The Growing Importance of Green Construction
For the past 10 years sustainable building initiatives, or “green building’’ programs, have grown at a blistering pace. In 2008, Engineering News-Record’s Top 100 Green Contractors generated $38.69 billion in revenue from green projects, a 70% increase over 2007’s numbers. As more projects go green, contractors need to develop capabilities to remain competitive.
Sustainable buildings generally result from a design, construction and operations approach that focuses on efficient use of resources—energy, water and materials—while reducing impacts on human health and the environment.
In 1998 the U.S. Green Building Council created the Leadership in Energy and Environmental Design green building rating system, which today serves as the defacto standard for sustainable buildings. By evaluating the design, construction and operation of newly constructed or renovated buildings, LEED promotes integrated, whole-building design practices while establishing common standards of measurement.
LEED certification falls into four categories based on points: LEED certified (26 to 32 points), LEED silver (33 to 38 points), LEED gold (39 to 51 points), and LEED platinum (52 or more points). A platinum-rated building is considered one of the most efficiently performing buildings.
For those interested in examples of green standards, the Federal Green Construction Guide for Specifiers developed by the Environmental Protection Agency, the Federal Environmental Executive and the Whole Building Design, provides a great resource. It addresses environmental aspects in support of the federal government’s green mandates and related programs. Available at wbdg.org/design/greenspec.php, it does not include complete specifications and is intended to supplement other models.
Private owners, state and local governments are increasingly adopting green construction standards for projects. The federal government is also getting involved with green construction in a big way. This is important to contractors and designers as a major market opportunity because the federal government owns about 445,000 buildings with total floor space of over 3 billion sq ft. Additionally the government leases 57,000 buildings comprising another 374 million sq ft of floor space, with much of this acquired under lease–to-build arrangements.
In 2007, President Bush signed an Executive Order to set goals in renewable and efficienct ennergy, acquisition, toxin reductions, recycling, sustainable buildings, electronics stewardship, fleets and water conservation for federal agencies. In October, President Obama signed an Executive Order setting numerous green requirements for the federal government.
The ARRA authorizes the General Services Administration to invest and award over the next two years $5.5 billion to transform federal facilities into high-performance green buildings. GSA’s project list includes dozens of Texas federal buildings, including $116 million earmarked for the Austin U.S. Courthouse and $109 million for the Leland Federal Building in Houston. These projects are intended to improve energy efficiency, conserve resources over the long-term, provide models of high-performance green design and reduce costly operating leases.
While designers generally have the most input in establishing green requirements, green construction is a great opportunity for contractors. There are 69 total LEED points and prerequisites. Contractors directly affect achievement of at least one of the prerequisites and 27 other points. A good LEED-qualified contractor can add significant value to a project by helping the team achieve LEED certification goals.
The green movement is developing its own set of legal concerns. Interestingly, section 2(h) of EO 13514 (Obama’s exectuive order) contains no mention of a rating system such as LEED. Most federal agencies require LEED certification; GSA requires its projects achieve LEED-silver certification. Some, however, have expressed concern over potential antitrust challenges to LEED rating based on previous challenges of “private standard setting associations” and codes when such a code could limit competition for products or services.
Examine contract provisions that identify the required LEED certification level and that define the party responsible for administering the LEED certification process. Does the contract clearly address applicable specifications and performance requirements and identify any damages associated with failing to obtain the required LEED certification?
Check with insurers about products for professional liability and general liability that take into account the “green’’ nature of a project.