For a long time the energy efficiency industry operated largely under the two-guys-and-a-truck-model: local businesses made up of small contractors.

Then the ‘super’ energy efficiency service companies (ESCOs) emerged, big operations taking on big contracts often for government, schools or hospitals, like the $35 million deal that Pepco Energy Services signed with the Prince George’s County Maryland Public Schools this week.

The US energy efficiency industry has continued to expand. Is it ready, now, to make serious headway exporting goods and services into international markets?

The International Trade Administration seems to think so. Anna Chittum, research associate for the American Council for an Energy Efficiency Economy, says in her blog that the ITA has been seeking comment on a national export strategy for both renewable energy and energy efficiency.

Part of a federal goal to double exports by 2015, the strategy is due to the Obama administration in September.

What might US energy efficiency companies export?

Possibilities are discussed in the 2010 Energy Industry Assessment, posted on the ITA Energy Team Home page.

The report points out that little export of energy services has occurred so far, although some US companies have established a foothold in international markets, such as Rockwell Automation, Honeywell, and Johnson Controls. But the potential is large for US ESCOs, especially in parts of the world where demand for energy is rising and reliability questionable. China and India are obvious candidates.

Export opportunity also may exist for companies that develop district energy and combined heat and power, according to industry assessment report. China, the Middle East, and India are prime markets.  For example, China plans to invest $360 billion over the next decade in district energy and US companies could capture at least $8.2 billion in sales, the report says. The Middle East is expected to invest $7 billion in district energy over the next decade and $15 billion over 20 years.

The term “green” is being increasingly applied as an easy way to identify products, including building materials and new homes, as having a better or smaller impact on the environment.

That’s fine for marketing slogans and advertising headlines, but it’s also dangerous if the product (or house) isn’t truly sensitive to its environmental impact and is simply trying to ride the coattails of a sincere effort to lessen our carbon footprint.

In those instances, intended or not, the term “greenwashing” comes into play. Simply, it refers to incomplete, insincere, exaggerated, or downright untrue promises made about a product’s environmental performance, with no real evidence to back it up.

As a professional builder confronted with “green” claims from a variety of building product manufacturers and some competitors, we are keenly aware of the threat that greenwashing can have on our credibility as a quality contractor.

So, in our business, we make every effort to substantiate the claims made by our suppliers regarding reduced water use, recycled content, energy efficiency, and other performance characteristics that relate to creating a “green” building.

How? Thankfully, the “green” movement within and outside of the building industry has spawned a wealth of independent, third-party companies that scientifically verify those claims with a battery of standards and test methods. When considering a product or system, we look for certifications from those entities, as well as specific performance information (such as the precise amount of energy the furnace claims to save) to give us confidence.

In addition, several local, state, and national “green” building programs, such as Energy Star, have cropped up to help us and other builders identify materials and methods that result in better-built homes. These programs not only serve as frameworks for higher-quality housing, but also refer to the independent verification programs, such as the EPA’s WaterSense (for low-flow plumbing fixtures), to give us greater assurance that we are truly building green.

Even then, however, manufacturers and some builders may unintentionally misuse the certifications they earn from such testing or evaluation. For instance, there’s no such thing as an “eco-friendly’” or “environmentally-sensitive” product or house, two terms that have no scientific basis and smack of greenwashing.

Failing to go the extra mile to verify environmental performance claims can put us at risk of becoming greenwashers, too. It’s also our responsibility to surround so-called green products and systems with a quality-built house that effectively optimizes the energy use, water use, and durability of those products.

That way, we can all feel good, and be confident in, your investment and our combined efforts to make the Earth a healthier place to live for us and future generations.

I have to agree with many of the points made and don’t think they are any less significant today. I value the move to fully integrated and sustained designed and built buildings. Looking to the long term to conserve resources, utilize them appropriately, minimize waste and finally and more importantly be energy efficient.

It puts a great deal of stress on a design team particularly when they are all disparate businesses and industries trying to serve a client and meet the standards of the varying Green Certification process.

That is the risk in ANY building assuring that it is solidly built and is meeting the needs and promises while also maintaining current standards and codes if not exceeding them… while “adding” green features.

Excitement, zeal and the ambitious have shown that when it works it really works but when it fails it equally fails. So what does it mean with regards to litigation and “fault”

I reprint the article below . And while I have my conclusions I let you find your own.

Expert: Green projects risky for contractors
By KATIE ZEMTSEFF
Journal Staff Reporter

Ujjval Vyas, an expert on risk management, said green building is fundamentally changing the construction industry in ways that bring new risks and liabilities to contractors.

Vyas is a principal at the Alberti Group, a national consulting firm that helps clients define sustainability goals, manage risk and improve the performance of their buildings. He is also anattorney and a professor.

Vyas was in Seattle recently to address the Associated General Contractors’ Future
Leadership Forum and give a public talk about what he called the myths and realities
of green building.

