America's Most Convenient Bank Goes Green

Frank Sherman, U.S. Green Officer at TD Bank sat down with GBLB to discuss TD Bank's announcement that it would be carbon neutral

GBLB:  What is the motivation behind TD Bank's green initiative? 

Frank Sherman: Lack of Federal leadership leaves it up to private enterprise. Right now, the private sector is going to have to pull us through in the short term.  Our green initiative is work we have been focusing on for a year and a half internally. The driver stems from TD Bank Financial Group in Toronto. Their senior leadership made the decision to become carbon neutral as a company. Their initial commitment early last year or late 2008 was to become carbon neutral by end of October of 2010. The US has follwed suit, and because the timing for the creation of TD Bank NA (the combination of Commerce Bank and Bank North) we were running a few steps behind.

GBLB: Were there any roadblocks to becoming carbon neutral? 

Frank Sherman:  We started analyzing the carbon neutral commitment over the past year, right at the time there was a lot of stress in the financial institutions. We had to look at "What is the impact this has on the company?" It made us try to really understand the company to figure out what can be achieved, to take action based on what we have done rather than just promises. It is as much a commitment going forward. We are fully aware that there is a lot we can continually do to improve, but you have to stake your claim and people can hold you accountable and we can hold ourselves accountable.

GBLB: What is TD Bank going to do going forward?

Frank Sherman: We are not doing anything now that is too far outside the norm for progressive corporations. We are making commitments to reduce carbon outputs. Given the trajectory we are on now, first and foremost is to reduce our carbon footprint and buying renewable energy credits and supporting renewable energy in US and Canada, and lastly to invest in carbon offsets.

We understand that we will always be judged by NGOs as not doing enough. It is not always useful to have a conversation when people think two different things. We accept the fact that others choose to go father or define environmental impacts differently. As we grow as a responsible corporate citizen, that is not to say we won’t take responsibility for secondary emissions. But, one step at a time was our way of approaching this.

GBLB:  What sustainable projects are you looking into as an investment for TD Bank?

Frank Sherman:  We are exploring how to balance the economics of buying carbon in quantity with investing in projects that effect our carbon footprints. For example, we bought a block of offsets from RGGI, we have balanced that with one landfill gas capture projects in New Jersey and a waste incineration project in Florida, both in areas where we do business. We are considering getting involved in projects protecting forests. We are looking at a potential carbon sequestration project in Pennsylvania. I look at carbon offsets as an investment project. We are looking to avoid emissions, and the investments we have made are ideally placed in the places where we do business.

We offset 203 million KwH, or 203,000 RECs. We purchased 31,000 metric tons of carbon offsets. That is based our 2008 greenhouse gas inventory. Our 2008 emissions equalled 121,000 metric tons of GHG emissions.

We measured our GHG emissions based on direct emissions of fossil fuels, electricity, fleet vehicles, fossil fuel impact of biz travel, leased space. We used a similar approach based on scope of emission we can control.

GBLB:  What are you doing in terms of green building? 

Frank Sherman: We identified green building as one way of addressing some of our sustainable goals right out of the gate. We began to thign about high performing green buildings as we started the process of reimaging our brand as America’s most convenient bank. We are doing all of our new branches green—but 2010 is a transition year with some in the pipeline. By the end of 2010 and going into 2011 we will be building green buildings almost exclusively.


Getting To Yes, Maybe--A Response From Jennifer Simon

Jennifer Simon practices environmental law at Obermayer Rebmann Maxwell & Hippel, LLP. She focuses her practice on alternative energy project development, permitting, and O&M with an especial emphasis on offshore renewable energy projects. She maintains a blog on offshore renewable energy at

Yesterday, Shari suggested that Obama’s “last ditch effort” to enact a watered-down energy/climate bill is just not worth the effort. As Pennsylvanians, Shari and I both live in a state that has identified “clean coal” resources (like coal gasification) as renewable resources, so we know a thing or two about ineffectual climate policy. Given Pennsylvania’s apparently futile approach to climate change, I am not surprised that Shari is uncomfortable with President Obama’s proposed energy/climate bill. However, I would suggest that this bill could provide the foundation upon which a comprehensive legislative solution could be built.

