A few years ago, when the recession first hit and the stimulus was still being worked out, there was talk of building a new, greening economy. Everything was abuzz with this idea. Even my local university engineering program made a major transition, aiming to become a national leader in green design. Three years later, the job market remains stagnant, and new construction and infrastructure work remain low. From what I’ve seen in news reports, the green economy has not quite met its promise.
On the other hand, it hasn’t been a total flop. According to a survey from McGraw-Hill Construction (a summary of which is available here with registration), green construction is now a significant portion 0f new residential construction, making up 17% of 2011 work by cost. They’re projecting a five-fold increase as the building market continues its upswing, anticipating that one-quarter of residential construction will be “green” by 2016. (Green in this context refers to LEED certified or equivalent building standards.)
Of course the future is ever uncertain, but if these projections are accurate, an upswing in the economy will take an upswing in green construction with it. There are a number of details in the survey that particularly caught my attention:
The cost of green construction has decreased. It’s long been known that greening your home can save one a significant amount in utility costs. But the upfront investment can scare away many homeowners if it doesn’t pay for itself on a relatively short time-scale. Since costs have come down, the length of time to recoup the extra costs is becoming shorter, which means it’s becoming attractive to more people.
Of course, more far-sighted individuals have been reaping the benefits of improved construction quality and energy for years. But it’s nice that the average person is starting to catch on. Not mentioned in the study is that energy itself is likely to become more expensive as time goes on, at least in some regions of the country. Thus the savings from improved efficiency will also become more significant.
Builders are finding green construction sells. Both builders and remodelers report the ability to conform to green standards is good for business. It goes to show the power of the consumer. If there’s a demand for a service, market forces will push service-providers to meet that demand.
Environmental reasons also don’t rank highly as the motivators. Instead, improved building quality and energy savings are convincing people to spend a little more upfront.
Green retro-fitting is also up. Remodellers are reporting much the same thing. In fact, it seems home-owners are willing to spend more on remodelling to green standards than buyers on new construction. Builders report home-owners will pay about 3% more for green standards, while remodellers say home-owners are willing to pay 5% more for green standards.
I wonder if this means that people who have already been in a house for a while and are familiar with their energy bills find it easier to picture the financial benefit in practical terms. It may be too abstract for some individuals who are moving into a home for the first time, and yet to pay a single utility bill for it.
With Congress opposing Obama on almost everything, coming to an agreement will be difficult. But it would be nice to see them get together and see about creating more public jobs by greening public infrastructure. After all, why not take the people who are stuck on unemployment anyway, and get them involved in worthwhile work that will actually end up saving money in the long run? It seems crazy to me that we can’t even get a bi-partisan agreement on something as obvious as that.
Photo credit: Dontworry