The US Green Building Movement - Green Means Go
As energy costs continue to soar to unprecedented levels, it appears that a critical threshold has finally been crossed in the US green building movement. Over the past several years, the “greening” of commercial real estate has started transitioning from a socially responsible peripheral issue into a business necessity for many commercial real estate players. Since 2000 (the year that LEED-NC (new construction) was adopted), the number of new green building projects has been growing at a compounded annual growth rate of 50 percent to 100 percent. In 2006, the number of projects achieving LEED-NC certification was almost 20 times the number that were certified during 2000 and 2001 combined. Approximately 50 percent of the aggregate building area of all LEED certified buildings in the US was certified during 2006 and the first half of 2007.
What has caused the acceleration of the green building momentum in the US? Primarily three factors:
(i) user demand,
(ii) government requirements and incentives, and
(iii) increased savings/reduced costs.
Continue Reading...The SEC is Getting Hot and Bothered over Climate Change
As the Intergovernmental Panel on Climate Change (IPCC) stated in its 2007 report, evidence of climate change "is unequivocal, as it is now evident from observations of increases in global average air and ocean temperatures, widespread melting of snow and ice, and rising global average sea level" (see IPCC Report, Summary for Policymakers, in Climate Change 2007: The Physical Science Basis at 5). Thus, the only question is whether the potential consequences of these physical effects of global warming on the company - such as damage to company property, interruption of revenue streams that such property generate, increased costs to comply with regulations attempting to minimize global warming, and potential liability in lawsuits seeking damages from parties perceived as causing global warming - are "reasonably likely" to have a "material" impact on a company's financial performance.
How to interpret and apply these two expansive and as-yet poorly defined terms in the context of climate change, given the unknown time horizons during which the financial impacts may arise, is the $64 or $640 million question publicly traded companies must now answer. [summary]
