Filed under: economics

U.S. Green Building Market Will Balloon to $173.5 Billion by 2015

Green construction

Think the trend of businesses making green office renovations is just a passing fad? Not according to the latest issue of EL Insights, which reports that the U.S. green building market value will balloon from $71.1 billion now to $173 billion by 2015. Commercial green building is expected to grow by 18.1% annually during the same time period from $35.6 billion to $81.8 billion. In this case, green building is defined as building with resource use and employee productivity in mind.

green building graphic

The explosive projected growth can be attributed both to a growing recognition of green building's potential cost-savings as well as incentives from the government (i.e. the multi-million dollar Sustainable Communities Challenge Planning Grant program and the Sustainable Communities Regional Planning Grant program). Green renovation will also comprise a significant portion of future green building, thanks in no small part to government projects like then Recovery through Retrofit initiative, which offers $80 billion energy and environmental retrofits for federal buildings.

The growth in green building will lead to a number of changes in the larger building market, according to EL Insights: Construction workers will increasingly seek out green training programs, companies will spend more cash on green building technology (GE is already doing with its ecomagination initiative), and homes touting green building features will do better on the real estate market. All of this will result in cost savings for building and home owners, who will reap the benefits of lower energy and heating bills.

So if you haven't been paying attention to the U.S. Green Building Council, now is the time to start--the non-profit offers virtually endless amounts of information on green building studies and LEED certification.

New study looks at cities’ use of IT to engage, empower citizens

According to a new study conducted by the Economist Intelligence Unit, cities around the world are beginning to treat high-speed Internet access and related information technologies as an essential component of their economic development and citizen engagement strategies.

The 2,800 person survey was sponsored by Siemens and EIU findings were unveiled in Singapore during the World Cities Summit Tuesday. According to Klaus Heidinger, Head of Global Center of Competence for City Management at Siemans IT Solutions and Services, more cities are treating their IT and broadband networks as basic utilities and an essential component of their governance strategies.

“One of the most striking findings is the fact that ICT has become a basic utility, like water and electricity, for all cities,” Mr. Heidinger said in a statement. The EIU study also found, Mr. Heidinger suggested, that ICT initiatives like smart grid will allow greater citizen participation with government and private sector electricity providers to reduce energy and encourage use of renewable energy sources.

According to the survey, 77 percent of businesses believe improved broadband networks in their cities would have a significant impact on city competitiveness, making it the most important ICT technology for attracting private-sector investments. It also found that emerging cities are turning to IT to manage infrastructure in ways that are as important as building the infrastructure itself.

The study also cited several US cities’ use of IT tools to empower citizens to help government. Portland’s CivicApps and New York City’s recent BigApps competition were heralded as proof of “an increasing trend where citizens, armed with data from official sources, video and other information, are coming up with smart phone and other mobile applications to make city living easier and more enjoyable,” the study said.

In March, Portland developed the Open Data Initiative and started a contest called CivicApps. According to an interview with Rick Nixon, program manager with the City of Portalnd Bureau of Technology Services, Portland noticed that other cities, like Washington, DC were proving the benefit of opening government data and releasing it to the public.

Mr. Nixon said the city wanted to “push innovation to the citizenry and empower them to deal with their own issues.”

And with the release of the EIU study, it seems other cities around the world are doing the same.

How green are the world's consumers?

National Geographic's third annual Greendex Survey, measuring global consumer behaviors that can make the world a more environmentally sustainable place, was released today.

The 2010 Greendex examines green behaviors in 17 countries — with U.S. consumers again placing last (though improving), and India coming in #1. The international polling firm GlobeScan conducted the 17,000-person survey.

There is a clear message to business and government in the results this year: The survey shows the major obstacle to adopting green behavior in the 17 countries is the perception of ‘‘greenwashing’’ (identified by 44 percent of all respondents) — a more significant barrier to environmentally friendly behavior than the financial cost of making an effort (31 percent). Another notable barrier is the sense that individual efforts are not worthwhile when governments and industries fail to take action (identified by 40 percent).

You can take a condensed version of the survey, which will help in understanding the overall results and findings of the Greendex. Try it yourself and see how you fair in comparison to the countries that were polled. You also can examine the Greendex survey results by country, find tips on living a more environmentally friendly lifestyle and read the complete 100+ page report here.

Keys to Rebuilding California's Car-Based Infrastructure (and Saving Money on Transportation Costs)

California residents living in sprawling suburban developments could save billions of dollars every year if they lived in denser, urban zones and along transit corridors, according to a study released today by smart growth and transit advocates TransForm. Analyzing four metropolitan areas--Southern California, the San Francisco Bay Area, San Diego, and Sacramento--Windfall for All found that shifting populations in those regions to denser development along transit corridors would save save $31 billion per year, or $3,850 on average per household [Report Summary PDF].

In the Bay Area, where annual car ownership costs on average over $8,000 per person, individuals spend roughly $34 billion every year on personal transportation costs, compared to only $4.6 billion spent by public agencies on transit and roads combined. Households with poor access to public transit not only spend double the amount per year on transportation when compared to those with good access to transit, they produce more than double the amount of CO2, a greenhouse gas.

