The funds will come from the Energy Efficiency and Conservation Block Grant the city received from the Department of Energy last year as part of the broad federal stimulus package.

To qualify, among other things, you must contract with a Certified Energy Manager (Green Squared has these) to perform an energy audit (Green Squared does these) and make energy utilization recommendations for the office building and the minimum amount of work to qualify for this program is $100,000.

This announcement coincides with the comments that we relayed in August from Spanjian at the Clean Air Through Energy Efficiency Conference held in Austin.

It also jives with what Spanjian said in reference to slowing PACE progress in Texas.

Houston, the “Oil Capital of the World”, has a recently appointed Director of Sustainability, Laura Spanjian, and she told the Texas Tribune that her city was “not going to wait” for the PACE problems to get solved. “We have set aside funds to help commercial property owners with the upfront costs of energy efficiency improvements,” she said in an e-mail. “We’re going to find another model in the short-term while the issues with PACE are being worked out.”

Kudos to Ms. Spanjian on her aggressive approach.

Vice President Biden said, “The initiatives announced today are putting the Recovery Through Retrofit report’s recommendations into action – giving American families the tools they need to invest in home energy upgrades. Together, these programs will grow the home retrofit industry and help middle class families save money and energy.”

Now we need a working solution for building owners, whether it is PACE or something else.

Houston is #2 on the most likely to dry up list. San Antonio’s #4. Who’s #1?

Two recent reports, an October 2010 report by environmental research and sustainability group Ceres, and a July 2010 report from the National Resources Defense Council, each outlined some of the likely areas where water issues will likely have a major impact on life as its citizens know it.

The investor website, 24/7 Wall Street, then ran analysis of those reports and cross-referenced it the water supply and consumption in America’s 30 largest cities to identify potential conflicts in regions which might have disputed rights over large supplies of water and the battles that could arise from these disputes.

They then created a Top Ten list with the most acute exposure to problems which could cause large imbalances of water supply and demand.

10. Orlando, FL

The area has implemented extreme conservation measures, including aggressive water-rationing policies and lawn-watering bans. As of 2013, Orlando will no longer be able to increase the rate at which it uses water from the Floridan aquifer, the city’s main source of fresh water supply. It is estimated that water usage in the Orlando area will increase from 526 million gallons per day from 1995 to 866 million in 2020. On the city website, the mayor is quoted, saying: “Orlando Utilities Commission water usage trends show Orlando water demand exceeding the supply by approximately 2014 if no action is taken.”

9. Atlanta, GA

The crisis began when the Army Corps of Engineers released more than 20 billion gallons of water from Lake Lanier, the city’s primary source of water. The lake is the site of an ongoing legal conflict between Georgia, Alabama, and Florida, all of which rely on the reservoir for fresh water. Last year, a federal judge declared Atlanta’s withdrawals from the lake illegal, and if the ruling stands, the city will lose roughly 40% of its water supply by 2012.

8. Tuscon, AZ

6. Fort Worth, TX

As Fort Worth continues to grow, the amount of water demand has continued to exceed the amount of water available through local supply. The Tarrant Regional Water District is trying to bring in more water from Oklahoma’s Red River. Oklahoma, wishing to preserve its water sources, limits interstate water sales. Fort Worth has countered with a lawsuit, which is pending in the U.S. Court of Appeals.

5. San Francisco, CA

4. San Antonio, TX

The NRDC says that the area is at extremely high risk for water demand exceeding supply by 2050 if no major systematic changes are made. Legal battles over the Edwards Aquifier with surrounding areas, including Austin, TX, are ongoing.

3. Phoenix, AZ

2. Houston, TX

Throughout most of its history, the city of Houston primarily drew water from the Jasper Aquifer, located along the southeastern coast of Texas. Over the last 30 years, the city began to suffer from dramatic rises in sea level of nearly an inch a year. Geologists eventually realized that the cause was Houston’s withdrawal of fresh water from the aquifer located under the city. This discovery forced city officials to use nearby Lake Houston and Lake Conroe for municipal water instead of the aquifer. Since 2000, Houston has been the fifth-fastest-growing city in the country, and its presence in an area with high drought likelihood makes it an immediate risk for serious water shortages.

