Presidential Candidates at the Energy Efficiency Forum - Melaver

In a preview of the energy and climate change debate brewing between Senators John McCain and Barack Obama, advisors to the presidential campaigns met at the 2008 Energy Efficiency Forum last week in Washington, DC, to stake out positions on reducing the nation's energy intensity and achieving greater efficiency.

For both camps, that meant addressing commercial real estate, an energy-intensive sector that has flown under the radar of federal policymakers as the price of oil dominates energy conversations.

Speaking for Senator Obama, Jason Grumet, executive director of the National Commission on Energy Policy, said buildings represent a "tremendous opportunity" for energy efficiency gains. "We have to invest in our infrastructure. We are not going to have safe and secure energy for the 21st century if we're trying to build it on 20th century infrastructure," he said.

On behalf of Senator McCain, former Virginia Governor George Allen, now an advisor to the campaign, said "it makes a great deal of sense in operations to look at those life-cycle costs in facilities, whether it's lighting, whether it's the construction materials, whether it's the heating and cooling systems or the water usage."

Even as energy and climate change have emerged as hot campaign issues -- both candidates gave major speeches this week on environmental initiatives -- the national discussion on energy-efficient buildings remains somewhat understated. For instance, a global report last year on buildings and climate change by the UN Environment Programme's Sustainable Building and Construction Initiative found that awareness of energy use in buildings is "still lagging behind." "The challenge to achieving energy efficiency, and reduced climate change impact, in buildings is ... usually not a lack of access to technical solutions, but a lack of signals to the building sector stakeholders to adopt such solutions," the report said.

Either an Obama or McCain administration could change that. Senator Obama has called for national energy efficiency goals in buildings and a $150 billion investment in clean energy to lift the economy, while Senator McCain has proposed stronger sustainable mandates on government space, which could create new energy efficiency markets in the private sector and drive down the costs of green products and materials.

Both candidates favor a cap and trade policy to limit greenhouse gas emissions and create government revenue that would be reinvested in research and development for clean energy initiatives such as renewable power and sustainable buildings.

The U.S. government currently spends $193 million annually on green building research, constituting just 0.2% of all federally funded research, according to a 2007 white paper published by commercial real estate services firm CB Richard Ellis.

As green building momentum accelerates, there's a role for lawmakers to encourage the trend, said Brenna Walraven, chairman of the Building Owners and Managers Association (BOMA) International and executive managing director of national property management with USAA Real Estate Co., who spoke at the Forum.

"Not all legislators understand our industry's potential role to be a key part of the solution," she told CoStar News in an email this week. But, she said, "when we've gone to the Hill to discuss our ideas, they've been well received ... I think there is a growing appreciation for our value to this discussion."

Indeed, signs of federal interest in sustainable buildings are increasing. Several industry groups, including the U.S. Green Building Council and building code developer ASHRAE, recently testified before Congress on the merits of green building. The Energy Independence and Security Act (EISA) of 2007, signed into law by President Bush in December, created several funding mechanisms for green building research and established a new Energy Star guideline for much of the government's leased space.

And in the absence of strong federal leadership, mayors and governors have taken the lead, enacting local green building standards in cities as large as Boston, Los Angeles, Dallas and Washington, DC.

The timing of increased government involvement could be critical to pushing real estate's greening trend over the hump. Despite major strides over the past year, sustainability remains far from mainstream within the industry. Less than 1 percent of buildings in CoStar Group's commercial property database of more than 44 billion square feet have received the U.S. Green Building Council's LEED certification or EPA's Energy Star label, the nation's most popular "green building" tags.

And in many smaller real estate markets, where the drivers of sustainability -- large corporate tenants and national property developers and investors -- are less present, demand for sustainable space is often nonexistent. "In local commercial real estate advertising, green has not really showed up as a factor," said Wes Tator, an advisor with Grubb & Ellis|Coldstream Real Estate Advisors in Portsmouth, NH, and one of the area's few LEED-Accredited brokers.

To that end, Walraven, a natural collaborator who helped usher in the green building era at BOMA with popular outreach programs like the BOMA Energy Efficiency Program (BEEP) and the 7-Point Challenge, anticipates a working relationship with the next president -- whoever he is.

"Federal focus on these issues absolutely will increase, regardless of who is our next president. We all saw what happened with the auto industry and their hard, expensive 'fight' against improving auto energy efficiency standards," Walraven said, calling it "very detrimental" to that industry. "We're more progressive and believe we have a huge opportunity to create a win-win strategy and be a key part of the solution."

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