GreenSuite

ABA and EPA Law Office Climate Challenge Gaining Traction

Not for nothing are law firms in

New York

and across the country finally stepping up in a big way to the "Law Office Climate Challenge," issued in March 2007 by the American Bar Association in conjunction with the U.S. Environmental Protection Agency.

Quickly realized cost savings have been "a really good promotional tool" for attracting signatories to the challenge, said Daniel A. Eisenberg, vice chairman of the air quality committee of the ABA Section of Environment, Energy and Resources.

"Our first year was slow, there weren't a lot of ways we could spread the word," said Mr. Eisenberg, an associate at Beveridge & Diamond in

Washington

,

D.C.

"But in the last six months, we've noticed a substantial uptick of interest in the challenge."

Money saved, as the old saw goes, is money earned. For example:

• Erik J. Sekler, executive director of Paul, Weiss, Rifkind, Wharton & Garrison, estimates a combined annual savings of $450,000 as the result of upgrading the firm's lighting fixtures and laptop computers with more energy-efficient models, switching photocopy machines to double-side default and using recycled paper and ink toner cartridges

• Tania Shah, firmwide director of corporate responsibility at Pillsbury Winthrop Shaw Pittman, estimates $200,000 in yearly savings achieved simply by state-of-the-art lighting and office climate control.

• Christopher M. Zegers, director of information technology at Herrick, Feinstein, attributed savings of about $220,000 to new computer virtualization programs that reduced his firm's need of 30 servers to about eight -- with added and even greater savings in reduced power and cooling needs.

Mr. Zegers sees virtualization, which compacts as many as six functions into a single server, as "the biggest cost savings and ecologically sound" advance in green technology. He noted surveys forecasting energy usage by Internet data centers to surpass that of the airline industry by 2015.

Too early to be calculated are individual savings for green-conscience lawyers, such as a special Zipcar opportunity at Pillsbury offices in New York, San Francisco, Washington, D.C., and London -- places where renting a car by the hour can make more sense than owning and garaging a personal vehicle, thereby adding to traffic congestion and air pollution.

Under a new partnership with Zipcar, Pillsbury picks up annual membership fees for its personnel -- about $100 in

San Francisco

, slightly higher in

New York

-- and Zipcar reduces its hourly usage rates by 25 percent.

But besides significant corporate and personal economizing, said Mr. Zegers, young lawyers especially "want to see that they're going into a green environment." Clients, he added, are "more and more looking to their vendors, including their law firms, to see how they're addressing being green."

"But money isn't our motivating factor," said David A. Crichlow, managing partner of Pillsbury's

New York

office.

Noting that his firm, as well as others, contract with car service companies offering hybrid fleet vehicles, Mr. Crichlow said, "A lot of this is driven by our wanting to do the right thing. We recognize that we've got to do our share to promote a sustainable environment. There are little steps we can all take, but if all firms took them together they'll have a great effect."

At Shearman & Sterling, which in common with all firms polled by the Law Journal rolled out its package of environmental initiatives during Earth Day on April 22, green goes from the office to employees' homes.

Joel A. Wirchin, director of administration for the

New York

headquarters of Shearman, said the firm created a special Web site with weekly advice on ecology-friendly household products, links to articles by green bloggers and an interactive feature allowing lawyers and others to offer their own green thoughts.

Signing On

At present, there are 85 signatories to the "Law Office Climate Challenge," issued by the American Bar Association and the U.S. Environmental Protection Agency.

Daniel A. Eisenberg, vice chairman of the air quality committee of the ABA Section of Environment, Energy and Resources, expects that number to increase to 100 by summer's end.

Law firms in New York state who have signed on to the challenge include the Manhattan office of Arnold & Porter; Bond Schoeneck & King; Chadbourne & Parke; Cuddy & Feder of White Plains, N.Y.; Davis Polk & Wardwell; Harris Beach; Holland & Knight; Morrison & Foerster; Nixon Peabody; O'Melveney & Meyers; Paul, Weiss, Rifkind, Wharton & Garrison; Sheppard, Mullin, Richter & Hampton; Simpson Thacher & Bartlett; Weil, Gotshal & Manges; and Sonnenschein Nath & Rosenthal.

---

Join in

• Purchase paper with at least 30 percent recycled content; use double-sided photocopying and printing whenever possible; recycle discarded paper.

• Participate in the EPA's Green Power Partnership program to reduce electrical uses generated by coal-fired plants (details at www.epa.gov/grnpower).

• Convert to low-energy overhead fluorescent lighting, use new low-energy bulbs for ambient lighting.

• Use office equipment and appliances approved by ENERGY STAR, an efficiency ratings program jointly administered by the EPA and U.S. Department of Energy.

• Install virtualization software in computer servers to increase efficiency and reduce power/cooling needs.

• Increase telecommuting.

• Organize office car pools.

• Contract with car service companies that use hybrid fleet vehicles.

"I don't think anybody believes we're saving three whales a minute or something like that," said Mr. Wirchin, "but I also think that people believe we're not just giving lip service to the need to change behavior in order to address real problems."

Thomas C. Jensen, an environmental law partner at Sonnenschein Nath & Rosenthal's Washington, D.C., office envisions a day -- soon to come -- when law firms engage in "vigorous competition, akin to the way we market our diversity initiatives and our pro bono commitments" to reduce waste and energy consumption and to embrace new technologies aimed at protecting the planet.

As chairman of an

ABA

subcommittee charged with overseeing the Law Office Climate Challenge, Mr. Jensen added, "My goal will be to have environmental performance become one of those markers of real leadership in the profession."

According to a national survey by the

ABA

, prepared by Mr. Jensen's project colleagues, the typical

U.S.

attorney, allowing for variables according to practice area and office size, uses 20,000 to 100,000 sheets of copy paper annually. As a result, that lawyer produces up to 4.5 tons of carbon dioxide and other greenhouse gases -- which is equivalent to driving a midsize car 8,400 miles, according to an online calculator provided by Carbonify, a nonprofit Australian organization that promotes environmental protection.

