Green Building Industry To Prosper With New Initiatives
February 15-28, 2011
California's Charge Toward Energy Efficiency Aims to Spur Job Growth
Long Beach Business Journal, Going Green Section, February 15-28, 2011
Homeowners looking to upgrade their properties with energy-efficient improvements can breathe a sigh of relief as new initiatives in California are expected to offset the cuts made to federal tax credits this year.
The tax bill passed by Congress slashed residential energy credits, now covering 10 percent instead of 30 percent of improvement costs and reducing maximum cumulative credit from $1,500 to $500. But contractors, investors and government officials in California anticipate energy-efficient upgrades to become more streamlined and affordable this year with new rebate programs and financial incentives expected to continue the push toward new jobs in the green building industry.
One such initiative is called Energy Upgrade California, to be rolled out as early as this month. As an alliance of California counties, cities, non-profit organizations, government agencies and utility companies, the program provides new rebates for cost effective improvements such as insulation, low-flow water-saving devices and heating-and-cooling systems.
"California's doing something a little bit different here," said Wes Harding, president and owner of Harding Construction & Sustainable Solutions in Long Beach. "We're going way beyond what the federal tax incentives ever were in terms of what the utilities and what the California initiative is trying to offer through this rebate program. It really should hopefully get some people back to work."
The unprecedented program provides homeowners with rebate amounts based on the percentage of increased efficiency to the home, which most aren't even aware of, said Harding, a BPI-certified home performance specialist, who helps homeowners navigate rebates and currently teaches a sustainable building course at California State University, Long Beach. Depending on the depth of the energy retrofit, California homeowners have the choice of following a prescriptive path for a $1,000 rebate and the possibility of up to $4,500 in rebates, requiring a certified contractor to facilitate the process.
While the program is still being worked out, the initiative totals $304 million in available funding for rebates statewide, paid for by a combination of state and federal grants, with the entire funding cycle lasting until 2013, according to Melinda Barrett, spokesperson for Los Angeles County's Office of Sustainability. The program plans to retrofit 28,000 single-family homes and 2,000 multi-family homes, equivalent to removing 36,287 metric tons of greenhouse gases. Harding said most L.A. homes were built prior to modern energy efficiency standards and are inefficient and outdated, leaking heat and gas.
A majority of the rebates are being administered through the state's investor-owned utility companies, which include Pacific Gas & Electric, Southern California Edison, Southern California Gas Company and San Diego Gas Company, in addition to publicly owned utilities, according to Barrett. Additional rebates are being offered through the state's various counties.
For homeowners in Los Angeles County, the program caps at $70 million with $35 million going to utility companies and the other half going to the county. The program works so that the utilities offer rebates of up to $4,500 while the county offers an additional $500 rebate for projects that get more than 20 percent in reduction in energy use, Barrett said. "It's intended to help homeowners save money, offsetting the initial up-front cost of doing this work and to create jobs and stimulate the contracting industry," she said.
Harding added that a majority of companies that would benefit from the added business would be construction and remodeling contractors in addition to general contractors, energy auditors and administrators. But, regardless of being more environmentally conscious, most homeowners would be attracted to the aspect of saving money alone, he added. "To some people [it] might be a touchy subject, but who doesn't want lower utility bills?" Harding said. "I think California in general in our own little micro climate it feels like there's been a change, and people are out there to do something and remodel and they do want to go green if they can."
The new program also aims to reduce confusion by streamlining the multitude of rebate offerings, financing programs, available contractors and other resources into one Web site at www.energyupgradecalifornia.org, expected to be fully operational sometime this month, Barrett said. "The beauty of the statewide program is that everybody's going to be using the same branding and the same Web site," she said. "Folks can go to that site, put in their address or their zip code and find out exactly what's available to them locally. The state will also have sort of a clearing house of all the kinds of financing available for these kinds of upgrades."
While financial incentives aim to continue energy retrofits, some homeowners are going even further with remodeling or rebuilding. Greg Morse, for instance, a Naples resident and local business owner, decided to deconstruct his entire 1938 home and is rebuilding it with state-of-the-art energy efficient features. He said his home now would use 50 to 70 percent less water than the average house, and eliminates his electricity bill after installing solar panels, lasting for the next 100 years. "It was important for me to think about the long term," he said. "My goal was to build a home that wouldn't use energy over its life time."
In addition, Morse recycled materials from the deconstruction, which were mostly made of redwood, that were made into doors. Long Beach currently requires through its new building code that any new substantial construction project recycle at least 60 percent of materials.
Some of the energy efficient features Morse is adding include having his entire home run on electricity only and eliminating the need for gas, by installing electric stoves, ovens, dryers and water heaters. For many upgrades he was able to benefit from local, state and federal tax rebates, he said. Having his main source of power from solar panels allows him to have what he calls a "net zero energy house," where it produces more energy than it consumes.
Another key feature was to be able to conserve water, so he installed a grey water system using a separate set of pipes that collects water from showers and wash basins to irrigate the outside of his home.
While states with more extreme weather would have more of a financial case for major energy efficient upgrades than in California's temperate climate, using less water and eliminating his electricity bill increases the resale value of the home, in addition to helping the effort to conserve water in California where there's a water shortage. Plus, adding the features now rather than later pays off in the end, Morse said.
Jeff Jeannette, owner of Jeannette Architects based in Belmont Heights, who designed Morse's rebuild project along with other green projects and remodels in the area, said there's a lot that can be done in rebuilding a home that won't necessarily add costs such as utilizing daylight with skylights and the placement of windows.
In addition, more residents are choosing more environmentally safe standards in construction, such as using low volatile organic compound (VOC) paints and materials, low-emitting carpets and formaldehyde-free dry wall.
"The green movement itself has changed the way people think about their home, that's for sure," he said. "All in all, conservation really needs to start with the people and owners that inhabit the homes."
Certified Green Building
As part of the Energy Upgrade California program, homeowners are also afforded the option of getting their home certified green. The program offers a $600 rebate toward green point-rated existing home certification, administered by Oakland-based Build-It-Green, a non-profit created in 2003 that created a rating system for homes with the credibility of being upgraded to a high standard with third party verification.
Tenaya Asan, program manager for Build-It-Green, said the organization was designed to primarily focus on providing a green rating system for the residential sector while Leadership in Energy and Environmental Design (LEED), developed by the non-profit U.S. Green Building Council, focuses more on commercial buildings. The program services new and existing single-family and multi-family homes.
She said the organization already has more than 15,000 homes either certified or in preparation for assessment. "It provides a credible entry point and goes up from there," Asan said. "We wanted to transform the whole industry."
For new homes, Asan said the organization is developing a climate calculator to provide quantified benefits for those homes that have qualified for green-point rated in terms of energy saved water and green house gas emissions. The tool would help builders conform to California Environmental Quality Act (CEQA) entitlements for large projects, she said.