Viewing posts tagged "Green Building"

Johnson Controls: What’s Hot in Green Building

Johnson Controls will informally refer to itself as the IBM of green building and in many ways the analogy is apt. Both companies have extensive histories. The Milwaukee-based company just announced another quarterly dividend, the latest in a streak that stretches back to 1887.

And, like IBM, the company is pervasive in its field. Johnson is one of the principal contractors behind the retrofit of the Empire State Building. It also employs 800 LEED-accredited employees. Thus, what the company does will have some impact on the market. (It also received a $299 million grant to develop transportation batteries earlier this year.)

We recently spoke to Don Albinger, vice president of renewable energy solutions. Here's what's on his mind:

• Performance-based contracts continue to gain popularity, particularly with public sector companies like schools or government agencies. In these agreements, a contractor performs a retrofit and then guarantees certain reductions in energy consumption, etc. If they miss, the owner gets a refund. The contracts are similar to energy services contracts, in which the contractor gets paid through a portion of the energy saved, but there are differences.

• Industrial solar steam is taking off. In these systems, heat from the sun is exploited to run industrial boilers. "It is about a 40 percent efficient process. Solar thermal has advantages we need to capitalize on," he said.

• Although biomass has been gathering interest in some parts of the country, it is being challenged by the relatively low price of natural gas.

• One of the next waves in the industry will involve around tying building energy management systems to other enterprise applications. HVAC will be linked to building security applications and both will be integrated into financial and other applications. This will make energy savings and efficiency more dynamic and easier to measure. The company worked on a project like this with the state of Missouri, which has helped cut millions out of operating budgets.

• And of course, customers looking at ways to cut power bills should always think about reducing consumption before putting up solar panels.

"You've got to stop the building from losing energy before you start putting in new capital equipment," he said.

Sustainable Spaces Renames Itself, Plots National Expansion

Sustainable Spaces is now Recurve and it's going national.

The company, which retrofits homes and small businesses, has largely worked in Northern California (one client had utility bills that came to $6,500 a month before a retrofit) but now it will expand to new geographies. Getting a made-up name from branding consultants is just one of those things you do to celebrate.

How does a residential contractor that's only five years old go national? The company is actually a software vendor in disguise. It has been studying home retrofits and writing applications that, ideally, will take the guesswork out of a home retrofit. Right now, contracting and retrofitting thrive on tribal knowledge: contractors each have their own tricks of the trade and live by them. Under Recurve's paradigm, it will enlist contractor/partners who will then plug variables into a computer – number and size of windows, number of individuals with respiratory problems in house, number of bedrooms, etc. – that will spit out good, better, best retrofit plans using Recurve's software.

The company employs a lot of ex-Googlers. The applications are why we picked Sustainable, whoops, Recurve, as one of the top ten companies in green software.

Behind the scenes, the company has something of a national profile already. Founder Matt Golden spends quite a bit of time lobbying for energy efficiency bills in D.C. and various state capitols.

"Over the past 5 years, the company has enjoyed phenomenal growth in revenue, doubling the business every year on average, mostly by referrals from satisfied clients. In 2009, one of the most challenging in history for the construction industry, Recurve grew revenues by 70% and employed nearly 70 people out of the San Francisco office. Recurve is the only home energy company in Northern California to be accredited by the Building Performance Institute, which sets national quality standards for the industry," the company stated.

Walmart to Outfit New, Renovated Stores With LEDs. 650 Stores in First Year

Walmart, the mega-retailer that helped put energy consumption on the agenda for corporate executives, said it will use light emitting diode lights from Cree in new stores and retrofitted ones. In the first year, that will come to 650 stores alone.

The stores will replace ceramic metal halide lights, those honkers you see in the ceiling of big box retailers. The Cree bulbs will emit the same amount of light as a 70-watt bulb but use 82 percent less power.

LEDs have been talked about for years, but are finally going to start appearing in large numbers. Commercial establishments will install them first. The bulbs cut power, and commercial establishments typically have more bulbs, but the bulbs also cut maintenance. LED bulbs last 50,000 hours, far longer  than vacuum-tube bulbs. That leads to fewer hours the maintenance people have to climb ladders to replace bulbs, order new bulbs, figure out places to stock the ones that just came in the mail, etc.

LEDs will come to the consumer market, but more slowly. Most people, after all, just change their own bulbs so the cost associated with swapping them is minimal.

The quality of light has also improved with LED bulbs – that "alien autopsy" tone of white is vanishing – and the price is coming down. Need more on lighting? Here's a comprehensive report on the subject that, just by coincidence, I wrote.

In the middle of the decade Walmart started looking at its energy bills and determined that it could whack a lot of operating costs through efficiency. Lighting was an early target. By taking out the light bulbs in the coke machines on the premises, the company saved $1 million a year.

LEDs represent the biggest opportunity in lighting. The second biggest (or first, according to some) will be equipment to network lights so they can be automatically dimmed or turned off.

Green Retrofit Funding Startup Gets VC Funds

PACE. It's gone from an obscure acronym in the green building market to a popular policy initiative championed by several states and Vice President Joe Biden in less than a year.

And now there's a VC-funded PACE startup.

NGEN Partners, Draper, Fisher Jurvetson and NewCycle Capital have invested in$12.2 million Renewable Funding, a startup founded by Cisco DeVries, who co-invented the PACE financing concept while the chief of staff for the mayor of Berkeley. UC Professor Dan Kammen is the other inventor. The company essentially helps a government establish a PACE program and administers them. DeVries acts as president.