1. Los Angeles, CA

Great work by 24/7 Wall Street in putting this list together.

If there is any doubt about the severity of this issue, legendary investor T. Boone Pickens has been spending MILLIONS on water rights throughout the Southwest (note the overlap in the above list).

Now, what are we going to do about it?

Per the report, the following EEMs played important roles in reaching the 50% energy savings target:

• The baseline hydronic VAV system was replaced with radiant heated and cooled slab
ceilings with DOAS for ventilation.

• Total plug loads were reduced by 23% to 0.68 W/ft2 (7.3 W/m2) by purchasing high efficiency electronic equipment and employing control strategies to eliminate plug loads when equipment was not being used.

I like how they approached all of the major energy drivers: building envelope, HVAC, lights, AND PLUGLOAD. Plugloads are often ignored and are hidden consumers in buildings.

I may have missed the full payback calculations (it is, after all, 163 pages), but I sure what have liked to see them. They did provide a summary of paybacks which were somewhat disappointing:

Low-energy high-rise large office buildings featuring well integrated energy efficiency measures demonstrated simple payback periods of less than ten years; low-energy low-rise large office buildings had simple payback periods of between nine and 16 years; and low-energy high-rise large office buildings with high glazing
fraction and minimal insulation had simple payback periods of greater than 20 years.

USGBC’s certifications for LEED for Existing Buildings (LEED-EB) jumped sharply from less than 15% of all certifications in early 2008 to more than 35% in second-quarter 2010. At the same time, the proportion of LEED for New Construction (LEED-NC) awards has fallen from nearly 60% of all certifications in late 2008 to about 30% at midyear 2010.

I view that as a very positive sign in the green retrofit space, but it is also an indicator of the drastic slowdown in all new construction. It likely also has something to do with the rush in late 2008 to get grandfathered in under the “old” LEED NC rules, versus the new LEED NC 2009 rules.

The city of Houston announced a new initiative called the Green Office Challenge with the goal of getting property owners and managers across the city to reduce their energy consumption, water use and waste, as well as encourage more office tenants to do things like recycle, car pool and use eco-friendly products.

A key component of the initiative includes an energy-efficient loan program that would provide an incentive to those concerned about the costs of going green. Later this fall, the city plans to offer low-cost loans to property owners and tenants, providing the money goes to reducing their energy usage. This will be part of Houston’s answer to some of the issues surrounding PACE financing. (See earlier blog article titled, “Four Texas cities eye PACE program”)

“People like the idea of doing energy-efficiency improvements, but they still get nervous about that upfront capital,” said Laura Spanjian, the mayor’s director of sustainability.

The details of the program are not yet finalized but it sounds as though the city will have about $7 million to make energy-efficiency loans at less than 3%.

Other Houston Greening Facts:
No. 8 in the nation in the number of LEED-certified buildings with 89
No. 6 in the nation in the number of Energy Star-rated buildings with 133

For more Houston green facts, see our notes from the recent Clean Air Through Energy Efficiency where Spanjian spoke.

Here are some of the highlights:

+ The City of Houston itself uses almost 500 million kilowatt hours of green power annually, which accounts for a third of all its consumption.

+ Green is not just for a small group of companies these days. Many companies now have Chief Sustainability Officers. The list of companies that use 100 percent renewable energy is enormous and includes companies that are vital to the Houston and Texas business community like Kohl’s, Whole Foods, and Dell Computers, to name a few.

+ It is easy to be greener by installing aerators, low-flow showerheads, T-5 or T-8 lights, variable frequency drives, and automation systems that have very short paybacks.

Here’s a quick run-down of several energy-efficient projects cited in the article.

Projects at Fairmont Waterfront hotel include a heat-recovery system to preheat incoming city water using heat captured from the hotel’s water system. It saves an estimated 305,380 kilowatt-hours (1,100 GJ) per year and $12,000 per year. Estimated payback is in two years.

