Green Building, Energy Efficiency, and the Economic Crisis

If you’re keeping up with current events, then you know that energy efficiency and the rise of green building practices are vying with economic news for dominance in the public’s field of attention.

The question that naturally arises is quite simple: In the midst of a bad economy, is it still reasonable to be focusing on all of this “green” stuff? And is the bad economy already affecting green projects or will they prove to be “recession proof”?

(Our regular readers will recall that we have given considerable attention to this issue in the past. See, for example, “Federal Economic Recovery Plan Focuses on Green Retrofits, Sustainability, Energy Efficiency,” “Green Business in 2009,” “Hold Onto Your Hats: Recession Drives Major Changes in HVAC,” and “Green Building Remains Strong amid Slumping Commercial Construction Market.”)

Of course we don’t have the answers for you. The fact is, nobody does. But we’ll direct you to seven articles about different aspects of the issue that you can read to help form your own judgment. After all, even though our primary focus is commercial HVAC, being focused on commercial HVAC right now means being focused on energy savings, money matters, and a changing technological, financial, and ideological environment. Yes, this is the way things have always been in this industry. But the intensity has presently reached a peak from which it won’t come down any time soon.

Please notice that the following items do not all say the same thing. They’re about different aspects of the issue, and some are opinion pieces rather than objective reports. The fate of green building, renewable energy, and efficiency practices in the midst of our economic storm is hardly a settled issue at the moment. There’s no bottom-line conclusion yet.

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1. Is the Green-Building Market Recession-Proof?

Source: Architectural Record, March 4, 2009

Condensed version: “Many in the architecture profession believe [green building] will continue to prosper even as the U.S. falls deeper into a recession. . . . Still, while the green-building movement may not be slowed by the recession, many say it will need to adapt to the new economic reality. . . . A focus on retrofitting, rather than new construction, is likely to be one way in which the recession affects the green-building movement. . . . The recession may also alter the kinds of green features and methods architects choose to employ. . . . Fluctuating energy prices and uncertainty about the economy¹s future notwithstanding, there is a general feeling among industry professionals that the recession will prove more beneficial than harmful to the green-building movement.”

2. Is Green Building the Economy’s Bright Spot?

Source: Sustainability Facility, February 13, 2009 (this article is basically a press release provided by the USGBC and widely published in various venues)

Condensed version: “New studies and reports point to green building as one of the growing bright spots for the U.S. economy, according to the U.S. Green Building Council. . . . In fact, as economic experts call for a recovery plan focused on green jobs and infrastructure, as consumers look to live in more economically sustainable homes, as businesses strive to cut operating costs, and as our national security needs depend on an end to reliance on foreign energy sources, green buildings’ ability to deliver solutions to these pressing challenges promises to change the way we view the building industry. . . . As green buildings help companies cut costs and build sound financial situations, the Center for American Progress’ [September 2008] study shows how such green investments on a wide scale can ignite the economy of the nation as a whole.”

3. Saving Money: How the green building industry is thriving in a down economy

Source: Energy Pulse, March 2, 2009

Condensed Version: “The reality for the green building industry is that in light of the current financial and economic climate, waving the green flag will only be sustainable though a vigorous and clear cost saving emphasis. . . . The reality for the Green Building industry is that survival depends on finding ways for consumers and companies to save money. . . .The successful companies in this economic environment will be the ones who create pioneering new products that are designed to save people money. Their challenge will be to offer value to a mainstream audience outside of Green Build attendees, while still making profits and remaining themselves, a sustainable enterprise.”

4. Green Power Forecast: Partly Cloudy — for the Short Term

Source: GreenBiz.com, March 9, 2009

Condensed Version: “When oil prices spiked last summer, investment in any renewable energy project seemed like a prudent, and even necessary decision. Within months, however, the cost of oil dropped, the economy tanked, and priorities shifted. . . . That spells doom for business owners and investors looking for short-term returns on their investments, but those taking a long view are more likely to see renewable energy as a worthwhile, especially with the American Recovery and Reinvestment Act of 2009 stimulus package offering billions in green power incentives which, in some cases, may offset up to 50 percent of some renewable energy installations.”

5. Green Building and the Economy

Source: EcoHome, February 6, 2009

Condensed Version: “EcoHome’s National Economic Survey of architects, builders, remodelers, and contractors shows a mixture of sad reality, cautious optimism, and strong hope for green building when the markets finally recover. And while most of the results were split between ‘green’ respondents already working in green building and ‘non-green’ respondents not yet involved, a large majority of all respondents agreed on the positive direction and potential for green building to emerge when the recession ends. Even 57% of non-green respondents believe that green building will lead all other trends when the housing industry re-emerges.”

6. Green Building and the Economic Recovery

Source: The U.S. Green Building Council (article published at FMLink)

Condensed Version: “A variety of recently released reports point to green building as a key solution to many of the challenges America faces today, from a faltering economy and unemployment to rising energy prices and dependence on foreign oil. Green building has the potential to be a significant driver for economic recovery. . . . Commercial buildings owners are continuing to allot funds to green initiatives. . . . And while jobs continue to be cut and unemployment continues to rise, green building is able to generate new green jobs for Americans. . . . Green buildings have the potential to help employers as well by helping companies cut costs and manage operating expenses. . . . In short, green building offers a practical solution and an opportunity for the building community to lend its weight to tackling challenges facing society today.”

7. Green push stalled by weakened economy

Source: The Business Ledger (Chicago), March 5, 2009

Condensed version: As the economy slows to a near halt, environmentally-conscious initiatives across a wide spectrum of industries are being put on hold as upfront costs exceed current budgets. For now, it seems the green push, including property design and construction, city planning, consumer products and more, will have to wait until the economy rebounds. President Obama’s recent stimulus package includes some provisions focused on boosting sustainability, yet implementation of those initiatives may be years down the line. . . . [M]ost in the commercial real estate and construction industry believe that demand for green building is going to grow rapidly over the next five to 10 years, as more data supporting the benefits of environmental design become available. Yet, even though sustainable design and construction is apparently the future of the industry, many developers and property owners just cannot afford the up-front costs at this time. For the most part, the only commercial projects that will be LEED-certified over the next year are government buildings.”