Congress Creates Tenant Star But Does Little Else

In a continued period of falling energy prices, for oil and natural gas as well as renewables, and in an era when energy use in the U.S. has not increased in decades (despite the increase in population), Congress passed an energy bill.

The Energy Efficiency Improvement Act of 2015, S. 535, a portion of this bill was formerly known as the Better Buildings Act of 2015, passed the House of Representatives last week and on April 23rd was presented to the President for signature. Senators Rob Portman, R-Ohio, and Jeanne Shaheen, D-New Hampshire have been working to get an energy efficiency bill passed for years and they have now succeeded, although this bill has no mandates and only requires the federal government (and no one else) to undertake some very modest, low cost, acts.  

Senate bill 535 requires the General Services Administration to develop and “publish” model leasing provisions to encourage building owners and tenants to use greater cost-effective energy efficiency and water efficiency measures in commercial buildings; and, develop policies and practices to implement the measures for the realty services provided by the GSA to agencies.

The bill amends the Energy Independence and Security Act of 2007 to require the Department of Energy to “study” the feasibility of improving energy efficiency in commercial buildings through the design and construction of spaces with high-performance energy efficiency measures.

This bill also amends the Energy Policy and Conservation Act to provide additional energy conservation standards for grid-enabled water heaters for use as part of an electric thermal storage or demand response program. Apparently the import of that is to exempt certain electric resistance water heaters used in demand response programs from pending DOE regulations.

Codifying the current practice, this legislation also requires a federal agency leasing space in a building without an Energy Star label to include in its lease provisions requirements that the space's energy efficiency be measured against a nationally-recognized benchmark. The agency must also meet certain energy consumption disclosure requirements or explain why it does not.

DOE is now required to maintain a database for storing and making available public energy-related information on commercial and multifamily buildings.

Arguably the most significant new program to come out of this bill is that, 

The Administrator of the Environmental Protection Agency, in consultation with the Secretary of Energy, shall develop a voluntary program within the Energy Star program established by section 324A of the Energy Policy and Conservation Act (42 U.S.C. 6294a), which may be known as Tenant Star, to promote energy efficiency in separate spaces leased by tenants or otherwise occupied within commercial buildings.”

Within Tenant Star, the EPA may develop a voluntary program to recognize commercial building owners and tenants that use high-performance energy efficiency measures in the design and construction of leased spaces.

Tenant Star will present business opportunities and may some day be a market driver in the commercial real estate sector. Such is close enough for government work.

Residential Green Building Increasingly Incentivized with Property Tax Credits

Recognizing that while commercial construction is increasing building green, but that green residential construction lags in market share, local governments are increasingly looking to enact voluntary incentives to drive residential green building.

At least 44 states and more than 400 local governments across the nation have enacted some form of green building legislation. Voluntary incentives offered by government include tax breaks, direct grants or loans, density bonuses, and advantages in processing approvals for green buildings. As a non-prescriptive, non-mandatory approach which does not burden owners of land with another mandate, this philosophy of advantaging green building is a real estate owner-friendly, results-oriented environmental incentive that may portend a future for broader environmental policy, going even beyond green building.  

But as would be expected from such a plethora of unrelated enactments, there is no widely accepted single incentive that owners report drives green building.

However, in the residential arena, developers and builders report that overwhelmingly the single government incentive that most helps drive green residential sales (single family and condominium units) is real property tax credits.  

Across the country, local governments are increasingly offering real property tax credits to incentivize residential green building.

The City of Cincinnati offers what is described as the most efficacious residential green building tax credits in the nation. Cincinnati offers property tax abatements for residential and commercial buildings constructed or renovated that are LEED certified. The original green building tax abatement ordinance was passed in 2006 and has been amended four times since, culminating in the current abatement law passed December 19, 2012 that includes the generous residential component.

For residential buildings Cincinnati makes available a 100% property tax abatement for 15 years (for new construction) or 10 years (for existing building retrofits) up to $275,000 LEED Certified buildings, $400,000 for LEED Silver buildings, and $562,000 for LEED Gold buildings. There is no value limitation on the tax abatement for structures that achieve LEED Platinum certification.

A 100% tax abatement for 15 years on a newly constructed LEED certified house is very generous. While precise statistics were nor readily available because the tax abatement is provided on buildings and not on individual units within a building, more than 500 LEED certified residential units have benefitted from the tax incentive.

Former Cincinnati Councilwoman Laure Quinlivan has been widely quoted saying the incentive is unique among others around the country for its generosity. She said the incentive was important to getting development deals to move forward. “We are a leader among sustainable cities because of our green building accomplishments," Quinlivan said.

With over 132 million housing units in the U.S., and more than a million new housing units constructed each year, there is a robust opportunity for green building. The dramatic strength of the housing sector would be further fueled by property tax credits that incentivize green building.

Image © Pasadena EcoHouse 2008

Promoting Electric Vehicles as Environmental Policy or Corporate Welfare

Maryland has been a leader in the promotion of plug-in electric vehicles.

In addition to federal government incentives, a total of 37 states and Washington, D.C. have created incentives for plug-in electric vehicles. 

While Maryland offers non-monetary incentives such as priority parking and high occupancy vehicle (HOV) lane access regardless of the number of occupants (when displaying an HOV permit on the vehicle), it is the dollar cost and source of funds for that public policy that is now drawing attention.

Maryland residents may be eligible for a one time excise tax credit, up to $3,000.00, when they purchase or lease a qualifying plug-in electric vehicle through June 30, 2017. Businesses may also qualify for the tax credit on up to ten vehicles.