In a separate article, Fairmont set a corporate commitment to reduce its greenhouse gas (GHG) emissions by 20 percent from its 2006 levels by 2013.

One caveat: the survey was of only 48 people who are in charge of sustainability for their companies. I think that sample size is too small. And, given these folks’ role in the organization, I am afraid their viewpoint is a bit slanted so to speak. But there are lessons to be learned.

My takeaways included:

+ “The green workforce is the general workforce.” – they believed that sustainability would be integrated into existing roles and job descriptions as a prerequisite for employability: Jobs in the future, respondents thought, will require people to bring a certain basic level of familiarity with sustainability issues and competence in skills related to sustainability to the table.

Interesting. I’ve never heard it put quite that way, but I agree with the premise wholeheartedly.

+ “Sustainable products can be competitive – with the right marketplace approach.”

Thumbs up from me.

+ “Sustainability’s bottom-line results might be better if you broaden your view of ROI.” – But to improve its performance, a company needs to do more than reap an immediate financial ROI on its sustainability initiatives. It also needs to consider managing risk, building its brand and reputation, complying with regulatory requirements, and investing in developing future products and services that will be viable in a world where sustainability plays a greater role in driving buying decisions.

There are definitely qualitative benefits that should be considered that are difficult to incllude in your CFO’s spreadsheet.

+ Primary owner of sustainability efforts? COO was 6%, Head of Environmental Health and Safety 6%, Board of Directors 4%, CFO 2%, other = 91%.

Two things: 1) It’s odd that Deloitte did not list Chief Sustainability Officer as one of the options (they were part of the others), and 2) quite obviously the multiple people selected as an owner leads to a lack of accountability, which is not good for results.

+ There is a clear lack of understanding between these sustainability owners and the ARRA funds that are available to them.

That’s bad news for policy makers and even worse news for those heading up these sustainability efforts. I would have guessed the sustainability folks would have been more aggressive in understanding the grants, tax credits, tax deductions, and rebates that are available to them and their projects.

+ Energy efficiency was the across-the-board winner as the most important environmental issue to the business.

EE rated 9 on a scale from 1 to 10 in importance and was the leader in every business sector. Wow, that’s impressive and surprising at the same time. Efficiency does not get near the publicity as other answers like alternative energy and transportation. Someone has been listening and reading this blog.

David Roth of gbNYC (Green Building in NYC) nails it with “What happened at 375 Hudson is a smashing success, but it’s also really nothing more than a pretty down-the-middle retrofit done well. It’s tough to imagine a better advertisement for green commercial retrofits than that.”

Roth continues, “This is common-sense stuff, not a revolutionary leap forward. It’s low-flow fixtures and improving fixtures, not slapping on some solar panels and hoisting a wind turbine. It is, in short, a basic green retrofit — one that happens to grade very highly in terms of LEED points and the sort of building performance metrics Energy Star measures, but not one that would be beyond the reach of most Manhattan office buildings. Which, in a way, is what makes it most extraordinary.”

Now you see why I said I love this story.

From the official press release, here are the main items which earned the LEED GOLD:

+ reduced electricity consumption by nearly 110,000 kWh per year by making changes to the HVAC and mechanical systems and installing variable frequency drives on the cooling tower fans;
+ reduced steam consumption by improving heat exchangers and making other HVAC improvements that reduced heating demand;
+ reduced annual water consumption by 1 million gallons by replacing original restroom fixtures with low flow aerators and new water closets;
+ adopted an expanded recycling program that encompassed not only office paper and waste, but batteries, electronic waste and construction debris;
+ implemented a building-wide Green Cleaning policy focusing on improving air quality and ensuring the purchase of sustainable cleaning and janitorial paper supplies.

That’s as basic as it gets…Down the middle of the fairway stuff…things that every building should do, whether they want a LEED plaque or not.

Golf clap for Tishman Speyer and main tenants Saatchi & Saatchi, Penguin Group, and Turner Construction.