LEED® (Leadership in Energy and Environmental Design), the brainchild of the U.S. Green Building Council, is an acronym that even the man on the street recognizes these days. He’s not entirely sure what the four letters stand for but does know that it has something to do with “green,” that there’s something good about it.
But while LEED undoubtedly is making inroads on the PR front, how is the green building-ratings system really faring in the construction marketplace these days, especially in view of the prolonged economic and construction downturn we are still suffering?
The answer is: pretty well, actually. In fact, on March 27, the USGBC announced that the 12,000th commercial project had earned LEED certification.
In the announcement, Rick Fedrizzi, president, CEO and founding chairman of the USGBC, went on to say, “Twelve years after the first 12 projects earned LEED certification, the green building community has reached a significant milestone. The momentum for green buildings is rippling around the globe, enhancing the built environment for generations to come.
“This milestone is made even more relevant as it is happening as the final comments are being collected on LEED 2012, the next iteration of continuous improvement of the LEED program,” continued Fedrizzi. “With these next changes, LEED will continue in its role as a catalyst for transformation of the built environment to ever higher standards of sustainable practice. Even in these challenging times, it’s clear that green building is a movement whose time is now.”
The to-be-expected PR prose aside, this is a significant milestone, underscored by the fact that today more than 45,000 projects are participating in the commercial and institutional LEED rating systems, comprising 8.4 billion square feet of construction space in all 50 states and in 120 countries. In addition, more than 19,000 residential units have been certified under the LEED for Homes rating system, with more than 76,500 more homes registered.
LEED and Downturn
“We actually see green building as a bright spot in the market,” says Ashley Katz, communications manager at USGBC. “Even though construction has slowed, LEED projects have maintained their share of the market. We have noticed, though, more certifications of renovated and retrofitted buildings, paralleling what’s going on in the industry.”
Lee Zaretzky, president of Ronsco, Inc. in New York, concurs: “I don’t think the economic downturn has impacted LEED projects. The added cost of building green is not prohibitive, and if an owner or operator wants to set out on a LEED certification project, the current economic climate is not going to sway him one way or another.”
“The downturn has slowed new commercial construction,” says Russell Unger, executive director of USGBC’s New York Chapter. “I have seen the sheer number of LEED projects decline along with that, but proportionately, I see LEED maintaining its share of the market.
“Owners who decide to build to LEED do that for strategic reasons. It is a long-term market view, and they are not going to change their minds based on the general construction market.”
“My observation is that LEED certifications are still increasing,” says Chris Mundell, an architect with HKS in Texas. “But LEED for existing buildings now outpaces LEED for new construction.”
LEED Drivers
Who drives a LEED certification project? Is it the owner, the building manager, the architect, the tenant or the contractor?
“I believe it is the end user who drives such projects,” offers Zaretzky. “Of course, architects have a say, too, those who want to educate their clients to build more energy efficient buildings. But in the end, it is the end user who stands to reap the benefits from LEED in lower utility costs and also from the PR value of going green.
“And they are also the ones to reap the great benefit of building higher-quality indoor environments that will not only attract good-quality personnel but will also retain them longer.”
“At this stage of the game,” says Katz, “it’s actually all of the above. When we first set out, these projects were driven by engineers and architects who wanted to see more efficient equipment and buildings.
“A little later, the tenants—seeing reduced operating costs—became the main drivers, in turn influencing the owners. Today, though, everyone is onboard. It has become a common goal now, shared by all involved.”
Charles Antone, a consultant with R.J. Kenney Associates, Inc. in Massachusetts, offers this observation: “It starts with the owner pushing the architect, although sometimes it is the other way around.”
“Another strong driving force was, and still is, the government,” adds Unger. “They were early implementers of building more energy efficient buildings.”
Mundell comes down on the side of the owners: “Some owners insist on building green for the right reasons, others for marketing purposes. But it’s driven by the owners.”
Levi Patterson, an architect with DLR Group in Oregon, adds, “In my experience, it’s all of the above. I’ve seen projects where the architectural team has pushed it; I’ve seen projects where the owners have pushed it.
“Of course, there have also been projects where we have pushed for LEED certification that the owners successfully resisted—it’s their money after all.”
Dave DeHorn, chief estimator at Brady Company in Los Angeles, says, “In my experience, it’s the architect who dictates the LEED level of a building, either as the driver or in carrying out the owner’s wishes.”
