Listening To Retail: ICSC's Take On Energy Efficiency

In an earlier post, I criticized the International Council of Shopping Centers (ICSC) for a letter sent to their members critical of the National Energy Efficiency Code provisions (Section 201) of the Waxman-Markey Bill (a summary of those provisions is available here). 

Yesterday,  I had the opportunity to speak to Kent Jeffreys, Staff Vice President in the Office of Global Public Policy of ICSC about their position on Waxman-Markey and the future of retail energy efficiency. Here are selections from our conversation:

GBLB: You were critical of the Waxman-Markey National Energy Efficiency Code proposal.  Why? 

KJ: One of the problems with the overall bill is that it is one size fits all when it comes to energy efficiency. For example, how do you measure the energy efficiency of a mixed use facility? Different code standards apply, and energy consumption is determined by tenant mix—a Best Buy and grocery store are different from a yoga studio and a shoe store. Waxman-Markey's adherence to the measuring stick being the building creates problems for shopping centers.

The bottom line is that the commercial building sector would like to see the same consideration that the utilities had—their deadlines were pushed off until 2020. There are a few facts that stand in the way of rapid adoption of a stringent new code. For example, many states don’t have energy codes at all. Other states have adopted different levels of ASHRAE. Waxman Markey refers to 2004 as the baseline. Then it says exceed 30% by 2010—which is tomorrow when it comes to new building construction. It is aggressive. We think it will be be problematic.

There are ways to achieve it. Talking to the technical folks, some are already exceeding ASHRAE by 20% or more. This requires certain design changes. If you start taking out windows, you can add more insulation. Most folks can move forward at 30%, we just don’t think they can do it by 2010. It is a bit unrealistic.

That is why we encouraged our members to talk to their members of congress about how they are increasing the energy efficiency. In the real world, we cannot make them all adopt cutting edge technology. The real world problems that we run into—if they have not been totally focused on energy efficiency, they are going to get a rude awakening if the bill passes in its current form.

The second step in the Waxmna-Markey Section 201, 50% by 2015, we actually don’t know how to do. You would have to change what ASHRAE addresses in order to calculate 50%, including operations, for example. 2015 is actually not that far away. At the very end, the coal burning utilities pushed their deadlines back by arguing technologically and economically that they couldn’t meet it.

These goals were picked in terms of political effectiveness, not technological. In the House, they were unwilling to even talk to us. Therefore, we couldn’t support the overall bill.

GBLB: What efforts did you make to try to work out these issues?

KJ: I went and met with people with folks from Wal-Mart, Target, developers, and let the staffers ask questions. The letter we sent out to our members was intended to inform about the fact that this will change the way they do business. Member of congress don’t know how this will impact their local communities. If you make it impossible for retailers to keep up with the times, in some communities it means jobs are not created, new projects and major renovations will not happen. I don’t really know the ramifications for the nation, but right now, no one is building anything because you can’t borrow money. We did not conduct a study to figure out how much 30-50% energy efficiency would cost—NAIOP figured out it would take 20 year payback. Then you have to figure out how you are financing it. We want members of congress to consider this. Right or wrong, the members of congress did take into consideration the cost for utilities.

There are things we support in the bill, like the REEP program. We tried to make this program more comprehensive.

GBLB: How would you suggest regulating your industry to create more energy efficiency?

KJ: The 40% “responsible” for GHG emissions by buildings—there is an underlying assumption that reduction by buildings lead to a 1 to 1 reduction of emissions. Direct emissions from commercial buildings is more like 4% than 40%. The initial responsibility means that we should be able reduce emissions by that much which is not realistic.

Until we address the generation issue—buildings are not the source of emissions—focusing on buildings is a false hope. If you look at California, the typical shopping center is more energy efficient, because of that experience, developers are adopting those procedures nationwide. But it’s going to take time. If 201 goes into effect, there will be no effect on overall GHG emissions. It will be swamped by other factors.

We would be happy to work with congress on a natioanl net metering standard, there is a patchwork of regulations right now. This would have very direct impact on reducing energy use—if there were economic incentives.

GBLB: What about the part of your letter which criticizes Waxman-Markey on the basis of creating additional code bureaucracy--"there is no trained inspection force to oversee a national building code, so it will require the federal government to retrain state employees and, no doubt, hire a huge number of new inspectors"? 

KJ: I think it is a critical flaw that congress passes a law and leave it to the states to implement. The states are strangled—they can’t run deficit spending. I don’t think that the federal government’s grant to the states for training and enforcement is sufficient. If the federal government thinks that the states will be able to enforce this code by 2010, with this amount of funding, they are sadly mistaken. Some states are really good and others are incompetent. You can’t say it is an anti-government notion—you have got to provide the resources to the states to get this done. The answer is for Congress to slow down and reconsider what it has done, or if you are going to pass the bill as written, give the states more money.

