Green is the buzzword of the decade, with everyone from automotive manufacturers to professional sports teams rolling out high-profile environmentally-conscious initiatives. But board members, property managers, shareholders and owners have a duty to look after another kind of green—cash flow. Is it possible to select energy options that positively impact both types of green?
"Green energy" refers to electricity generated from renewable resources such as sun, wind, geothermal, hydro or biomass. Green energy supply options help reduce a building's carbon footprint, which is the amount of greenhouse gas emissions contributed to the environment. A percentage of the electricity consumed in New York is already green, and the percentage is on the rise. In 2004, the Public Service Commission created a Renewable Portfolio Standard (RPS) to increase New York's usage of energy generated from renewable resources. The policy, which is administered by the New York State Energy Research and Development Authority (NYSERDA), created incentives to increase the level from 19 percent in 2004 to 25 percent by the year 2013. Making conscious choices to use more green energy right now, however, can positively impact a building's finances as much as the environment.
Encouraging Conservation, Cutting Costs
New York has created several "green building" initiatives to encourage developers and builders to design and construct environmentally-friendly commercial properties. NYSERDA provides technical and financial assistance to those interested in building green. In addition, New York State's Green Building Tax Credit program was created by the New York State Department of Environmental Conservation at the beginning of the decade to provide tax credits of up to $2 million per building.
For existing buildings, discounted loans may make renovations and green retrofitting possible. Under the New York Energy Smart Program, if all or part of a multi-family loan is being used for NYSERDA-approved energy-efficient improvements, the loan may be eligible for an interest rate reduction for up to 10 years. The rate reduction is four percent less than a participating lender's or lessor's normal market rate for most of the state, and up to 6.5 percent in the Con Edison service territory.
Existing buildings and new construction can also get involved with the U.S. Green Buildings Council's Leadership in Energy and Environmental Design (LEED) Green Building Rating System. LEED gives building owners and operators the tools they need to have an immediate and measurable impact on their buildings' performance. Meeting LEED standards will help buildings run more efficiently, thereby saving money.