The bleeding edge of green

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As local and national forces push toward higher levels of energy efficiency in buildings—even to net zero—a heated debate has broken out over what levels of efficiency are really achievable.

The Commercial Real Estate Development Assn . (formerly known as NAIOP) generally supports the move to more efficient, sustainable buildings, but recently came out with a study claiming that efficiency levels above 30% are just not economically viable for today’s office building market.

The April online issue of BuildingGreen.com admirably framed the study by saying it “reflects the two-pronged industry resistance to green building: energy efficiency is either seen as too expensive or as requiring too much change in design and construction practices.”

This debate needs to be put in context. First, we need to consider what is technically achievable. Then, we need to take into account what is cost-effective from a number of perspectives: those of the owner, a utility, and society.

I just returned from a national ASHRAE conference on net-zero-energy buildings. Based on the evidence presented, there are buildings that technically have already achieved net zero and some that are even energy producers. However, very few are complex or large buildings; most are small interpretive centers or schools. This picture will be changing soon. There are a number larger and more complex net-zero energy projects in process, including the proposed 300,000 sq ft Portland+Oregon Sustainability Center.

One driver in the market, the 2030 Challenge, has set a 2009 target for 50% more efficient than the Commercial Building Energy Consumption Survey (CBECS) regional average (by building type). That target rises to 60% in 2010. But 50% is achievable today, even for larger more complex buildings. A number of examples have been documented in ASHRAE’s new High Performing Buildings magazine ( www.hpbmagazine.org ).

OK, but what about the cost-effectiveness part of the equation?

Owners justifiably want to control costs. They need to work within a budget that yields an asset that is marketable. But two points consistently get lost in this debate. First, the nature of what defines a competitive building is shifting. Tenants are increasingly looking “under the hood” at the pros and cons of high-performance buildings. An owner might actually make more money by investing more. Second, the financial lenses of simple payback and initial project costs are no longer adequate to understand cost-effectiveness. New values are being assigned to buildings, which require a longer and more nuanced view of a project’s lifecycle.

For example, utilities gain additional value from the energy not used by a building and maybe even the renewable energy generated by the building. They get to offset the need for new capacity, allowing them to have lower costs or keep costs from rising too dramatically.

Finally, society will increasingly demand that we reduce the carbon emissions related to building energy use and assign a value to doing so. Climate change mitigation comes with its own financial calculus, assigning monetary values to societal values—changing a building owner’s financial pro forma through societal investment (incentives) or requirements (penalties).

There is no turning back. The evolution of buildings is already occurring and we need to adjust our assumptions, goals, analysis tools, and methods.

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