Residents, governments and businesses can also acquire a Maryland Energy Administration rebate for purchasing and installing an electric vehicle charging station, known as Electric Vehicle Supply Equipment (EVSE). The rebate is 50% of the purchase and installation price capped for residential at $900, commercial at $5,000, and for retail service stations at $7,500. The EVSE rebate program is for systems installed before June 30, 2017, but rebates are issued on a first-come, first-served basis.

The rebates are issued on a first-come basis, as are the excise tax credits, because those programs must be funded. And while Maryland has received limited federal grant funding for this purpose and used a portion of its share in a Clean Air Act suit settlement, most of the funding comes through EmPOWER Maryland from the Regional Greenhouse Gas Initiative (RGGI). RGGI is a multi-state emissions cap and trade program designed to reduce CO2 by causing electric utilities to purchase emission allowances which are ultimately paid for by the utility customers on their monthly bills.

Maryland is one of several states that have statutes generally prohibiting car manufacturers from operating dealerships. HB 235, pending on this final day of the 2015 Maryland legislative session, authorizes a car manufacturer to be licensed as a dealer if it deals only in plug-in electric or nonfossil-fuel burning vehicles, so that Tesla that bypasses the traditional model for selling vehicles through franchised dealers can operate in Maryland. The debate over the legislation has called into question the environmental policy of advantaging plug-in electrics.

One key public policy question that had previously been little debated in Maryland, or elsewhere, is whether utility customers should pay for the investment in car charging stations. It is arguably corporate welfare at its worst to subsidize utility monopolies with a regressive fee on electricity. Some suggest utility shareholders should fund business opportunities. And in Maryland many of the charging stations are old or bad technology by the time they are installed.

Another policy conundrum is that while there are 23 plug in cars available in the U.S. market from 12 manufacturers, they are expensive vehicles and the highest sales in Maryland are to residents in the top 10 wealthiest zip codes, with over the half of those 2014 sales within in two high incomes counties, Montgomery and Howard, thereby subsidizing wealthy vehicle purchasers.

Also little debated is the larger question of the efficacy of plug-in electric vehicles in a state like Maryland where 60% of the electricity is generated from coal. That is, coal fired power plants produce the electricity for those vehicles.

None of this is to suggest electric vehicles should not fit into the mix, but is government choosing winners and losers, including is it disadvantaging natural gas vehicles that benefit from new abundancies and perpetuating obstacles to fuel cell vehicles that are fighting to enter the broader market? There is little doubt that today, the final day of legislative session, Maryland will change the law to allow Telsa retail stores in Maryland, but is any of this good environmental policy? 

LEED is the Tool to Restrict Water Use in This Town

While much attention was given last week to California Governor Jerry Brown’s executive order, in response to that state’s long running drought, seeking to reduce overall water use by 25%, there may be more to be learned from how the small Town of Hampstead in Maryland responded to its own water crisis in 2008.

Despite that the U.S. uses less water than it did in 1980, availability of potable water is increasingly an issue. According to the EPA, at least 36 states are anticipating local, regional, or statewide water shortages this year.  

In 2008, the 6,323 people residing in the Town of Hampstead, for the first time since it was incorporated in 1888, were experiencing severe water stress and sought to restrict water use and faced a moratorium on all building. The Town Commissioners sought a proven response that was both easily articulable and could be readily and quickly implemented.

With the Town water system running out of water, the Town created a Groundwater Conservation District “encouraging environmentally sensitive and sustainable ‘green’ design and construction methods, minimizing impervious surface, maximizing groundwater recharge and protecting the aquifer.”

Within that District outdoor watering and irrigation was strictly prohibited. Washing of cars, boats, campers, windows, and the like, was prohibited except by a hose equipped with a flow-restricting device.

Cognizant that every 6 days, U.S. water utilities lose an entire day’s water from leaking pipes, the Town started an aggressive program of locating and fixing leaks, including offered a bounty of up to a $9,000 credit on water bills to customers  for self locating a water leak on their property.

And by ordinance 2008-449, Hampstead Town Code 135-150 was amended to provide:

Any new building or structure shall comply with the Leadership in Energy and Environmental Design (LEED) standards for silver certification or a standard deemed equivalent by the Commission. The developer shall be responsible for the cost of the Town hiring a consultant to certify that the site plans and construction drawings conform to the LEED or other approved environmental standard. The Commission may establish a higher standard if deemed appropriate by the Commission.

The ordinance was tied to LEED 2009 NC which included for the first time as a prerequisite, WEp1 that all projects must reduce water use by at least 20%.  And by requiring that projects be certifiable at the Silver level, land owners were encouraged to pursue credit WEc2, where a 30% reduction in water use garners two points, with up to four points available for a 40% reduction. Owners were also advised to pursue credit WEc1 which is available for a 50% reduction in potable water use for irrigation.

Using LEED as a tool to restrict water use obviated the need to create some new regulatory scheme from scratch. The ordinance met with little, if any, negative comment because most accepted government has a proper role in responding to a crisis and, in part, because the plumbing industry was familiar with LEED. And that projects need only be LEED ‘certifiable’ and not actually certified ameliorated the concern that LEED voluntary third party rating system was being misused.  

The LEED water reduction prerequisite and credits provide an ideal tool for reducing water use. Carefully drafted, LEED can provide the standards, in an ordinance, for restricting water use. More simply put, LEED can be the ideal liquidity strategy.

Photo in the rain at the base of Gangkhar Puensum, Bhutan 2008 

All Solar Panels are Pervious in Maryland

Forget what you know about earth sciences and think law. By statute all solar panels are pervious in Maryland.

