Image courtesy Pacific Northwest National Laboratory, pnl.gov

commercial building efficiency.jpg [3]

This week, Los Angeles, a member of the C40 Cities Climate Leadership Group [4], announced a new program that will help the city’s commercial building owners cut energy use and thus reduce the greenhouse gas (GHG) emissions that are contributing to global warming and climate change.

The C40 [5] is a worldwide organization created in 2005 and currently chaired by New York City Mayor Michael R. Bloomberg. Guided by a 10-member steering committee comprised of the mayors of other C40 cities, the organization aims to institute and support local (citywide) measures that increase regional sustainability as a way of addressing climate change on a global scale.

Los Angeles, one of 58 global cities acting in cooperation under the C40 umbrella to address issues presented by climate change, is joined by the Clinton Climate Initiative [6] Cities Program [7], which is fully integrated into the C40.

Called the LA Commercial Building Performance Partnership [8], the program brings together a group of energy-affiliated organizations (the California Energy Commission [9], Los Angeles County, the Los Angeles Department of Water & Power (LADWP [10]), and So Cal Gas [11], plus numerous building industry expert groups and commercial banks) to provide a funding mechanism that makes the program as individual as a fingerprint and enables it to promote building energy efficiency by, among other measures, offering free energy audits.

This funding is made available from PACE [12] via a new bond issue structure, with some additional funding (for energy assessments and loan reserve funds) stemming from the stimulus, aka The American Recovery and Reinvestment Act of 2009.  

PACE, or Property Assessed Clean Energy, is a program that provides the money for energy efficiency and renewable energy installations for homeowners and small businesses via municipal tax levies against a property that can be paid back over time as a portion of property taxes. The advantage of PACE financing is that it eliminates the huge upfront costs of replacing all a home’s windows or installing a solar hot water heater, for example.  

The Clinton Climate Initiative, or CCI, operates under the umbrella of the William J. Clinton Foundation [7]. As created under the former president, the Initiative incorporates a Cities Program Services that functions in both an advisory and project financing capacity, as well as offering access to business and government partners similarly engaged in climate action.  

The LA program [13] will begin with 12 million free energy audits as the opening sally in a battle to retrofit 20 to 30 million square feet of Los Angeles commercial real estate. As an adjunct, the program also anticipates creating jobs, and notes that, for each $1 billion spent on energy efficiency, 7,700 jobs come into being.

In fact, participants stated, adoption of similar measure in other U.S. cities could “make a huge impact on urban greenhouse gas emissions.”

In LA, as in many large cities, commercial buildings represent the largest source of energy consumption. The LA figure is 57 percent, which is higher than the national average [14] of 46.2 percent. This latter figure, which represents more than 18 percent of total U.S. energy consumption, has grown by 74 percent since 1980, and represents the three biggest commercial energy uses: heating, cooling and lighting.

And, while fuel sources have become cleaner -- that is, less laden with those GHGs -- the overall increase in energy use is troubling. For example, in 1980, coal-fired generation accounted for 1.1 percent of the total (with renewables at a meager 0.2 percent). By 2011, coal is expected to account for 0.3 percent, while renewables jump to 0.8 percent. But total consumption will have risen by 78 percent, essentially negating the cleaner energy sourcing.  

The LA program will not only help commercial building owners increase their building’s energy (and water) efficiency, but will reduce costs to tenants and give a major push to the local economy, not merely in creating jobs but by extending the workforce in existing companies in the same vertical as efficiency goals are met.

The financing for these projects will be offered at competitive rates, with up to 100-percent funding available. As part of the Energy Upgrade California [15] program, this initiative takes the extra step to reducing energy use and emissions in “green” California. As part of the Obama Administration’s Better Buildings Challenge [16], the program also hopes to spark private sector investment to ensure that America’s commercial buildings are 20 percent more efficient over the next ten years.