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Green Building

GRESB Merges with GBCI: What it Means for Survey Respondents

Just over five years into its existence GRESB, the benchmark for portfolio-level sustainability performance has merged with GBCI, the dominant building-level sustainability certification body.

The move makes clear winners of GRESB (the Global Real Estate Sustainability Benchmark) and GBCI (the Green Building Certification Institute): they now have almost total dominion over building- and commercial real estate company-level green certifications and rankings. Arguments for and against the merger have since cropped up. While healthy dialogue will help us get to stronger, more transparent and ultimately more valuable measures of non-financial performance, this post is not about taking sides.

Instead, it’s a look at the merger’s practical impacts on Survey Respondents. From this point of view, the merger is a decidedly good thing. Here’s why:

In order to win the trust of those who would disclose (Survey participants) and purchase its data (Investors), GRESB needed to bring more rigor to its auditing and assurance processes. At its core, this is what the merger is all about. GRESB and GBCI drive this point home in their joint press release: “GBCI’s established expertise providing rigorous third-party review, verification and training, will be extended to the GRESB Survey… Together, GBCI and GRESB will provide investors with reliable information to inform global real estate investment decisions [italics mine].”

But improved rigor doesn’t just build trust in GRESB’s scores and rankings, it’s also a prerequisite of any credible measure of non-financial performance for the global commercial real estate industry. And this is the (unicorn?) data point for which we’re all searching. As rigor increases, GRESB will be in a better position to sift through its haystack of asset- and entity-level information to tell us what truly matters, why and by how much.

This gets to the other benefit of the merger: deeper and higher quality data sets. GBCI’s market visibility and credibility should expand GRESB’s reach. As it ensnares more respondents and increases its Survey sample size, data depth and robustness should similarly improve, helping drive more accurate measures of financial performance. Consequently, investors who fret they’re buying reports filled with dubious data should be assuaged.

As investor confidence in the Benchmark grows, Survey participants can take comfort that a more stable and sophisticated GRESB will translate to more accurate scores and rankings. More accurate scores will carry greater currency with investors, which means the time and expense of sustainability reporting will be worth it. Ultimately, as incentives and market signals for sustainability performance become clearer, companies will devote more resources to taking action on sustainability as opposed to merely disclosing it which, of course, is the whole point. It’s also the moment at which Survey respondents get greatest benefit from participating in GRESB.

While these outcomes are by no means assured – much hard work remains in front of the newly wed organizations – some practical impacts are highly likely:

GBCI will bring enhanced rigor to GRESB’s methodology as well as its data collection and assurance processes.
Greater rigor will enhance the value of GRESB Survey results.
More robust scores and rankings mean investors will use them to scrutinize financial performance.
Greater investor scrutiny will raise the stakes and lead to fiercer competition.

In other words, the bar will get higher.

November 4, 2014 0 comment

Green Building

LEED v4 Delayed, Again

written by Stuart Kaplow

The U.S. Green Building Council has announced that projects will still be able to register under the current LEED 2009 through October 31, 2016.

News of the extension of LEED 2009 began circulating this week and is being heralded and widely supported as positive across the environmental industrial complex.

This is arguably the third extension of the date when projects must use the new LEED v4. The date is an extension from the close date of June 1, 2015, announced in summer 2102 when the vote on “LEED 2012” (now LEED v4) was delayed.

In USGBC’s announced 3 year cycle for updated LEED, 2015 would have been the third year and next version of the green building rating system was expected. Instead, USGBC continues to work on v4 and in particular on the v4 Materials and Resources credits.

It is important to appreciate this delay in the context of what else is going on in green building. In early 2015 the new and 2015 International Green Construction Code will be available, an updated ASHRAE 189.1 will be published, the new ICC 700 National Green Building Standard will be approved, and there will be a 2015 Enterprise Green Communities Criteria.

Recall USGBC announced in July 2013 that LEED v4 had been approved by an affirmative vote of more than 86% of those in the consensus body of members. v4 officially launched in November 2013 at the USGBC Greenbuild Conference and Expo in Philadelphia and projects have been able to register under v4 since that time.

And while there are over 57,000 commercial projects participating in LEED, comprising more than 10.5 billion square feet of construction across 50 states and 149 countries, data available from GBIG shows there are only 253 registered LEED 4v projects across all the ratings systems and only 9 certified v4 projects.

There remains uncertainty over the still pending several appeals from the vote approving LEED v4 and this extension no doubt had a lot to do with that.

A great deal of attention was garnered at Greenbuild last week by the announcement of a new USGBC Supply Chain Optimization Working Group that will strive to perfect the LEED v4 Materials and Resources credits as part of the USGBC and American Chemistry Council joint initiative. Much of the chatter at Greenbuild was that the EPDs and HPD were too far out in front of good science and that a step back was necessary. There is much speculation that it is the contemplated overhaul of the Materials and Resources credits that are driving this v4 delay.