Congress has been dithering around with potential climate legislation for more than half a decade while various government entities have questioned whether climate change science is accurate, whether regulations can be effected under current statutory schemes (e.g., the Clean Air Act), and whether the costs of regulation outweigh the benefits of saving life on planet earth. Meanwhile, emissions from energy generators, buildings, and mobile sources continue to rise and the predictions of dire consequences attributable to climate change continue to become direr and more imminent.

In the late 1970s, scientists announced that the dangerous thinning of the earth’s atmospheric ozone layer was due to anthropogenic causes, legislators and regulators were equally paralyzed by competing interests and apathy. But in 1978, EPA took an affirmative—if not remotely comprehensive—step by banning aerosol chlorofluorocarbons (“CFCs”). As social consciousness and international pressure increased, this initial regulatory ban on aerosol CFCs ultimately led to the U.S. signing and ratifying the 1987 Montreal Protocol—a far reaching and comprehensive international treaty which will likely yield statistically significant improvement over the next 50 years.

Climate change, like ozone depletion—or healthcare for that matter—is a hot button issue where legislative consensus is a near impossibility. But we need to start somewhere, don`t we?

Getting To Yes, Maybe

According to EENews, the Obama administration is trying a last  ditch effort to get a hybrid energy/climate bill passed:

President Obama is striving for consensus on a path forward that can deliver substantial greenhouse gas emissions reductions and satisfy concerns in the Senate about energy security. In an address to the nation's top CEOs at a Business Roundtable meeting scheduled for Wednesday, Obama is expected to discuss his energy plans. According to several sources, one of the proposals under discussion is to find ways to incentivize coal-burning power plants to switch to cleaner-burning natural gas.

Economywide cap and trade or carbon tax? Maybe not.  More nuclear, probably and more "clean coal" investment, almost assuredly.  So why pass this watered down, milquetoast version of a climate and energy bill?  

There are times in lawyer's lives when they must adopt a different hat--after all the risk identifying and negotiating and hand wringing is over, there must be a signature on the dotted line.  A lawyer must advise their client that the deal is as good as its going to get, that the settlement is worth the risk.  Because no one can predict the future, there is no absolute guarantee that the deal that is struck in advance of events is as good as what could happen if events are allowed to unfold and decisions are made based on actual events.  But dealmaking has value--it allows parties to have security and allows disparate parties to come to terms that are acceptable to all, if ideal for none. 

But I wonder if this is that deal.  Let's say Obama inks this settlement, shepherded on the Republican side by Senator Lindsey Graham.  The question must be--Will the environment really benefit, not Did We Get Something Passed.  Doing something is not always better than sticking to your guns and fighting on.  The best lawyers--and politicians--know when the deal is as good as it's going to get.  I don't think we're there yet.

What would you do to make your home more energy efficient for $57,000?

A study out of the Government Accountability Office (GAO) reports:

As of 31 December 2009, according to data available to the Department of Energy, about 9,100 homes had been weatherized out of a planned 593,000

The pricetag for weatherizing 9,100 homes? Over $57,000 per home. 

According to the Home Energy Saver website, sponsored in part by the Department of Energy and Environmental Protection Agency, the average cost of the top 10 home energy upgrades is just $3,960, a difference of over $46,000 per home. 

Part of me doesn't care. According to Keynesian thinking, just spending stimulus money and fast, it doesn't matter how, is key to stoking the economy.  But there is part of me which envisions the thousands of additional homes which could have been weatherized had the government been more efficient in its spending. 

Stinky Situations--The Corrosive Case Of Waterless Urinals

I have previously posted about the hazards of ossified building codes when confronted with new green technologies.  Waterless urinals appear to showcase this issue dramatically.  Last week, Chicago's city government announced that it was ripping out the waterless urinals installed in City Hall.

The problem is that Chicago's building code requires commercial buildings to use copper pipes in indoor plumbing. But the U.S. Army Corps of Engineers specifically states that drainpipes for waterless urinals "cannot be made of copper pipe, which corrodes."

