of clean energy.  My comment:  I thought this really was a good observation that we are in a global competition of developing clean energy.
  • Dr. Peter Senge, MIT:  He made some interesting observations regarding sustainability principles.  For example, to produce a computer chip you must use 630 times the weight of the chip in materials to construct it.  That is an amazing amount of waste those goes into developing a single small product.  The observation was made to show the opportunity to reduce waste in the process thereby saving money

Overall, I thought the Summit was a testament to the a growing positive attitude in Cleveland about change. Attendees were willing to devote three days in dark hall of the Convention Center to discuss these topics and develop a plan. 

A Dose of Reality

I will conclude by making an observation regarding building success out of the Summit.  I was lucky to participate directly in the Great Lakes Regional Collaboration (GLRC).  The GLRC was a on-going process to develop a plan for protecting and cleaning up the Great Lakes. It was initiated by President Bush by Executive Order.  The idea was to follow the Florida Everglades model and secure significant funding for restoration of the Great Lakes.

The GLRC was on a scale five times the size of the Cleveland Sustainability Summit.  It involved multiple federal agencies, Indian tribes, state representatives, non-profit groups and environmental groups.

Similar to the Cleveland Sustainability Summit there was tremendous energy and optimism from the participants.  However, that optimism also led to the inclusion of some very unrealistic goals and actions in the GLRC plan for the Great Lakes.  I remember continually raising the concern that the plan had to be realistic and build toward the future.

Some of the most unrealistic proposals were included in the final plan.  What happened...after a full year in development, the plan was virtually shelved due to budget concerns at the federal level.  Participants were disheartened and charges were thrown around that the process was purely a political tool. 

I hope the concept of a lasting 10 year strategic plan for attracting green jobs to Cleveland does not follow a similar path.  Significant progress is possible, but it must include a dose of reality.

So You Want Green Jobs Cleveland...

Cleveland has is trying to increase momentum toward become a hub of green industry.  As a recent Clevelander I appreciate the efforts to promote sustainability, renewable power, and other green industry as a means of attracting jobs and improving the economy.  (photo:flickr:heidigoseek)

I have had the luxury of working with many of the cities around the State on environmental issues.  I honestly believe Cleveland has more resources and a more developed culture on sustainability then the other major Ohio metropolitan areas.   If you think differently check out the compiled list on Positively Cleveland of 75 Green Thing in Cleveland Plus.

But make no mistake about it, Cleveland is facing tough competition.  Frankly, Michigan and Pennsylvania have been more aggressive in promoting policies that would attract green industry to their states which puts Cleveland at a disadvantage. Those windmill blades you see traveling up I-71, those were not built in Ohio and are more than likely not going to be put up at a site in Ohio.   So, if we want to be serious about a green industry in Cleveland we will have to be prepared to beat the competition.

Mayor Jackson is trying to take the first step toward putting together a strategic plan for attracting green industry.  On August 12-14 he is holding a summit called Sustainable Cleveland 2019.  Here is the description of the summit off of the City's webpage:

From August 12-14, Mayor Frank G. Jackson will host a three-day summit, bringing together a diverse group of people vested in and dedicated to Cleveland to use their vast knowledge and imagination to create an action plan for building a green economy for Cleveland’s future. This summit will be facilitated by Dr. David Cooperrider of the Fowler Center for Sustainable Value at Case Western Reserve University. The goal is to create an action plan for economic sustainability that will support business growth; protect the environment; and, create opportunities for individuals to prosper.