LEED ROI
Most owners are businessmen first and foremost and, as such, take a decidedly bottom-line view on most projects: Return on investment will always play a pivotal role in any building decision, whether green or conventional.
With 12,000 commercial projects now certified, we must assume that owners have seen significant return on their investments, or we would never have reached such a number. The question is: Where do they realize their ROI?
Says Zaretzky, “A tenant’s ROI is greatly improved by higher productivity and lower employee turnover. I believe that investment in LEED is one that that pays back in HR savings. Let’s say that LEED certification adds 5 percent to the project cost. Those 5 percent will be earned back with massive interest in very short order from the HR side.”
“These days, a new green building need not cost more than a conventional building,” says Katz. “Today, due to demand, many manufacturers have greened most, if not all, of their product lines, which in turn has lowered the cost. In fact, it may soon be that you’ll only be able to buy green drywall. You’ll build greener, whether you intend to or not.
“That said, when it comes to ROI, I agree that greener, healthier buildings increase productivity, drive down healthcare costs and make for fewer sick days. All evidence points to this, and this will obviously pay you back handsomely.”
Mundell adds, “While a better indoor environment obviously will save you money in the long run, this is not as easily documented as are energy savings. When it comes to utilities, you simply compare bills. When it comes to a soft return like increased productivity, this is harder to document and is still not embraced by owners. Owners are still swayed mainly by savings in energy costs.
“I would say, though, that a better indoor environment would have the largest impact on hospitals, where employees normally work 12-hour shifts. When you spend such long sustained periods in a place, the quality of your environment takes on a whole new significance.”
Patterson comes down on the side of indoor environmental quality. “Our firm has a fair amount of experience in school design,” he says, “and we have learned that better access to daylight, an outdoor view and good acoustics improve student test scores.
“Of course, the absence of VOCs and mold, another aspect of indoor environmental quality, helps too.”
The problem with soft savings, like employee productivity, is that they—unlike utility bills—can be hard to wrestle to the ground and can be open to interpretation. Still, while the energy savings on a LEED certified project can be significant, the HR savings can be greater still, by magnitudes.
Consider this: A corporate tenant rents a floor of a downtown high-rise. What are his operational costs per square foot?
Utilities will run him between $7 and $10 per square foot, rent might run him $20 to $100, but employee salaries will run him $100 to $400 per square foot.
At these rates, even if you reduce employee absenteeism only slightly, and improve his energy level (with ample daylight, proper heating/cooling and proper lighting) for even a small productivity gain, the tenant will soon see a significant return on his “green” investment.
In a paper written by William J. Fisk of the Indoor Environment Department, Environmental Energy Technologies Division, at Lawrence Berkeley National Laboratory, Berkeley, Calif., entitled, “Health and Productivity Gains from Better Indoor Environments and Their Relationship with Building Energy Efficiency,” he drew the following conclusions:
There is relatively strong evidence that characteristics of buildings and indoor environments significantly influence the occurrence of communicable respiratory illness, allergy and asthma symptoms, sick building symptoms, and worker performance.
Theoretical and limited empirical evidence indicate that existing technologies and procedures can improve indoor environments in a manner that increases health and productivity.
Existing data and knowledge allows only crude estimates of the magnitudes of productivity gains that may be obtained by providing better indoor environments; however, the projected gains are very large.
The potential savings and productivity gains are larger than the total estimated cost of energy used in buildings.
That said, it is up to the owners concerned to realize and attempt to quantify the potential return on investment from increased employee productivity and reduced absenteeism.
The return is there for the reaping.
LEED and IECC
One would expect LEED and the International Energy Conservation Code, sharing so many energy-efficiency goals, to be joined at the hip, and in many respects they are.
As Zaretzky sees it, “It strikes me that LEED and the evolving IECC specs are converging to create a new normal.”
Confirms Katz, “We share a mission, that’s for sure. In fact, we have been working with IECC for quite some time now.”
“Thirty years from now,” suggests Antone, “we will not have green buildings and conventional buildings. There will only be buildings, all green.”
Mundell sees a convergence as well: “I think that the more important code going forward will be IgCC (the International Green Construction Code), which will address more than just energy. Both codes are important, of course, but the problem still is that not all building types are the same. Hospitals, for example, use a lot more energy than office buildings. That’s where the IgCC will have a better fit.”
