ENR 2019 Top 100 Green Building Contractors and Design Firms: Sustainability Intensifies
Sustainable design and construction used to be fairly straightforward. Design firms and contractors would take the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) standards, work with the owner on what level of LEED certification it was willing to aim for, and complete the checklist to meet it. But with the proliferation of standards, more state and local requirements and growing sophistication of owners about what they want or need, the industry is now faced with a more daunting task to ensure work is sustainable.
The growing appetite for sustainable structures can be seen in the results of the 2019 ENR Top Green Building survey. As a group, the Top 100 Green Design Firms generated $6.77 billion in 2018 design revenue from projects registered with and actively seeking certification from third-party ratings groups under objective sustainable-design standards, such as the USGBC’s LEED standards. The total is a 9% increase from $6.21 billion in 2017.
Among contractors, the sustainable market also did well. The Top 100 generated $68.61 billion in 2018 contracting revenue from projects actively seeking green certification, up 10.5% for the group, from $62.11 billion reported for 2017.
The numbers are up, but there has been a major shift in sustainable construction over the past few years. When LEED v4 was first proposed in 2012, there was widespread criticism about how tough the new standard would be to comply with, and the provisions about chemicals of concern to user health caused a firestorm among chemical suppliers.
Once LEED v4 was released, many owners asked if there were alternative sustainability standards. This gave a boost to such standards as GreenGlobes, Passive House and other general green building standards. It also gave impetus to more specialized standards, such as WELL Building and Fitwel for healthy buildings, Envision for infrastructure and ParkSmart for parking facilities. Tougher standards also emerged to propel sustainable building to new levels, such as the Living Building Challenge. With owners, architects, engineers and contractors now having a vast array of choices to design and build sustainably, LEED no longer is the only game in town.
USGBC has not been quiet on the criticism of LEED v4. This past year, it unveiled LEED version 4.1, which addresses several aspects in LEED v4 that needed refinement, and debuted LEED Net Zero, for net-zero energy, water and waste.
“The thresholds for rainwater management, daylighting and acoustics were modified to be more realistic and achievable,” says Greg Mella, corporate director of sustainability for SmithGroup. He notes that the Building Product Disclosure and Optimization credits were overhauled, providing teams with more direction on referenced standards and outlining compliance paths that are more realistic.
For many in the industry, LEED v4.1 clarifies some credit requirements while streamlining the documentation efforts. “It focuses on greenhouse gas reductions as a key metric of performance and allows for greater versatility in sourcing renewable energy. The revisions to the materials credits provide much needed flexibility in documenting performance,” says Scott Beckman, PCL’s director of sustainability.
Many firms have seen little change in the use of LEED since the introduction of LEED v4. “Our clients generally demand proof of their sustainability investments, and LEED provides a great measuring stick,” says Kjell Anderson, director of sustainable design at LMN Architects. He says there was a rush to register under v3, but “we haven’t seen a drop off in our portfolio now that v4 is out.”
Some firms are beginning to see LEED v4 as the new normal. “I don’t think LEED v4 is a problem. There are a lot of new builders who don’t know anything but LEED v4,” says Ryan Poole, DPR project and sustainability manager. He says many firms are looking beyond LEED v4 to the new LEED Net Zero standard, which he says is gaining traction.
However, there are many firms that believe LEED has lost some steam. “I think that LEED v4.1 has helped adjust some of the missteps of v4, but in general there is not a lot of momentum behind LEED anymore,” says Ellen Mitchell-Kozack, director of sustainability at HKS. In many places, codes are outpacing it, and it has lost its significance as the leading edge of sustainable design, she says.
With the increase in sustainable-design certification programs available to teams, clients have options beyond LEED. “As such, the cachet once associated with obtaining LEED certification may have been diluted,” says Mella. Client interest in sustainable design has steadily grown from year to year, but interest in pursuing full LEED certification seems to have waned slightly, he says.
From an energy perspective, codes like the 2015 International Energy Conservation Code and now the 2018 IECC are “in many ways a more important driver than LEED certification,” says Josh Radoff, senior vice president, built ecology, at WSP. He also notes that under v4, “there appears to be more of a willingness to achieve Silver [rating], since getting to Gold and Platinum is significantly more challenging than it was under v3.”
One of the most controversial elements of LEED v4, and one of the most difficult to qualify for, is the requirement for building product disclosure and optimization of material ingredients. This has led to a scramble among building product manufacturers to identify and disclose the contents of their products. It also has caused consternation among designers and contractors around identifying and recording materials and equipment used in a project that comply with LEED v4’s material content requirements.