I will be participating and no doubt will offer my opinions on the success of the summit in future blog posts.  But for right now, I am just pleased to see a focus on developing a strategy.  Now lets see if a viable strategy emerges. In a very general way, such a strategy should include:

  • Specific action items that focus on building a culture and structure needed to compete for green jobs
  • Courage and vision to make difficult choices.
  • An on-going commitment by more than just a few to implement the strategy
  • Participation by the business community
  • Linkage to Cleveland's other major growth industry- Health Care

 

LEED "Decertification"- USGBC Moves Toward Requiring Demonstration of Improved Performance

With the launch of Leed Version 3, the U.S. Green Building Council (USGBC) has increased the rigor of certifications and even issued the threat of "decertification"- losing your building's green status.  USGBC has decided to throw only a pebble into the pond on this round- its still pretty hard to lose your building's LEED status. However, Leed v3 foreshadows a time when serious work will continue beyond the certification stage.

MPRs AND DECERTIFICATION

Right now USGBC only ties the possibility of "decertification" to a fairly innocuous list of Minimum Program Requirements ("MPRs").   After your building attains LEED certification it can lose that status if it fails to adhere to any one of the following MPRs (additional commentary based upon LEED website):

  1. Compliance with environmental laws- New Construction..only up through certification. Existing building..its an on-going requirement;
  2. Project must be a complete, permanent building or space- No movable buildings please..and it must the entire building;
  3. Project must utilize a reasonable site boundary-  No gerrymandering please...you cannot shape your project in weird ways just so the project can qualify for points or meet a pre-requisite;
  4. Building must comply with minimum floor area requirements- Must be a project involving at least 1,000 square feet.  No toll booths or kiosks;
  5. Building must comply with minimum occupancy rates Must server at least one full-time equivalent employee...who the heck is worrying about certifying vacant buildings?;
  6. Must share whole-building energy and water usage data- Share this information for 5 years and make it accessible through the web.  However, its not a performance standard; and
  7. Project must comply with minimum building area to site area ratio- gross floor area must be no less than 2% of project boundary.  Who is certifying tiny buildings on large parcels?

Number six- the requirement to share energy and water usage data- was the most controversial, setting off some wild speculation.  Some worried that if their building failed to meet the projected water or energy usage projections it could lose its LEED certification.  This appears not to be the case.  

Preston Koerner wrote a good post discussing decertification on his blog JETSON Green.  Preston contacted the USGBC regarding the possibility of decertification based upon under performance on water and energy usage projections.  USGBC indicated that they just want people to share the information, decertification for failing to meet energy or water usage projections won't happen under LEED V3.

ENERGY AND WATER USAGE CONTROVERSY

There has been controversy over whether LEED certified buildings actually perform better than standard construction.  Recently, a study sponsored by USGBC found that on average LEED certified New Construction buildings used 24% less energy.  However, the study also showed some buildings are performing much worse than models predicted.  As an extreme a small number are even performing worse than if they just met basic code requirements.

While the study shows LEED generally results in improved efficiencies, the study also shows certification is no guarantee on performance.  So while right now USGBC is requiring reporting of statistic, it seems inevitable that it will move toward some form of performance standards and verification.

If you are interested in the controversy surrounding decertification, Matt DeVries at Best Practices Construction Law has done the best summary of the blogosphere debate over decertification.  A lot of folks are worried about the implications of just being required to track all the data.

However, if LEED certification is truly going to become the gold standard for measuring sustainable buildings doesn't the USGBC have to start verifying environmental performance of buildings?  I think at a minimum USGBC will require on-going verification if you want LEED certification of your existing building (post-new construction). 

TECHNOLOGY OPTIONS

As the requirements to track LEED elements becomes more rigorous, technology has tried to ride to the rescue.  Houston Neal wrote a good review of various software options for tracking LEED projects.  He asked that I take a look and provide any comments.   All I can offer is that most of the software seems to assist with document management as you building a project toward submission for certification.  What about adding features to help track performance post certification? 

FINAL THOUGHTS

To me the trend appears clear...USGBC is moving away from simple certification and toward verification of greenbuilding performance claims.  In otherwords, the LEED process doesn't end when the plaque goes up on the wall.