Of course that doesn’t mean that rain actually passes through the solar panels or that in Maryland the panels are constructed to be any more permeable than elsewhere. Maryland is not trying to alter the laws of science, but rather seeking through public policy to prioritize environmental stewardship. 

Chapter 702 of the Session Laws of 2012 makes law that,

For the purposes of issuing a permit or variance relating to zoning, construction, or stormwater for a project to install a solar panel, any calculation relating to the impervious surface of the project required by the State or local governing authority issuing the permit or variance may include only the foundation or base supporting the solar panel.

This is significant because regulating impervious surface on a property, either by establishing a maximum allowable area or a ratio of impervious surface to the total lot area, is a common zoning performance standard used by local governments in Maryland and elsewhere. Also, with respect to stormwater management, counties and municipalities in Maryland are required to cause stormwater to be managed, for quantity and quality, based on the area of impervious surface that will result from development. And Maryland imposes annual stormwater remediation taxes on land owners, implemented by suburban counties and municipalities and levied on a per square foot calculation of impervious area on a lot.

The result is obvious if installing a ground mounted solar array in a field. But the benefit of the law is redoubled when the solar panels are rack mounted above an off street parking lot or on the roof of a building. By way of example, the areas under the rack mounted panels over parking spaces reduce the amount of impervious area that must be calculated for zoning, for stormwater management, and for stormwater taxes.

And before the inner geek in anyone becomes concerned about what happens to all that ‘stormwater’ remember it was just rain falling onto the ground before an earlier law began regulating and taxing rain as stormwater.   

Unfortunately, the law to date has had little, if any, effect in Maryland. Most counties and municipalities have been slow if not downright reluctant to implement the state mandate.  

Maryland has a Renewable Portfolio Standard with 20% target for renewable energy by 2020, including at least 2% from solar. While Maryland straddles the Chesapeake Bay, North America’s largest estuary, and as such regulation of water quality is among the strictest in the nation, the state has balanced environmental impacts of power generation and determined that onsite renewable energy is worthy of advantaging.

After an analysis circulated that included utilizing the EPA TRACI tool that took into account impact categories of ozone depletion, global warming, acidification, cancer, non-cancer, human criteria, eutrophication, smog formation, ecotoxicity, fossil fuel use, land use and water use, this legislation passed both houses of the legislature unanimously.

The law is not unique to Maryland. In 2010 New Jersey enacted a similar law exempting solar panels from zoning limitations on impervious cover and, anecdotally, that law has been embraced in a state that is second in the nation in the total number of homes and businesses which have solar panels installed.

Other states must follow this lead if we are to save the planet. Not only does encouraging solar panels make sense from an environmental risk a management perspective, but more broadly we should be advocating for other sophisticated laws and regulations (not simply tax credits and the like) that incentivize sustainable technologies. 

Eco Terrorism is Not in the Headlines so Did it Ever Exist?

America’s most notorious eco-terrorist, Eric Taylor McDavid, was surprisingly released from prison earlier this year after serving 8 years of a 20 year sentence when a Federal judge determined “the FBI withheld documents from McDavid's trial defense attorneys that indicated they used an informant to entrap him,” according to a news release from the Civil Liberties Defense Center.

In 2004, John Lewis, deputy assistant director of the FBI Counterterrorism Division, told the Senate Judiciary Committee: “the FBI’s investigation of animal rights extremists and ecoterrorism matters is our highest domestic terrorism investigative priority.”  

The 1998 Vail arson that destroyed the Two Elk Lodge and caused at least $12 Million in property damage was the most destructive act committed by environmental activists in U.S. history. Beyond the U.S. there were anti whaling property damage in Japan and elsewhere. And by all accepted definitions, the car bomb threat at the United Nations Climate Change Conference in Cancun, Mexico was threatening to people inside the targeted building and therefore constituted a terrorist act.

Some have argued that special interest extremism “eco terrorism” is at worst a political ploy or at best a misnomer although there is no doubt that certain acts outside the U.S. (like Cancun) were terrorist. A better assessment might be that domestically there were a very small number of individuals committing criminal property damage acts (not left wing or right wing, but) in the name of environmentalism; and in unprecedented FBI investigations, including Operation Backfire, the Federal government sought them out and prosecuted them. Between 1993 and 2003, the number of FBI agents dedicated to domestic counterterrorism programs grew by 224% to 1,669 - nearly 16% of all FBI Special Agents.

The Anti-Tree Spiking Act of 1996, enhanced sentencing guidelines, and a variety of other new state laws criminalized and served as a real deterrent to eco-terrorism. Then the adoption of the PATRIOT Act was further fuel for the hunt for “radical environmental activists” such that, after years of decline, by 2012 there were no “eco-terrorist attacks” in the U.S. (and there have been next to none since).

As such, it is little surprise that there were no headlines when on a January 7, 2015, U.S. District Judge Morrison C. England in California in final settlement of a habeas petition accepted McDavid's guilty plea to conspiring to destroy a U.S. Forest Service lab in Placerville, which carries a maximum term of five years. Because McDavid had served nine years, England ordered him released for time served.

Judge England expressed exasperation at the FBI’s failure to turn over the evidence, which included e-mails and a letter from McDavid to an FBI informant that defense attorneys said would have bolstered their argument that he was entrapped and induced by sex. Much of this was the subject of a gritty Outside Magazine story “Honey Stinger” in 2012.