Observers should not over-read this announcement. It is clear that LEED v4 will be a hugely positive advancement. And LEED is going to thrive.

Read the USGBC press release here.

In light of this 18 month extension, it is now necessary that developers and builders of projects planned to break ground through 2016 evaluate if that building is better registered under LEED 2009 or v4? And beginning immediately, green building industry contract documents must be modified to anticipate v4, and a rewritten and new series of Materials and Resources credits.

October 30, 2014 0 comment

Green Building

DOE Issues Final Rule on Federal Green Building Standards

written by Shari Shapiro

The Federal government has long been a leader in constructing green buildings, and LEED has been the Federal standard of choice. The Department of Energy issued a final rule updating its recommended certification standards and levels for all Federal buildings on October 14, 2014.

The Final Rule does not tell Agencies which rating system to use. Rather, if the Agency chooses to use a rating system, such system must meet the following characteristics:

Allow assessors and auditors to independently verify the criteria and measurement metrics of the system;
Be developed by a certification organization that (i) provides an opportunity for public comment on the system, (ii) provides an opportunity for development and revision of the system through a consensus-based process;
Be nationally recognized within the building industry;
Be subject to periodic evaluation and assessment of the environmental and energy benefits that result under the rating system; and
Include a verification system for post occupancy assessment of the rated buildings to demonstrate continued energy and water savings at least every four years after initial occupancy.

Sounds a lot like LEED to me, so unless something else comes into the marketplace, Federal buildings are likely to use the LEED standard.

The DOE’s rule is based, at least in part, on a General Services Administration (GSA) report on green building rating systems issued on October 25, 2013, and available here. The GSA recommended LEED-2009 Silver or 2 Green Globes v 2010. It also contained a variety of other recommendations, including keeping current with the rating systems as they evolve.

The GSA’s recommendation is an interesting one for two reasons:

(1) the GSA requires its buildings to be LEED Gold, and

(2) the recommendation was not supplemented to recommend LEED v4, even though the GSA did evaluate LEED v4.

Since the Final Rule does not have a recommended rating system, and most agencies are unlikely to parse whether a particular rating system other than LEED complies with these characteristics, the GSA’s recommendations are likely to become the Federal default.

October 21, 2014 1 comment

Green Building

Redefining an Old Commercial Building – 435 Indio

written by Sarah Backhouse

Take one outdated commercial building in Sunnyvale, California, one crack engineering and architecture team, some top Silicon Valley technologies, and one audacious design challenge. The result? 435 Indio. A building transformed from nondescript 70s tilt up to sleek, modern, drool-worthy work space for any Bay Area startup.

Custom designed skylights bring in an abundance of natural light, complimented by Lunera LED lights and Enlighted lighting sensors. View glass automatically adjusts to heat and glare. Indoor air quality is optimized though operable windows and Big Ass fans.

John Picard, President & CEO, John Picard and Associates: “What’s amazing is the technologies all came from this area, are the drivers for the design, and the engineering drivers that are bringing the potential for the productivity.”

Interface carpets made from reclaimed fishing nets, zero waste bathrooms from Dyson, a fabric ceiling for acoustics and polished concrete floors for natural insulation. Last but not least, the net zero energy building is 100% powered by solar.

Gary Dillabough, Managing Partner at the Westly Group: “We designed this to have an exceptional tenant who can do something extraordinary in the world and this becomes the place they do that in.”

September 15, 2014 0 comment

Green Building

Saint Paul has an Alternative to LEED

written by Stuart Kaplow

Much has changed, but much has remained the same, in the arena of green building law mandates since March 18,2002, when the city of Normal, Illinois enacted Ordinance 4825, the first ever mandatory green building law, requiring LEED certification in the Central Business District for public or private new construction of over 7,500 square feet.

Many thought green building mandates would spread across the county. But today, with more than 89,000 local governments across the U.S., there are less than 200 green building mandates that apply to ‘purely’ private building.

Among the most progressive and unique of those green building laws is the Saint Paul sustainable building policy applicable to government building and private construction receiving public money. Saint Paul has the audacious goal of wanting “to be the most livable city in the United States.”

First effective in 2004 and modified several times, today the Saint Paul law applies to any new construction project receiving more than $200,000 in City or other governmental funding programs. The developer must choose for the project one of the following rating systems and levels with which to minimally comply:

Commercial Projects: LEED New Construction, Silver certified; or Green Globes, 2 globes awarded; or State Guidelines Building Benchmarking and Beyond (B3) compliant; or Saint Paul Port Authority Green Design Review (as applicable).

