I spoke to a gathering of construction industry attorneys the other day about changing environment of Federal government regulation portending huge business opportunities for green building. These were my prepared remarks for that talk.
While much of the mass media hyperbole is focused on the new Administration’s 2018 “skinny” budget request of $5.7 Billion for the Environmental Protection Agency, the bigger story is for construction attorneys is how the changing environment of Federal government regulation portends huge business opportunities for green building, and especially for construction attorneys who advise the sustainable building industry.
This is a time of major changes to the national environmental agenda, and an ideal moment to articulate how green building is “the” ideal means of voluntarily mitigating the negative environmental impacts that human activity has on the planet.
Green building can save the planet
The construction of buildings provides countless benefits to human beings far beyond mere shelter, and voluntary stewardship of the environment through green building can save the planet, or, more precisely, green building can save mankind and our current way of life.
It is this belief, that green building will provide a safer, healthier, and more sustainable way of life, that has led to the broad brand and wide market share acceptance of the LEED green building rating system. [i]
In most business circles today, the debate about climate change has shifting away from a discussion of costs and risks, and towards the question of how to capitalize on the exciting opportunities in the green building space.
Prospering from voluntary sustainability is consistent with the current Federal government’s refocusing of the national environmental agenda. The 45th President of the United States is not a 1960s Barry Goldwater environmentalist who favored “federal intervention with regards to the environment.” To the contrary, President Donald J. Trump is a real estate developer who campaigned on dismantling much of the EPA (e.g., rolling back EnergyStar, WaterSense and other programs that can be transferred to the private sector) and repealing executive orders on climate change (e.g., including those associated with the Guiding Principles for Sustainable Federal Buildings), withdrawing from the Paris climate accord, and rolling back regulations (e.g., Clean Power Plan, non tidal wetland expansion, etc.).
Reduce energy use, water use, solid waste and GHG emissions
While there is no one homogenized building type, voluntary green building can significantly reduce energy use, water use, solid waste and greenhouse gas emissions.
By way of example, compared to the average commercial building, an oft quoted study found the LEED Gold buildings in the U.S. General Services Administration’s portfolio generally: consume 25% less energy, use 11% less potable water, have 19% lower maintenance costs, 27% higher occupant satisfaction, and emit 34% lower greenhouse gas emissions. [ii]
But at a time when many in society describe environmental matters apocalyptically, as if human existence on the planet is at risk, a real, and currently available, response is a built environment reducing energy use, water use, solid waste and greenhouse gas emissions.
And green buildings do all of that and so much more.
TRACI lead us to LEED
It is time to refresh our recollection that the first version of LEED allocated points based substantially upon the U.S. National Institute of Standards and Technology “Building for Environmental and Economic Sustainability” (BEES) environmental impacts in 1998. [iii] An updated version of BEES is expected in 2017.
Later, LEED version 2009 reweighted the solutions to environmental impacts using the U.S. EPA “Tool for the Reduction and Assessment of Chemical and other environmental Impacts” (TRACI). [iv] Implementing TRACI standards was not a large leap from the previous standard because the previous BEES standard was based upon the existing TRACI standard. The current TRACI standard measures impacts based on: Ozone Depletion, Global Climate, Acidification, Eutrophication, Smog Formation, Human Health Particulate, Human Health Cancer, Human Health Noncancer and Ecotoxicity. The green building industrial complex will remain relevant in this changing environment only by effectively articulating the positive outcomes from those impacts to developers and owners. .
Driven by building owners in pursuit of those positive environmental externalities, green building has already exploded onto the scene with a 3200% growth in share of the U.S. non-residential construction activity since 2006. [v] That statistic, in and of itself, should cause every construction attorney to turn green.
The wellbeing of building occupants
Moreover, the wellbeing of building occupants is in 2017 increasingly being described as a key driver of sustainability. In the in the U.S. alone, there are more than 120 million employees who spend an average of 8.1 hours at work within a building each day. And staff costs broadly account for 90% of business operating costs, the health and wellbeing of those employees, and the resultant increased productivity of healthy and happy building occupants, makes this emergent trend in sustainability very real. [vi]
The aims for a sustainable building have shifted in the U.S. from green buildings that were “high performance” because they had a low carbon footprint to, now, occupant wellbeing and the resultant increased productivity. This dramatic shift may mean less demand for LEED buildings (although 1.85 million square feet being is being LEED certified every day) [vii] and more WELL projects and Fitwel building, two emerging building standards that center on considerations around protecting occupant health, wellness, and productivity.
That view, including the voluntary shift in priorities, is consistent with those that control the White House and Congress. It also meshes well with land owners who believe that a voluntary, non-mandatory approach to environmental protection is the best hope for stewardship of our planet. They believe that burdening land owners with yet more government mandates is wrong and is not efficacious.
The failure of green codes
The broad failure of the International Green Construction Code to be widely enacted suggests a mandatory green building code that goes far beyond life safety is going too far and will not be accepted by developers and owners. Further, the fact that ASHRAE 189.1 has only been implemented by the U.S. military is equally damning. Mandatory green codes and energy standards touted by the last Administration, when Congress would not enact hyperbolic responses to climate change at the risk of changing our way of life, are not popular with the current thought leaders in control of the Federal government.
Additionally, attempting to mandate that a private land owner must build a LEED or Green Globes certified structure misuses the voluntary rating systems. David Gottfried, the U.S. Green Building Council co-founder who unabashedly believes “all building should be green” said in a 2014 interview, “LEED was designed as a voluntary standard” acknowledging that “some governments have grabbed onto it.” And Jerry Yudelson, the former President of GBI (the Green Globes folks), makes clear he does not advocate mandatory green building laws for private building and he sees “a benefit of allowing the freedom of the marketplace to control this rapidly changing field, where performance counts.”
Making a profit while saving the planet
But not only is green building a cost effective engineered solution for many of the environmental impacts arising from human activity, from an economic perspective, it is clear that green building is profitable. There is nothing wrong with making a profit on innovations developed in response to those environmental impacts while saving the planet, whether it needs to be saved or not.
George Carlin famously quipped in one of his oft repeated comedy routines, “The planet is fine. People are fucked.” [viii] But his observation that Earth is 4.5 billion years old, so “The planet isn’t going anywhere. We are,” belies the comedic wisdom of this very real fact.
Once the dust settles from the ideological Armageddon over the 2018 Federal budget and with a push from the President when the U.S. withdraws from the Paris accord, it will become clear that green building policies that promote growth and innovation creating an environment rich for investment in real estate can save both mankind and our current way of life; and we all can get wealthy from building green
[vi] See, Fitwel may be the Future of Building Sustainability, https://www.greenbuildinglawupdate.com/2017/03/articles/sustainability/fitwel-may-be-the-future-of-building-sustainability/