U.S. Green Building Council Launches LEED v3- Bike Racks v. Brownfields

On Monday I passed the LEED AP exam for New Construction after about a month and half of studying.  I can't tell you how relieved I was when the computer screen at the testing center had the word "PASS" on it.  After the U.S. Green Building Council's  (USGBC) launch of LEED v3, I am already known as a "Legacy AP" even though my accreditation is a mere three days old.  Even though the ink hasn't dried yet on my AP credentials, I'd like to make a few observations of LEED v3. 

USGBC  launched LEED v3 on April 27, 2009.  The new version includes changes to the scoring system for projects, the LEED accreditation process and the LEED on-line tools for administering projects.   There were three major changes made to the scoring process under v3:

  • Harmonization- the new prerequisite/credit structure tries to take the various LEED rating systems (Core & Shell, New Construction, etc.) and equalize requirements for obtaining certain credits under each structure
  • Weighting of Credits- greater priority was given under the scoring structure to energy efficiency and climate change
  • Regionalization- new bonus points are awarded if your project achieves certain credits that are deemed priorities in the region the project is located

Bike Racks v. Brownfields

For new construction and major renovation projects, LEED NC v2.2 (old system) scored projects on a 69 point scale. Under LEED NC v2.2 achieving most credits you were awarded one point, which led to a great deal of criticism of the old scoring system. For example-

  • Putting up bike racks- if you put some bike racks in front the building = 1 point
  • Redevelopment of a brownfield- if you redeveloped a former brownfield with hazardous substance contamination that cost $4 million to address = 1 point

It was my hope that LEED v3 would address such inequities in the scoring system.  Unfortunately, it appears those still persist.  Perhaps I am partial to brownfield redevelopment, but I simply don't understand why LEED v3 still only gives 1 possible point for achieving this credit.  To me this was the single biggest oversight in the revamping of the LEED scoring structure.

With the release of LEED v3 USGBC tried to give greater weight to energy efficiency and climate change.  As examples, EA Credit 1 Optimize Energy Performance went from 10 total possible points to 19.  EA Credit 2 On-Site Renewable Energy went from 3 possible points to 7. 

I understand the prioritization of climate change and energy efficiency which really impact the overall life cycle of a building.  However, I come at this from an environmental perspective given my background.  To me we should be encouraging addressing thousands of historically contaminated sites that liter our urban landscapes.  Due to the significant costs and liability issues associated with brownfields, many developers stay away from these projects all together.  

LEED v3 offered an opportunity to better promote brownfield development.  My recommendation would to have been to provide at least 4 possible points for brownfield redevelopment.  This would be equal to the new scoring system available points for WE Credit 1 Water Efficient Landscaping. The points could be awarded based up on the remediation costs associated with the property.  There is a correlation between remediation costs and levels of contamination, which would mean projects addressing more extensive contamination get more points.

Regionalization

Perhaps my focus on brownfields stems from living in the industrial Midwest where numerous abandoned factories occupy our cities.  LEED v3 also incorporates a new bonus point pool to recognize regional prioritization.  A project can achieve up to 4 bonus points for achieving certain LEED credits.  This would mean brownfield redevelopment could get 2 points instead of 1.  Still not enough in my mind, but at least 2 is greater than just 1. 

USGBC has created a spreadsheet first separated by State and then by zip code for virtually the entire U.S.  You can go into the spreadsheet and look up the zip code for your project and there will be six credits that have been prioritized by local USBBC Chapters.  For example, in the Cleveland area here are the six prioritized credits:

  1. Sustainable Sites Credit 6.1- Stormwater Quantity- reduction in rate and flow of stormwater post development
  2. Sustainable Sites Credit 6.2- Stormwater Quality- implementation of controls to capture 90% of the flow and remove 80% TSS
  3. Energy and Atmosphere Credit 2- On-site Renewable Energy- provide a minimum of 3% of energy needs from on-site renewable energy
  4. Water Efficiency Credit 2-  Innovative Wastewater- reduce generation of wastewater by 50%
  5. Materials and Resources Credit 2- Construction Waste Management- achieve reduction of 75% of C&D waste
  6. Materials and Resources Credit 6- Use Rapidly Renewable Materials- 2.5% of the cost of materials used on the project should be from rapidly renewable construction materials

I scratch my head at these regional priorities for the Cleveland area.  I am certainly okay with promoting renewable energy, but there are other critical issues that face Cleveland.  Why not prioritize these credits?