If attorneys were to adopt recommendations by the law office challenge, said Howard Hoffman, general counsel for the EPA, they could cut individual greenhouse gas production nearly in half.

Further, according to EPA estimates provided by Mr. Hoffman, the typical

U.S.

lawyer generates another six tons of carbon dioxide in a year's time through electrical use at work and three more tons in daily commuting by car.

What strikes Mr. Jensen as a "mind-blowingly large number" is the measure of paper used by all offices of Sonnenschein -- approximately 65 million sheets annually.

"If we cut back just 10 percent, we're talking about 6 million sheets," he said. Paper prices being what they are, he added, "That's a big deal."

Mr. Jensen described such a cut, as well as many other green initiatives at Sonnenschein and other firms, as part of "a collective national discovery of how much low-hanging fruit there is out there in terms of changing our environmental behavior."

Looking toward a future of ever more sophisticated and effective change for the better, Mr. Jensen predicted, "Technology is there, and capital will be there. Over the next 10 to 20 years, we will have progress that will dwarf any industrial push we've ever seen. It's going to be a great, great period in our history."

Contact Thomas Adcock.

Boston Challenging San Francisco with Landlord's Greening their Portfolios

I have heard rumors that Boston Based Beacon Properties and UBS are going for LEED-EBO&M with their entire San Francisco portfolios and hope they follow through with that goal as their peers are in Boston.   EOP sold it's entire San Francisco portfolio of office buildings to Morgan Stanley last year who has not make any green promises for them.- JW

Boston's biggest property owner going all green

Equity Office cites social, fiscal benefits to upgrades

By Casey Ross

Globe Staff / August 28, 2008

The city's largest property owner - spurred by high energy prices and rising demand from tenants - is seeking "green" certification for all of its office buildings, marking a major milestone in Mayor Thomas M. Menino's push to make Boston the nation's most environmentally friendly city.

Gallery Check out green buildings around the world

Equity Office Properties Trust, which owns 20 structures in and around Boston, is outfitting its buildings with features ranging from energy-saving heating and cooling units to new bike racks as part of a multimillion-dollar effort to stamp its buildings with the green label.

"We're doing this from a social responsibility perspective, but it's also become necessary to maintain tenants," said Greg Shay, president of Boston operations for Equity Office. "It's gotten to the point where not taking action is somewhat foolish."

Equity Office, which was acquired by Blackstone Group last year, operates office towers across the country, but it is installing the green technologies only in its Massachusetts properties, beginning what could become a national effort, executives said. The company's marquee addresses include One Post Of fice Square, Rowes Wharf, and 60 State Street.

The effort by Equity Office will result in a 50 percent increase in the city's stock of green-certified office buildings, bringing the total to 34 from 23. The company is still tallying total savings, but executives estimate they will save $1.5 million in electricity costs by 2012 on six buildings where upgrades are underway.

While early environmental efforts have focused on curbing vehicle emissions, commercial and residential buildings consume about 70 percent of the nation's electricity and they also account for 39 percent of its carbon dioxide emissions, making homes and workplaces the largest collective source of harmful greenhouse gases, according to the US Green Building Council. Transportation accounts for about 30 percent of emissions.

The Menino administration has strongly encouraged property owners to seek green certification for existing buildings, which continue to be a drag on the city's effort to reduce greenhouse gas emissions.

The city enforces a zoning law that requires all newly constructed buildings larger than 50,000 square feet to achieve certification under Leadership in Energy and Environmental Design (LEED), a program operated by the US Green Building Council, a nonprofit that promotes sustainable building design.

But the law does not apply to existing structures, meaning the city's efforts to reduce greenhouse gas emissions are largely tied to the slow pace of redevelopment. Currently, only one existing office tower, managed by Beacon Capital at One Beacon Street, is certified under the program; Equity Office's plan will increase the number to 12 by 2013.

"The real pioneering innovation here is that Equity is committing to upgrading its existing properties, not just new construction," said James Hunt, Menino's chief of energy and environment. "Executives are now seeing that this is good for the environment, and it's good for public health."Continued...

Equity is seeking to achieve at least minimum LEED certification for all its buildings in the Boston area. The program is based on a ratings system that measures the efficiency of commercial and residential buildings. The system assigns silver, gold, and platinum certifications based on a building's adherence to an environmental checklist.

The checklist includes dozens of conservation measures, ranging from paper and plastic recycling to use of water-saving plumbing features to installation of automatic lighting features and rooftop landscaping. Equity Office said it expects to spend about $4.7 million on a pilot program that includes upgrades to four buildings. The effort will ultimately result in all its buildings being upgraded over the next several years.

Another major landlord, Boston Properties Inc., which owns the Prudential Tower, is also instituting green technology in its buildings. Executives said the firm is seeking to upgrade 11 million square feet of commercial space in Boston, Cambridge and Waltham.

The campaign has included extensive improvements to the Prudential, where the company has introduced automatic lighting switches and faucets, and employees use only ceramic coffee mugs and glassware instead of Styrofoam or paper products.

Environmental regulators said the movement toward green buildings has been aided by the sharp increases in costs for fuel and electricity, which have been crippling corporate budgets across the country.

Ian Bowles, the state's environmental secretary, said the campaign by Equity Office is part of a broader shift toward green buildings among universities, hospitals, and other major energy consumers that are under heavy pressure to cut costs - and appear green-conscious to the outside world.

"It's reflective of the high price of fossil fuels and growing concern about greenhouse gases," Bowles said of the Equity campaign. "It's really starting to drive the commercial real estate industry to focus more on green building."

Another motivating factor is the high demand from tenants.