Judge England said “I sat through the 10-day trial of Mr. McDavid,” … . “I know he's not necessarily a choirboy, but he doesn't deserve to go through this, either. It's not fair.”

The takeaway from all of this is muddied. A December 2014 The Washington Post headline asked, Ecoterrorism: threat or political ploy? Earlier this year a headline in, The Pacific Standard, simply inquired, Whatever Happened to ‘Eco-Terrorism’? In a world, today, with headlines about Boko Haram and Al Qaeda, the Earth Liberation Front and the Animal Liberation Front that made headlines in the 1990s, seem tame if not all but inconsequential. The eco issues of recent past have not gone away they are the “sustainability” issues of today and still worthy of an honest discourse.

Image © GreenIsTheNewRed.com 

Green Code Mandatory on April 1 For All Building in Baltimore

By Jacqueline Lusk and Stuart Kaplow

Baltimore City adopted the International Green Construction Code 2012 as an overlay to the City’s building, fire and related codes effective April 1, 2015.

And despite that the IgCC becomes mandatory on April Fools’ Day, we are not playing a practical joke when we tell you that the effective date has “shifted.” Read on ..

Baltimore was among the first jurisdictions, in 2007 to mandate that all “newly constructed, extensively modified non-residential buildings” .. “achieve a Silver rating in the appropriate LEED rating system or satisfy the Baltimore City Green Building Standard” (a LEED-like local enactment). That mandatory law had some efficacy with new construction but almost no market impact on renovations as building owners strived to avoid the enactment.  

Council Bill 14-0413 repeals that existing law and commencing April 1, 2015 expands its scope and breadth with a new Baltimore Green Construction Code to apply to all new construction and “all repairs, additions, or alterations to a structure and all changes of occupancy” with very few exceptions (.. one or two family dwellings, etc.).

Significantly, the new Green Code does not apply to: structures that achieve a LEED Silver rating; residential and mixed use buildings of five stories or more that comply with the ICC 700 at the Silver performance level for energy and Bronze level for other categories; and, to structures that comply with ASHRAE standard 189.1. The new enactment allows the Code official to accept third party certification of compliance with these alternative compliance paths; and the authors’ businesses will provide those certifications.

The Code official has announced a provisional shifting of the ‘hard’ April 1 effective date that may be available until the effective date of the triennial code revision (of the building, plumbing, energy and other construction codes) which will likely be in first week of July, 2015. Until that not yet determined date, projects may utilize the new Green Code, but significantly, the Code official will accept new registration for the Baltimore City Green Building Standard for projects determined to have expended significant time and money in plan approvals and for projects that were not required to comply with the old Standard (e.g., a building under 10,000 square feet), which projects when registered by that date may be permitted to proceed under that Standard.

The urgency in sunsetting the Baltimore City Green Building Standard was in large measure because it utilizes many of the LEED 2009 metrics, but when USGBC again delayed LEED v4 and announced projects will be able to register for LEED 2008 through October 31, 2016, the Standard’s functionality was extended through that date.

The modified effective date is also influenced by the fact that the adoption of the updated Baltimore City Zoning Ordinance has slowed and many of the new green features of that not yet adopted zoning code are necessary to make the new Green Code efficacious.

This delay in effective date is a big deal. Despite that less than a hundred projects in total have registered under the sunsetting of the Baltimore City Green Building Standard, many of those were multi-family residential buildings (which will see major changes in compliance requires under the new Code).

And the City Standard may see many more applicants after April 1 because this new Green Code applies to all repairs and renovations (not subject to the prior law), which will result is a sea-change in terms of increased number of buildings that must be green.

Policy making public officials have described that when the triennial code revisions are adopted there will also be changes to the new Green Code. To address the matter of how multi-family residential is burdened under the new Green Code, projects that comply with the Enterprise Green Communities standard will be added to the list of those exempt from IgCC compliance. There will also be significant changes to the energy requirements in the IgCC clarifying compliance.

Of note, there is an exemption process where the Code official may, in unusual circumstances and upon a showing of good cause, grant an exemption from any specific requirement of the Green Code. This not only authorizes the shifting effective date, but also will be key in making the new Green Code workable. The IgCC as adopted in Baltimore is not a base code, but rather sets a higher bar than even LEED Silver where compliance with the 32 pages of edits made to the form IgCC make this enactment very green.   

While some of the edits to the form code appear innocuous , like requiring “at least 50% of the total building materials used” in a building of 25,000 square feet or greater, must be recycled, recyclable, bio-based or indigenous (within 500 miles), others are not. In a first for any American city, buildings subject to the new law are now mandated to have renewable energy systems.

The enactment corrects some of the industry bias in the form IgCC when, in pursuit of heat island effect mitigation, Baltimore permits the use of “porous asphalt pavement” in addition to pervious concrete. The form code all but bans asphalt pavement in favor of concrete products (i.e., when the IgCC 2012 mandates heat island mitigation for not less than 50% of site hardscape with material as having a solar reflectance value of not less than 0.30 [.. think light colored concrete and not dark colored asphalt]).

As progressive as this bill is, Baltimore is one of a very limited number of jurisdictions mandating new construction and renovation of both private and public buildings must be green. After the 2014 mid-term elections, many of today’s newly elected conservatives believe that a voluntary, non-mandatory approach to environmental protection is the best hope for stewardship of our planet. It is that same belief that has led to the broad brand and wide market share acceptance of LEED as a voluntary green building rating system. But Baltimore has had a mandate on the books since 2007, so, while there are not 50 shades of green, with alternative compliance paths for achieving green building, this new Green Code is being viewed favorably.