  1. Sustainable Sites Credit 3 Brownfields- The Cuyahoga County Commissioners Department of Development provides the following statistics about brownfields:

    [Based on a US EPA funded study]- Approximately 4,623 acres of brownfields in Cuyahoga County with the majority of that land located in the City of Cleveland and its surrounding inner ring suburbs. Cleveland, alone, has approximately 350 brownfields and an estimated 1,000 to 2,000 condemned structures. Additionally, the Cuyahoga County Planning Commission found that 40,000 acres, or 14%, of the County’s land, has at some time been devoted to an industry that has historically been known to be a higher risk for environmental contamination.

  2. Sustainable Sites Credit 5 Protect and Restore Habitat and Maximize Open Space- it is really tough to find remaining greenspace in Cleveland.  It is estimated that 95% of the land in Cuyahoga County has been developed. The lack of open space/greenspace creates other issues such as flooding and stormwater control.  This would seem like a prime credit to be prioritized in the Cleveland Region.

"Greenwashing Rampant" and FTC Is Taking Notice

Green marketing claims are running rampant, according to the April 2008 survey by Terrachoice a consulting firm that runs the Canadian government’s eco-labeling program.  Labels on products frequently claim “recycled content”, “biodegradable”, and “safe for the environment.”

The recent survey found that the number of big box store products making green claims grew 79 percent since its last report, in 2007.  In addition, the amount of advertising containing green claims has risen shapely.   Terrachoice reviewed 18,000 ads in recent issues of Time, Fortune, National Geographic, Sports Illustrated and Vanity Fair, TerraChoice found that more than 10 percent of all ads in 2008 made “green” claim, up from 3 percent in 2006. 

Businesses making these claims better pay even more attention to FTC requirements, known as the "Green Guides".  The FTC has recently began to take enforcement actions against businesses who can't substantiate their green claims. I was recently contacted by a business owner who faced signing a consent order with the FTC to resolve allegations of "greenwashing." 

The FTC had taken a long hiatus from enforcement of the Green Guides.  As discussed on the Consumer Advertising Law Blog, one of the FTC Commissioners only as recently as June 2008 indicated the FTC had not brought any cases under the Green Guides since 2000. 

Commissioner Rosch gave two reasons for the fact that the FTC has not brought any cases under the Green Guides since 2000. First, industry has been abiding by the Guides. Second, private enforcement under the Lanham Act and self-regulation have developed into effective alternative enforcement mechanisms over the past 30 years. However, the eight-year enforcement hiatus may be coming to a close. In his speech, Commissioner Rosch noted that FTC “staff is currently investigating a variety of environmental product claims.”

Well, based upon the recent activity it appears the hiatus is over and FTC is actively enforcing the Green Guides.  This enforcement is taking place even though the FTC has yet to update the Green Guides after an extensive public involvement process.  The FTC enforces Section 5 of the FTC Act, which generally prohibits "unfair or deceptive acts or practices," including advertising that is false or misleading. 

Businesses should be careful to read the Green Guides and seek advice before making any green claims on their products.  Otherwise, they may face signing a FTC consent order that carries with it severe restrictions on the ability to market green attributes of its products. A few things to keep in mind:

  • FTC has enforcement authority to issue a cease and desist order for up to 20 years. 
  • The prohibition against unsupported or deceptive claims can extend to officers, subsidiaries and other divisions of the company.
  • Cease and Desist authority includes what is called "fencing in relief."  The relief is designed to prevent similar conduct.  As a result the prohibit against additional "deceptive" claims may cover all the company's products.  The relief may also include more draconian terms that require notification if senior management responsible for marketing departs for a new company.  In other words, the terms of the consent order can follow significant decisions makers to other jobs.