Executives at Jones Lang LaSalle, an Equity Office tenant at One Post Office Square, said the real estate firm has welcomed upgrades to the building, including the mandatory use of green cleaning products as well as energy-efficient light bulbs and plumbing features.

"The cost of energy is going up and energy consumption is going up, so anything to help with that is a significant benefit," said David Slye, managing director for Jones Lang LaSalle in Boston. He said benefits of air filters and increased use of daylight also improve the working environment for employees.

Studies have shown that implementation of green technologies can increase productivity between 10 and 15 percent, according to the State Environmental Resources Center, an organization that tracks the impacts of green energy policies. The group cites research showing that cleaner air quality and better temperature control improves alertness of employees and decreases absenteeism.

Shay, of Equity Office, said the vast majority of large office tenants are asking about green technology during negotiations, and many are now listing LEED certification as a baseline requirement.

"We really find that you can get knocked out of the running if you don't have it," he said. "It's very difficult for anyone to argue that this is a social movement that's not here to stay. Green is not going anywhere, so you either adopt it or you're playing catch-up."

Casey Ross can be reached at cross@globe.com.

© Copyright 2008 Globe Newspaper Company.

NYT Article on Burgeoning Service Sector for Green Building Industry

I am always delighted to see coverage in the New York Times and Wall Street Journal about LEED and Green Building in general. I also would be delighted to see the cost of green services to become more standardized and lower as the level of expertise in LEED in its corresponding services (commissioning, design, construction, engineering, documentation, etc.) becomes more prevalent.  It is disheartening to see companies with the best intentions decide not to pursue LEED certification because of the additional cost not of materials or methods but of services.  Looks like we're on the right track!-JW

Serving Architects, Consultants in Everything Green Become Mainstays

By LISA CHAMBERLAIN

Published: August 26, 2008

On a recent Friday, when the rest of the staff of the architecture firm Beyer Blinder Belle was out of the office enjoying a beautiful August day, about 25 people sat in a windowless room learning about the Leadership in Energy and Environmental Design (LEED) certification process.

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Chester Higgins Jr./The New York Times

Lauren Yarmuth, a green consultant, helps architects like Guy Geier.

Conducting the seminar was Lauren Yarmuth of YRG Sustainable Consultants, one of a growing cadre of consultants who specialize in helping developers, architects and sometimes tenants gain an official stamp of approval from the United States Green Building Council through its LEED certification program — the undisputed calling card of environmental bragging rights.

That some two dozen architecture professionals — including a partner in the firm — were getting daylong instruction is indicative of the growing importance of sustainable design, especially as local and state governments are increasingly requiring LEED certification of public projects.

“Going green used to be part of just a handful of organizations’ mission statements, but now it’s become part of everyone’s agenda,” said Ashley Katz, communications director for the Green Building Council. “That has, of course, increased the need for sustainability consultants.”

Many of the consultants are, like Ms. Yarmuth, trained as architects and work directly with the Green Building Council to develop and refine the guidelines they help clients follow. At the end of 2006, the Green Building Council’s membership included 679 consultants. By July 31 this year, there were 1,590.

This mirrors the rapid increase in the number of buildings certified by the council: In 2005, there were 404 buildings that met LEED standards. Midway through 2008, 1,705 buildings have been certified.

The council was founded in 1993 by Rick Fedrizzi, David Gottfried and Mike Italiano, three friends with backgrounds in marketing, development and environmental sciences. Since its founding, the council has grown to more than 16,700 member companies and organizations. It is financed through memberships, educational programs, a yearly conference and expo, and LEED certification fees. Membership ranges from $300 for small businesses to $12,500 for billion-dollar corporations.

LEED started certifying new construction as “green” or “sustainable” in 2000, and the fifth version of standards is being prepared for 2009. Like any fast-moving industry, it has not been a perfect evolution.

“There have been some examples of consultants who charge a lot of money to churn paper without results,” said Tom Paladino, a sustainable consultant based in Seattle, who has been working in the field since 1994. “But if you’re serious about sustainability, third-party certification, like LEED, is part of the deal. Otherwise, it’s like saying, ‘I want to get fit but I don’t want to get on the scale.’ ”

And the scale itself, which the building council has constantly calibrated, can still require expert advice. “Just because LEED gives a point for something doesn’t mean it’s the right thing to do environmentally,” Ms. Yarmuth said at the Beyer Blinder Belle seminar. “You will encounter trade-offs a lot.”

She used as an example one commercial client that wanted credit for alternative transportation, which required bike parking and showers for 5 percent of full-time employees. While bike racks are simple and easy, showers use water and more construction materials (not to mention more money). “Is that the best thing to do in a hot, dry climate where there is a water shortage?” she asked.

For consultants, “this is their core competency,” said Emilio Galanda, assistant vice president and head of corporate facilities for ING investment management, which hired YRG to oversee LEED certification for the renovation of its three-floor, 17,000-square-foot headquarters at 230 Park Avenue. “They act as an adviser that is impartial.”

Despite a seemingly straightforward point system and scorecard, getting LEED certification is not always easy. Even large firms with employees with titles like “environmental strategist” hire consultants to walk them through the process.

A year ago in May, CB Richard Ellis developed a corporate policy to be carbon neutral by 2010, according to Sally R. Wilson, global director of environmental strategy for the real estate investment and management firm. CBRE manages 1.9 billion square feet of properties, buildings or facilities, and many of its clients are looking to go green as well.

The company started with its own regional headquarters at 750 Ninth Street NW in Washington.

Ms. Wilson brought in Holley Henderson, a principal of H2 Ecodesign, based in Atlanta, to manage the process and make sure the architect was designing to LEED standards.

“Certified wood is a hot topic right now” with the Green Building Council, Ms. Henderson said by way of example. “The requirement is, 50 percent of wood has to be sustainably harvested. But keep in mind, if you use wheat or sunflower board or some other alternative, those are grasses, not wood. The way the credit reads, 50 percent is a lot, so the more you reduce your wood, the easier it is to get this credit. People who just look at the scorecard and checklist wouldn’t understand these nuances.”

