Supply and Demand
The tremendous energy needs of the building sector give it great leverage for driving demand for green electricity.
U.S. buildings account for almost 50 percent of energy use and more than 75 percent of electricity use, including energy used for construction and building material. This large appetite for energy gives green buildings huge potential as a driver for increased renewable-energy investment—on the building itself (mainly using photovoltaics), through the purchase of renewable energy credits (RECs), and by using green electricity from renewable energy facilities such as wind turbines, that are not at the building site.
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The LEED rating system encourages investment in renewable-energy generation by offering a credit for projects that have a two-year contract to purchase Green-e Energy-certified power directly or via renewable-energy credits. Longer-term contracts have substantially greater impact in actually driving new renewable-energy investments, which typically require 10 to 15 year financing. In addition, Green-e certification specifies power from new renewables, defined as those built since 1997.
The new book Greening Our Built World models the renewable-energy impact of a national shift to green design and finds that greening buildings could drive over 100 gigawatts (GW) of new renewable-energy installations by 2050, about $200 billion of renewable- energy capital investment, equal to nearly 10 percent of our entire generation capacity today. But for this potential to be achieved, the current LEED language has to be updated to require additional and longer-term renewable-energy commitments.
The Energy and Atmosphere Technical Advisory Group for LEED (EA-TAG) recently reviewed these LEED credits, and recommended two changes.
1 Qualifying renewable-energy projects must have been brought online on or after January 1, 2005, instead of 1997.
2 Lengthen the required term of the purchase from two to five years so that renewable-energy power purchase contracts would be long enough to effectively drive new renewable-energy investments.
The intent of these proposed changes is to ensure that green electricity and REC purchases provide a much stronger driver for new renewable-energy investments. These changes can be accommodated by Green-e Energy, the REC program that provides a verification function for green-power purchases. There would also need to be some minor changes made to LEED and to Green-e Energy verification procedures in order to authenticate a building’s five-year purchase commitments.
These changes should be fully adopted by the USGBC in 2010. They would create an effective and strong driver for developing new renewable energy. This would strengthen the brand value of LEED, increase U.S. employment and competitiveness, cut CO2 and other air and water pollutants, and accelerate the greening of our built world.
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