Residential Projects: LEED for Homes or LEED NC, Silver certified; or Minnesota Green Star, Silver awarded; or Green Communities, Minnesota Overlay compliant.

The last 6 commercial projects subject to the law each selected to comply with the B3 Guidelines.

The B3 Guidelines for both new buildings and major renovations: Exceed the state energy code by at least 30 percent, focus on achieving the lowest possible lifetime costs, encourage continual energy conservation improvements, include air quality and lighting standards, create and maintain a healthy environment, facilitate productivity improvements, and specify ways to reduce material costs.

To achieve these goals, the B3 Guidelines build on previous local and national efforts. The guidelines are designed to be clear and able to be used without consultants. They are designed to be compatible with LEED. Most importantly, the guidelines set up a process that will eventually lead to an accounting of the actual costs and benefits of sustainable building design. The State has further clarified the scope of the guidelines to focus on office and higher education classroom facilities, although the guidelines are suitable for most other building types.

B3 may not have LEED’s national cachet or the marketing power of a LEED seal mounted on a front door, but it is an efficacious sustainable building tool that is popular with the environmental industrial complex and worthy of your review.

Nationally consensus appears to be that a building code or the like that goes far beyond life safety is going too far and mandatory green building codes are not generally desirable. As damming as that is, the public appears willing to accept both government building and the beneficiaries of public money be required to comply with a voluntary green building rating system.

August 28, 2014 1 comment

Green Building

Enterprise Green Communities Criteria Being Updated

written by Stuart Kaplow

In 2015 the use of LEED v4 will become mandatory, a new 2015 International Green Construction Code will be available, an updated ASHRAE 189.1 will be published, the new ICC 700 National Green Building Standard will be approved, and there will be a 2015 Enterprise Green Communities Criteria.

In the arena of green building standards, green rating systems and green codes among the widely respected residential rating systems is the Enterprise Green Communities Criteria.

While the Criteria was developed by Enterprise to “provide a clear, cost-effective framework for all affordable housing development types in any location in the country, including new construction and rehabilitation in multifamily as well as single-family buildings,” the Criteria are used in more than just affordable housing.

The current Enterprise Green Communities Criteria, adopted in 2011, are grouped into the following eight categories: 1. Integrative Design, 2. Location + Neighborhood Fabric, 3. Site Improvements, 4. Water Conservation, 5. Energy Efficiency, 6. Materials Beneficial to the Environment, 7. Healthy Living Environment, and 8. Operations + Maintenance, which are not dissimilar from LEED for Homes.

All project types (single family, low rise multifamily, and mid/ high-rise multifamily) and construction types (New Construction, Moderate Rehab, and Substantial Rehab) use that set of Criteria.

There is only one level of Enterprise Green Communities Certification awarded. To achieve certification, projects must achieve compliance with the Criteria mandatory measures applicable to that construction type. Additionally, New Construction projects must achieve 35 optional points and Rehab projects must achieve 30 optional points.

Enterprise Green Communities has certified more than 30,000 homes to date (as compared to more than 132,000 registered with 50,000 certified under the LEED for Homes rating system). Also significantly, the Criteria have been adopted by more than 20 states as a mandatory requirement for allocation of Low Income Housing Tax Credits, a Federal program that finances roughly 90% of all affordable housing production in the U.S. So, the revision of the Criteria is of great import.

There are two primary opportunities where you can engage with the 2015 Criteria Development Process: First, Enterprise community partners local market offices are currently collecting feedback during the “Local Developer Comment Period” through third quarter 2014. And then, after the efforts of several working groups, Enterprise Green Communities will welcome comments on a draft version of the 2015 Criteria during their public comment period late in the fourth quarter of 2014.

For more information about the 2015 Green Communities revisions process email greencommunities@enterprisecommunity.org

2015 will be a year of great change in green building standards, rating systems and codes. Participating now in the development of the 2015 Enterprise Green Communities Criteria is an ideal way to prepare for what is to come.

August 15, 2014 1 comment

Green Building

Litigation Over First Ever LEED Platinum Building Tarnishes Green Building

written by Stuart Kaplow

Last week, a federal appeals court brought back from the dead, a more than $6 Million lawsuit filed over materials supplied in 2000 for the first ever LEED certified Platinum building. Despite that the unpublished opinion is not binding precedent, it will have a chilling effect on green building and in particular on the selection of new or untried materials and products that are the keystone of many sustainable projects.