And not even the consultants always get things right. CBRE installed a green roof on the section it had control over, but the Green Building Council did not award it the credit it was seeking since it did not cover the required percentage of the total roof.

As Ms. Henderson works with more and larger clients, she has seen larger firms bringing the work in-house. “In the last six months, I’ve seen a trend away from being hired as an embedded employee in the whole process to having more of an advisory role,” she said.

“We do have a sustainability manager in-house; we didn’t have that before,” said Guy Geier, senior partner of FXFowle, an architecture firm that hired YRG to manage the firm’s renovation of the National Audubon Society’s new 28,000-square-foot office space on Varick Street in Lower Manhattan, which is expected to achieve LEED platinum status. “We will continue to use YRG for bigger, more complex projects,” which are increasingly done overseas in Asia and the Middle East.

According to Thomas W. Hicks, vice president for international programs at the council, there are LEED projects under way in 75 countries. “There is tremendous demand to bring LEED in and localize it to their conditions,” Mr. Hicks said.

Interview with Karla Bell Pioneer in Green Building and Visionary Eco-Entrepreneur

I am speaking with Karla Bell, one of Australia and indeed the world’s best-known environmentalists. Karla is a pioneer in green building and was responsible for the green building requirements in the 1994 Sydney Olympics, and now is boosting the formation and adoption of the carbon market with the company she has formed to service it, CarbonFlow.  CarbonFlow develops and markets software for carbon market participants, which as explained in the interview below, could help unlock tremendous opportunities in the green building industry.  For more information on the Carbon Market visit The Greenhouse Gas Blog at www.ghgblog.com .  

_____________________________________________________________________________

Q1: As one of the initial global pioneers in Green Building, beginning with your work in creating the first Green Olympic Village and Games in Sydney Australia in 1994, how have you seen motivations for “going green,” evolve over the last 15 years?

I think as an early pioneer of anything, there is a first flush of excitement around a new initiative such as ‘Green Buildings’, particularly when the first global initiative was associated with the Olympics in Sydney and still continues with Beijing having just been awarded the LEED Green Building Council Award (1).  However, there has been a cooling off period from the initial hope that Green Buildings would go out and multiply beyond the Olympics. Since, the adoption of the Environmental Guidelines for the Summer Olympic Games, in September 1993, I would say enthusiasm for Green Buildings has waxed and waned. This is normal and during this period the vested interests have emerged to challenge the wisdom of the new program. Then overtime as the concept has merit new advocates have emerged such as the various Green Building Councils, around the world, accreditation programs such as LEED (1) and practitioners: architects, engineers, developers, real estate agents such as Studley (2), have also sprung up who know how to develop and build Green Buildings.

Overtime these advocates start the slow drip feed process of influencing the community and in this case Green Buildings have been accepted as a good idea through-out the community at all levels, government and the private sector. We are now at the stage where in the USA and Europe, Australia

and perhaps now even in the developing world, where green buildings may well be mandated or swept up hopefully in projects under carbon trading. More of this later.

_____________________________________________________________________________

Q2: How developed is the adoption of Green Building practices in the United Statesvs. the rest of the world and what best practices would you like to see the US learn from?

I think that no country has gone beyond pilot programs and Green Building demonstrations programs. There is a lot of advocacy everywhere. The Austin Green Building

(3) program in Texasencourages participation and this seems to be the most common global approach. There are few mandatory Green Buildings standards in the USA, which is also the case in most European countries as well.

So, to answer your question how many countries across their building portfolio of residential, commercial and industrial have adopted a Green Building program that covers all these issues. The answer is none.

What we have is a continuation of the pilot, demonstration model and voluntary programs. The Olympic Villages from Sydney on have continued to be pilots, albeit large demonstrations of what is possible. Sydney, Athens and now Beijinghave continued on with the Olympic spirit of leading the world in the development of GreenBuildingprograms. Beijingreceived the US Green Building Council LEED Award last week. Even bidding cities such as Stockholm, Swedenwho lost out to Athens

in 2004, went ahead and built a green village called Hammerby Sjostad on the Olympic village site. There are many examples of private developers creating Green Villages like Prairie Crossing in Chicago.

At this point, I should make a distinction between energy efficiency measures in buildings and Green Buildings. Since the signing of the Kyoto Protocol in 1997, aimed at reducing energy consumption to combat Climate Change, most western countries have adopted some energy efficiency measures. These measures so far are minimum standards that means a building can be classified as energy efficient. To qualify under these systems most require some passive design measures such as orientation, energy efficient lighting, insulation and some energy efficient appliance selection such as washing machines, dishwasher, refrigerators and other household appliances. .

Most of the energy reduction measures have not gone so far as to mandate natural ventilation, day-lighting or prescribed renewable energy use on-site such as solar hot water, Photovoltaic cells, wind, geo-thermal energy etc. In a true Green Building

program energy efficiency and the use of renewable energy is a subset of all the sustainability measures.  This comment does not downgrade the importance of energy efficiency in Green Buildings, it is a major factor, however a Green Buildingcovers more than energy.  .

A Green Buildings includes measures in

- Energy efficiency and the use of renewable energy

- Water efficiency and the use of recycled water

- Waste avoidance and minimisation of solid and hazardous waste

- Selection of materials to prevent out-gassing from paints, gums, glues, adhesives

- Protection of biodiversity through sustainable timber selection and native landscaping:

In Californiasince the late 1990 California Bill SB 280 legislation on Green Buildings has been stalled. Hillary Clinton had as one of her energy program initiatives standards for Green Buildings, which I discussed on my blog www.GHGblog.com (4) What measures it included is not clear, was it just energy efficiency, I don’t know. What measures has Senator Obama and John McCain put forward on green buildings would be interesting to know.