This has led to a stinky situation--"with the corrosion causing urine to build up in the wall behind the men's room."

Building codes are not the only issue which has plagued waterless urinal installation.  According to the Philadelphia Business Journal, in Philadelphia's Comcast Center,

Philadelphia's Plumbers Union Local 690 did not want to install the waterless urinals because it would have required the laborers to do less work, according to published reports. As part of the compromise, the two sides have proposed that Liberty and city officials monitor performance of the urinals.

The compromise that was reached was that the Union installed piping in the walls that would allow for conversion to flush urinals if there are problems with the waterless ones.

When new technology meets old infrastructure--be it copper piping or entrenched union interests--the results can be...stinky.  In addition to the stench, who pays for removing the urinals and converting to ordinary fixtures? What happens if removing the waterless fixtures makes a building lose its LEED status?  Who is at fault for causing the waterless fixtures to fail? The installers? The architect? The owner/user? 

The Renewable Energy Tax Code Wilderness--Production, Investment and Grants OH MY!

I will make an admission.  I took tax in law school, and, it was the academic equivalent of having my left arm sawed off without anaesthesia.  Why? Mostly because things which should have been clear seemed hopelessly obscure.  Now I deal with advising clients on incentives available for sustainable projects, and the tax code and I have had to battle to a stalemate.  At least, I battle, and the tax code just sits there impentarably.

One of the features which is particularly difficicult is the relationship between 26 USC 45, which deals with tax credits for producing renewable energy (the "production tax credit" or PTC), 26 USC 48 which deals with tax credits for investing in renewable energy equipement (the "investment tax credit" or ITC) and the Renewable Energy Grant created by the ARRA.  All three of these relate to businesses which have installed renewable energy technologies, like solar, wind and geothermal.  It should be clear and easy to understand which ones apply to your business and what the incentive will be.  As with all things related to the tax code, however, it is not.

I am going to attempt to clear up some of the obscurity, but, as with all information on this blog, it is for informational purposes only, not legal advice; and you should consult your legal and financial advisor to provide you with proper advice for your business.

Title Applies to Amount of Incentive
Production Tax Credit
  •  Wind
  • Biomass
  • Geothermal
  • Solar
  • Small Irrigation
  • Municipal solid waste
  • Hydropower
  • Marine and Hydrokinetic
 1.5 cents per kW of power generated at a qualified facility for the 10 years beginning on the date the facility was placed in service AND sold to an unrelated person during the taxable year
Investment Tax Credit
  •  Solar for heating, cooling, hot water, illumination or solar process heat
  • Fuel cell
  • Microturbine
  • Geothermal
  • Combined heat and power (cogeneration)
  • Small wind
  • Ground water thermal
 30% of the cost of the "energy property" for solar and small wind, 10% for geothermal and other renewable sources
Renewable Energy Grant  Applicable property under Section 45 or 48  10% or 30% of the basis of the property, depending on the type of property placed in service during 2009 or 2010 or after 2010 if construction began on the property during 2009 or 2010 and the property is placed in service by a certain date known as the credit termination date

The incentives are mutually exclusive--The PTC and the ITC cannot both be taken, and they can be swapped for the REG, but you cannot take the PTC/ITC and the REG.

In plain english, it appears that the PTC is designed for renewable energy sources where the power is designed to be sold to others as a Renewable Energy Credit, and the ITC is designed for renewable energy sources where the power is used on-site.  The Renewable Energy Grant allows companies which have invested in either type of renewable energy capacity to receive cash, as opposed to a tax credit, which is helpful particularly if the company has no tax liability or a tax loss. 

 There are some resources available to help you sort through this morass.  The DSIRE database has quick summaries of available state and federal incentives.  The Utah Clean Energy site has a nice summary of the renewable energy features of the ARRA.   The DOE site has a useful summary of renewable energy incentives for businesses as well.