The Chesapeake Bay Foundation v. Weyerhaeuser Company arose from the construction in 1999 of the Chesapeake Bay Foundation’s headquarters in Annapolis, Maryland. SmithGroup designed the building and Clark Construction oversaw its construction. SmithGroup’s “green” design called for exposed structural wood members outside the building envelope, including some that penetrated the facade. Under a March 3, 2000 purchase order that it entered into with Clark, Weyerhaeuser agreed to provide Parallam PSL columns and beams for use as the exposed wood members.

Parallams, which have a rough-hewn appearance, are manufactured by bonding together strips of wood. Its contract with Clark required Weyerhaeuser to treat the Parallams with the preservative PolyClear 2000, something then new and untried.

Water damage to the Parallams was observed during construction. Following final completion of construction in late December 2000, water began leaking through the Parallams into the building. In 2001 and 2002, the leakage was investigated by two outside consultants hired by Clark. A 2001 report by one of those consultants addressed to the Bay Foundation described that such water could cause deterioration or rot in the Parallams themselves if they were not properly treated with a wood preservative.

In a damning fact that may have had more to do with this court decision than the law, the Bay Foundation “… subsequently learned that the Parallams had not been treated with PolyClear 2000 as certified, that PolyClear 2000 was not in any event well suited to the job of preserving the Parallams, and that Weyerhaeuser had knowingly given false assurances to the contrary.”

The Bay Foundation initiated this case in state court on December 3, 2010 (i.e., 9 years, 11 months and some odd days after final completion) and the case was ultimately removed to the US District of Maryland. The complaint focused on the deterioration of the Parallams. According to the complaint, Weyerhaeuser breached its contract with Clark, owed common law indemnity and contribution to SmithGroup and Clark, and was liable to the Bay Foundation and SmithGroup for negligent misrepresentation and negligence.

The federal trial court, in awarding summary judgment to Weyerhaeuser, concluded that the plaintiffs’ state law claims were time-barred. Maryland’s statute of limitations provides that “[a] civil action at law shall be filed within three years from the date it accrues unless another provision of the Code provides a different period of time within which an action shall be commenced.” Maryland follows the discovery rule, which provides that “the cause of action accrues when the claimant in fact knew or reasonably should have known of the wrong.” And the trial court reasoned the 2001 report did just that.

But, the three judge panel of the Fourth Circuit Court of Appeals vacated the more than 2 year old order (that had dismissed the case) and remanded the case for further proceedings.

The federal appellate court said, “viewing the evidence in the light most favorable to the plaintiffs, a genuine dispute exists as to whether knowledge of the water infiltration problem would have put a reasonable person on notice that the Parallams were susceptible to premature deterioration and that their PolyClear 2000 treatment would not preserve them.”

This blog will continue to watch the saga that are these disputes and differences arising out of the first LEED Platinum certified building. And while only time will tell if this case will have a chilling effect on green building, it certainly will cause architects to give pause before specifying new or untried materials and products that are the keystone of many sustainable projects.

August 6, 2014 0 comment

Green Building

After GRESB: Four Things to Consider After (and Just Before) You Submit

written by Matt Ellis

You’ve purged your inbox of property manager emails and compiled a mountain of data into one gleaming, “almost-final” 2014 GRESB response. Just one last meeting with the Powers That Be stands between you, the submit button, and a well deserved glass of [insert choice beverage here].

Here are a few things to keep in mind when you reviewing your GRESB response with management:

Use GRESB’s Response Check: GRESB offers a free, high-level Response Check before final submission. Take advantage of it! You can put your boss (and yourself) at ease knowing you get a free practice swing before the real moment.
Expect a different score: The significant overhaul of GRESB’s reporting system and methodology eroded some of the institutional knowledge veteran reporters had accrued because they had to rejig their processes and systems to accommodate new questions and data requirements. At the same time, the new score weightings will almost certainly lead to some shuffling around which quadrant reporters fall into. There will be winners and losers, so make sure to set management’s expectations accordingly.
Prepare for an audit: GRESB has drastically tightened its validation and assurance process to expose inaccuracies and improve the quality of its benchmark. Make sure to discuss a plan of attack with management for if and when GRESB comes knocking. If you need resources to bolster your ability to respond to an audit, make sure to ask for them now.
Plan for next year: It’s the last thing you want to do, which is why it’s the most important thing you can do: plan for next year while everything is still fresh in your mind. What systems can you put in place at the asset level to ensure better results and easier data collection? What organizational policies need a tune-up? While you won’t be filing a GRESB response for another nine months, the 2015 reporting period is coming up in only six. Once you toss out the holidays, you really only have five months to put in place the changes on which you’ll be reporting next year.

Ladies and gentlemen, welcome to the world of continuous reporting!

August 5, 2014 0 comment

Energy Efficiency Green Building

The ABCs of Building Energy Efficiency: Which Building Certification is Right for You?

written by

DOE. LEED. USGBC. EPA. ISO.

