Customers visit Starbucks redesigned SoHo store incorporating the city's first LEED (Leadership in Energy and Environmental Design) registered design, an internationally recognized green building certification system, in New York, Tuesday, April 27, 2010.

LEED-ing Taxpayers to Waste Money?

Policymakers need to take a hard look at LEED certification standards.

Customers visit Starbucks redesigned SoHo store incorporating the city's first LEED (Leadership in Energy and Environmental Design) registered design, an internationally recognized green building certification system, in New York, Tuesday, April 27, 2010.

A LEED certified Starbucks in New York

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Earth Day and Arbor Day recently passed, and with them various attempts to highlight issues on the environmental community’s agenda. Not surprisingly, the more dyspeptic elements of the movement parlayed concerns over matters like climate change and pollution to serve their own ends. Among these was an overwrought protest against the job-creating Keystone XL pipeline, which appeared on the verge of going forward earlier this year before the Obama administration announced another election-timed delay in deciding the project’s fate. The less politically-inclined participated in events such as recycling drives, tree plantings, home energy efficiency seminars and local park clean-ups.

While all of us have a stake in the future of the planet we share, one important constituency deserves a more prominent voice in the debate over environmental policy on Earth Day, Arbor Day and every day – overburdened taxpayers. No, this is not some cold-hearted essay on why the “green” of money must trump the “green” philosophy of respecting the Earth. In fact, fiscal and ecological responsibility can not only coexist, they can reinforce each other if public officials are willing to revisit past dogmas.

One such opportunity is the Leadership in Energy and Environmental Design, or LEED, standard for construction. Developed by the nonprofit U.S. Green Building Council to certify various practices and materials for putting up buildings as friendlier to the environment, governments at all levels have embraced LEED in their own property developments. But is LEED truly delivering the ecological benefits and cost-saving energy efficiencies that it promised? Are the assumptions behind LEED, the particular choices that supposedly should be made on behalf of a greener footprint, supported by the best available facts? These questions are being asked with increasing legitimacy, not to mention urgency.

[See a collection of political cartoons on energy policy.]

One recent example is an investigation of the District of Columbia government’s mandate that all new public buildings meet LEED’s “silver” standard or better (and that public as well as privately-owned facilities disclose energy usage). A sampling of buildings in the District conducted by the Washington Examiner turned up some results that offer pause to economy-minded citizens. Using the Energy Star efficiency system, the median score for LEED-certified structures (28.5 out of 100) was “insignificantly higher” than that of conventional ones (26.5).

Interestingly, the District’s own Department of Environment expressed reservations in a separate assessment of the mandated program, noting that it reflects “dependence on a third-party organization [USGBC], over which the government has no oversight, to set … green building standards.”

Ultimately, D.C. taxpayers may not be realizing the energy savings touted by their leaders when they imposed LEED on government construction, but there’s little incentive to reconsider the scheme, because the District has reaped about $5.2 million in permit fees since the initiative began about four years ago.

[See a collection of political cartoons on gas prices.]

Besides the District of Columbia, several hundred municipalities have written LEED into their codes for regulatory or tax-credit purposes, and the outcome for taxpayers has been far from uniformly promising. As far back as 2009, The New York Times was reporting on structures with LEED status that were “not living up to” the coveted label. A study of New York properties conducted last year by Oberlin College Professor John Scofield suggested that “LEED building certification is not moving NYC toward its goal of climate neutrality.”

Fortunately, the federal government has not issued its own edict that LEED be implemented among private-sector builders nationwide, but America’s taxpayers are not necessarily off the hook. The U.S. General Services Administration has required that all of its new federal buildings and renovations meet the LEED criteria, potentially piling millions in upfront expenses onto many projects. In fact, it estimates that the certification process alone for LEED (exclusive of actual construction) can tack on tens of thousands in additional taxpayer costs to every project.