In the absence of mandated across the board legislation, the voluntary system seems to always predate anything further. It allows industry to feel comfortable with the issues and able to build. To that end resource centres spring up and there are many in all US

states. In Californiafor example there are centres such as The California Green Builder (5), a voluntary program for green builder and The Green resource centre also. (6) _____________________________________________________________________________

Q3. What are the most significant impediments to more widespread adoption of green building practices?

The most significant impediments include to my mind a holistic way of thinking from the setting of the brief for the building all the way through the implementation from design to construction and operation. When I worked on Green Buildings I always endeavoured to create a role called Environmental Design Management on the same level as the architects, engineers, design and construction managers, which was supposed to be a collaborative process between myself and the whole team. A green building needs an Environmental Design Manager, someone to be responsible for following the entire process from the brief, design and the selection of materials and technologies and if necessary interacting with the workers onsite.

Suffice to say, this approach is contrary to the way the process normally works, which is hierarchial, with the Architect as God. Additionally, once the environmental brief and the brief for the building (what it is actually used for) has been set, the building often times will emerge and design itself. The role of the architect is to resolve these issues. Green Buildings are not about statement architecture.

Another issue concerns the tendering process. Each individual item is tendered for in a building and costs measured item by item. This process does not work well for Green Buildings, particularly if best practice is the objective, only one material or technology may provide the solution. Therefore you actually have to know something and select the material/system through a process of one’s own discernment. Tendering is designed to remove discernment and provide lowest cost. This approach does not mean the buildings should be a field day for people to procure the most expensive on the contrary, if you procure a system the overall system has to be procured. For example take a lighting system – If you include natural ventilation and day-lighting as part of the lighting system (natural and artificial light) then you will actually need fewer lights and wiring and this means you can afford more expensive energy efficient lights and with less wiring you can afford non-pvc wiring which is about 10% more expensive because you have less wiring overall.

Q4. What would be your most useful advice for a company or project owner to overcome the perceived or real obstacles at the outset of a green project?

I would advise that a company or project owner create a collaborative design process, with an Environmental Design Manager responsible for the brief all the way through the design, construction and delivery and operation of the Green Building. It is important to be flexible with tendering for materials and systems when trying to achieve best practice. In the case of a building owner it must be remembered that the 80./ 20 rule applies and that, the real cost of the building is in its operation over its life time. It makes sense to focus on the real costs, which means that the operation of the building upkeep and understanding of the green building technologies is required by the Building manager or Facilities manager.

5. With you newest endeavour, CarbonFlow, your team is helping to create and monetize a market for carbon.  How do you envision carbon markets impacting green building?

The Carbonflow team include other people with a keen interest and background in Green Buildings, Helen Priest is on the board of the NZ Green Building Council, the Corporate Ventures Manager of Meridian Energy (7) a utility in New Zealand and an investor in CarbonFlow.(8). Meridian has been undertaking Green Buildingprojects in New Zealand, called the “Righthouse” (9)

A Quote from Helen Priest from Meridian: “We think there is a huge opportunity to create a range of very effective offset-related products around green buildings (especially residential) if only there was a way to create high-quality (certified, verified) credits at a micro-scale.  Just look at the (now famous) McKinsey graph around carbon and see how much below the line (ie negative carbon cost) is sitting there and not getting done that has to do with buildings. But somehow there needs to be a way to pull all the smaller, disaggregated pieces together and streamline the ability to create credits from energy efficient/green building space.  When that happens, energy companies can create products and services that will encourage better decisions around energy design and use in buildings. We think the opportunity to get this rolling through our relationship with Carbonflow is a win-win."

Meridian Energy has also been active in green buildings in the commercial sector through our representation on the NZ Green Building Council Board and with the Customhouse Quay building.  We think carbon seems an obvious place for the NZGBC to apply their excellent skillsets with high quality tools and standards to incentivise others to look at the opportunity with carbon and green buildings.

Meridian's Customhouse Quay building is a leading example of carbon abatement through energy efficiency.  Meridiansought the highest sustainability design principles in reducing its building carbon footprint - including analysis of the products and services used in the building.  Through linked design features such as chilled beams and thermal mass, use of rain water and solar hot water, the Meridianbuilding demonstrates that energy efficiency can be both carbon friendly and award winning”.

Listening to Meridian and others involved in Green Buildings, it is my view that the best way to get widespread take-up of Green Buildings is to lobby the Voluntary Carbon Standard (VCS) (10) to include Green Buildings as a sector eligible for Carbon Credits. Simon Dawes, our strategic partner DNV, a company that audits more than 50% of the global carbon market has also agreed. (11)

Why the VCS?

The reason is that so far the regulated carbon markets in Europehave not included Energy Efficiency, an important subset of Green Buildings at this stage. The Voluntary Carbon market has been set up to include countries and sectors outside the compliance markets. The VCS uses CDM as the de-facto standard. The price of credits is approximately similar to that of the compliance markets. For more information see The Voluntary Carbon Standard website (10) In the USA, the parties interested in Green Buildings should develop a project and a methodology under the VCS and get it approved. In this case whilst, the USis not a compliance Kyotocountry there is an anomaly that would allow a project to be developed in the USA. CarbonFlow is an interested party in such an energy efficiency project. CarbonFlow has a suite of software called CarbonStep for the VCS markets especially designed to automate the documentation process for all energy efficiency projects. (8) _____________________________________________________________________________

Q6. What stakeholders are participating in the carbon market now?