PACE – or property assessed clean energy – loans for retrofitting homes and commercial buildings for energy efficiency differ from conventional loans in that the money gets paid back through supplemental property tax assessments. That small twist brings a host of benefits. The owner doesn't have to worry about losing the value of any retrofit if the home gets sold because the new owner assumes the payments. The payments, ideally, can also be lower than the amount saved on energy bills, making the retrofits free. Local communities also see job activity in the area. And moribund banks get to write loans.

Fourteen states including Florida, Texas and Maryland as well as 30 municipalities have already passed PACE programs. Berkeley, Calif. became the first governmental body to issue PACE bonds in January. The House and Senate included provisions inside their versions of Waxman-Markey that would permit the federal government to guarantee the bonds, which would enhance their marketability. Interest on PACE bonds right now aren't tax free.

Last week, Joe Biden made PACE loans a central part of his Recovery through Retrofit program unfurled last week.

There are major questions swirling around the company. Typically, consulting/services companies have trouble scaling. The universe of potential customers is likely also limited and closing a sale or engagement could take time. Still, if the federal government passes pending proposals to guarantee PACE bonds, the market could cause consumer demand to explode.

"With a federal guarantee it grow from a hundreds of millions to a $400 to $500 billion program," said Jack Hidary, one of the principals of PaceNow, a nonprofit geared to drumming up national support, earlier this month. (Hidary was also behind Cash for Clunkers.) "It can also help the 1.5 million people out of work in the construction industry."

Tax Breaks for Ice Air Conditioners? A Proposal Is in Congress

Install an ice maker; get a tax break.

Congressional representatives Mike Thompson (D-CA), Wally Herger (R-CA) and Earl Pomeroy (D-S.D.) have introduced the Thermal Energy Cooling and Heating Act of 2009 (HR 3918) that would give a 30 percent tax credit and accelerated depreciation to individuals or businesses that install thermal energy systems that reduce peak demand.

The primary thermal energy system on the market today that fits this description is the ice cooler marketed by both Ice Energy and Calmac. In these systems, ice is made at night when power is cheaper (or generated but not consumed). It then melts during the day: Heat exchangers allow the chilly vapors to circulate through the building and cool them.

The definition also seems to include solar air conditioners, which use heat collectors and evaporating refrigerants to cool buildings. Chromasun is working on those.

There are a couple of trends wrapped into this bill:

1. Energy efficiency is getting more attention. Right now, businesses that install solar receive a 30 percent tax credit. You can get an 30 percent tax credit for energy efficiency retrofits, but only for the first $1,500 of work. The Thermal Act provides what seem to be comparable incentives. Secretary of Energy Steve Chu has long been a supporter of improving building energy efficiency.

2. Waxman-Markey may get piecemeal'ed. The bill hasn't passed yet, of course. And if it doesn't, expect to see a flurry of bills that concentrate on very specific parts of the overall bill. Efficiency enjoys bipartisan support. It cuts power consumption and generally can help create jobs because much of the revenue is generated from installation.

3. Air conditioning is cool and lots of new companies have come into the market (see the cavalcade here). In all, air conditioners gobble up around 5.2 percent of the total energy in the U.S. and about 10 percent of the electricity. (Building operations account for around 39 percent of U.S. power according to the Department of Energy and 13 percent of that power in residential and commercial buildings goes to air conditioners.) Not only are air conditioners themselves inefficient, the sensors and other mechanisms often aren't networked property for dynamic control. Walk around your building and count the female co-workers who are wrapped up in Snuggies sometime.

4. Air conditioning is going to get even cheaper. Utilities are currently contemplating programs under which they would pay for new AC units. A rebate and a tax credit? What CFO could say no?

Cypress, Adura Team Up for Building Management

Heating, air conditioning and ventilation account for 32 percent of the energy consumed in commercial buildings and lighting consumes another 25 percent, according to the 2008 Buildings Energy Data Book. Cypress Envirosystems and Adura Technologies are going to work together to reduce it.

Cypress, a division of Cypress Semiconductor, has developed a radio controlled thermostat that can replace the pneumatic thermostats deployed in most buildings built before 1995.

"You can't control them [pneumatic thermostats] remotely," said Harry Sim, CEO of Cypress Envirosystems. "They are compressed air."

Cypress' thermostat costs about $500 and installs in a few minutes. Google, Kaiser Permanente and Stanford have all installed the thermostats. (You need a single thermostat for roughly every 1,000 square feet of floor space, said Sim.)

Adura, funded by VantagePoint Venture Partners, has devised a controller for lighting systems. In tests with PG&E, Adura managed to cut power going to lights in a building by over 72 percent.

By combining together, the two companies say they can cut building power consumption by 30 percent to 50 percent. Cypress will sell Adura's equipment and vice versa. Over time, the two companies will try to synchronize their software so that it comes across more as a seamless solution. The technology from Cypress and Adura also work with the building management systems from incumbents like Johnson Controls and Honeywell.

Along with energy efficiency retrofits, building management has turned into a growth market in the past few years. Both the Federal government and the state of California have already passed initiatives to ensure that new commercial buildings will be net-zero energy structures by 2030. While solar will provide power, a substantial portion of the net-zero goal will be accomplished through clever conservation.

And each building adds up. Sim noted that California's baseline power requirement is around 35,000 gigawatts and the peak power requirement is around 55,000 gigawatts. That 20,000-gigawatt gap between baseline and peak is largely consumed by air conditioners flipping on on a hot summer day.