Define ‘green’ please

By Elisa Wood
July 27, 2011

Describing a building as ‘green’ makes a lot of people cringe. The word is overused. And what does it mean exactly?

Serious efforts are underway to move away from the hype and offer a more specific analysis of a building’s energy performance. Think nutritional labels for food, except in kilowatt-hours instead of calories.

In fact, more than 50 national, regional and local governments have created policies to rate and disclose the energy efficiency of commercial buildings, according to the Institute for Market Transformation (IMT). They include the European Union, China, Australia and Brazil.

In the US, two states have such policies, California and Washington, as do five cities: Austin, Washington DC, New York City, San Francisco and Seattle.

These programs already place more than 60,000 buildings, totaling 4.1 billion square feet of floor space, under energy rating and disclosure rules. Meanwhile, Massachusetts is considering standards, as is the city of Portland, Oregon. And many more local and state governments are expected to follow. To help them, IMT this week published areport that details best practices in building labeling.

Why label buildings the way we do food? When a building has an energy performance label, buyers and sellers better understand its market value, IMT says.

“The premise mirrors transparency rules in other market sectors, such as nutritional labels on food and fuel economy ratings on vehicles, which are recognized around the world as consumer protections and keystones of free and fair enterprise,” says IMT, which is a Washington, D.C. group that seeks ways to overcome market failures in the energy efficiency industry.

While building labels may be a good idea, they are not always easy to create. For starters, property owners must be able to access data on how much energy their buildings consume. For large buildings, with many tenants, this can be difficult. Sometimes tenants have their own electric meters. Building owners must go to each tenant to seek the data, a cumbersome task at best. And some tenants may refuse to supply the information. Here utilities can help, says IMT, by agreeing to aggregate a building’s total energy use and supplying it to the owner (while keeping individual tenant data confidential).

In addition, once the building has a label, the information has to be simple for potential buyers to access. IMT recommends that states post the data on easy-to-navigate web sites that allow searches by address, benchmarking metrics, owner’s name, and traditional real estate characteristics, such as building size.

Two major approaches exist to rate buildings, says the report. Asset ratings “measure the structural energy performance of buildings based on simulated operating conditions.” Operational ratings, on the other hand, measure how much energy a building actually consumes. China tends to use asset ratings, while most US jurisdictions, so far, seem to prefer the operational approach.

How quickly will energy performance labeling catch on? It’s clearly become a hot topic, and the IMT report will help jurisdictions that want to move forward. Still, creating the rules is a state-by-state or even city-by-city effort, as is often the case when it comes to US energy policy. So we may be scratching our heads for awhile about what it means when we hear a building described as ‘green.’

What political party do your electrons support?

By Elisa Wood

October 20, 2010

Lucky for Americans, information technology doesn’t appear to be owned by any one political party. If it were, Congress would still be squabbling over whether or not to support the Internet and you’d be reading this on paper rather than online.

Not so for energy. Generally speaking, Republicans tend to be pro-fossil fuel, while Democrats typically come down on the side of green energy. This feud – which is a key reason Congress cannot pass an energy bill — confuses me. Does a coal-fired plant represent some conservative ideal not found in wind power? What’s liberal about the squiggly light bulb illuminating my desk?

How can electrons be partisan?

Okay, I know I’m over-generalizing and bound to attract admonishments from readers who will point out where liberals are sometimes pro-brown and conservatives pro-green. But I think we’ve seen the debate come down along party lines enough in the United States that my assumption is fair.

That’s why it was intriguing to see the recent report “Pro-Partisan Power,” a combined effort of think tanks on both sides of the political spectrum: the Brookings Institution, Breakthrough Institute and the American Enterprise Institute.

In the words of the report authors:

Today, few issues in American political life are as polarized as energy policy, with both left and right entrenched in old worldviews that no longer make sense. For the better part of two decades, much of the right has speculated darkly about global warming as a United Nations-inspired conspiracy to destroy American sovereignty, all while passing off chants of “drill, baby, drill” as real energy policy. During the same period much of the left has oscillated incoherently between exhortations that avoiding the end of the world demands shared sacrifice, and contradictory assertions that today’s renewable energy and efficiency technologies can eliminate fossil fuels at no significant cost. All the while, America’s dependence on fossil fuels continues unabated and political gridlock deepens, preventing real progress towards a safer, cleaner, more secure energy system. The extremes have so dominated mainstream thinking on energy that it is easy to forget how much reasonable liberals and conservatives can actually agree on…”

The report goes on two make four key recommendations: 1) Invest in energy science and education; 2) Overhaul the energy innovation system; 3) Reform energy subsidies and use military procurement and competitive deployment incentives to drive price declines; 4) Internalize the cost of energy modernization and ensure investments do not add to the [federal] deficit.

The authors say this can be done at a cost of $25 billion, which can be recovered through small fees on imported oil, electric utility surcharges, a very low price on carbon or other means that will not cause great pain to any one group.

You may or may not agree with the recommendations. But it is hard not to be impressed with how the authors suggest we portray energy – not as a battle between left or right, but as a technology play, as innovation. I suspect this is what Rhone Resch, president and CEO of the Solar Energy Industries Association, meant when he said that solar energy is an industry, not an issue, as reported recently inRenewable Energy World North America Magazine.

