A Green Building Market Overview

2. Building Materials

Building materials comprise bricks, cement, drywall, carpets, furniture, wood flooring, windows, insulation, etc. Approximately 12 percent of the energy in the U.S. gets consumed in construction and preparing building materials, according to the DOE. The idea here is to produce products, like thermal windows, that reduce energy consumption, or cut the energy and natural resources used in manufacturing them.

Serious Materials – which specializes in drywall and windows – essentially kicked off what has become an expanding pool for startups. Some names to watch: Timber Holdings (wood); Integrity Block, Serious Materials and Arrx (concrete forms); Microposite (siding); Aspen Aerogels (insulation); Icynene (spray-foam insulation); Ecore and Lehigh Technologies (rubber); Sage Electrochromics and Photosolar (windows); and Enocean (creates kinetic power to replace wires). Element Partners, Navitas Capital and Foundation Capital have some of the more interesting portfolios.

Despite the interest, however, these companies face a daunting, uphill challenge. Contractors are notoriously conservative and cheap. If green building materials cost more, they won't adopt them.

Another challenge: getting out of development. Hycrete has incorporated its material into structures but many companies remain in the lab.

3. Hardware and Software

When asked at a recent event what his favorite green company was, Wired.com's Alexis Madrigal said it was Autodesk. Unusual, yes, but it makes sense the more you think about it. To reduce energy consumption or the fossil-fuel based materials in a product, you have to start with design. Simulation tools from Autodesk, Bentley Systems and others can examine a building's performance under various environmental conditions as well as gauge the effect of putting the ovens in a kitchen close to lobby air conditioning vents. A few companies in stealth mode are expected to soon unveil design applications for net zero energy homes.

The other big hardware and software market is in tools for managing heater/air conditioner HVAC, lighting systems, landscape sprinklers and other internal systems. Although heating/air conditioning systems have been linked to remote management systems produced by Johnson Controls and Honeywell for years, a new generation of tools from companies like Cimetrics and Tririga claim they can control thermostats more dynamically. Optimum Energy and EPS, meanwhile, specialize in controlling air conditioner chillers and industrial equipment, respectively.

Lighting is almost completely ignorant – only around 10 percent of lights are controlled on IT networks. Watch out for companies such as Adura Technologies, HID Laboratories and Lumenergi.

4. Appliances

Appliances are otherwise known as HVAC and lights. Lighting has been perhaps the most active market in terms of VC activity and for good reason: Light bulbs are the last major vestige of the vacuum tube era. The incandescent bulb celebrates its 130th anniversary this year. VCs put $86.5 million into lighting in 2007 and $185 million in 2008. Some notable companies: Renaissance Lighting BridgeLux, NiLA, Kaai, Soraa, Luminus Devices, Nuventix and D.Light  (LED lamps and components); Eden Park Illumination, Novaled and Ceelight (flat architectural lights); Luxim and Topanga (plasma lights); Vu1 (cathode lights); Lumiette (thin fluorescent); Energy Focus (interior fiber optics); and Sunlight Direct (piped sunlight).

There are also low-tech solutions. Kawneer, the architectural products group at Alcoa, sells windows with integrated light shelves. A light shelf is a white board that reflects sunlight inside. It can cut light power bills by 12 percent.

In HVAC, look at: Chromasun (solar air conditioners); Ice Energy and Calmac (ice cooling); Groundsource Geothermal AC Research (pre-cooling air); and Octus Energy (condensation cooling).

_{Source: U.S. Department of Energy}

5. Energy Generation

Solar and small wind have been around for a number of years. The next big trend will be to make these more unobtrusive. Several CIGS vendors promise to release building-integrated photovoltaics. Armageddon Energy, meanwhile, has come up with easy-to-assemble photovoltaic systems for homes.

Join industry leaders and influencers at Greentech Media's Green Building Summit in Menlo Park, Calif., June 11.