The number of certifications for energy efficiency, as well as the organizations that can help guide you, can make your head swim.

Does the EPA have anything to do with LEED? Can the USGBC help me with my DOE?

It can be quite confusing, for sure.

One thing we all know is that greater energy efficiency positively impacts a company’s bottom line and can even contribute to topline growth as more consumers seek out environmentally responsible businesses. Not to mention more efficiency means less carbon that contributes to climate change.

Here we break down three certifications, noting how – and when – they can help you.

LEED. One of the more well-known certifications, you may have seen a LEED plaque on a skyscraper or car dealership. What does it mean? The company or individual incorporated environmentally responsible building practices throughout the construction or renovation to lessen its impact on the environment for the long run. The U.S. Green Building Council offers many resources to guide you through it, offering different levels of certifications to meet your needs.
ENERGY STAR®. If you’re like 87 percent of households in America, you know the ENERGY STAR label when you see it. But did you know that it’s not just found on refrigerators and dishwashers? Commercial buildings and industrial plants in the U.S. can earn ENERGY STAR certification by meeting energy performance standards defined by the U.S. Environmental Protection Agency. The benefit? Pursuing ENERGY STAR certification creates networking opportunities among companies where they can share best practices, with EPA facilitating these communications. Furthermore, these sites use less energy, are less expensive to operate and have comparatively fewer greenhouse gas emissions.
ISO 50001. Developed by the International Organization for Standardization, the ISO50001 provides organizations big and small with the requirements for the continuous improvement of an energy management system. With ISO, there are no fixed targets for improving energy performance – benchmarks are set by the user organization or regulatory authorities. If your company has met other standards set by ISO, obtaining ISO 500001 usually only requires a few more steps. By establishing frameworks for organizations across many sectors, it is estimated that ISO standards could influence up to 60 percent of the world’s energy use.

There are also several challenges that inspire companies to continue their aggressive greenhouse gas reductions.

ENERGY STAR® Challenge for Industry. There’s another opportunity within the ENERGY STAR program if your site is industrial (think manufacturing, mining, etc.). The Challenge for Industry helps energy managers set goals to improve energy performance. You meet the challenge if your site reduces energy intensity by 10 percent in five years or less. What’s more, you can reapply and be recognized each time your site achieves another 10 percent reduction. Put simply, if you meet the goal, you meet the challenge. Recognition includes a profile on the ENERGY STAR website and a certificate documenting your savings.
Better Buildings, Better Plants Challenge. By joining this U.S. Department of Energy challenge, a company pledges to reduce energy intensity by 25 percent over the next 10 years. Any company in the U.S. manufacturing sector, regardless of size or level of energy management expertise, is eligible for partnership. This challenge is beneficial if you’re looking not only for recognition, but also technical support. Participants receive resources such as a technical account manager, in-plant training sessions for employees and invited guests, and software tools for metrics and development.
ENERGY STAR Partner of the Year. As the EPA’s highest honor for corporate energy management, this distinction recognizes organizations from ENERGY STAR’s 20,000 partners who have made outstanding contributions to protecting the environment through superior energy efficiency. Awards are given in several categories to companies across various industries. Organizations go through a stringent application process to be considered. For example, the Energy Management category honors companies who adopt a continuous energy management strategy across their entire portfolio.

There you have it: three certifications and three types of recognition that not only highlight the energy efficiency of your company, but provide you with resources and best practices to help you do it.

Article by Fastlane, appearing courtesy 3BL Media.

August 1, 2014 2 comments

Green Building

Lawsuit Over LEED Documentation

written by Stuart Kaplow

A case filed last week in a California court is a prime example of the importance of contract documents in a LEED project.

Earlier this year the City of Palo Alto gave notice firing Flintco Pacific, Inc., the general contractor responsible for construction of the Mitchell Park library, a proposed LEED Platinum project. With a performance bond in place, the City and the surety announced in early March that they has negotiated a takeover agreement that will allow a new contractor to complete construction.

But the current dispute playing out in letters between counsel for Palo Alto and Flintco is the claim by the City that when Flintco’s contract was terminated, it did not turn over the documentation necessary to pursue LEED certification. In a letter reprinted in part in the local print media, Assistant City Attorney Cara Silver said, “very little of the LEED documentation appear to be present.” And in a follow up letter from the City’s outside counsel, David Ginn to Flintco, also made public, Palo Alto further claims the missing documents relate to the “source and specific type of materials incorporated into the project, methodologies employed by the contractor to reduce waste and impact, and a significant number of other requirements.” Flintco responded that it had made all of the documents in its construction trailer available to the City and that these documents are responsive to all the deliverables identified in the construction contract.

