New Green Building Technologies = New Business Opportunities
February 2010By Gary Gigot
All signs point to green building as a trend that is here to stay, and a driving factor in the renewal of the building industry. If the USGBC Greenbuild conference provides an indication of the state of green building, the fact that the November 2009 show was bigger than ever—despite the economy—is hard to ignore. LEED certification has also seen explosive growth in recent years. The 2009 Green Building Market and Impact Report found LEED registered green building activity has grown to a cumulative total of more than 7 billion square feet worldwide since the standard was launched in 2000—more than 40-percent growth in 2009.
ENERGY EFFICIENCY
One aspect of green building, energy efficiency, was an especially hot topic in 2009. Remember President Obama joking with David Letterman about the efficiency of the sets’ air conditioning this fall? How about U.S. Energy Secretary Chu calling himself “an energy conservation nut?” What is less known is that energy efficiency was a central component of every one of the climate bills debated in Washington D.C. in 2009. And for good reason. With buildings responsible for 40 percent of the nation’s energy consumption, the opportunity for significant savings is real. In fact, the USGBC estimates that greater building efficiency can meet 85 percent of future U.S. demand for energy, and a national commitment to green building has the potential to generate 2.5 million American jobs.
With nearly $17 billion in American Recovery and Reinvestment Act of 2009 (ARRA) funds slated for energy efficiency and renewable energy projects, it’s clear that energy efficiency is being held responsible for a lot of lofty goals including job growth, energy security, and improving the environment. States are getting in on the act, as currently 26 states have enacted or have pending legislation that mandates building energy efficiency, growing from only nine states with such legislation in 2006. These states are driving building owners and consumers to be mindful of their carbon footprint and in some cases, especially in commercial buildings, retrofitting buildings for operational efficiency.
GREEN BUILDING PROGRAMS
Cities are also implementing green building programs. A recent AIA study found that today 138 cities have green building programs, an increase of 50 percent in 2 years. The West and Mountain regions have the greenest building programs, but Eastern states are rapidly catching up, with a 75-percent rise in green building programs since 2007. For instance, New York has seen a big push recently with the announcement of the efficiency upgrades planned for the Empire State Building. And this winter, New York City passed legislation that requires owners of New York City’s largest buildings to pay for energy audits, undertake lighting upgrades, and take other steps to reduce energy consumption.
The term “green building” encapsulates a wide range of concepts that promote environmentally responsible and resource-efficient actions throughout a building’s life cycle, often putting green goals ahead of the overall expense. The concept of energy efficiency stands apart from some green building initiatives in a very important way: it’s relatively cheap—the cleanest and cheapest kilowatt of energy is the one never used. That means that even if there is an upfront cost to put efficiency measures into place, the return continues—month after month, year after year.
This point is important because even though LEED and other performance standards are rising in popularity and green building mandates are becoming more prevalent, often the primary driver for building owners is cutting their day-to-day operating expenses. As a company who provides software that helps commercial building owners increase HVAC efficiency and reduce their operating costs by 30 to 60 percent, we see this firsthand. That’s why it’s very important that contractors looking to expand their businesses into the green space focus on projects that provide a fast ROI and results that last over the long term.
RETURN ON INVESTMENT
With ROI being such an important consideration, funding and financial incentives play an important role in efficiency projects. Fortunately, funding is no longer the barrier it once was. Communities across America are applying for Department of Energy grants for use in a variety of commercial and residential efficiency programs. In addition, new creative financial programs are becoming available, such as the Property Assessed Clean Energy (PACE) bond programs enacted in more than a dozen states in the past year. Combine these programs with the myriad of tax credits and utility rebates being offered across the country, and the opportunities are greater than ever before. Because of the savings efficiency provides, we’ll continue to see new financing options in the years ahead that will accelerate the adoption of efficiency programs.
What’s most exciting, however, is how new technologies are elevating the possibilities when it comes to efficiency. This year people saw more examples than ever of information technology being applied to operating the physical environment, such as buildings. This convergence—sometimes called operations technology—is transforming the way buildings are managed, and it’s leading to unprecedented improvements in energy performance.
Contractors play a critical role when it comes to adoption of new green building technologies. Often new technologies challenge traditional construction, control, and operations methodologies. This means that time investments are needed to test and implement green building solutions, and gain a full understanding of the value they provide.
The benefits of energy efficiency to the country, to businesses, and to building owners are clear. As new technologies enter the marketplace, the potential for contractors to grow their business, and help their customers save green will increase as well—particularly for those businesses willing to embrace new approaches to building design and maintenance. Contractors are looking forward to 2010 and the decade that follows as being the time when green building, and in particular energy efficiency, takes center stage. ■
About The Author:
Gary Gigot, chief marketing officer for Optimum Energy, is responsible for generating awareness and driving increased market penetration of HVAC optimization software as the leading energy efficiency solution available for commercial buildings today. Previously, Gigot was an investor and chief marketing officer of Visio Corporation where he played a central role in positioning Visio as the leader in business drawing software.
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