While penalties will typically not become an issues until a cease and desist order is violated, the order itself will still carry very onerous terms and conditions.  For these reasons, company's should really proactively review any green claims and ensure they meeting FTC requirements.

Ohio Introduces Legislation to Mandate Green Building Certification

The Ohio House has introduced H.B. 7 which would require new construction be certified as a green building under the U.S. Green Building Council's LEED program.  Here is the text of the bill: 

 

Sec. 153.013. Whenever any building or structure is to be
erected or constructed using any state capital moneys, including moneys from the education facilities trust fund, the building or structure shall be certified as meeting at least the silver standard of the leadership in energy and environmental design green building rating system developed by the United States green building council.

What are the pro's and con's of advancing legislation requiring LEED certification? 

Pro's

  • Good for the environment-the obvious...It encourages green building which reduces energy demand and is good for the environment. 
  • Prepares the State for a carbon constrained and regulated world- Ohio ranks either 3rd or 4th in emission of greenhouse gases.  Commercial buildings, through energy use, constitute a significant portion of GHG emissions.  Ohio definitely needs to show more leadership in preparing for mandatory GHG regulation.
  • LEED is a well recognized third party verification system for green building- More than 100 State (including Washington and Connecticut) and local governments have incorporated some form of LEED mandates into legislation or ordinances.

Con's

  • It picks a winner- Why pick LEED when there are other well recognized third-party greenbuilding verification systems, such as Green Globes?
  • The LEED system is revised frequently, the law is not- In 2009 the LEED system went under a major overhaul.  Ohio legislative principles do not allow incorporation of future changes to referenced standards.  Therefore, to keep up with the latest revisions the Legislature would be forced to revise the legislation.
  • LEED system was and is not perfect-  The old version LEED 2.2 for New Construction awarded the same amount of points for putting in bike racks as it did if you redeveloped a contaminated brownfield.  Also, Ohio may want to encourage certain practices more than others set forth in the LEED rating system.
  • Is Ohio delegating legislative authority?  The LEED rating system is developed by the membership of the U.S. Green Building Coalition, not a State Agency.  Therefore, Ohio would be passing along the authority to establish standards for new construction to a private entity that is not accountable to the public.  When similar Legislation was introduced in California, the Sacramento Bee called it a "two-pronged assault on democratic process that not only bypasses the usual procedure for making new law, but also transfers the regulations authorized by the new law to a private organization that’s completely unaccountable to the public.” (See, Is LEED Legislation-whether Public or Private-Undemocratic)

There is growing controversy regarding legislative mandates for LEED.  A recent study even suggested some LEED buildings are not performing at the level of energy efficiency promised. (See, Northeast Energy Sustainable Agency- "Legislating Greenness")

Henry Gifford has provided statistical proof, from US Green Building Council’s (USGBC) own data, showing that at least to date, Leadership in Energy and Environmental Design (LEED) buildings have on average proven to actually use more energy in their operation than comparable buildings.

I am currently studying for the LEED AP exam, so I have a strong investment and belief in the USGBC rating system.  However, I am not sure an outright mandate of a specific rating system is the way to go. 

Why not just specify in legislation that all government buildings must meet a level of greenbuilding certification specified by the Department of Administrative Services (or some other state Agency)? This would allow a more fluid process where DAS could adjust requirements to meet changes in the third party verification process.

(Photo: Payton Chung/everystockphoto.com)

Obama's Environmental Agenda Collides with the Economy

Have you ever heard of the irresistible force paradox?  What would happen if an irresistible force met an in-movable object?  I think this paradox may describe what will happen when the Obama Administration's environmental agenda meets the reality of the economy. 