And while Flintco argues that its contract was improperly terminated after the building was more than 97% complete that dispute may have to wait for another day.

It is disputes and differences over the documentation necessary to pursue LEED certification that apparently lead Flintco to commence a Petition for Writ of Mandamus against Palo Alto (.. yes, the general contractor sued the City) in Flintco Pacific, Inc. Vs City Of Palo Alto, filed July 17, 2014 in the Superior Court of California, County of Santa Clara, asking the court to declare that the City is violating the California Public Records Act and to command the City to produce all records relating to Flintco’s information request for 49 categories of documents related to the construction including writings related to LEED certification.

While the merits of the construction dispute are beyond the scope of this blog post, this matter is significant because if highlights the importance of construction contracts expressly providing for who owns the LEED documentation. A common contract provision, but not found in the contract in this instance, provides,

Any LEED certification plan and materials prepared to support the LEED certification application are intended for use by the Owner with respect to this Project. [LEED Consultant] grants the Owner a nonexclusive license to utilize, including reproduce, the plan and those materials for purposes related to the building that is the Project. [LEED Consultant] shall be deemed the author and owner of the LEED certification plan and the materials prepared to support the LEED certification application, and shall retain all common law, statutory and other retained rights, including copyrights.

Do you know who owns the LEED documentation on the project you are working on?

July 29, 2014 0 comment

Green Building

Where are America’s Greenest Buildings?

written by Elisa Wood

Ok, no surprise to see Washington, D.C. or San Francisco ranked high in a list of the cities with America’s greenest buildings. But Atlanta?

Georgia’s capital was the only southern state to make the top ten in the 2014 U.S. Clean Tech Leadership Index, released July 15 by Clean Edge. The cleantech research firm tracks the cleantech progress of the 50 largest metro areas and the 50 states.

“A good deal of Atlanta’s performance can be chalked up to the city’s green-building requirements, having passed an ordinance that all new city construction and major renovations must be Silver-LEED certified,” said Ron Pernick, Clean Edge managing director.

Atlanta knocked out Milwaukee to take over the number ten spot in the green building ranking.

The South has been notoriously slow to pursue green technology. But Atlanta is different. This is not the first time the city made Clean Edge’s top 10 list. It was number #8 in 2012, but then dropped to #12 in 2013, according to Pernick.

With the exception of Atlanta’s entry, the green building list showed little change over 2013. Clean Edge attributed the lack of change to the long lead times for new construction.

This year’s top spot went to Washington, D.C. , driven by efficiency efforts in federal buildings. Boston and Minneapolis also made the top ten. Otherwise the usual suspects, Western cities, dominated the top slots: San Francisco, Denver, Portland, Seattle, San Diego, Sacramento. The five cities at the bottom of the green building list were: New Orleans, St. Louis, Memphis, Birmingham and Oklahoma City.

Why cities are important

Energy use by cities is gaining increased attention because of the dramatic population growth in metro areas. Cities accounted for almost all US population growth from 2012 to 2013.Worldwide, 7 out of 10 people are expected to live in cities by 2050, up from today’s 5 out 10.

Meanwhile, city leaders are increasingly pursuing green energy to attract jobs and meet carbon emissions goals. They are also looking for more control over their power supply, which is contributing to growing interest in microgrids and other forms of decentralized energy.

Green building was just one aspect of the green tech market analyzed in the detailed 49-page report. It also looked at electric vehicles, renewables, patents, policies, investment and other factors that signify progress by cities and states.

Across all categories, the top three cities were all in California: San Francisco, San Jose and San Diego, which jumped four places. California was the top state for the fifth consecutive year, with Massachusetts and Oregon repeating their #2 and #3 rankings from the 2013 state index. Vermont and Connecticut moved into the top 10 this year, while Hawaii and Minnesota dropped out.

For overall energy efficiency, California continued with the lowest annual per capita consumption, 6,704 kWh, followed closely by Hawaii. 6,767 kWh. The remaining top states were all in the Northeast, with the exception of #9 Alaska

Other significant findings from this year’s report are:

Colorado, Vermont, Oregon, and Washington each now exceed 100 LEED projects per million people for the first time
Eleven states now generate more than 10 percent of their electricity from non-hydro renewable energy sources, with two – Iowa and South Dakota – exceeding 25 percent.
U.S. solar installations climbed more than 40 percent year-over-year
Registrations of all-electric vehicles more than doubled from last year to nearly 220,000 nationwide
At least eight states now have more than 50 percent smart-meter market penetration; California leads with 70 percent.