Will The Separation Of Powers Kill Climate Change Action? Call In the Green Deal Coalition

I promised a post on Obama's State of The Union, but in mulling over my response to the speech and several other events which have occurred in the days that followed, I realized that the issue which needs to be addressed is the degree to which the separation of powers between the executive and legislative branches of the government of the United States will serve to delay or derail real regulatory action on climate change (and green building), even where a strong executive seeks to pursue these goals.

The only hope is for Republican and Democratic senators concerned about climate change to form a coalition with the Obama administration.  This will require pressure from a new New Deal coalition--a "Green Deal" coalition of citizens, corporations concerned about the impact of climate change on their businesses, unions seeking new clean energy and green construction jobs, minorities seeking access to the middle class and political machines seeking a big win. If these factions can align behind climate change regulation, real legislative progress is possible.

Our government is one of limited, separated powers.  The Executive Branch has only three real avenues of power--administrative, diplomatic and rhetorical.

Over the past few months, the Obama administration has been using the administrative tools within the delegation of executive power to boost climate change regulation.  On December 7, 2009, The EPA made an endangerment finding with respect to greenhouse gases. On January 7, 2010, the SEC issued guidelines regarding corporate disclosure of climate change risk.  On October 5, 2009, Obama issued an Executive Order requiring all federal agencies to assess their environmental impact, and setting aggressive green building requirements for federal facilities, followed on January 29, 2010 with an announcement pledging  to reduce the federal government's greenhouse gas pollution by 28 percent by 2020. 

Obama also used his diplomatic authority to forge an international accord at Copenhagen, however limited.  All 55 countries, responsible for more than two-thirds of global greenhouse gas emissions, submitted plans to curb their impacts as of 1/31/10.  

Finally, using his rhetorical power, in Obama's State of The Union, he tied investments in clean energy to economic growth, and encouraged the Senate to pass a clean energy bill:

Next, we need to encourage American innovation. Last year, we made the largest investment in basic research funding in history -– (applause) -- an investment that could lead to the world's cheapest solar cells or treatment that kills cancer cells but leaves healthy ones untouched. And no area is more ripe for such innovation than energy. You can see the results of last year's investments in clean energy -– in the North Carolina company that will create 1,200 jobs nationwide helping to make advanced batteries; or in the California business that will put a thousand people to work making solar panels.

But to create more of these clean energy jobs, we need more production, more efficiency, more incentives. And that means building a new generation of safe, clean nuclear power plants in this country. (Applause.) It means making tough decisions about opening new offshore areas for oil and gas development. (Applause.) It means continued investment in advanced biofuels and clean coal technologies. (Applause.) And, yes, it means passing a comprehensive energy and climate bill with incentives that will finally make clean energy the profitable kind of energy in America. (Applause.)

I am grateful to the House for passing such a bill last year. (Applause.) And this year I'm eager to help advance the bipartisan effort in the Senate. (Applause.)

I know there have been questions about whether we can afford such changes in a tough economy. I know that there are those who disagree with the overwhelming scientific evidence on climate change. But here's the thing -- even if you doubt the evidence, providing incentives for energy-efficiency and clean energy are the right thing to do for our future -– because the nation that leads the clean energy economy will be the nation that leads the global economy. And America must be that nation. (Applause.)

In short, Obama is doing everything within his delegation of authority to enhance climate change regulation.  But, at the end of the day, the President cannot make laws.  He cannot force corporations or citizens or even states to undertake major changes to their actions which would be necessary to make dramatic reductions in greenhouse gas emissions.  He cannot withhold federal funds from states that fail to regulate or curb their own greenhouse gas emissions.  Those powers remain exclusively with Congress.  Only Congress can cap greenhouse gas emissions. Only Congress can tax greenhouse gas emissions.  Only Congress can enact a national enegy efficiency building code, or compel states through withholding funds to update their building codes to promote green building and energy efficient practices. 

In a system of separated powers, significant social change requires cooperation among the branches of government. So, with the partisan bickering in Washington and the recent election of a Republican senator in Massachusetts, the chances of significant progress on climate change regulation have decreased.  Only the Green Deal coalition can save us.