More construction is going green, with some cities requiring green certification and
owners hiring teams specifically to create LEED buildings. But green building means
using new systems and technology, and is changing the traditional relationship
between team members.

Vyas said contractors need to better understand how these changes affect them. “People are afraid to have the hard conversations because they’re afraid to beagainst something that everybody’s for,” he said. “You don’t have to be against it at all. You can love sustainability. Just do what you always do (and remain skeptical).”

Vyas said it’s important to know who’s responsible if things don’t perform as
promised. Contractors, he said, need to be careful because owners often consider them
the financially responsible party. The best way to proceed, he said, is to ask
questions. “If you don’t remain skeptical, you significantly increase the risk and
liability on the product.”

Legal risks

Vyas said he has been involved in lawsuits when a team’s aspirations didn’t match a
building’s performance. He said he sees lotsof legal risk connected to green buildings.

For example, if a tenant requires LEED space and moves into a new building that
later fails to get certified, it’s going to be costly for the owner to lose that tenant, andit could end up in court. If a building fails to perform as promised,
Vyas said, the owner will sue the contractor,not the architect. “(The architect) isn’t worth going after. You are, and your insurance carriers are worth going after.”
Vyas said there are other legal questions about green projects. With a typical
building, contractual requirements end at substantial completion. But with LEED, a
building is not complete until it has received certification, which can take an extra year.

Vyas said this can compromise warranties associated with substantial completion. To
avoid problems, teams should write into contracts when their responsibility ends. An attorney can lead a team astray if he or she is not experienced in sustainability
issues and construction, he said. Teams should also never guarantee a level of LEED certification or imply that a project will reach a high level of performance until
it does, he said, and they should also be careful about claims they make in press
materials.

Vyas said contractors need to be much more actively involved from the beginning to
avoid suits. Owners often speak most with architects, so the image they get of a
finished product is what the architect envisions. Vyas said contractors need to
communicate often with the owner about what is and isn’t realistic.

“Architects believe that owners should pay for their dreams. Their zeal can become your performance requirement,” he said. “Unless you say differently, the owner will think you agree with what the architect says.”

Contractors should see all the contracts, he said, because another firm’s contract could require something they did not agree to. They also need to be up to speed on green building and contractual risk, and limit their role by clarifying the scope of their work in contracts. Vyas said contractors should make it clear to owners that they are happy to install new systems or technology, though they are unclear about how they will perform.

“I’m suggesting you be the first person that says, ‘this is our scope and our role.’
The architects often just have no idea what they’re talking about,” Vyas said.
If a contractor is installing a confusing piece of equipment, “issue (the architect) a blizzard of RFIs.”

Too often, he said, these discussions don’t happen.

Some solutions

One of the great myths of green buildings, Vyas said, is that they perform better than others. He said there just is not enough good data: “The information stream is seriously polluted.” A building that is sustainable can also be high quality, depending on the motivation of the team. “Sustainability is a great location for you to really establish that you are a quality enterprise, not that you are a sustainable enterprise. That’s a big, big difference.”

If you’re doing it for the marketing benefits, then you need go no further than LEED, Vyas said.But a team that wants to reach the highest level of quality needs to go beyond LEED and start thinking about how it can provide the highest quality building. To create a truly high performance building, Vyas suggests entering into a design/build contract and a performance contract, and requiring commissioning at the beginning of a project. These actions, he said, get everyone at the table early and help ensure that a building meets their goals. “I see no better way than to engage in a design/build contract and a performance contract.”

Failing that, teams need to do more research on the performance of products and tools. Focus on quality rather than just green, he said. Owners will recognize the level of quality brought to the table and will “hopefully discriminate in the marketplace and choose you.”To get team members working together, Vyas suggests contractors buy local architecture firms. A medium-sized construction company, he said, could easily buy the hottest architecture firm in town, creating a design/build firm that offers owners a single source for both services This would combine client pools and push competitors out of the market, while allowing team members to plug holes that occur when developing sustainable projects in a traditional way, he said.

“I would argue right now, every contractor should be going out there and just buying,” he said. “This is the time to just purchase them.”

Jeff Robinson, general superintendent at John Korsmo Construction, said the talk resonated with him, especially the idea of having architecture and construction firms combine forces. Vertical integration, he said, is key. “That is clearly the direction that a lot of firms are heading and the GC/CM procurement method is
one of the positive ways that we’re working with our clients to be involved in design upfront… and helping them wash out the problems,” he said. “I think it’s a good idea.”

Vyas said owners need to be more clear about what they expect from projects. Owners should send clear signals to the architect and contractors that they are looking for real solutions and a truly high performance building. Contracts should specify that any product or design solution used will be considered fully vetted.
“If you have to have 17 sub consultants, that’s the case. It’s your duty,” he said. “Just because they saw it in a magazine, they don’t get to spec it.”

I recently had coffee with an Insurance Agent discussing risks and issues surrounding Green Building and LEED.