Would taxpayers eventually recover the higher investment from LEED over time, due to reduced energy consumption? The experience so far suggests mixed outcomes at best. One study of 11 Navy facilities, for example, determined that four LEED buildings performed more poorly on energy savings tests than non-certified structures; four others had only slightly better performance.

[See a collection of political cartoons on the economy.]

No wonder my good colleagues at Taxpayers Protection Alliance have been demanding answers from the General Services Administration on the value of LEED. In three separate Freedom of Information Act requests last year, the alliance asked for documentation of the federal government’s relationship with the U.S. Green Building Council in developing LEED. The group is shining a spotlight of accountability on what it calls “private, non-science based non-profit organizations like the USGBC being involved in creating environmental standards that are then relied upon to dictate government policies and in turn cost taxpayers millions of dollars.” The alliance is still waiting on the General Services Administration to provide a complete response.

One reason LEED has come under criticism is its controversial methodology. LEED certification requires as little as a 40 out of 100 “score,” based on factors that range from generating energy savings to providing niceties such as bikes racks to … hiring a LEED certification expert. Another problem with LEED is its pick-winners-and-losers approach to selection of building materials. For instance, wood that meets LEED specifications can only carry a Forest Stewardship Council seal of approval, which, as I noted in a prior post, can create needless economic distortions and unintended environmental consequences.

Such biases may be even less defensible in light of findings reported from the Global Institute of Sustainable Forestry at the Yale School of Forestry and Environmental Studies. The institute and its co-researchers calculated that on a per-square-foot criterion, a wood-based floor consumes about one-sixth the energy of a steel floor and less than one-third the energy of concrete. But wouldn’t harvesting wood end up depriving the environment of resources that keep greenhouse gases in check, on balance leaving the ecosystem in worse shape? According to the study, not necessarily: The current worldwide harvest rate of 20 percent of wood growth could be boosted to 34 percent, thereby replacing some other materials like steel and concrete in buildings. The net result would, by their projections, avoid up to 31 percent of greenhouse gas emissions and 19 percent of fossil fuel usage associated with steel and concrete. While experts will continue to sift through these findings, they illustrate the ongoing importance of keeping an open mind toward new ways to meet construction needs that are cost-effective and environmentally efficient.

[ Read blogger Brad Bannon on why we urgently need action on climate change.]

This writer cannot claim to be an authority in construction, architecture or engineering. Nonetheless, data continue to accumulate from a plethora of sources – including ones closer to these professions – that LEED may not be as reliable a gauge of environmental or energy stewardship as many had thought. Before elected officials go even further with wiring LEED into future construction projects, they would be well-advised to reevaluate its entire foundation. This should not be an exercise in repositioning the thumb on the scales, thereby favoring a new set of industries or narrow constituencies. Rather, it should be an honest, thorough inquiry into how the environment as well as taxpayers can be better served.

There are hopeful signs that this conversation has already begun. Late last year, for example, General Services Administration officially recommended that other federal agencies could choose an alternative certification standard to LEED. Known as “Green Globes,” this method has a pedigree of nearly two decades and was recently aligned to conform to the codes of the respected American National Standards Institute. (For its part, however, General Services Administration will continue to use LEED on its own projects). Thankfully, the Department of Defense is now recognizing Green Globes as an option in its construction plans, thereby fostering greater competition and innovation in certification processes.

Still, further progress can be made. More transparent, evidence-based techniques such as Life Cycle Cost Analysis have yielded dividends for taxpayers in wastewater infrastructure, roads and other areas. They can function equally well for government office buildings, warehouses, and even military sites. More aggressive competitive bidding rules, as well as a regulatory regime that is less hostile to developing novel building designs, could also affect positive changes. Simple enforcement of energy-reduction rules in government facilities (e.g., shutting down office equipment when not in use) could make a difference too.

A spiffy LEED certificate may spruce up an otherwise plain edifice, but it’s time for policymakers to look beyond appearances and focus on proven approaches that deliver value in government construction. After all, taxpayers deserve accountability and sustainability from the ground up.