How Much Red Before Going Green?

In the days of “Occupy Wall Street” where social media and the internet showcases the delivery of various political and social viewpoints to the masses at the speed of thought, never before witnessed in our history, we are still slow to push forward some initiatives that would greatly help this country.  This occurred to me while reading a very interesting post from a Sustainability Roundtable member

I am talking, in particular, about Green Building and Sustainable Development in our cities.  This notion of incorporating green building practices in retrofitting and new building developments has been bantered about, and vehemently debated throughout the country for over a decade and yet we are still at the beginning stages of a wholesale build-out.

I can’t help but be confused by all the differing reports from industry experts regarding the true cost of building green.  The extremely conscious city of Portland in the beautiful state of Oregon is no exception to the differing opinions on how much green initiatives to be incorporated into the development plans of the city.

No doubt, on a national level, the awareness is growing and some states and local municipalities have already implemented Energy Performance Regulations requiring various levels of disclosure and reporting.

The big question in my mind is, where is the bottleneck that is preventing this renaissance?  There are many incentives and subsidies that help diffuse the pain of high capital costs, as well as, the recurring operational cost savings from a “greener” building.

In the latest Sustainability Roundtable: Management Best Practices

publication, they outlined three recent trends:

  1. The most respected statistically normalized studies consistently demonstrate that green buildings create value through leasing (5%) and sale price (5-7%) premiums.
  2. When consultants are not overpaid, green buildings and, specifically, green building certification, are in fact far less costly to achieve (0-2% additional cost) than many real estate professionals assume.
  3. There is increasing recognition of the health and productivity benefits of green buildings.

Another key takeaway from the report stated, “leading companies are moving to a more sustainable leased space to lower operating costs, reduce environmental risks, increase productivity, improve recruiting and retention, implement corporate sustainability mandates, and enhance brand and reputation.”

It all sounds great but I am neither a civil engineer nor a city planner, so where is the Beef?  What else needs to be done in order to motivate a faster change?  Your voice is welcome!

4 Replies to “How Much Red Before Going Green?”

  1. The bottleneck is complacency of the non-institutional landlords and building owners – only continuing education, higher energy costs and an evaporating tenant base from the non-sustainable properties will spur faster action.

    1. Great points…
      Continuing education and awareness is on the rise-check!
      Higher Energy costs are a reality-check!
      Are tenants placing sustainable offices and green building efficiency higher up on their priority lists? Is anyone noticing any trends?

  2. I know for a fact European firms are required to submit carbon footprint metrics as a part of their annual reporting and even with that there is no appetite for taking on higher operating costs to be more green.

    Frankly energy costs may well be falling like a stone following the November 2012 elections provided Republicans move forward with their plan to drill for energy in the US as a means of eliminating debt and reducing unemployment. Cap and Trade is dead and alternative energy sources have proven to be far less robust that hoped leaving the alternative options of wind and solar as small players on the global stage.

    That however does not stop governments from subsidizing losing industries in hopes of a breakthrough or more likely a mandate. Mandates are just another way of saying a rising cost of operations for businesses and inflation for consumers. I want clean water and air just like any other sane person but at what cost, what is the ROI we need to have for 10% cleaner water, how does that change manifest itself in improving lives, ditto air.

    I remember how dirty air was in the 60’s and 70’s, we have made great strides is the next improvement worth the price? What is the goal for green buildings, why the race? Could it be that there is someone who is prepared to make a huge profit on the new energy or new standards. I know one company that has little regard for cleaner anything, increasing its footprint in the tidal sewers of India and China while developing software to manage carbon credits.

    Before we run to mandate green buildings I suggest we think about the investment required and the impact of those investments. Remember any rise in corporate costs results in a similar if not more substantial rise in product costs-the corporate return must always be defined in percentages above the costs of production.

    Be careful of unintended consequences, they typically are the most damning.

    1. Great counter points…the devil is in the details.
      You state economic barriers, or more specifically, a balance of economic factors to influence the supply side concerns.
      What are your thoughts & observations regarding the demand side of this puzzle?

Leave a Reply

Your email address will not be published. Required fields are marked *