The 2012 IECC codes, which have now been ratified and rolled out, though not yet adopted by all states and localities, aim to increase energy efficiency by 30 percent over those specified by the 2006 IECC code. A 2015 iteration of the IECC code aims to increase the energy efficiency over the 2006 version by an almost hard-to-grasp 50 percent.
Bottom line: USGBC and IECC are indeed on the same mission.
Which begs the question: Thirty years from now, if there are no green buildings, only buildings, will there still be a USGBC and a LEED ratings system around?
Says Katz, “We often joke that we will get to a point where USGBC and LEED become obsolete, when there is no difference between buildings and green buildings.
“That said, I don’t think we’ll ever get there—perfection is very hard, if not impossible, to attain. There will always be room to raise the bar. And that will be our ongoing mission, to raise the bar, to make buildings an even deeper shade of green.”
“I think LEED and IECC will eventually converge,” says Zaretzky. “So I think that LEED’s future looks bright. And going forward, LEED will not only affect contractors and how we construct buildings, it will also make manufacturers more conscious about what materials go to make up their products, and more focused on recycling and reduced carbon footprint.
“This way LEED—and the growing green awareness—will benefit more than just those who aim for LEED certification. It will also place greener products into the hands of the owners and builders who haven’t given LEED a second thought.”
On the Subject of Codes
Walter Scarborough, an independent Texas architect, offers this take on the future of LEED: “Today, building green, and LEED, is a movement that has gained firm traction in the architectural community, and what I predict will eventually happen is that LEED, or some other rating system—or the actions that they encourage and specify—will become the new norm. It will become part of future building codes and at that time we will have no further use or need for LEED.
“Of course—while we’re on the subject of codes—if this keeps up, if we continue to see more and more, and stronger and stronger codes, if more and more regulations continue to hit the books, we will reach a point where we’ll have so many rules and regulations that we can no longer afford to construct buildings that meet them all.
“This flood of codes is like the government that always promises to slim down but never does. Old codes are rarely dropped, while new ones are constantly added.
“Codes are also trying to regulate a safe worksite, but that’s like trying to outlaw poverty—no regulation is ever going to accomplish that. It’s down to us human beings and our ethics and responsibilities to see to it that the site is safe, and by the same token to see to it that we build energy efficient, sustainable buildings.”
Antone agrees, “LEED will eventually spell the new norm, while trying to make things greener still. Still, it comes down to the guy on the ground constructing the projects; it comes down to his or her capabilities. Truth is that we’re running out of good crafts people these days, so who is going to put up these extremely energy-efficient buildings?”
Suggests Unger, “I think that when the codes have made our new, and existing, buildings as green as they can be, LEED will still survive, but will then constitute an elite status. The top 10 percent of projects will go for LEED, the others will go for the code-specified net-zero carbon footprint.”
Patterson offers a different take: “There are other, perhaps better, initiatives out there, like Architecture 2030 that tracks and documents EUI (Energy Use Intensity).
“My view is that LEED was not intended to be the perfect design driver for sustainable construction, as it was not set up to change the way contractors construct buildings. Rather, its goal was to change the industry by making it aware of green and its impact. I think to some degree that LEED has already achieved this.”
LEED 2012 & Beyond
The next iteration of LEED is LEED 2012, which will be unveiled at the November Green Expo in San Francisco. USGBC is currently collecting feedback on the proposed codes to arrive at a final consensus.
According to Katz, “The upcoming LEED 2012 will provide additional focus on the long-term sustainability of buildings, including a stress on ongoing performance to ensure that buildings are indeed operated as designed for maximum efficiency.
“LEED 2012 expands into a long-term engagement tool, for long-term sustainability with programs aimed to benchmark and measure building performance past occupancy.”
As outlined on the USGBC site, the upcoming 2012 version of the LEED ratings system aims to achieve the following:
• Reverse contribution to global climate change.
• Enhance individual human health and well-being.
• Protect and restore water resources.
• Protect, enhance and restore biodiversity and ecosystem services.
• Promote sustainable and regenerative material resource cycles.
• Build a greener economy.
• Enhance social equity, environmental justice, community health and quality of life.
These are vitally important goals—not only for our industry but also for our planet—and seeing that the new version of LEED centers on them, there seems to be little doubt about where LEED is heading.
Coeur d’Alene, Idaho–based Ulf Wolf writes for the construction industry as Words & Images.