While I have no problems with either I have said I choose not be to be a LEED AP or do any third party verifications for any organization or group offering such credentials to a building.

My reasons were liability, redundancy between programs (how do you know which is best), unnecessary I believe in residential housing as it offers no tax breaks only additional costs and more importantly if you are building correctly and with energy efficiency and sustainability in mind you don’t need the silly plaque on the wall.. just do it. And finally I am not an employee or associate of the USGBC, NAHB, MBA, EEBA, the Lung Association, Energy Star etc so unless they want to hire me to promote their programs and share the indemnity associated with certifications I choose to not PAY them for the privilege.. I will however pay for your resources, education and training and share that with my clients as needed.

I found this article today in Goddard Construction Magazine and it explains the risks that anyone looking to build and certify green what you need to consider prior to taking that project on. I don’t want to discourage anyone from building green but I would prefer building SMART over any acronym any day.

Home Environment & Compliance Risk Mitigation In Green Building
Risk Mitigation In Green Building

Written by Franz Wagner, P.E. and Jeff Myung, LEED AP

They say it’s always greener on the other side, but Green-built and LEED-certified projects can have you seeing red if owners and contractors do not take precautions to mitigate risk. While many executives in the construction industry initially perceived green building as a fad just a few short years ago, it is undeniably here for good.

Green building offers project stakeholders the allure of increased profitability, but to achieve optimum return on their investment, building owners and contractors need to mitigate the inherent risks associated with sustainable building. The first step to mitigating your risk is to understand how the risks emanating from Green building differ from those emanating from traditional building.
Risk Management in Site Selection

To obtain maximum Site Sustainability LEED credits, project owners often seek out locations that have been declared brownfield sites (abandoned or underused industrial and commercial facilities available for reuse) and also sites in close proximity to mass transportation, population density and accommodations for electric vehicles and bicyclists.

The development of brownfields may be complicated by real or perceived environmental contamination. The land is often contaminated by low concentrations of hazardous compounds such as lead, PCBs, mercury, hydrocarbons and asbestos. Additionally, such sites often pose unique pollution exposures created by working near subways, railroads and waterways. Because site selection is a key component in LEED certification, owners and developers need to evaluate the numerous insurance products available in the current marketplace to address environmental liabilities arising from these projects constructed on remediated properties. Various forms of coverage can be pursued to insure against existing and unknown pollution conditions as well as pollution conditions arising out of the construction work being performed. Each of these insurance products deserves consideration depending on the specifics of the work and the selected project site.

Loss Control Considerations

The stringent LEED credit system offers designers and contractors the guidance they need to produce a sustainable facility, but with those credits also come safety concerns that must be addressed in order to avoid costly insurance claims. The following outlines three loss control considerations that you should discuss with your insurance broker and safety consultant. By informing them of the green design elements planned for your project, your safety consultant can provide adequate training and equipment, and your broker can enhance your policies with the necessary coverage.

1. Material Reuse

LEED credits are offered for reuse of building materials, which often require some of the materials to be abated of lead paint in the case of reusing steel beams or exposed wooden beams, or stripped of hazardous compounds such as mercury in the case of reused electrical devices. At The Graham Company, our safety consultants advise site managers and contractors on best practices and the American Conference of Governmental Industrial Hygienists (ACGIH) and the Occupational Safety and Health (OSHA) standards for protecting employees during this phase of construction.

2. Vegetative Roofing

Vegetative roofs are an ideal way to maximize LEED credits for reducing heat island effects, using maximum green space and capturing and reusing rain water. However, vegetative roofs also present a unique condition for worker-fall protection during construction. The lack of exposed concrete and steel on a rooftop creates new challenges in providing construction workers with fall-arrest anchor points, as well as falling-object protection for those below.

3. Indoor Air Quality Control

During the final phases of construction and just prior to occupancy, the U.S. Green Building Council (USGBC) and Sheet Metal and Air Conditioning Contractors’ National Association (SMACNA) place minimum expectations for continuous air exchanges. This challenge creates new demands of ventilation during final construction activities, such as painting, drywall and plastering, floor and carpet installation and waterproofing. While such activities may not have posed concern under traditional building conditions, the progressive LEED requirements for ventilation may now present you with a new series of occupational health concerns.

4. Update Your Insurance Program

Brokers who understand the risks associated with LEED construction are better equipped to structure the insurance coverages for these projects. For example, Builders Risk Policies do not automatically cover some of the unique aspects of a LEED project, such as the loss of earnings from an inability to achieve energy credits or sell off surplus energy due to a loss, or the additional soft costs associated with rebuilding to LEED standards. Keeping your broker informed on the extent of these projects will result in a more comprehensive insurance program to address these LEED-specific exposures.

Related Articles

• Green Architecture: What makes a Structure a “Living Building”? (scientificamerican.com)
• USGBC Tackles Building Performance Head On (prweb.com)