GLBU Prediction 2009: It's All About the Retrofit
"Green" was the buzz word in 2008. In 2009, Green Building Law Update predicts that green buzz words will become more nuanced and the focus will be on "energy efficiency," "retrofits," and "existing buildings."
I don't mind making this prediction because it is not much of a stretch. There are three factors that will contribute to the popularity of retrofitting existing buildings to improve energy efficiency.
First, as we have been discussing all week, President-Elect Obama is pushing a large stimulus package aimed at, in part, improving the energy efficiency of existing buildings and homes. Yesterday, President-Elect Obama again stated his plan "to modernize 75 percent of federal buildings and improve energy efficiency in 2 million homes to save consumers billions of dollars on energy bills."
The second factor that will contribute to increased popularity for retrofitting current building stock is a slowdown in new building project developments. At this point, we have all heard the dire warnings of a construction slowdown. This construction slowdown is due, in part, to tightened lending options. We also know that tenants are now demanding green buildings. The result will be that building owners will look to "retrofit" their existing buildings so as to offer more green building options.
Finally, climate legislation in the form of cap-and-trade is coming. Early investments now to reduce energy use through retrofits will pay off for big businesses.
What do you think? Are my predictions off? What is your one prediction for the green building industry in 2009?
Related Links:
- Obama's Green Energy Plans Build Hopes, Skepticism (Reuters UK)
- Construction Slowdown Hits Architects (BizJournal)
- Construction Slowdown Still to Come (Wall Street Journal)
- Congress to Delay Action on Cap-and-Trade (Wall Street Journal)
- A Very Detailed Green Stimulus Proposal (GBLU)
Totally agree with you that there will be renewed focused on retrofitting. Another possible reason may also include those individuals, who can still qualify for loans may think about upgrading their existing home instead of moving.
And when you think about it, this is where our focus as a nation should be - on improving the energy efficiency and design of our existing buildings. There are more existing homes and commercial blgs, so it stands to reason that's where we could have the greatest impact in reducing our energy use.
BTW: really like your blog!!
I agree with you! Retrofit is the low hanging fruit..
I couldn't agree more! My past and future clients are always looking for green retrofitting. Its nice that people are finally getting the hint in the residential market.
Chris, I think you are dead-on. Green has moved from 'buzzword' to 'action item', and its not going away.
Retrofits and increasing energy efficiency is not a new concept, and until recent years was primarily focused on Residential by use of ‘Demand-side Management (DSM) Programs’ (Wrap-up/Seal-up programs, demand meters, etc.). NOW, we have leadership that can see the importance of these programs and are pushing for similar improvements to our existing commercial buildings.
The biggest obstacle will be changing the American mindset of wanting everything NOW! Increased efficiency will save you money over time, but you may not see the savings within the first year. But not all things can be viewed in monetary terms, such as Indoor Air Quality.
Another challenge in 2009 will deal with 'Green Washing' (the practice of companies spinning their product lines as being environmentally friendly as a means to appeal to consumers, persuading them to buy that product rather than another). With all the companies suddenly jumping on the 'green wagon', consumers will have to sort through all the misleading information, or pick the best sources for Green Information to help guide them (such as Green Building Law Update!).
Great work Chris, I always enjoy your posts!
Jennifer: There are Energy Efficient Mortgages (EEM) and Energy Improvement Mortgages (EIM) available to consumers and MOST mortgage folks dont even know about them, or have never done one! EEM's are for new construction, EIM's are for improvements to existing homes. With an EIM, you can get more than the value of the home in order to make 'Green Improvements'. The EEM's and EIM's will require an additonal inspection to certify the improvements have been made.
Urban Trekker: It is low hanging fruit but also where the biggest impact can be made. Building codes have caused some improvements over time, so newer buildings should in theory be more efficient. Retrofitting older buildings is where we can see bigger percentages of improvement.
Jami: It all started in the residential side...consumers and local government has just been 2-3 decades behind in acceptance. Now that Oil prices go up, consumers are listening. Much of this began during the Carter Administration, with many of the early programs being across the New England states (ConnSave, MassSave, etc.), and of course California.
If any of you have an interest in further discussions, feel free to follow me on Twitter: @Realtor_Brent
Jennifer - Glad you agree and glad you like the blog! It does make sense both from a financial and environmental standpoint.
Urban Trekker - "Low hanging fruits" - I like the way you put that.
Jami - I think the stimulus package will create a big "hint" for the residential market to adopt energy efficiency strategies. Should be an interesting year.
Brent - Thanks for reading my blog. New companies with little experience in green building techniques can also result in unhappy customers, which increases the chance of green building litigation. Choosing the right green contractor is very important!
I agree as well. My hope is that my clients will decide that this is a good way to go. Retrofits and re-use of existing structures is a "niche" that those who want to survive this slowdown need to get into.
I would hope that energy efficiency for everyone becomes a reality. I would think that that would take care of more people in more ways than just the environment.
Thanks
Robert