Many designers say this has put added pressure on how they specify. “LEED v4’s rigor with materials puts more onus on the design team to specify compliant products, which has required more time as we understand more thoroughly the environmental attributes of our specifications,” says Anderson of LMN Architects.
Difficulties in gathering and assessing material content have led many firms to create their own tools or databases to assess LEED v4 compliance. ZGF Architects has established the ZGF Green Dot program that “screens products in our materials library against important industry standards to streamline selection of healthier materials for every project,” says Ted Hyman, managing partner.
DPR Construction is another firm that has developed its own sustainable product database, but has taken it one step farther. “Our data gives not just the carbon impact on how the products are produced, but also tracks how much energy is expended on transporting them to the project site,” says Poole.
Many firms are beginning to collaborate to create group databases or analytical tools. LMN has helped organize the local Healthy Materials Collaborative, gathering architects and spec writers to understand the new product transparency landscape, says Anderson. “We have a no-vinyl policy where we specify products where no vinyl is present, working with our clients and vendors to satisfy cost quality and durability concerns,” he says.
Another collaborative effort is the Embodied Carbon in Construction Calculator (EC3) by the Carbon Leadership Forum. EC3 is a business-driven tool that helps stakeholders easily understand the embodied carbon of the structures they build and facilitates more informed decision-making when sourcing materials to reduce the impact of that embodied carbon.
Webcor has partnered with the Forum to develop the tool, says Jenelle Shapiro, Webcor’s senior sustainability manager. “We see EC3 as a tool for our clients and ourselves to make more informed decisions by evaluating the carbon impact of multiple options,” she says.
NBBJ is currently beta testing EC3 on major project work, including the global headquarters for Microsoft in Redmond, Wash., says Peter Alspach, director of design performance. “The open source platform has been developed by the University of Washington in collaboration with many industry partners like Skanska. This tool changes the game,” he says.
Another issue, particularly for contractors, is ensuring their suppliers and subcontractors understand and comply with LEED v4 product content requirements. “Anytime you raise the bar, as LEED v4 does, it requires you to work with your trade partners to make sure they understand your needs. It also requires more conversations with our trade partners than we used to have,” says Julia Gisewite, director of sustainability for Turner Construction.
Many firms believe that LEED v4 has set a new agenda for sustainability by focusing on embodied carbon inherent in the construction process. “The inclusion of Life Cycle Assessment is a major step in bringing the concept of embodied carbon into the mainstream design and construction community,” says Greg Kight, director of sustainability at Jacobs. “Awarding up to three LEED points to the Building Life-Cycle Impact Reduction credit sends a signal to the project teams pursuing certification and the industry.”
Growing awareness of the urgency of embodied carbon is a significant issue for construction. While sustainability standards have focused on improving operational performance for the last two or three decades, building products constitute only about half of many buildings’ carbon footprint, emitted bit by bit over a structure’s life. “Embodied carbon, from the extraction, manufacture, transportation and erection of building materials, is emitted before the doors open,” says Beth Heider, Skanska USA chief sustainability officer. “That is a major problem that can be addressed immediately.”
Embodied carbon also has become a concern for clients, “especially for large corporate clients that have carbon reporting commitments, as well as for public municipal clients,” says Jessie Buckmaster, sustainability manager at Hathaway Dinwiddie Construction Co. “During preconstruction, we are being asked to evaluate structural material options to achieve the lowest carbon footprint, such as CLT mass timber, which we are using on several projects, and to explore ways to reduce emissions through concrete mix designs and other building products.”
Many firms have developed tools to monitor and address energy usage and embodied carbon during the construction process. Job Site Insights (JSI) is PCL’s in-house developed cloud-based smart construction platform (ENR 10/22/18 p. 87) that saves project costs while reducing environmental impact, says sustainability director Beckman.
He gives an example from a recent mixed-use tower project that was equipped with JSI sensors. The platform enabled the team to adjust the typical 24-hour heater usage, a standard in construction during cold winter months, and turn heaters off for parts of the day. This reduced natural gas heater usage by 46% and reduced electrical heater usage by 58%. “That’s the equivalent energy of more than 130,000 gallons of gasoline for one year,” he says.
While LEED remains the dominant standard to measure sustainability, owners increasingly are looking at other standards that fit their priorities. “Clients are getting more sophisticated with their approaches to sustainability. Where LEED was once the universally accepted standard, building owners have begun prioritizing their needs by pursuing other specialized standards related to net-zero energy, carbon or human health and wellness,” says Beckman.