What if the states think implementing energy efficiency evaluation is too hard? Then they may say everybody passes and you get no increase in energy efficiency.  You need standards which are realistic and can be enforced and implemented by the public. 

Say It With Me Now--"GREENBASHING"

By now, everyone has heard of "greenwashing"--a term used to describe the practice of companies disingenuously spinning their products and policies as environmentally friendly.  The new wave of anti-environmental action is more devious, and potentially more destructive.  I choose to term it "greenbashing." 

What is greenbashing? The use of seemingly reasonable arguments about catastrophic costs or unforeseen dangers to undermine progressive environmental programs.  There have been lots of examples of greenbashing lately.  Here are a few choice examples:

1.  Green roofs may spontaneously combust.  In challenging Toronto's recent mandatory green roof by-law, Don Marks, executive director of the Ontario Industrial Roofing Contractors Association, warns that

“I don’t believe that the insurance industry has caught up with the increased risk of fire that may result from improperly maintained green roofs...”

According to engineer Rob Diemer, partner with AKF Engineering, this threat does not comport with reality:

This is a new technology and the codes, insurance companies, underwriters and testing agencies are just now catching up. From what I have seen, we should see code language and testing protocols dealing with wind uplift and fire hazard for green roofing in the near future. In the mean time I think the fire hazards are minimal and depend a lot on the type of roof and plants used.


On an extensive roof using shallow, lightweight, mineral based growing medium and sedum plants, there is probably little or no fire hazard. Even if the plants should die due to a prolonged drought, the fuel load of the dead plants is minimal and it is likely that any fire would rapidly consume the plants and die out before damaging the building structure. Intensive roofs using deeper growing medium and larger plants may provide a larger potential fuel base; however, most of these roofs need to be irrigated which would tend to mitigate the fire hazard due to drought induced plant death. As with all things in life there are no guarantees; however, it would appear that the potential fire hazard of green roofs is more than outweighed by the many positive benefits they provide.

2. A national energy efficiency code will catastrophically increase housing prices.  The National Association of Home Builders issued a press release on June 29 regarding the national energy efficiency provisions of Waxman-Markey that Chris Cheatham and I discussed here in our Green Building Guide to Waxman-Markey.  According to the NAHB, requiring increased energy efficiency will have catastrophic effects on affordable housing:

The market is not geared up to supply the necessary materials and equipment, and that's going to drive up costs. The result will be fewer working-class families in these new energy-efficient homes. They'll be relegated to older, less efficient housing stock and face ever higher utility bills.

In addition, a national energy efficiency code would apparently impede regional sustainability considerations: 

Usurping states' rights to determine appropriate building efficiency for homes and buildings within their jurisdiction would result in ineffective application of efficiency standards to address varying climate zones and specific needs, he added.

The reality of the situation is, of course, that builders benefit from lack of regulation. Currently,  thirteen states have no statewide commercial building codes, and fourteen states have no statewide residential building code.  A national energy efficiency building code would impose regulations where none existed before, or more stringent regulations in jurisdictions with lagging codes.  The result might be higher costs of construction--but of course lower cost of ownership of homes in the long term.  

3.  A National Energy Efficiency building code will require huge new federal bureaucracy.  Our friends over at Sullivan Kreiss  reprinted a letter that the International Council of Shopping Centers sent to its members warning of the dangers of a national energy efficiency building code: 

The cost and complexity of this federal takeover of state and local building codes forced ICSC to oppose the overall bill. The specific efficiency targets are too aggressive and the deadlines are too short. In addition, there is no trained inspection force to oversee a national building code, so it will require the federal government to retrain state employees and, no doubt, hire a huge number of new inspectors. Supporters of this new federal program simply refused to negotiate or compromise on the language. As a result, ICSC does not support this provision.

Of course, the way that Section 201 is written, building codes will be drafted and implemented by code councils and the states/local governments in the same way they are now, unless those entities fail to develop codes that meet the Waxman-Markey efficiency standards.  Also, the ICSC letter fails to identify how retraining code official in energy efficiency and creating additional green jobs enforcing an energy efficiency code would be a bad thing.  

Greenbashing would be a rational approach to protect vested interests if there was vested interest to protect.  However, according to the Census Bureau, new housing starts in May were down over 45% from 2008 and shopping centers are being decimated as well.  Instead, these groups could embrace sustainable programs to create new demand for their products, and to help the climate crisis which will effect us all.