To get to the stakeholders working in both the compliance markets and the Voluntary markets, I will have to backtrack to describe briefly the Emissions Trading mechanisms under the Kyoto Protocol.  The United Nations Convention on Climate Change official website explains the Protocol very well (12). In brief, The Kyoto Protocol, in the 1st commitment period 2008-2012, the Annex B parties, (developed countries) except the USA, agreed to reduce emissions by -5% on 1990 levels. (12)

Annex B Parties with commitments under the Kyoto Protocol can achieve these targets using flexible mechanisms known as emissions trading. Emissions trading, allows countries that have emission units to spare to sell this excess capacity to countries that are over their targets. A new commodity was created in the form of an emission reduction of C02e (Carbon dioxide equivalents). As carbon dioxide is the principal greenhouse gas, people speak about trading in carbon. Carbon is now tracked and traded like any other commodity. This is known as the "carbon market."  (12)

A tradeable asset or carbon credit is created by a series of contracts promising to deliver greenhouse gas (GHG) reductions through the markets under the Kyotoprotocol.

The Clean Development Mechanism (CDM), Article 12 of the Protocol, allows an Annex B party, a party with an emission reduction commitment to implement an emission-reduction project in a developing country. Such projects can earn saleable credits called certified emission reduction (CER) credits. (12) The incentive to invest in projects is created by the different costs of carbon abatement. A CDM project might involve, for example, a rural electrification project using solar panels or the installation of more energy-efficient boilers. CDM projects are currently clustered in South America and Asia, although there are several emerging countries in Africawhere CDM projects are currently being developed.

Joint Implementation is the mechanism known as “joint implementation,” defined in Article 6 of the Kyoto Protocol, allows an Annex B party, with an emission reduction commitment under the Protocol to earn emission reduction units (ERUs) from another Annex B Party with an emission reduction commitment. Joint implementation offers Parties a flexible and cost-efficient means of fulfilling a part of their Kyoto

commitments, while the host Party benefits from foreign investment and technology transfer. An example is a project in Canadasold into Japanor a project in Bulgaria sold in to Italy or Spain. (12)

Voluntary Carbon Markets under the Voluntary Carbon Standard have been established to allow many types of projects to earn credits not currently included in the sectors under the various Emissions Trading schemes and to include developed countries like the USA not currently a Kyoto Protocol country with emission commitments. The voluntary market follows the same process of creating credits as the CDM or JI market but can occur in a country outside the Kyoto Protocol like the United States. The VCS obviously highlights anomalies in the carbon trading system as a whole for example EU ETS (European Emissions Trading Scheme) does not at this stage include transport or energy efficiency projects, whereas CDM does cover these types of projects. Energy Efficiency projects like Green Buildings in the developed world may well be best developed under the Voluntary Carbon Standard in the USA.

Now back to the stakeholders!

A Multi-Party stakeholder documentation process has been set up by the UN for the creation of carbon credits in each market, which follows a similar path. CDM is the de-facto standard for all other carbon markets. There are a range of multi-party players in the project creation, approval, certification and trading process for a CDM/ JI project and with the exception of the UN the VCS follows a similar process.

- The United Nations has established for CDM credits the CDM Executive Board which has an Executive Board, of 10 members from developed and developing countries. The Executive Board (EB) can establish panels or working groups and has created five Panels to date, which govern registration of projects, methodologies for projects etc to create credits (CERs) etc. The role of the CDM Executive Board is very important in agreeing project methodologies. There have been methodologies approved on energy efficiency projects such as energy efficient lighting and solar hot water projects. Methodologies are approved on application. If a methodology has been approved under CDM it can be fairly guaranteed to be accepted under JI or the Voluntary market. (12)

- Designated National Authorities (DNA) are government established national bodies in each country involved in the CDM. They are responsible for granting approval to local projects, which have fulfilled national criteria for sustainable development and with a good chance of succeeding at eventual registration, as well as acting as a focal point for CDM activities.

Buyers and Sellers require approval from the DNA of the industrialized country where they have commercial operations in, while Sellers will require approval from host country DNAs. (12)

- Designated Operational Entity (DOE) are the independent parties, which act as "auditors" to CDM. These auditors generally are the auditors for JI and VCS projects. These companies are certified by the CDM Executive Board as Designated Operating Entities (DOE), before they are able to provide this service to project owners. DOEs are responsible for checking and validating the Project Design Document (PDD); this is a technical document, which fully describes the CDM project. Registered DOEs include companies such as DNV, SGS or TUV-SUD. (12)

- Project Owners  are on the sell-side. They own the assets, which may be developed into CDM projects e.g. farms, chemical factories, steel plants, cement plants, or state-owned energy companies seeking to develop alternative power generation sources. Project owners may also be the project developers if the CDM activity is related to their core industries.

- Project Consultants  are a growing market of environmental/technical consultants, which advise on implementation, compile the required project documentation starting with the Project Design Document (PDD).

- Buyers come from a variety of sources public and private utilities, oil companies, investment banks, government programs and institutional and private hedge funds. Some Buyers approach Sellers directly, whilst others operate through brokers. Sellers can access a wider market of interested buyers through using a CER broker. Example of a broker is CantorCO2e.com  (13)

- Legal Firms, such as Baker and McKenzie (14) are usually engaged to create the legal documents concerning the normal commercial aspects of a project and the Issuance of the CERS for sale to third parties.

This gives you some idea of the parties involved and the complexity in creating a carbon credit.

Q6. What do you believe will be a, or the, catalyst(s) for the US and our businesses to participate in the carbon market?

The US may or may not join the Global Agreement, the Kyoto Protocol but I do believe it will participate in Greenhouse Gas (GHG) reductions.

To date nine Northeastern U.S. states formed a state-level emissions capping and trading program known as the Regional Greenhouse Gas Initiative (“RGGI”) (15), and in 2006, California

enacted Global Warming Solutions Act (“GWSA”) (16) aimed at reducing GHG emissions 25% by the year 2020. GWSA puts Californiain line with the Kyotolimitations, but at a date later than the 2008-2012 Kyoto commitment period.

