Thursday, January 14, 2010

Calgreen, take me away

California issued stringent building regulations for new commercial and residential construction today, the San Francisco Chronicle reports.  Christened "Calgreen", the program seeks to integrate green construction practices into the building code, a vital undertaking in a state that seeks a 33% renewable energy requirement for its utilities and a 80% reduction in its overall greenhouse gas emissions by 2050.  California appears to recognize the enormous challenge it faces, and is rightly undertaking aggressive early action by pulling as many policy levers as possible to build out an infrastructure that accomodates human needs and market trends, while also curtailing energy and other natural resource demands.  The name of the game is "sustainability" and California is proving to be a leading player.

There a number of remarkable aspects to this story.  Calgreen continues the state's long-standing environmental leadership that has achieved memorable milestones such as special treatment for state environmental standards under the Federal Clean Air Act, and the state's remarkable constraint of per capita energy consumption since the 1970s--during a period when house have increased by 50% in size, and air conditioning has become almost universally wide-spread. The program draws broad-based support from government, realty, construction and consumer groups.  And, quoting the Chronicle, "[i]ndustry officials said that it would increase construction costs only slightly.' (ed: Emphasis added.)

While Calgreen seems to be that elusive beast on the Savannah of government regulation--a program that garners public-private support and doesn't raise costs--one Lion was conspicuously absent from the broader roar of support.  The US Green Building Counsel--sponsors of the nation's de facto green building standard, LEED (Leadership in Energy and Environmental Design)--not only demurred, but actually oppose the new standards.  USGBC claims that Calgreen will lead to "confusion", implying that a standard which, for the first time codifies a state-level mandate for green building, is somehow a bad thing. Setting aside for a moment the question of whether such confusion would actually result (and if it did, whether that is too high a price to pay for a program that makes great and measureable strides against GHG emissions), it is probably instructive to peel back the PR veneer of USGBC's opposition in order to ask: is it possible that there exists any other motitivation?

In doing so, it is important to note that the Counsel generates huge revenues from its de facto monopoly on green building certification: builders pay large fees for certification review and ratification, while building and design professionals (over 20,000 member companies and over 100,000 indvidual members at current count) engage in testing, training and certification themselves, on a pay-to-play basis.  The USGBC is thuse a multi-million dollar enterprise, and it recognizes Calgreen for what it is: competition.

Why is Calgreen a threat to the USGBC franchise?  If a builder has to meet a standard that either exceeds or is not materially different from that established by the USGBC, where is the incentive to seek LEED status as a Silver, Gold or Platinum building--and to pay the very susbstantial fees required to earn such certification?  Worse yet, what happens when California's standards spread eastward, making the USGBC effectively obsolete in other states?

For developers and other environmental professionals, Calgreen is a welcome first step on a longer road of emancipation from that started out with promise, but eventually created the same results that most monopolies do--unncessarily high costs, limited choices and inefficient execution.  Calgreen proves California is serious about the question of Global Warming.  Sadly, and as COP 15 proved, great challenges remain to a coordinated effort among nations.  In most cases, sovereign resistance boils down to economics.  The situation today in California appears to be a microcosm of that global intransigence.  While the state has clearly staked out ground to support the greater good, special interests seek to undermine these efforts, grubbing selfishly for dollars instead of solutions.

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