“Net-zero building and energy-storage mandates and new public-private investment vehicles are just a few of the emerging policies that are dramatically shifting the energy landscape,” said Clint Wilder, Clean Edge senior editor. “While there have been some regional attacks against cleantech supportive policies, such as net metering and renewable portfolio standards, for the most part, the clean-tech industry and its allies have successfully fought off such efforts.”

Issued July 15, the 2014 U.S. Clean Tech Leadership Index is available here.

July 16, 2014 3 comments

Green Building

Lawyers’ Opinions in Green Building Transactions

written by Stuart Kaplow

We are increasingly called upon to give legal opinions that a green building is LEED certified, ‘certifiable’ or otherwise really a green building.

The purpose of a legal opinion given in a commercial real estate transaction is, most simply put, to provide the recipient of the lawyer’s writing with comfort regarding specified aspects of the transaction.

One might ask why they need an opinion from a lawyer that their building is green? The best response is because in many instances their lender requires it. While legal opinions are given in a variety of commercial contexts, they are increasingly being required as part of the due diligence by lenders when making loans secured by (i.e., a mortgage) a green building.

The size and nature of a transaction may well affect the scope of the opinion requested and in larger traditional mortgage financing as well as bond financing, lenders attribute increased value in the security being provided for loans when a building is LEED certified or the like.

Opinion letters are often given by the borrower’s attorney at the request of and for the benefit of the lender. Traditionally, legal opinions in the context of loan transactions provide assurances that the loan documents are valid, binding and enforceable. Often legal opinions arising from the purchase of real estate involve assurance that the improvements exist accordance with applicable zoning, subdivision and other land use laws and regulations. Opinions are also given, from time to time, that a project complies with environmental laws. And now counsel to borrowers and sellers are being called upon to provide assurances that the real property and improvements which exist or are to be constructed have been designed and exist or will exist in accordance a stated green building standard, rating system or code.

Additionally, as increasing numbers of governments make green building mandatory or offer incentives for high performance buildings, purchasers and lenders alike want assurances that a building is in compliance with those green building laws. Tenants, who with greater frequency are required by law or policy to lease only green premises (from the federal government to multi family residential builders and colleges to retail builders) are a fast growing requester of opinions.

We also receive requests to give opinions of counsel that a project is LEED ‘certifiable’ or ASHRAE 189.1 compliant or complies with Enterprise Green Communities criteria; commonly associated with qualifying fir governmental incentives. Committing that a project will be LEED certifiable versus certified by GBCI increases certainly and lowers risk.

And while we believe a lawyer should not be asked to be an additional warrantor of facts, the distinction between questions of law and fact may at time be difficult to separate. In giving an opinion, a lawyer is not and should not be thought to be providing a guaranty or insurance against loss.

As a function of the fact that there are more green buildings being constructed and those building are being bought and financed, we will be giving increasing numbers of legal opinions that green buildings are ‘really’ green buildings.

July 9, 2014 2 comments

Green Building

E-Cigarettes will be Prohibited in Future LEED Buildings

written by Stuart Kaplow

On July 1st the U.S. Green Building Council released a change to LEED classifying electronic cigarettes as a form of tobacco smoking for the purposes of the smoking prohibitions of the LEED Environmental Quality Prerequisite 2, Environmental Tobacco Smoke (ETS) Control, which is also applicable to LEED v4.

Project teams must follow rating system addenda posted before their project’s registration date. Addenda are often substantive changes to LEED content including corrections, interpretations and alternative compliance paths that may substantively change the way a given requirement is achieved or meant to be achieved. Addenda are accessible in the addenda database.

Addenda are often released as LEED Interpretations which “are official answers to technical inquiries about implementing LEED on a project.” They are most easily accessed in the credit library by selecting the “Interpretations” tab within each credit.

“LEED Interpretations are not an avenue for making significant changes or new requirements to the LEED rating system. LEED Interpretations are also not the intended path for fixing errors in the LEED rating systems and reference guides.”

In this instance, the inquiry was “Are electronic cigarettes (e-cigarettes) covered under the Environmental Tobacco Smoke Control prerequisite?” The LEED Interpretation,

Yes, electronic cigarettes are considered a form of smoking for the purposes of both the interior and exterior smoking provisions of the LEED Prerequisite Environmental Tobacco Smoke Control. As recommended in the December 2013 report [1] prepared for the World Health Organization, “e-cigarettes should be prohibited anywhere where the use of conventional cigarettes is prohibited”. The indoor air quality impacts from electronic cigarettes are not fully characterized, but there is sufficient evidence that electronic cigarettes produce emissions in fine aerosol form that can expose building occupants. For example, according to the report, “several chemicals that have been found in e-cigarette aerosol and e-liquid are on California’s official list of known human carcinogens or reproductive toxicants, including nicotine, acetaldehyde, formaldehyde, nickel, lead, toluene(1)”. [1] Background Paper on E-cigarettes (Electronic Nicotine Delivery Systems); Grana, R.; Benowitz, N.; Glantz, SA; December 2013; University of California.