"The most astounding thing is that agencies pinch their pennies on transit and cut back and we feel like we can't afford not to save that service," said Stuart Cohen, Executive Director of TransForm. "We're already spending more than seven times as much as our agencies spend on public transit and roads just on buying and operating our vehicles."

What's more, the report points out that fuel costs represent a small minority of the cost of owning a car, so the craze for electric and other low-emission vehicles will not dramatically reduce the transportation costs for those living far from their jobs and far from transit. The best solution to combating climate change, the report notes, is to build walkable, vibrant communities where residences are situated close to job centers. 

Transpo_CO2_small.jpgClick to enlarge: household CO2 from transportation in the Bay Area.
The report highlights California's Senate Bill 375 (SB 375), which establishes a legislative framework for mandating smart growth along transit corridors, and it argues there are economic incentives for individuals, developers, cities, and regions for limiting the role of the private automobile in transportation spending.

"By reducing public and private transportation costs and increasing revenues to local governments, SB 375 can help put dollars back in the pockets of consumers and local governments," said Cohen.

Windfall for All counters the claim that SB 375 will be too costly to implement during the current economic crisis with several examples of how planning denser cities and offering alternatives to private car travel can save money.

First, in Sacramento, the Sacramento Area Council of Governments (SACOG) created a 2050 development blueprint that forecasts current development patterns and compared them to smart growth patterns. SACOG found that Sacramento would save $9.4 billion in public infrastructure costs (transportation, utilities, water, etc), $655 million in annual residents' fuel costs and $8.4 billion less for land purchases to offset environmental degradation from sprawl. The city would also see a 300 percent increase in public transit use if the city clustered development around transit within an urban growth boundary.

Transpo_Cost_and_CO2_small.jpgBenefits of public transportation for household costs and pollution. Image: TransForm.
Another case study from TransForm's report analyzed the promising results from the University of California San Diego's (UCSD) experiment in promoting non-automobile travel to the campus. Rather than build 10 additional parking facilities that had been planned and using parking revenue from three garages built between 2001 and 2007 at UCSD's La Jolla campus, the university invested in shuttles, expanded routes, discount and free fares on transit, as well as facilities for bicycling and pedestrians, all of which has resulted in a dramatic reduction of solo-driver trips. The alternative transportation measures and the costs savings from not building the new garages were so significant, UCSD has frozen the construction of new garages. The USCD model was successful enough to convince the  University of California system to require universities to present a business model analyzing the benefits of transit, ride sharing, and bicycle facilities before building new garages.

In the Bay Area, parking regulations are a significant impediment to dense development. In San Leandro, parking minimums of more than two parking spaces for each new home made dense development a planning impossibility. When San Leandro re-wrote its downtown plan, it rezoned to allow 3,400 new homes, more than seven times the limit under the old zoning laws. The first development in the new Downtown Transit-Oriented Development Strategy, The Alameda, designed by San Francisco Architect David Baker, saves $3.9 million by eliminating a level of parking and produces 30 more affordable units, according to the report.

Based on these and other case studies, Cohen suggested California should consider levying a climate impact fee on gasoline to generate enough money to expand public transit options and expand walkable communities while improving the economy and meeting ambitious greenhouse gas targets.

"Building our communities with the expectation that every driver in a family is going to have to own their own car is part of what is part of what is bankrupting families," said Cohen. "The infrastructure for the... roads and those patterns of growth is part of what is bankrupting our public agencies."

Costs_of_Car_ownership_small.jpg

Windfall for All Critical Recommendations

  • Integrate full economic analysis into planning. The huge dividends from efficient land use become evident once personal costs, not just public budgets, are considered. Without such analysis, we will continue to promote plans and policies that cost too much for families, businesses, and local governments.
  • Provide cities and counties with an infusion of funds to engage the community in planning. The state should make funds available for updating zoning codes and parking policies to make more efficient use of land and resources. Identifying strategies to maintain and expand the number of affordable homes is also critical.
  • Fund cost-effective public transportation. The state needs to provide leadership and restore funds for public transit, as well as make it easier for regions to raise new revenues with climate-impact fees. Economic analysis could determine whether such fees, if spent in ways that promote more efficient communities, can reduce our overall costs.
  • Innovate, evaluate and replicate. There are dozens of innovative strategies – whether an individual program such as car-sharing, or a comprehensive rewards approach such as UC San Diego’s. MTC, the Bay Area’s transportation agency, will soon launch the first “Transportation Climate Action Program.” This program will seed, evaluate and replicate innovative programs. Other regions should follow suit.
  • New development should minimize pollution from new residents – or pay to mitigate it. The San Joaquin Valley is encouraging efficient development from the start. New developments that don’t provide walkable communities with convenient transportation choices must mitigate the costs of the air pollution that will be generated by future residents. The state and regional air districts should encourage this same system for mitigating the costs of greenhouse gases.