Green Buildings’ Bottom Line

HONG KONG – Killer typhoons in Taiwan and China. A failed monsoon in India. The United Nations Secretary General in the Arctic pleading for action on climate change, while politicians bicker over who will bear the costs. But, instead of letting that debate rage while the planet heats up, policymakers should embrace one of the cheapest ways of cutting the air pollution that lies at the root of the problem: making buildings more efficient. Surprisingly, buildings account for about one-third of global energy use. Transportation, mostly cars, accounts for roughly another one-third. Factories and mines make up the rest. A lot of attention has gone into making cars and factories more efficient since the first global energy shocks of the 1970’s. Yet most buildings are bigger energy hogs than a fleet of SUVs. Given advances in technology in everything from window glass to air conditioners, change can come for no net cost. The World Business Council for Sustainable Development, which produced a landmark study on the topic, contends that buildings should put back into the system at least as much energy as they take out. The consultancy McKinsey & Company notes that a number of key energy efficiency technologies for buildings offer payback periods of less than a year and could have a dramatic impact on greenhouse-gas emissions. But governments must act. Building codes already guard against dangers like fire and earthquakes. Far-sighted governments in places as different as Germany and Singapore are now mandating green buildings. Policymakers there know that governments have a role in mandating regulations to create a level playing field and helping build industry capacity. California’s latest building and appliance standards are expected to avoid the need for five large power plants in the next 10 years. Buildings last for decades, so decisions made today have a long-term impact on our energy consumption. Efficient buildings enable countries to produce and consume less energy, which supports economic development, because money is freed up for other projects, while promoting energy security and environmental sustainability. All of this can be done without hurting economic growth. The average US refrigerator uses only one-quarter of the electricity of its counterpart of 30 years ago, despite being larger and offering more features. Greener buildings are particularly important for Asia, home to the world’s most rapid economic growth – now and probably for decades to come. Asia’s share of global energy consumption has doubled in the past 30 years, and its buildings’ share of energy use is growing at similar rates, with China and India alone constructing more than half of all the world’s new floor space. Without well-designed policy measures, improvements in the energy efficiency of buildings and appliances will continue at a relatively slow pace in Asia. If Asia pursues a business-as-usual policy, it will burn money on energy that could be put to other uses. Energy-hungry China builds the equivalent of two to four 500-megawatt power plants every week. Each year, it adds more new energy generation capacity than the installed base of the United Kingdom. No one can ask China to slow its development. But if China can improve its energy efficiency, it will save money and strengthen its energy security. Indeed, Chinese government sources estimate that an efficient building is five to six times cheaper than an inefficient building to heat, cool, and light. Before change can come, some old myths need to be demolished. Myth 1: Green buildings cost a lot more to build. Initially, there may be higher costs, usually 3% to 10%, though this figure tends to fall quickly, as everyone from architects to construction workers becomes more familiar with new ways. Moreover, suppliers re-tool to manufacture more energy-efficient products, causing prices to fall. But even higher upfront costs are quickly paid for with cheaper utility bills. Myth 2: Energy-efficient buildings are uncomfortable. The idea that energy-efficiency means sitting in the dark, shivering in the winter and sweating in the summer is nonsense. Repeated studies have shown that well-designed buildings are more comfortable. Green offices have lower employee turnover and fewer sick days. Green buildings increasingly show higher capital values. Myth 3: If energy efficiency worked, everyone would have done it already. This is like the joke about the two economists who ignore a $100 bill they see lying on the street, figuring that if the money were real someone would have picked it up. Building developers often don’t want the extra cost or extra hassle of breaking old habits. And why should they? After all, they either sell the property or pass on the higher utility costs to tenants. Nothing stands in the way of change except the unwillingness to change old patterns. Governments need to set standards that become progressively tighter over time. Everyone in the building and construction industry needs to be more creative. Tenants need to take the same care with buildings that they do with cars. The net result of a series of small changes would be a dramatic reduction in energy consumption. Mark L. Clifford is Executive Director of the Asia Business Council and co-author of Building Energy Efficiency: Why Green Buildings Are Key to Asia’s Future. Copyright: Project Syndicate, 2009.www.project-syndicate.orgFor a podcast of this commentary in English, please use this link: http://media.blubrry.com/ps/media.libsyn.com/media/ps/20091123Clifford1.mp3

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Green Buildings’ Bottom Line