In addition twenty three states have set goals or mandated standards for the adoption of electricity generation from renewable sources, such as wind and solar.(17) Many States require utilities to implement energy efficiency programs to reduce electricity consumption. Both renewable energy projects and energy efficiency programs could yield carbon credits, if they can be shown to reduce GHG emissions under the VCS. The McKinsey Global Institute estimates that energy demand in the United Statescould be cut in half over the next fifteen years through energy efficiency programs.

U.S. Presidential Candidates Senator McCain and Senator Obama both have proposed a cap and trade system,  In a for-runner of the debate next year after the George Bush exits the Whitehouse, in June, 2008, the U.S. Senate considered the Lieberman-Warner Climate Security Act (S. 2191) (18), which proposed the establishment of a cap-and-trade system for CO2 emissions, analogous to the cap-and-trade program in place in the U.S. for acid rain pollutants since the mid-1990's. The bill was defeated, before going to a formal vote. In a press release, Senator Lieberman said "We have convinced a majority of the Senate to support mandatory, comprehensive, market-based legislation to curb global warming and enhance U.S.energy security." (19).

The size of the Carbon Trading market may induce the USto participate in one way or another.  According to the World Business Council on Sustainable Development (WBCSD) (20) the Carbon markets are set to explode. Analysts believe the global carbon market could see a veritable boom in the next 12 years, especially if the USsteps in.

The value of the global carbon market shot up by 80% in 2007, with some 2.7 billion tons of CO2 credits, worth €40.4 billion in a sign of growing enthusiasm for the carbon trading industry among companies and investors worldwide. The WBCSD further noted around 60% of this trading took place through the European Union's Emissions Trading Scheme (EU-ETS), with 1.6 billion tons of carbon emissions, worth €28 billion, changing hands in the bloc. (20). The UN-administered Clean Development Mechanism (CDM), which allows companies to meet part of their emission reduction targets by financing carbon-cutting projects in the developing world, accounted for a further 947 million tons of carbon dioxide, worth €12 billion.

Voluntary markets, where companies or individuals concerned about their carbon footprint can choose to buy emission credits, are also starting to grow; the largest being the US-based Chicago Climate Exchange, where trading volume doubled in 2007 to 22.9 million tons.

Q7. What do you believe are the most significant opportunities for businesses and organizations to improve their carbon footprint and sustainability?

I think government and the private sector should step up to the plate and not focus on the cost of change, but on the new industries, new jobs, local jobs to be created in the clean tech sector. Smart technologies will transform transport (cars, buses, trains, aviation), buildings (commercial, residential, industrial) industry (oil and gas, manufacturing, metals, mining) agriculture. In fact all sectors can develop new technologies to meet the challenge of combating global Climate Change. Most clean tech solutions will also create energy security reduce conflict in the world and make the earth a better place to live on many levels.

Everyone can participate at all levels – it is a massive opportunity and Climate Change should be viewed as that.

Q8. Is there anything else you would like to add on GreenBuilding

or Carbon Markets?

At this point I would like to explain what the CarbonFlow team believes the carbon market needs both in the compliance markets and in the Voluntary Carbon Market At CarbonFlow we believe that the market needs a more efficient process as the project cycle takes up to 12 to 18 months from project origination to issued CER. All the way through the process there are inherent delays, which cost money and raise the cost of the process, which in itself acts as a disincentive to more rapid project creation. The Carbonflow eRecord -CarbonFlow, Inc. develops and markets software for carbon market participants. Carbonflow was founded in 2006 to address the process inefficiencies and supply hurdles in the current carbon market.

Despite rapid growth, carbon markets remain very inefficient today. The current creation process acts as a constraint on the supply, and, along with the lack of transparency, affects the price of credits. Supply constraints are obvious hurdles in a market where there is clearly a growing demand from both the Kyoto

targets and an emerging voluntary market.

CarbonFlow works to drastically lower the cost and time it takes to create a credit. Our product suite also improves the velocity and transparency of this growing market, while enabling the expansion of the carbon credit supply.

Our Carbonflow™ suite enhances productivity, reduces both administration costs and the financial risks of managing Greenhouse Gas (GHG) offset projects, and manages the delivery of certified carbon credits for buyers and sellers worldwide. These carbon markets have accelerated since the inception of the "cap-and-trade" market system of the Kyoto Protocol to the United Nations Framework Convention on Climate Change and in 2006 exceeded US$30 billion in total value.

The Carbonflow™ eRecord delivers exactly what the market participants are clamoring for -- faster cheaper processes, more transparency, and better quality data. CarbonFlow's solution is based on patent pending cross-organization collaboration engine and eRecord technology.

It lets everyone in a project talk with everyone else and keeps a permanent eRecord that stays with the project from inception forward.

The technology is designed to meet Kyotoproject methodology requirements including registration, verification, certification and monitoring requirements under the Kyoto CDM, JI and ETS compliance mechanisms.It is also suitable for the voluntary and regional compliance markets in the United States. It could be applied to create carbon credits which are tradable worldwide.

Voluntary Carbon Standard Market Entry Point

CarbonFlow's Carbon Step™ module enables the low cost automation of validation and verification processes. Part of Carbonflow’s Solution targets the rapidly growing voluntary market.  The patent pending Carbon Step software automates the delivery and distribution of greenhouse gas emissions offsets or carbon micro-credits created by gas and electric energy conservation programs and renewable energy sources such as solar power. Carbon Step complements existing utility billing systems (including eBilling and smart metering programs) by providing a key component in driving customer participation in both residential efficiency and industrial demand response programs — the carbon microcredit.

In the compliance and Voluntary markets we believe that the CarbonFlow and Carbon-Step suite is what the market needs.

This is an ideal software tool to work with energy efficient projects / green buildings in the voluntary carbon market.