Much is being said about the relative wisdom of this LEED Interpretation, but the most significant ‘take away’ is, given that a project team could not have reasonably anticipated such an addendum, and that addenda, issued without advance notice or prior alert, are binding when issued; it is key that all addenda be reviewed as they are released quarterly.

Earlier this year, I wrote in this blog, Marijuana Smoking is Allowed in LEED Buildings. The conclusion in that blog post was that the LEED prerequisite was for “tobacco smoke”. But e-cigarettes also do not involve “tobacco” or “smoke”? E-cigarettes deliver a nicotine containing vapor (an aerosol, but not smoke) to users by heating a solution typically made up of propylene glycol. E-cigarettes do not burn or smolder the way conventional cigarettes do.

Worthy of discussion is the lack of public comment for addenda, and in this instance that USGBC identifies as the rationale for this change in LEED, a single much criticized “scientific review” funded by the WHO Tobacco Free Initiative with support from the University of California Tobacco Related Disease Research Program; neither an unbiased forum. Moreover, one of the authors, Neal Benowitz is a consultant to pharmaceutical companies that market smoking cessation medications and has been an expert witness in litigation against tobacco. The other authors apparently work for that Tobacco Related Disease Research Program; making none of them neutral or detached. Read the study yourself and draw your own conclusions about the need to make this change to LEED outside of the 3 year public update process.

The larger issue is that the LEED rating systems change quarterly. While “LEED Interpretations are not an avenue for making significant changes or new requirements ..” it is clear that LEED Interpretations can be material and all involved with LEED projects should review addenda as they are released quarterly.

July 3, 2014 0 comment

Green Building

Baltimore May Adopt the IgCC Green Building Standard

written by Stuart Kaplow

Last week, an ordinance was introduced in the Baltimore City Council for the purpose of adopting the International Green Construction Code.

The IgCC will be adopted as an overlay in conjunction with existing building, fire and related codes and will apply when a permit is required, except the new green code will not apply to: 1 or 2 family dwellings, multiple family dwellings that contain no more than 5 units, a structure that is LEED Silver certified or higher, or a structure that is ASHRAE 189.1 compliant.

It is necessary to appreciate that Baltimore City was an early adopter when it enacted a green building law in 2007 that, prior to this legislation, remains among the most sweeping of that in any major American city. Today the building code mandates that all newly constructed, extensively modified non-residential, and specific multi-family residential buildings, that have or will have at least 10,000 square feet of gross floor area, must be LEED Silver certified or comply with the Baltimore City Green Building Standard.

So, while it was controversial in 2007 when Baltimore mandating that privately owned building must be constructed green, Bill No. 14-0413 sponsored by Councilman James B. Kraft is being warmly received as providing more and better options for developers. That is under the bill a developer may pursue LEED Silver certification, compliance with ASHRAE 189.1 or build to the IgCC. That menu of options allays the concerns of many who will now be able to determine which green building standard is most efficacious for their project.

But make no mistake, Baltimore is not greenwashing. A change in the existing code is necessitated by the USGBC’s June 1, 2015 effective for LEED v4, when projects will no longer be able to register under LEED 2009, because the Baltimore City Green Building Standard piggybacks on LEED 2009 metrics and forms. A change had to be made. Also driving the bill is an unsettled question in the existing code of the definition of what is extensively modified and subject to the green mandate. In the already built out City of Baltimore many projects have not been required to build green that will now fall within the scope of this new IgCC mandate.

The Maryland legislature enacted enabling legislation permitting local governments to adopt the IgCC in 2011 and Baltimore will be the first to do so. Although as this bill is introduced, Montgomery County, Maryland is preparing legislation to repeal its existing LEED centric mandate replacing it with the IgCC. And the State is drafting regulations to allow use of the IgCC on State capital projects, including schools, where the law had previously required LEED Silver certification.

The first reader version of the bill repeals the current Green Building Standard replacing it with more than 25 pages of modifications to the form 2012 IgCC, and will be available later this week. Significantly for an ordinance that does not grandfather any projects, it contains an uncodified provision where the building code official may grant waivers from the new law for 180 days from its effective date in instances of good cause. Waivers may be key for projects that have been designed, but not yet permitted.

The ordinance boldly describes its purpose to “reduce the negative impacts and increase the positive impacts of the built environment on the natural environment and building occupants.” Mandatory green building has been and remains the law in Baltimore City. This bill makes the flavor of green more palatable.

June 23, 2014 1 comment

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