Heather Keil Energy Law – Spring 2008

LEED project certification - provides independent, third-party verification that a building project meets the highest green building and performance measures United States Green Building Council (USGBC) issued a set of guidelines in 2000 LEED Professional Accreditation - building professionals with the knowledge and skills to successfully steward the LEED certification process Sustainable Building and Construction Initiative (SBCI) was launched by the United Nations Environment Program (UNEP) in February 2006 LEED website Source: FMI’s 2008 U.S. Construction Overview.

Buildings In the United States alone, buildings account for: 65% of electricity consumption 36% of energy use 39% of greenhouse gas emissions 30% of raw materials use 30% of waste output (136 million tons annually) 12% of potable water consumption Buildings are one of the heaviest consumers of natural resources Factors that are expediting the growth of green building: Unprecedented level of government initiatives Heightened residential demand for green construction Improvements in sustainable materials LEED website Source: EIA Annual Energy Review 2005. U.S. Energy Information Administration, U.S. Department of Energy.

Green Building by the Numbers The value of green building construction is expected to exceed $12 billion in 2008 and is projected to increase to $60 billion by 2010. The construction market accounts for 14.2% of the $10 trillion U.S. GDP The construction market involves a workforce of 120 million people The three largest segments for nonresidential green building construction (office, education and health care) will account for more than 80% of total nonresidential green construction in 2008. Source: McGraw-Hill Construction Analytics, SmartMarket Trends Report 2008 Source: 2006 DOE Buildings Energy Data Book Source: Asia Construct, Euro Construct and National Statistics, 2006. Source: FMI’s 2008 U.S. Construction Overview.

Benefits of Green Building Environmental benefits: Enhance and protect ecosystems and biodiversity Improve air and water quality Reduce solid waste Conserve natural resources

Benefits of Green Building Economic benefits: Reduce operating costs Enhance asset value and profits Improve employee productivity and satisfaction Optimize life-cycle economic performance

Benefits of Green Building Health and community benefits: Improve air, thermal, and acoustic environments Enhance occupant comfort and health Minimize strain on local infrastructure Contribute to overall quality of life

What will green cost? The most common reason for not incorporating green elements into building designs is the increase in first cost Reasonable levels of sustainable design can be incorporated into most building types at little or no additional cost. Sustainable materials and systems are becoming more affordable, sustainable design elements are becoming widely accepted in the mainstream of project design, and building owners and tenants are beginning to demand and value those features. However, advanced or innovative sustainable features can add significantly to the cost of a project and must be valued independently to ensure that they are cost- and/or environmentally effective.

What will green cost? The cost for incorporating sustainable design elements will depend greatly on a wide range of factors, including building type, project location, local climate, site conditions, and the familiarity of the project team with sustainable design. In most cases, these factors have a relatively small but still noticeable impact on the overall cost of sustainability. Cumulatively, however, they can make quite a difference There can be no single answer to the question, but it is easier to answer the question “What will green cost me on my project?”

