Here in Rhode Island, as elsewhere, well-intentioned people are proposing legislation that would mandate that any public building or any building receiving public subsidy be LEED rated. I already addressed my concerns with that proposal in “Legislating Greenness”. The problems include:
1) Empowering a single private out of state organization with essentially unregulated monopoly powers to define, change, certify and charge for greenness certification, which is effectively being mandated as a building code standard.
2) Eliminating market based competition and real market signals for defining, evolving and improving green building standards.
3) In the only study ever done on LEED buildings, when rigorous statistical analysis was applied to the data in an independent review, it ended up that at least to date, LEED buildings actually have used more energy than typical buildings.
Perhaps the biggest problem is that rating systems like LEED add more layers of complexity and more fees for LEED professionals, architects, engineers and construction managers, but they don’t add any meaningful accountability to the system. That’s exactly why LEED buildings can use more energy than conventional buildings and why LEED rated skyscrapers can leave their lights on all night when nobody is in the building. Once the rating is determined based on design, the building can call itself green no matter how poorly it actually performs.
With the economic situation we are in, the goal of green building advocates has to go beyond putting plaques on walls and having nice things to say in the press. We know that real green buildings actually save energy and save significant amounts of money in their operation. We need real accountability and serious incentives to make that happen.
So lets stop counting points and instead focus peoples attention much more clearly with a measurement we all understand very well – dollars.
The way states fund new buildings needs to be changed. Rather than coming in as an allocation or grant of cash, half the funding should be delivered as it is now under current funding mechanisms and the other half should be delivered to the agency or municipality building the building as a short term zero interest loan with a two year balloon payment. That loan would be forgiven if after two years of operation gas, oil and electric bills are 25% lower in energy units used per square foot than on comparable existing buildings in the state. If the building doesn’t meet this goal, the agency, municipality or other recipient of the funds would have have to repay the loan in full.
Such serious incentive would focus attention on what actually matters far more than counting greenness points.
With financial incentives that are clear and serious, the building procurement process for new buildings would quickly evolve to requiring energy performance bonds from architects and general contractors which would focus their attention very clearly. Architects and contractors would quickly become more serious about details. Schools would have to start training architects and engineers on issues that actually matter. Companies that failed to deliver would have a hard time getting energy performance bonds for future projects. The market would start providing real significant rewards for real green building.
Building operations and maintenance staffs would have more prestige and be considered a far more important part of organizational management with serious money on the line for real measured building performance.
Among other benefits, this kind of legislation would require getting baseline data on the existing building stock. The process of collecting and comparing real baseline data would get the state and municipalities comparing their existing buildings to each other on very simple and easy to calculate metrics – annual therms, gallons of oil and kWh per square foot. It would immediately become very obvious which buildings need to be fixed.
Both through improving the worst performing buildings and building new buildings that use 25% less energy than baseline, the goals and minimum performance levels constantly and automatically reset higher toward better performing buildings.
Such a system doesn’t need “Accredited Professionals” using abstract rating systems to count points. All that is needed is the utility bills that get delivered every month anyway.
Henry Gifford deserves credit for inspiring the concept that buildings should be rated on actual performance as measured by utility bills. All that is needed is to add some real accountability to that very clear and simple rating system.
The situation our country is in regarding energy, the environment and the economy is serious. We need serious incentives to drive serious solutions.
Let’s not forget that these buildings are filled with working people. Exposure to more sustainable living practices will also help build a greater awareness that people will take home to their personal lives as well. Every little bit counts.
All,
An architect that I respect immensely has pointed out in private communication that the proposal I suggested is far too harsh and draconian with half the cost of a project potentially subject to claw-back and the resulting finger pointing and dispute if the energy performance doesn’t measure up.
I am far less wedded to the specifics than the general concept of tying this stuff to dollars rather than greenness points. Perhaps the right answer is that only 5% or 10% of the construction funding should be subject to actual performance results.
Perhaps instead of any penalty, there should be a bonus payment that is shared between the architect, contractor and facilities manager. The bottom line is to make the standards accountable to real performance and tied to real dollars, so people pay attention to performance.
Fred
Instead of conditions on release of capital, why not have an adjustable interest rate for the funding, the rate subject to how well the building actually performs? Within bounds, and subject to some considerations (such as type of building and/or tenant), higher energy consumption could trigger a higher interest rate. After all, projects with lower energy and operating costs are better credit risks, yes?