Remember a few months back when oil peaked around $140 a barrel.  Of course you do...But do you also remember the momentum that the green movement due to the reality of limited resources and escalating energy prices.  Everything looks possible- a shift to renewable energy, energy conversation, higher gas mileage vehicles, and climate change legislation.

Now, only a few months later and oil is around $60-70 a barrel (I just filled up my gas tank for $1.90 per gallon)  We saw an economic meltdown the likes that has not been seen since the Great Depression.  How did this effect the momentum (the irresistible force) behind the Green Movement.  Let's take a sampling of recent headlines....

  • Many Solar Energy Firms Likely to Fold During Economic Crisis- Analysts say nearly three-fourths of all solar energy companies could go out of business due to extremely tight credit, intense competition to produce solar panels, and falling prices.
  • Local Government's Reconsider Costs of Green Building Mandates- The poor economy means tight budgets for most local governments.  This has forced local governments to begin questioning the costs associated with mandating LEED certification on new construction.
  • T. Boone Pickens Places Wind Farm On Hold-  The dramatic drop in the cost of natural gas and the global credit crunch makes wind less competitive, according to Pickens.  As a result, he is putting on hold or scrapping plans for his massive 4,000 megawatt wind farm in Texas. (comment:  I guess Mr. Pickens is still a business man and not just motivated by getting us off of foreign oil)
  • Renewable Energy Blues-  As reported in the Wall Street Journal, "when fossil fuel prices were soaring, things like offshore wind farms suddenly looked appealing, and guaranteed electricity prices from wind farms looked like a bargain. But with fossil fuel prices headed south and capital getting more expensive, renewables are losing some of their glow." (see also "Clean Energy Meltdown, Now GE is Bailing")
  • Will EU Member States Use Economic Meltdown to Avoid Climate Targets-  When the economic crisis spread to Europe, the EU's ambitious goals on Climate Change were second guessed.  The current EU target of a 20% reduction in emissions by 2020 is set to automatically increase to 30%. Recently, Poland, Greece, Hungary, Slovakia, Romania and Bulgaria have opposed an increase in reduction targets.   Other EU countries are also second guessing their commitments. As reported in the Wall Street Journal, Germany’s foreign minister said recently: “This crisis changes priorities.” 

Exit polling from yesterday's election indicated that around 60% of the people who cast their vote made their decision based on issues associated with the economy.  After a quick search I could not even find where the environment ranked as a motivating issue.  I'm willing to bet it was a non-issue for the majority of the voters.

When the Obama Administration takes office and develops their environmental agenda it is likely to include: strong climate change legislation, renewable energy mandates, and policies that will not favor fossil fuels.  However, that Agenda will meet an immovable object that will likely cloud Obama's entire first term...the economy.  What emerges from the collision is anyone's guess.

(Photo: Flickr Transplanted Mountineer)

Supplier Sustainability- Should Sustainable Purchasing Principles Be Applied to Your Attorney?

Sustainable purchasing- is defined by the Sustainable Purchasing Network as "a management process for acquiring goods and services in a way that gives preference to suppliers that generate positive social and environmental outcomes, and that integrates sustainability considerations into product selection so that impacts on society and the environment are minimized throughout the full life cycle of the product." 

Here are some examples of how large companies are pushing sustainable purchasing:

1.  Hewlett Packard Announces Disclosure of Supplier CO2 Emissions-  "HP's continued leadership in supply chain transparency will result in positive operational changes in environmental practices and will encourage other companies to do more to advance supply chain responsibility,"

2.  Alcan Adops Guidelines for Sustainable Supplier Relationships- In its brochure, Alcan says it "will terminate contracts with suppliers who fail to adhere to the principles" set forth in its sustainability guidelines. 

3.  Walmart Leads Retailers Towards Sustainability-  Walmart announced it will require all suppliers to demonstrate that their factories meet specific environmental, social and quality standards. Walmart will include certification and compliance components in its supplier agreements for verification of sustainability efforts. 

So, the question I have is whether use of outside professional services, such as legal services, should be examined under the same sustainable purchasing guidelines? 