In the coming days applicants utilizing Baltimore’s e-plans permit submittal system will be prompted to complete a new Green Building Statement Of Compliance. When subject to the new law, an applicant at the time of building permit must select a compliance path (i.e., Green Construction Code or LEED or ICC 700 or ..).

It is important that those contemplating construction or renovation in Baltimore be aware that the state of Maryland adopted a very different version of the IgCC for use on Maryland capital budget funded projects.

And it should be lost on no one that all of this involves the IgCC 2012 and not the 2015 version. The 2015 IgCC was approved in November and will be published in May 2015, but will not be eligible for use in Maryland until approved by state and local government officials.  

With only a matter of days until the April Fools’ Day, we are working with property owners and builders to promptly evaluate the impact of the several alternatives for green building now required of nearly all construction and renovation in Baltimore.

Jacqueline Lusk is a sustainability consultant at Lorax Partnerships and can be reached at jackie@loraxllc.com. Stuart Kaplow is a sustainability and green building attorney and can be reached at skaplow@stuartkaplow.com.

Fannie Mae Interest Rate Break on Green Building

The exciting news in residential green building is that the Federal National Mortgage Association, commonly known as Fannie Mae, is providing incentives, including lower interest rates for multifamily properties with a green building certification.

There are an untold number of incentives for green building, including policies at the local, state and federal government levels, however, even in toto they are of limited efficacy. 

But Fannie Mae’s new incentive of 10 basis points off any loan for properties with a green building certification has the potential to be a game changer.

Fannie Mae, founded in 1938, is a government sponsored enterprise that has been a publicly traded company since 1968. Its purpose is to expand the secondary mortgage market with securitized mortgages. And while Fannie Mae has had green initiatives since 2010, they have previously been of limited scope. The NYC M-PIRE product is only available in New York City and the Green Preservation Plus program provides extra proceeds for green improvements and repairs only to affordable properties, resulting in both of those very good incentives only being available for an extremely limited number of properties.  

Fannie Mae’s green initiatives mission is “to improve the energy and water efficiency, to enhance the financial and environmental sustainability, and to extend the useful life of the U.S.'s multifamily housing stock.”

This new pricing break program does just that. It is available for refinance, acquisition and supplemental loans. And eligible properties are conventional multifamily, affordable and co-ops nationwide.

The pricing incentive of 10 basis point off is very real. (A basis point is one hundredth of a percent. For example, 10 basis points is the same as a 0.1%.) There is no minimum or maximum loan size. And the maximum loan to value is up to 80%.

The property must possess a valid, current third party green building certification. The list of acceptable certifications from the Fannie Mae website are:

EarthCraft, Greater Atlanta Home Builders Association & South Face

ENERGY STAR for Multifamily

ENERGY STAR for Qualified Multifamily High-Rise, EPA

Green Communities, Enterprise Community Partners

Green Globes, Green Building Initiative

GreenPoint, Build It Green

Home Energy Rating System, RESNET

LEED, US Green Building Council

National Green Building Program, National Association of Home Builders (NAHB)

While USGBC issued a press release about this new initiative some days ago, it is significant that green building can be much more than only LEED.

Beyond the benefits to owners of these multifamily properties that have a green building certification, the arguably larger benefit of this initiative is Fannie Mae’s sale of the bundled “green” mortgage backed securities. This is huge as it serves to standardize and expand the emergent green secondary financing market in the U.S. (.. think green bonds).  Each of those third party certifications is required to satisfy those environmentally conscious investors who will purchase the green securities.

Fannie Mae’s lower interest rates may not be the “in” response to climate change dystopia, but green mortgage backed securities, getting a big boost by this initiative, will be a key source of financing for green building that will save the planet.

Georgia's Legislation Banning LEED for State Buildings is Much Ado About Nothing

Georgia General Assembly House Bill 255 is proof that the “wood wars” surrounding the LEED green building rating system continue to be waged.

That said, the specific bill is Much Ado About Nothing.

Despite that the previous much debated LEED credit for FSC Certified Wood is gone from LEED v4, the new MRc3 credit, “Building product disclosure and optimization – sourcing of raw materials” is a new source of controversy. To receive the credit, a project must use “at least 25%, by cost, of the total value of permanently installed building products.” For wood products, the credit requires products “certified by the Forest Stewardship Council or USGBC-approved equivalent” (.. and, apparently, there are no such approved equivalents). 

Earlier battles in the wood wars, when the FSC Certified Wood credit was at the center of controversy, resulted in Congress halting funding of 2012 and 2013 Department of Defense LEED Gold and Platinum projects, lead Maryland and other states to enact laws and issue Executive Orders to not pursue the FSC Wood credit on government LEED projects, and more.

On August 10, 2012 by Executive Order Georgia Governor Nathan Deal decreed,

that any new or expanded state building shall incorporate “Green Building” standards that give certification credits equally to forest products grown, manufactured, and certified under the Sustainable Forestry Initiative, the American Tree Farm System and Forest Stewardship Council.

That Executive Order, having the import of not permitting use of LEED on Georgia state funded building, remains in place in Georgia.

So when HB 255 proposes to  memorialize the following,

Whenever green building standards are applied to the new construction, operation, repair, or renovation of any state building, the state shall use only those green building standards that give certification credits equally to Georgia forest products grown, manufactured, and certified under the Sustainable Forestry Initiative, the American Tree Farm System, and the Forest Stewardship Council,

as a statute, will change nothing on the ground in the Peach state and is Much Ado About Nothing.