I agree with Fred. Too much goes into a “rating” and not enough goes into substance. Btu/sq. ft for a business sector such as commercial office space would be a great way to measure a building for energy efficiency. As far as “green” materials, public transportation nearby, and recycled materials, these are also sustainable ideas and should be given some credit.
It amazes me that since American’s spend over 90% of their time in a building, all buildings aren’t “green”. It might be a boost for our health.
Hi folks,
Fred certainly makes a point in that a building should not be built just to chase points. And the efficiency of long term operations of the building after the fact are indeed what truly matters. The one area directly affecting the building performance over time is the lack of commissioning a building properly. ANY building that is not controlled properly no matter the details of the shell, HAVC systems etc. will fail to live up to its potential performance expectations or declarations.
Here in RI where I live, a green building bureaucracy has been proposed. If the type of financial arrangement proposed here were to become a reality, we now lovingly can say our state government has an added layer of hidden financial decisions whereby those controlling the strings will have a field day, what with all that great stimulus money coming!!!!!!!!!!
All,
Along with David’s truly great idea of making interest rates adjustable subject to metered energy performance, two other really great ideas on this subject recently came out of private conversations.
Chris Benedict suggested that the wall thickness dedicated to insulation be deducted from the square footage of buildings for purposes of calculating real estate taxes. Currently building areas are generally calculated to the exterior for tax purposes, so more insulation adds to ongoing real estate taxes without providing revenue from usable space. Chris’ proposed change would provide real benefits on an ongoing basis for the life of the building. While perhaps not applicable to public buildings, this is a wonderful idea for property tax policy generally.
Carl Freeman suggested a system of revenue neutral tax credits and debits based on performance. His ideas inspired me to think of addressing the public building challenge by establishing a revenue neutral energy fund which again compares buildings relative to a baseline with buildings performing worse than baseline paying into the fund and those performing better than baseline receiving cash from the fund. Such an “energy tax” system on public buildings would magnify the financial costs and benefits of energy performance. It would also have the same ancillary benefits of the original proposal in this post regarding getting baseline data on existing buildings and having a constantly self adjusting benchmark. Tied to a PR effort, it would spotlight the companies creating both great and lousy buildings and the effectiveness with which agencies manage their operations.
All these ideas seem far superior to counting points and chasing plaques. More feedback and creativity like this is really helpful as we think about how to approve the pending green building legislation here in Rhode Island and throughout the country.
Thanks all,
Fred
Fred, your idea of a revenue-neutral building-energy tax reminds me of attempts in Maine to pass a “guzzler/sipper” tax for automobiles. The idea was to lower excise tax for fuel-efficient vehicles and to raise it for the bronto-mobiles. As you can imagine, this was impossible to pass in the Legislature. But I think we should keep trying, both with vehicles and with buildings.
I really like Chris Benedict’s idea, too.
Fred,
You hit the issue on the head. The consulting community and building industry has abdicated its responsibilities in regard to construction practices. They are never held responsible for there performance unless it becomes a Health/Safety issue. Do not include IAQ as one of the health issues. Lets call that a safety issue that the fire departments in force.
I also find that the same consulting engineering firm makes the same mistakes in design form project to project. The reason for this is no feed back loop. The design team never learns if there design works. This proposal will create the feed back loop. Once you are held responsible in the pocket book the approval of alternatives and value engineering will stop.
I get called into new buildings all the time that are uncomfortable and energy hogs. The most common reasons are shabby construction practices, value engineering and the control system not being programmed. Once these deficiencies are built into the building they are very expensive to fix. Today the consulting engineer who has construction management responsibilities abdicates them to the commissioning engineer. Almost all the work the commissioning agent does is in the base contract of the design engineer of record but is not done. I am performed the some work today as a commisssioning engineer or energy auditor that I use to perform as a consulting engineer doing construction management.
As far as your metric is concerned I think once all the data is collected we will find that building perform worse then currently advertised through the CEBEX system. The 25% criteria may still result in poorly performing buildings. I have noticed that it is getting easier to get an Energy Star rating through Portfolio Manager as the data base increases. I would consider 35 or 40% of average in the northeast. Considering that a large percentage of the building stock is over 50 years old and some 300.
Yes consultants and builders should be held accountable to there Errors and Emmissions Insurance to get the job done correctly.
Remember construction management jobs can not be out sourced over seas.
What happened to Pride in your work.