I would very much like to hear your thoughts on this topic, so please comment on this post to start a discussion.  Here is some food for thought....

  • Does Your Attorney's Reputation Impact Your Company's Reputation?-   If your attorney has a reputation for railing against all environmental regulations, will your company be linked to that reputation by the public, environmental groups and regulators?   Does who your attorney represents in other matters impact you in any manner?  For example, what if your attorney has been quoted in the paper defending a company seen as blatantly ignoring environmental laws.  Can that representation be connected to your company or is it just an attorney doing his job? 
  • Do the Ends Justify the Means?-  Perhaps your company is concerned with the cost of compliance with a particular environmental regulation.  Your attorney has a strong argument that regulation is illegal.  But how is the public going to view your company being named in the succesful lawsuit that tosses the regulation out?  Or, maybe your more of a strict interpretter of the law and think any regulation that is illegal in some fashion should be stricken from the books.

I think it depends on the goals of your corporation.  If your trying to develop a corporate image as a sustainable company perhaps you should view your attorney as a "supplier."  However, if your motivation in choosing professional service providers is their capability regardless of their image, then it shouldn't matter much.

If you decide to examine your attorney under the sustainable principle microscope, here is a list of possible actions. 

  1. Ask your lawyer or law firm whether they have adopted any sustainable principles in their own organization.   Example in Cleveland Plain Dealer, Green Law Offices Try and Reduce Paper Waste.
  2. Ask your lawyer or law firm whether they have provided any Pro Bono services to sustainable causes or provide service to the community.
  3. Ask other companies, professional associations, regulators or even a respected environmental group about the reputation of your attorney.  Are they an "agency basher" or seen as effective counsel that people like to work with?
  4. Ask your attorney where they stand on key issues you care about, such as Climate Change. 
  5. Ask for examples or search for them on-line of recent successes, press coverage, or activities of your law firm or attorney that provide insight to their reputaiton or activities.

Maybe you disagree entirely with the notion you should interview your attorney or law firm as a supplier.  If so,  I would like to hear from you as well. 

 

(Image from UN's Division of Sustainable Development)

Ohio Trying to Sieze Green Jobs to Jump Start its Economy

A report released today by the U.S. Conference of Mayors estimates that job growth associated with green industries could be the fastest growing job market over the next few decades.  As reported in Time Magazine:

A major shift to renewable energy and efficiency is expected to produce 4.2 million new environmentally friendly "green" jobs over the next three decades, according to a study commissioned by the nation's mayors.

By 2038, another 4.2 million green jobs are expected to be added, accounting for 10 percent of new job growth over the next 30 years, according to the report by Global Insight, Inc.

"It could be the fastest growing segment of the United States economy over the next several decades and dramatically increase its share of total employment," said the report, obtained Wednesday by The Associated Press.

Ohio, with its long history of manufacturing and its heavy reliance on fossil fuels, has been slower to embrace green ideas as means of turning its economic fortunes around.   However, the drumbeat of bad economic news has more Ohio leaders looking for new opportunities to jump start Ohio's economy.  From 2000 to 2007, Ohio lost 209,000 jobs.  During that same period Cleveland lost 63,000 jobs based upon a report compiled using Department of Labor statistics

The single largest development was passage of legislation (S.B. 221) this summer that created a renewable portfolio standard, advanced energy portfolio standard and energy efficiency requirements. However, a review of recent local news stories and events shows the Buckeye State is beginning to focus on developing a green economy:

  • Cincinnati Wants to Lead Green Roof Movement in U.S.- The City Council on Wednesday became the first in Ohio with a plan to channel grants and loans to residents and businesses to replace tar and shingles with vegetation.
  • Columbus Summit on Sustainability and the Environment-  MORPC, the Columbus metropolitan planning organization, held a successful multi-day summit at the Columbus Convention Center.  Over 500 individuals attended that event that had a wide range of presentations relating to sustainability. 
  • Eight Major Green Projects in Northeast Ohio- They include attracting fish to the Cuyahoga River shipping channel through installation of plants along the bulkhead, deconstruction of abandoned homes to recycle the materials, local food from urban community gardens, etc.
  • Wind Turbines on Lake Erie- Cuyahoga County officials this week rolled out the first three reports from their $1 million study of a grand vision -- erecting two to 10 wind turbines in the lake off Cleveland's shore.  Constructing off-shore wind power in fresh water is seen as a possible economic driver in Northeast Ohio.
  • Ohio State University Participates in Solar Decathlon- 20 university teams will participate in the 2009 Solar Decathlon. The teams, chosen from the United States, Canada, and Europe, will each receive $100,000 from DOE to design, build, and operate energy efficient, solar-powered homes.  The Solar Decathlon is an international, biennial competition that challenges university teams to design and build energy efficient solar-powered homes.
  • Ohio Has 28 Solar Sites as Part of National Solar Tour-  Green Energy Ohio organized the tours in Ohio as part of the American Solar Energy Society.  The tours are from October 3-5.
  • Ohio Gov. Recognizes U. of Toledo Solar Power Leadership-

 

Sustainability, take note of fuel and energy saving opportunities

Here is a sampling of sustainable practices that can directly improve  your company's bottom line. As you can see from the descriptions, these practices involve large Fortune 500 companies.  However, there is no reason they can't be implemented by smaller companies.  The examples in this post can help save fuel and reduce energy costs.  With ever increasing prices for both the incentives and advantages of thinking proactively continue to grow.

Plastic or Wood Pallets?  The Wall Street Journal reported that using plastic pallets instead of wood for trucks is not only more environmentally friendly, but also a money saver. The Journal reported:

They last longer, they weigh less, and they don’t need paint or chemical treatments. Since a plastic pallet can easily handle 100 trips—versus two trips for a single-use wooden pallet—the difference in greenhouse-gas emissions is stark: 45,000 kilograms of carbon dioxide for the plastic pallets, compared with 300,000 kilograms for the wooden pallets. Most importantly, says iGPS, you don’t have to chop down trees to get plastic pallets: A Virginia Tech study found that 40% of the U.S. hardwood harvest goes to wooden pallet production.

On the iGPS website (a manufacturer of plastic pallets) even has a calculator which lets shipping companies tally how much fuel they’d save by switching from wood to plastic.

Retailers Discovering Energy Efficiency-  Another Wall Street Journal article covered the increased usage by major big box retailers and supermarkets to energy efficient heating, cooling and lighting. Stores like Office Depot, Kroger and Walmart are saving energy and money by adopting advanced energy efficient designs in their stores.  In Ohio, a state that will be facing significant increases in energy prices, smaller retailers and commercial store owners are wise to take heed.  Here are some of the changes being implemented:

  • Skylights that have reflective mirror that tracks the sun to provide natural lighting throughout the store thereby reducing energy costs
  • Intelligent lighting systems that automatically adjusts the fluorescent lighting based on the availability of natural light in the store
  • Parking lots use concrete not tar to reduce heat generated around the store
  • LEDs (light-emitting diodes) rather than incandescent bulbs in freezer units

The article notes that construction costs increased by 10% to add these energy efficient technologies, but each store is projected to save 25% in energy costs.  This will allow recovery of their upfront costs within a matter a few years.  I am certain those calculations don't even take into account the likelihood of increased energy prices.

Smartway the "smartway" to reduce diesel costs-  U.S. EPA's Smartway program is an innovative brand that represents environmentally cleaner, more fuel efficient transportation options.  Smartway can help finance equipment that can significantly save fuel costs.  For example, Auxiliary Power Units (APUs) allow truckers to power their truck without idling.  Smartway also rates vehicles based upon their emissions.  Perhaps one of the most useful tools you can find on U.S. EPA's website is the Smartway calculator.