While this and other proposed anti-LEED laws should not be ignored, few think there is any crisis of purpose or legitimacy in the LEED rating systems and many believe opposition might be expected when LEED commands a 95% market share in the multi-billion dollar certified Green building market. Possibly the better question is whether the voluntary third party rating system is being misused when it is mandatory for government building, in Georgia and elsewhere?

At the end of Shakespeare’s Much Ado About Nothing, Benedick and Beatrice join forces to set things right, and the others join in a dance celebrating the marriages of the two couples. It is unlikely that the U.S. Green Building Council will similarly accept any of the more than 50 ‘forest management practice’ programs across the globe, and the organization’s longstanding exclusive relationship with FSC will continue. Some have suggested that the ongoing reworking of the v4 material credits will allow USGBC to ‘set things right’ not just with lumber but also with the larger controversies surrounding materials, stemming the anti v4 tide.

HB 255 is set for public hearing before the Georgia legislature’s State Properties Committee this Wednesday, March 4 at 2 p.m. 

Largest Owner of Buildings in North America Considering LEED v4

The General Services Administration is seeking public input on its analysis of LEED v4 and other questions related to the Federal Government's use of LEED v4.

Given that the Federal Government is, by far, the largest owner of buildings in North America, and is also the owner or more green buildings and more LEED certified buildings than anyone else, this is significant.    

The Energy Independence and Security Act of 2007 requires the GSA to review existing green building certification systems every 5 years to identify a system and certification level “deem[ed] to be most likely to encourage a comprehensive and environmentally sound approach to certification of green buildings.”

The Director of GSA’s Office of Federal High-Performance Green Buildings provides the findings of that review to the Secretary of Energy who, in consultation with the Department of Defense and GSA, formally identifies the system(s) to be used across the federal government. Such a review was undertaken in 2006 and 2012.

After an evaluation process that spanned several years, and after agency, public, and private sector input, GSA recommended in October 2013 that agencies use one of two green building certification systems that best suit agency missions and portfolio needs: the Green Building Initiative’s Green Globes 2010 and the U.S. Green Building Council’s LEED 2009.

GSA completed a supplemental review of the U.S. Green Building Council’s LEED v4 in November 2014 to determine its alignment with Federal green building requirements. And while some have suggested that v4 generally aligns, there are very real and large gaps in the robustness of the new LEED version credits with respect to energy and materials where the v4 credits are not aligned with Federal statutes, regulations and Executive Orders.

On January 21, 2015, GSA published a request for information in the Federal Register seeking additional public input on its analysis of LEED v4 and several other questions related to the Government's use of LEED v4 and future GSA reviews of green building certification systems.  

GSA is soliciting comments for 60 days, ending on March 23, 2015 and those active in the environmental industrial complex are urged to comment.  

GSA is also holding an online public listening session on March 2, 2015 from 1 - 3 p.m. EST to hear comments from stakeholders.  Information on the public listening session can be found at: http://www.gsa.gov/portal/content/206591

Once the comment period closes, GSA will be using this input to augment its 2013 recommendation as it relates to LEED v4. 

“GSA elected not to re-review the Green Globes rating systems at this time with .. changes looming.”

On a closely related matter, it is important to note that on October 14, 2014, the U.S. DOE published a final rule that formally identifies criteria that green building certification systems must meet in order to be used by the Federal Government. This GSA request for information is not for the purposes of that final rulemaking, but to inform GSA on its related responsibilities to study green building certification systems and recommend ones to the DOE that may fit within the framework of the final rule. DOE's final rule is worthy of your reading.  

Climate Change Scientist Andrew Weaver Wins Libel Case Against Canadian National Post

Canadian climate change scientist Andrew Weaver won a widely watched defamation lawsuit against the National Post last week.

The Supreme Court of British Columbia found that “the defendants have been careless or indifferent to the accuracy of the facts” in four articles about climate change published in print and online, in late 2009 and early 2010, by the National Post. The articles were titled, 

Weaver’s Web: Is it unreasonable to suggest his charge of theft against the fossil fuel industry is totally without merit?

Weaver’s web II: Climate modeller’s break-in caper spreads across Canadian university, exposing Climategate as monster cross-disciplinary big-oil funded attack on psychology labs,

Climate agency going up in flames: Exit of Canada’s expert a sure sign IPCC in trouble, and

So much for pure science: ‘Climategate’ raised questions about global warming. The ongoing debate about its impact raises questions about the the [sic] vested interests of climate science.

Justice Emily Burke felt the need to make clear that the case “is not who is right in the debate on climate change. Rather, the issue is whether the words and statements in the four articles defame the character of Dr. Weaver.” But then the decision continues, “the debate for the purpose of this matter, as at the date of the publication of the articles, can be described as follows: on the one hand, scientists espouse the view that recent global temperatures demonstrate human-induced warming.  On the other hand, other scientists say the science has not established this proposition.”

The court determined that the impugned words were defamatory concluding “that an ordinary reader would infer these meanings from an overall consideration of the articles; particularly the first three, which relatively quickly set the stage for the theme of deception and incompetence. The plaintiff’s integrity and credibility as a professor and scientist was called into question, thereby damaging his personal and scientific reputation.”

The court also concluded “the defendants definitively espouse a skeptical view of climate change and are unwavering in their expression of this. While certainly entitled to express those views, .., they deliberately created a negative impression of Dr. Weaver. .. As evident from the testimony of the defendants, they were more interested in espousing a particular view than assessing the accuracy of the facts.” Initial reactions to the decision against the traditionally conservative newspaper are mixed with some speculating this currently politically correct ruling could have a chilling effect on reporting science unless it is overturned by the appellate courts.