The market is far more educated than it was previously, with building owners and tenants having a far clearer understanding of what a sustainable design solution is. “Gone are the days when merely slapping some solar panels on the roof or erecting a green wall are considered sustainable design. The focus is now about resiliency and wellness,” says Alastair MacGregor, AECOM vice president and high performance building engineering leader.
One area of interest among owners is providing a healthy environment for tenants. Many firms say that clients want to show that their facilities are healthy places to work, using that fact as a draw to recruit new employees. “We are seeing an increase in the number of double certifications in buildings, usually under LEED and the WELL Building standard or LEED and Fitwel,” says Gisewite of Turner.
Major employers see health and wellness in the workplace as important to their bottom line. “With the cost of recruiting and the demand for talent so high, firms are willing to invest in health and wellness like never before. We have 22 projects ongoing that are either WELL Building certified or in process to be certified,” says Steven Straus, of Tetra Tech’s high performance buildings group.
Healthy building standards are often an easier sell to owners than more general sustainability standards, says Mella of SmithGroup. Sustainable design had traditionally focused its outcomes on environmental health, but to some, the relationship between buildings and environmental health was seen as indirect, benefitting future generations. The focus on health and wellness is more direct, with benefits that impact today’s building occupants’ productivity and well-being. “As such, it is an easier value to promote.”
Generally, the clients Hathaway Dinwiddie works with still require sustainable design and construction or LEED certifications, says Buckmaster, but now “are adding other project certifications to layer into their sustainability strategy.” This includes WELL, Fitwel, LBC and internally developed zero waste and materials goals.
However, there are often significant costs associated with health-related standards. “We saw great interest a few years ago, but the WELL and Fitwel systems are still not mainstream,” says Anderson of LMN Architects. “WELL in particular has a daunting price tag due to the system’s rigor.” The firm is pursuing Fitwel along with LEED platinum on its new project at the University of California-San Diego, he notes.
Net Zero Gaining
For many in the industry, net-zero energy is no longer pie-in-the-sky. Poole says net-zero energy and water are moving out of the demonstration phase and beginning to go mainstream. “The cost of photovoltaic (PV) cells have come down, making net-zero energy a realistic option,” he says. However, Poole says their use becomes more problematic in some urban areas where there is not enough space for a PV array to provide energy for a large building.
ZGF is another firm finding a lot of work on net- zero energy projects. “Some leading-edge projects are going beyond, targeting net-zero performance and/or the Living Building Challenge,” says Hyman. “ZGF has multiple projects using the Living Building Challenge’s Red List to specify materials with no known human carcinogen, a task that is surprisingly and distressingly difficult in the industry.”
Many firms see increased interest in net-zero energy. “We anticipate an increase in clients seeking the LEED Zero Energy certification, which requires any or all of the following: net-zero carbon emissions, net-zero energy use, net-zero waste and/or net-zero water use per the USGBC guidelines,” says Mark A. Winslow, project executive for environmental solutions at Gilbane Building Co.
One of the most interesting challenges facing industry firms, Hyman contends, is the “inversion” of energy generation costs over the next few years. With the mismatch between peak demand loads from 3 p.m. to 7 p.m. and peak PV generation earlier in the day, the challenge will be providing renewable power in the evening, he says. “That will remain a challenge until battery power scales up sufficiently to provide power without the reliance of carbon-generated energy when solar power is not available.”
This is becoming an issue in California, where there is a revolution to eliminate all nonrenewable energy sources. “Recently, peak-time-of-day energy billing in California shifted from 1-4 p.m. to 5-8 p.m., largely because of the significant amount of photovoltaics installed at workplaces throughout the state,” says Straus of Tetra Tech.
While energy saving buildings are becoming ubiquitous and the possibility of net-zero energy as the baseline for building codes is getting more plausible by the month, net-zero water goals are more elusive. “The ability to convince clients to include graywater systems for irrigation, toilet flushing, etc., remains a challenge unless municipal systems are readily available,” says Hyman. “Blackwater treatment systems, such as living machines, continue to be cost prohibitive for most projects, and many jurisdictions will not allow treated water to be reintroduced into domestic water supply unless it can be tested daily—an impossibility except in the largest scale treatment facilities.”
With the variety of ways projects can certify their buildings as sustainable—LEED, WELL, Fitwel, Passive House, Living Building Challenge, Net Zero—and issues concerning energy use, air tightness, health and wellness, and resilience, “contractors can no longer slide by with simply understanding LEED requirements and managing their subcontractors’ material purchasing documentation,” says Steven Burke, sustainability manager at Consigli Building Group.