LEED for Homes LEED for Homes Checklist 8 categories: Innovation and Design Process (ID) Location and Linkages (LL) Sustainable Sites (SS) Water Efficiency (WE) Energy and Atmosphere (EA) Materials and Resources (MR) Indoor Environmental Air Quality (EQ) Awareness and Education (AE) Rating: Certified: 45-59 Silver: 60-74 Gold: 75-89 Platinum: 90-136 Initiative for Affordable Housing • What are the objectives of the Initiative for Affordable Housing? The Initiative for Affordable Housing is a component of LEED for Homes that addresses the inherent differences between affordable housing – particularly multi‐family homes – and market‐rate, single‐family homes. It is being funded by a generous grant provided by The Home Depot Foundation. The ultimate goal of this initiative is to recognize and reward the intrinsic resource efficiencies of affordable housing in the LEED for Homes rating system. In this way, USGBC and The Home Depot Foundation will promote sustainable building practices specifically for affordable homes. • How does the Initiative for Affordable Housing fit within the scope of the LEED for Homes program? LEED for Homes is a collaborative initiative that actively works with all sectors of the home building industry, including the affordable housing sector. LEED for Homes is a voluntary initiative designed to promote the transformation of the mainstream home building industry toward more sustainable practices. LEED for Homes certification requirements include several measures specifically intended to reward efficiencies typical of affordable projects: 􀂅 Compact developments (up to 3 points); 􀂅 Site selection and close to existing infrastructure (up to 3 points) 􀂅 Limit outdoor water use (automatically earned by compact developments —1 point); 􀂅 Homes with ready access to community resources and open spaces (up to 3 points); and 􀂅 Homes that are smaller than the national average (up to 10 points). 􀂅 Collectively these measures represent more than 50 percent of the points needed to achieve a certified LEED Home. • Why should I build LEED for Homes qualified affordable housing? A home is not affordable if it is not energy efficient, healthy and durable. Affordable homes that are certified under the LEED for Homes Program will be distinguished in their markets as environmentally responsible and higher quality products. LEED‐rated homes benefit residents directly because the LEED Rating System incorporates prerequisites related to occupant health and well‐being. In addition, the mandatory energy‐related prerequisites ensure at least 20‐30% energy savings (relative to the national energy code). Additional energy measures can result in 30 to 70% reductions in energy costs. The selection of U.S. Green Building Council Page 2 March 2008 sustainable materials, recommended in LEED for Homes, provides improved durability and is more environmentally responsible. • How will the quality of LEED Homes be assured? The strength of LEED for Homes is third‐party verification. This verification process includes both on‐site inspections to ensure that the LEED for Homes features have been installed correctly and performance testing to ensure proper performance. LEED for Homes Providers are local and regional organizations that are selected to provide technical, marketing and verification support services to builders. A Provider arranges for certain performance tests to be conducted on the home. When all of the LEED for Homes features are verified, the USGBC issues a rating certificate for that qualified LEED Home. • How do I participate in LEED for Homes? Affordable housing developers interested in participating in LEED for Homes should contact a Provider. A list of Providers can be found at www.usgbc.org/leed/homes. Once the Provider approves the project to move forward, the project team can register the project online. • What kind of funding is available to affordable housing projects? If the builder/developer organization is a 501(c)(3) nonprofit organization the USGBC registration fee will be waived. In order to take advantage of this waiver, mark the project as affordable on the registration form, and the project will be registered without payment. In addition to waiving the registration fee, assistance is available through a generous grant from The Home Depot Foundation to cover verification costs associated with LEED certification. Contact your Provider for more information on how to qualify for this assistance. • LEED for Homes contact information For questions about LEED for Homes, please e‐mail homes@usgbc.org or contact your Provider.

LEED for New Construction LEED-NC Rating System is designed to guide and distinguish high-performance commercial and institutional projects Includes office buildings, high-rise residential buildings, government buildings, recreational facilities, manufacturing plants, and laboratories Rating: Certified: 26-32 points Silver: 33-38 points Gold: 39-51 points Platinum: 52-69 points LEED-New Construction (NC) buildings are delivering anticipated energy savings LEED energy use is 25-30% better than the national average

LEED for Existing Buildings The LEED for Existing Buildings Rating System helps building owners and operators measure operations, improvements and maintenance on a consistent scale, with the goal of maximizing operational efficiency while minimizing environmental impacts Addresses whole-building cleaning and maintenance issues (including chemical use), recycling programs, exterior maintenance programs, and systems upgrades It can be applied both to existing buildings seeking LEED certification for the first time and to projects previously certified under LEED for New Construction or Core & Shell

LEED for Commercial Interiors LEED for Commercial Interiors is the green benchmark for the tenant improvement market (office, retail, and institutional buildings) Tenants who lease their space or do not occupy the entire building can LEED certify their space as a green interior Benefits: Healthy, productive places to work Less costly to operate and maintain Have a reduced environmental footprint

LEED for Core & Shell Complementary to the LEED for Commercial Interiors rating system Acknowledges the limitations of developers in a speculatively developed building and encourages the implementation of green design and construction practices in areas over which the developer has control Developers can often implement green strategies that indirectly benefit future tenants. Conversely, developers can inadvertently implement strategies that prohibit tenants from executing green fit-outs Works to set up a synergistic relationship, which allows future tenants to capitalize on green strategies implemented by the developer Core and shell covers base building elements such as structure, envelope and the HVAC system