The justice awarded Dr. Weaver $50,000 in damages.

In an unusual move, she also ordered the National Post to remove the offending articles from its websites and electronic databases, as well as publish “a complete retraction” of the defamatory statements, “in a form agreed to by” Dr. Weaver.

However, in the first court decision in Canada to address the issue of whether a newspaper can be liable for reader postings on its website, the justice sided with the National Post, which had argued it was not the publisher of the comments, and had removed them.  

The case is, of course, decided applying Canadian law, but the 62 page decision in Weaver v. Corcoran, 2015 BCSC 165, is wonderfully informative and an enjoyable read.

Top 10 States for LEED Green Building and Surprise Top LEED Rating System

Today, the U.S. Green Building Council released its annual List of the top 10 states for LEED certification in 2014.

Now in its fifth year, the List has become much anticipated. While some chuckle at a measure of “per capita square footage” (i.e., using U.S. Census data and including all commercial and institutional green building projects certified throughout 2014 to determine how many square feet were LEED certified in each state for each man, woman and child), there is valuable information to be gleaned from reviewing the List, including looking for business opportunities among the fun benchmark.

Among the extremely useful information is that green building is no longer only about erecting new high performance buildings. In 2014, LEED for Existing Building Operations and Maintenance was once again the most popular rating system within the top 10 states, with existing buildings representing 48% of the total square footage certified. The LEED for Building Design and Construction category (including New Construction, Core & Shell, Schools, Retail, Hospitality, Data Centers, Warehouses and Healthcare) cumulatively represented 46% of the square footage certified. And the remaining 6% of total square footage certified in 2014 was Interior Design and Construction.

Illinois retained its top national position for the second year in a row, with 174 LEED certifications representing 3.31 square feet of LEED certified space per resident.

Maryland and Virginia have helped the mid-Atlantic region remain the epicenter of green building across the country. Washington, D.C., which is not included on the list (because it is not a state), is notable as it continues to lead the nation with 29.44 square feet of space per resident certified in 2014. Maryland and Virginia finished third and fourth respectively, and both states increased their per capita totals to 2.70 and 2.33 square feet of LEED space per resident in 2014.

Demonstrating that LEED continues to thrive, the 2014’s List had the highest average (2.34) of per capita space certified per resident per state since 2010, and the second highest average to date. Six of the eight states (IL, CO, MD, VA, MA and HI), which were also on the list in 2013, increased the amount of square feet of space they certified per resident in 2014.

Illinois and Colorado are the only two states to make the list every year since 2010. Two newcomers to the list are Georgia and Arizona.  

Collectively, 1,662 commercial and institutional projects became LEED certified within the top 10 states in 2014, representing 251.7 million square feet of real estate. Worldwide, 4,502 projects were certified in 2014, representing 675.7 million square feet.

More than 24,000 projects representing 3.5 billion square feet of space have been LEED certified to date, with another 38,400 projects representing 8.2 billion square feet in the pipeline for certification.

None of these statistics include the LEED For Homes rating system and the more than 63,000 residential units have been Homes certified.

And yes, this post is about the past, about what happened last year, but the most significant ‘take away’ from the List is that there is a huge business opportunity in green building when every day, more than 1.7 million square feet of space is LEED certified.

Graphic courtesy of USGBC 

All Water is Greywater - So Don't Ban Greywater in Your Plumbing Code

As governments across the country enter the triennial building code cycle, including adopting the 2015 International Plumbing Code, it is key that they not ban greywater use.

Codes are usually adopted by local government legislative bodies, often with the advice of boards comprised of retired or senior members of local trades (e.g., the Plumbing Board) many of whom may not be conversant in sustainability and new innovations in green building. Many, if not nearly all, local governments alter and amend national codes for their own purposes. A prime example is that many local governments adopted the 2012 International Plumbing Code or 2012 National Standard Plumbing Code amending the national standard codes to remove the provisions that authorized the reuse of greywater (i.e., most by simply deleting 2012 IPC Chapter 13 Gray Water Recycling System).   

Water, including rain (i.e., storm water) other than toilet waste, draining from a building is greywater and suitable for reuse as nonpotable water. Reusing greywater serves multiple purposes: it reduces the amount of potable water needed to supply a building, it reduces the amount of wastewater entering sewer or septic systems, and it provides an alternative for storm water management, etc.

Plumbing codes now specify how systems must be designed, installed, and maintained to prevent cross contamination of drinking water and nonpotable water. That toilets are flushed and lawns are watered with drinking water is crazy.

But clinging to the past, many local governments today ban greywater. In 2010 the Maryland legislature was forced to enact a state law mandating “a county may not adopt or enforce a provision of a local plumbing code that prohibits a greywater recycling system.”

Banning greywater use is silly because arguably, all water on the planet has been reused. Earth came into being with all of its water about 4.4 billion years ago. No water has been added or subtracted. Scientists tell us that over the last 50,000 years over 100 billion people have inhabited the Earth and let’s assume a conservative 30 year life span with a typical person needing to consume 3 quarts of water a day (although today the average American uses 1.9 gallons a day). So that is more than 858 trillion gallons of water consumed by people. And that doesn’t include animals that outnumber people by over 1000 to 1. An elephant may consume 40 gallons a day. Paleontologists tell us the bathtub size depression found south of La Junta, Colorado “is the first recognized evidence of urination by dinosaurs” proving that about 150 million years ago a dinosaur stopped and peed 300 gallons. And there were millions of dinosaurs, all drinking water and peeing. So, easily creatures have had inside their kidneys and peed thousands of times all the potable water available on the planet. At this point it is all greywater.  