Bibliography:

1.      http://www.mediabistro.com/unbeige/awards_competitions/beijings_olympic_village_takes_home_LEED_award_91647.asp

2.      http://www.studley.com/page.ww?section=root&name=Home

3.      http://www.austinenergy.com/energy%20efficiency/programs/Green%20Building/Participation/index.htm

4.      www.GHGblog.com

5.       www.cagreenbuilder.org

6.       www.greenresourcecenter.org

7.       www.meridianenergy.co.nz

8.       www.carbonflow.com

9.       www.righthouse.co.nz

10.      www.vcsregistry.apx.com

11.      www.dnv.com

12.      www.unfccc.com

13.     http://www.cantorco2e.com/

14.     http://www.bakernet.com/BakerNet/Practice/EnvironmentClimateChange/default.htm

15.      http://www.rggi.org/

16.      http://en.wikipedia.org/wiki/Global_Warming_Solutions_Act_of_2006

17.      http://en.wikipedia.org/wiki/Green_tags

18.      http://www.opencongress.org/bill/110-s2191/show

19.      http://www.mckinsey.com/mgi/publications/Curbing_Global_Energy/index.asp

20.      http://www.wbcsd.org/plugins/DocSearch/details.asp?type=DocDet&ObjectId=Mjg1Mzg

Greening of the Games

The Beijing Olympic Village earns praise for its LEED Certification in the article below from Occupational Health and Safety.  I have had the pleasure of recently connecting with Karla Bell, the initial visionary behind "greening" the Olympic Games, starting with her work on the Sydney Australia games in 1994.  Sydney was indeed the first Green Games though the LEED standard had not yet been developed.  I am thrilled to be featuring an interview with Karla, who continues to be an eco-poineer most recently founding CarbonFlow, which develops and markets software for carbon market participants,  in an upcoming GreenSuite post. -- JW

Beijing Olympic Village Earns a Gold

August 18, 2008

Some 17,000 athletes in Beijing for the 2008 Olympic Games are making their temporary home at a first-of-its-kind, environmentally friendly Olympic Village. Today, the U.S. Green Building Council (USGBC) announced that the plan for the village has won Gold--that is, a LEED®-Gold certification under USGBC's pilot LEED for Neighborhood Development certification program.

The Beijing Olympic Village is the first Olympic Village to receive LEED certification, and as part of the pilot program, it is one of only eight developments--and the first international project--to thus far achieve certification under LEED for Neighborhood Development, a program that began with a call for pilot projects in early 2007. Nearly 240 projects from 39 states and six countries are now registered to participate in the pilot. USGBC says the information learned during the pilot program will be used to make further revisions to the rating system and certification process, and the resulting draft rating system will be posted for public comment before it is submitted for final approvals and balloting. For more information on LEED for Neighborhood Development, visit www.usgbc.org/leed/nd.

"The world's most pressing issues--including climate change, habitat destruction, water and energy shortages, human health, and social inequities--require global cooperation to solve," says Rick Fedrizzi, USGBC president, CEO, and founding chair. "The Olympic Games represent the exciting possibilities that emerge when the world comes together. The commitment of the Olympic Village, demonstrated through its success in the LEED for Neighborhood Development pilot program, is an important part of that effort. It sets an inspiring example while the world is watching, and the real, measurable environmental and health effects will be a real benefit to the people of Beijing for years to come."

The Neighborhood Development program--a collaboration among USGBC, the Congress for the New Urbanism, and the Natural Resources Defense Council--certifies neighborhoods for their design and performance in four categories: Smart Location & Linkage, Neighborhood Pattern & Design, Green Construction & Technology, and Innovation & Design Process. The Green Construction & Technology category awards developments for their integration of green infrastructure elements and the green building principles promoted by the other LEED certification programs. Depending on the number of points a development receives in each category, LEED for Neighborhood Development certification is awarded at four levels: Certified, Silver, Gold, and Platinum.

In 2004, the U.S. Department of Energy and China's Ministry of Science and Technology developed a "Protocol for Cooperation in Clean Energy Technologies for the 2008 Summer Olympic Games in Beijing." The protocol resulted in plans to seek LEED certification for the Olympic Village--a goal now achieved. USGBC says the village's Gold certification is the latest example of the council's commitment to engaging the people of China in USGBC's vision of buildings and communities that regenerate and sustain the health and vitality of all life within a generation. Most recently, USGBC has supported the formation of the new China Green Building Council and anticipates working with the China GBC as it grows and continues to promote sustainable, healthy building practices in a country that builds nearly half the world’s new buildings every year.

"China's growing population, its emerging economy, and the opportunities and challenges it represents ensure that China will play a key role in the future of our planet," Fedrizzi said. "The fact that one of the world's first LEED for Neighborhood Development-certified plans is a cause for great optimism that China's growth in the coming years can be a model of sustainable development."

SF LEED Based Building Requirements Signed By Newsom

Monday, August 4, 2008 - 11:55 AM PDT

S.F. Mayor Newsom signs green building legislation

San Francisco Business TimesMayor Gavin Newsom today signed what's being touted as the "nation's most aggressive green building legislation" requiring all new and renovated office buildings to meet minimum green standards by 2009 and the highest green standards by 2010.

The Mayor signed the legislation following a tour of the newly renovated Matarozzi/Pelsinger Builders headquarters at 355 Eleventh St. in the city's South of Market neighborhood. That building is the first to receive priority permitting for green building. Under that program, projects seeking the highest rank of Leadership in Environmental Design -- or LEED Gold -- certification get "front of line" privileges during the building permit application review.

Matarozzi/Pelsinger renovated the building for its headquarters and will occupy the second floor and half of the first floor. A restaurant is planned for the remainder of the first floor. Gast Architects will occupy additional space in the building.

The building required significant structural upgrades to make it earthquake-safe. And the roof of the building will include 30-kw solar panel system and a "living roof" or garden. The building was designed to make use of natural air ventilation including operable windows. Other green accoutrements include bamboo flooring, radiant heating floors, bicycle parking, and dedicated parking spots for alternative-fuel vehicles.