LEED for Schools Recognizes the unique nature of school spaces and children’s health issues Addresses issues such as classroom acoustics, master planning, mold prevention and environmental site assessment Green schools are productive learning environments with ample natural light, high-quality acoustics and air that is safe to breathe Green schools nurture children while saving money

LEED for Retail LEED for Retail is in Pilot Recognizes the unique nature of the retail environment and addresses the different types of spaces that retailers need for their distinctive product lines.  USGBC and over 80 Pilot project teams are collaborating to create two new rating systems: LEED for Retail: New Construction LEED for Retail: Commercial Interiors

LEED for Healthcare Developed to meet the unique needs of the health care market, including inpatient care facilities, licensed outpatient care facilities, and licensed long term care facilities It may also be used for medical offices, assisted living facilities and medical education & research centers Addresses issues such as increased sensitivity to chemicals and pollutants, traveling distances from parking facilities, and access to natural spaces Represents a culmination of four years of close collaboration between the Green Guide for Healthcare (GGHC) and USGBC.  

LEED for Neighborhood Development The LEED for Neighborhood Development Rating System is currently in its pilot period It integrates the principles of smart growth, urbanism and green building into the first national system for neighborhood design Purposes: Reduce urban sprawl Encourage healthy living Protect threatened species A collaboration among USGBC, the Congress for the New Urbanism and the Natural Resources Defense Council

Federal/State Requirements The system is rapidly spreading – federal departments and agencies and state and local governments are adopting LEED as a guideline or are adopting other LEED incentives The federal government now requires that new official buildings above a certain size be LEED-certified Several cities have adopted similar measures

LEED – The System LEED was a step in the right direction Created a national standard, providing reliable information, a rigorous rating system, and a checklist for going green However, there are serious problems

Problems with LEED LEED has become expensive, slow, confusing, and unwieldy, resulting in: Mediocre green buildings where certification, not environmental responsibility is the primary goal A few super high level eco-structures built by ultra motivated and wealthy owners – stand as a beacon of impossibility Explosion of LEED certified architects and engineers chasing lots of money but designing few buildings Discouraged group of professionals who want to build green but cant afford to certify their buildings

Problems with LEED System is easy to manipulate Focus on points, not environmental benefits points game get the PR benefits of a green project without actually having the most environmentally friendly building a $395 bike rack and a multimillion-dollar low-energy A.C. system both get one point Basic certification is too low a hurdle to merit the green stamp of approval developers can rack up the minimum number of needed points without going much beyond the requirements

Problems with LEED System does not consider regional differences Water conservation is more important in some areas Neglects the importance of a building’s life cycle Location is not emphasized enough No penalties for non-compliance after certification

Cost Problems Developers have to bring in many consultants and reviewers to approve each step Can significantly raise building costs The USGBC's fees for registration range from $750 to $3,750, and certification runs from $1,500 to $7,500, depending on the size of the building. The big costs come in the form of energy modeling, commissioning, and other requirements of certification; these can run into the tens of thousands of dollars, according to architects and developers

Green building - Myths Many reports incorrectly state that green building and LEED certification in particular does not cost more than conventional building Green building costs more than conventional construction LEED certification typically adds 1-5% to the budget The myth that going green costs nothing is damaging to clients who discover the reality of the process The danger is that LEED certification could eat away funds that could otherwise be used to improve a building Ex) Milwaukee’s new Urban Ecology Center is one of the greenest buildings in the Midwest but is not LEED certified bc it would have added $75,000 to the cost

LEED – the future The idea behind LEED is a worthy goal, there have just been problems in the execution LEED does not guarantee energy efficiency Some critics argue that the basic certification is too low a hurdle to merit the green stamp of approval – developers can rack up the minimum number of needed points without going much beyond the requirements

Solutions to LEED Shift the focus from points to environmental benefits: Make more critical credits mandatory (energy efficiency) If the cost of LEED continues to go up, then ppl will stop seeking LEED certification Provide for additional cost cuts The USGBC is working to address member concerns and refine LEED while broadening it to cover more types of building projects LEED in an ongoing project, constantly being revised and approved upon

Thank you.