Americans left or right can’t argue with innovation. It has brought us things we all like, our cell phones, our downloadable music, air conditioning, meals we can heat in minutes, and voices that tell us which way to drive our cars so that we don’t get lost — which all somehow have managed to remain free of any partisan taint.

The full report is available here:http://thebreakthrough.org/blog/2010/10/postpartisan_power.shtml

Elisa Wood is co-author of “Energy Efficiency Incentives for Businesses 2010: Eastern States,” available at www.realenergywriters.com.

Clean Energy Prospers: Toto, We’re Not on Wall Street Anymore

By Elisa Wood

October 17, 2008

Wall Street is in the middle of an earthquake. Main Street is shaking from the tremors. Easy Street has been wiped off the map. Is there a safe haven from this economic meltdown? Green Street looks pretty appealing.

Green Street is a term used increasingly to describe businesses that offer energy efficiency, solar, wind and other forms of clean power. While the global economy braces for cost cuts and job loss, Green Street is forecasting profit and massive job creation.

Green Street has been prosperous for while, but its fortunes rose considerably October 3 when President Bush signed into law the $700 billion financial rescue bill.

By way of a series of odd events, the recovery bill included tax credits for clean energy. The credits have nothing to do with the financial rescue, but were attached to the bill at the last minute. Clean energy advocates had been trying to convince Congress to pass the tax incentives for 18 months. Some of the credits had expired; others were about to end; and still others were new to the bill. Before the credits were attached to the recovery bill, clean energy lobbyists in Washington had all but given up on any chance of their passage this year.

What does the bill offer the efficiency industry? Homeowners once again receive tax credits for making a range of efficiency upgrades to their houses. The new law also gives a boost to green commercial buildings, efficient appliances, smart grid technologies and plug-in hybrids. Equally important, it recognizes the efficiency of combined heat and power by offering a new 10% tax credit for small projects. For specifics about the credits see http://www.ase.org/content/article/detail/2654.

A solar conference held this week in San Diego underscored the financial health of Green Street. More than 20,000 people attended. Solar companies described plans for a dramatic increase in rooftop installations, mega solar concentrated power in the southwestern deserts, and manufacturing facilities to equip all of the projects. In all, the solar industry, alone, expects to create nearly a half million jobs as a result of the clean energy tax credits.

This is more good news for energy efficiency, since it is closely aligned with the solar industry. A mantra throughout the solar industry is that efficiency is the first fuel; that is, it is important to first find all cost-effective efficiency in a building, then add solar. In fact, some solar installers help customers finance solar installations with the money they save by cutting back on energy use.

Several factors conspired to cause today’s financial crisis. High oil prices certainly contributed. Energy, the dirty kind, helped get us into this, and energy, the clean kind, will help get us out.

Visit Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets podcast and newsletter.

Energy Efficiency: Not a Sound Bite Business

By Elisa Wood

I’m a star at the neighborhood playground because I write about energy. Let me explain. I have a young son, and often find myself next to the swings talking with other parents. Inevitably we talk about work. Inevitably it comes up that I know a little about energy. And inevitably I'm surrounded by a crowd that wants to know-- demands to know--why the US doesn’t use more green energy.

They are looking for a sound bite answer, like “It is Bush’s fault” or “Exxon is evil.” Instead, I find myself grasping for an answer, even though I’ve been following this business for 20 years -- or more accurately – because I’ve been following this business for 20 years.

Overhauling a nation’s energy infrastructure is no easy task and far more complex than people realize. And unfortunately, this lack of understanding, among politicians and the general public, is what gets us into trouble. Since the 1970s, we have swung back and forth from urgency to complacency about energy independence. We forget about the problems created by our over-dependence on fossil fuels once gasoline prices drop. We seem to operate under the false impression we can fix our energy problems near instantly should we really need to act.

A new World Bank book underscores the complexity of revamping energy infrastructure, in this case, energy efficiency in three countries where demand is growing rapidly. Called “Financing Energy Efficiency: Lessons from Brazil, China, India and Beyond,” the book finds enormous energy savings opportunities in these countries, which are among the top 10 energy consumers in the word. But to realize the savings, the countries must develop “large numbers of relatively small projects scattered among hundreds of thousands of industries and building complexes.”

Needless to say, the logistics are daunting. Moreover, efficiency projects tend to lose when competing for up-front capital against power plants because efficiency is about saving money – a more difficult concept to sell than making money.

But interestingly, it is not lack of capital in these countries that thwarts efficiency but “inadequate organizational and institutional systems for developing projects and accessing funds.” In other words, efficiency is not on the main agenda of business and government.

The challenge for governments is to influence the broad technology choice decisions of investors and encourage them to adopt energy efficiency solutions, according to the book. The problem, the authors say, needs to be fixed on the institutional level and must consider the unique local economies. The book attempts to provide a framework for creating financing systems.

With many case studies on ways efficiency has been financed in various countries, this nearly 300-page book makes it no easier to come up with a quick sound bite for why it is a struggle to green our energy supply. But the authors do give some valuable industry perspective on how to get there as the world prepares for a 53% increase in energy demand over the next two decades. It is worth a look. Written by Robert P. Taylor, Chandrasekar Govindarajalu, Jeremy Levin, Anke S. Meyer and William A. Ward, the publication is available at http://www.esmap.org/filez/pubs/211200830655_financing_energy_efficiency.pdf

Visit energy writer Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets newsletter.