Drinking water is among the most pressing environmental issues facing the planet. But because potable water is so cheap in most Western countries, it is given short shrift in many sustainability efforts. 

In a potable water constrained world, local governments should not delete 2015 IPC Chapter 13 Nonpotable Water Systems when adopting plumbing codes this year.

Indoor Marijuana Growing Accounts for Over 1% of all Electric Consumption in the U.S.

In 2015, when vaping is out and Marley Natural Weed is in, the largely unrecognized and surging use of electricity associated with marijuana must be considered. 

Indoor marijuana growing operations accounted for over 1% of all electric consumption in the U.S., according to a 2011 study by Evan Mills, a Lawrence Berkeley National Laboratory researcher. In California, marijuana production accounted for about 3% of electric use, according to the study. The methodology of the study, self-recognizing the difficulties in tracking an activity that was illegal, only considers the indoor cultivation of cannabis, which is a small segment of what is the nation’s largest crop by value. 

The growth since the data gathering for 2011 study has been significant with marijuana legalized for recreational use in four states and medicinal use in 19 states.

Energy use at the reported magnitudes is very real, and the growth since 2011, when combined with the expected growth of electricity demand in this fast growing sector confounds energy forecasts and risks obscuring savings from energy efficiency policies and programs.

Although non legal marijuana growing is hard to calculate, the association with high energy use has been accepted for decades. A sharp increase in electrical use in a house has been used by police as probable cause to issue a search warrant for illegal marijuana cultivation.  On a square foot basis, the energy used in marijuana cultivation facilities exceeds that of hospitals and data centers. 

Print media accounts in Colorado have estimated that electricity costs are now 50% of the wholesale cost of the emergent industry of indoor cannabis production.

Boulder County, Colorado has responded with a regulatory requirement that each Medical Marijuana Optional Premises Cultivation or a Retail Marijuana Cultivation Facility must “directly offset 100% of the electricity consumption through a verified subscription in a Community Solar Garden, renewable energy generated on site, or equivalent.”

The local Colorado electricity utility, Xcel Energy expects to roll out a rebate program for the marijuana growers by early summer, according to Gabriel Romero, the utility spokesperson. Xcel is already offering rebates on a case-by case basis using existing lighting incentive programs, but the new rebate will encourage growers to replace their older lighting equipment with more efficient LEDs and the like.

The Northwest Power and Conservation Council, considering the impact of legalized cannabis production in Washington State, and based on new hard data from Colorado, estimates an increase in future electricity demand of over 160 megawatts. As other states implement newly enacted Marijuana laws and more states consider decriminalizing pot or legalizing it for medical or recreational use, it is clear that energy use in this sector will increase dramatically.

The impact of the emergent legal cannabis industry is widespread, including that among the most read of my blog posts last year was, Marijuana Smoking is Allowed in LEED Buildings.

Noting that growing pot is today not very green, an article in the Portland Business Journal last week anticipated the increase in energy use by Oregon’s new recreational marijuana industry asked, “is it time for LEED weed?”   

Pennsylvania is First State to offer Tax Credit for Passive House

Pennsylvania is the first state to offer tax credits for low income Passive House building.

Applications submitted under the PennHOMES and low income housing tax credit program are scored and ranked in accordance with a numerical criteria. By way of example, up to 30 points are awarded to developments located in areas with high poverty rates or large numbers of senior citizens eligible for affordable housing.  

Up to 25 points are awarded for green building, including up to 5 points for redevelopment of a brownfield site, and up to 10 points for an adaptive reuse of a vacant building.

What is unique in the applications due by January 30, 2015 is that up to 10 points may be awarded to those developments which meet Passive House certification requirements (national or international). Actual Passive House “certification” from PHIUS or the Passive House Academy is not required. At construction completion, all third party test results and verifications required by Passive House, including blower door testing and commissioning reports, are submitted to the state and the project must be Passive House “certifiable.”  

For the uninitiated, the Passive House green building rating system uses a set of design principles to attain a rigorous level of energy efficiency. “Maximize your gains, minimize your losses” summarize the approach. A Passive building is designed to employ continuous insulation through its entire envelope without any thermal bridging and that building envelope is ‘extremely airtight’ preventing infiltration of outside air and loss of conditioned air. It employs the use of high performance windows (typically triple-paned) and doors.

An issue may be that while worldwide Passive House reports more than 40,000 buildings meet the standard, today there are only 130 Passive buildings in the United States, and only 11 of those are multi-family or commercial.

The Pennsylvania Housing Finance Agency reports that it is aware of at least one eligible building. “We may get 130 applications and we are going to fund about 40,” said Brian Hudson, executive director of the Agency, so the points available for Passive building would be key in the highly competitive tax credit process.

No points are available for LEED projects.

But, recognizing the limited efficacy of a program tied only to the very little used Passive House, Pennsylvania will also incentivize low income green housing with the $1 Million in tax credits when 10 points may be awarded for green building to projects achieving Enterprise Green Communities Criteria optional 25 points for new construction and 20 points for substantial or moderate rehabilitation properties. At construction completion, written certification must be submitted describing which Green Communities criteria were achieved.

An architect working on a housing retrofit in Pittsburgh observed, the State of Pennsylvania may have singlehandedly moved Passive House from the radical fringe to mainstream green building.

© picture-alliance/ dpa Passive Hose building in Darmstadt-Kranichstein, Germany