Week in Review

Last week was a busy week with the SJF Summit on the New Green Economy and the TCREW Sustainable Design luncheon. The next few weeks have some pretty interesting events that I'd like to share with you as well. To learn more about upcoming events, visit us on Facebook. Become a fan and stay tuned!

First, a review of The Summit. A big shout out to Deb Parsons, Kenan-Flagler classmate and Queen of Sustainability! She headed east to spend some time at the SJF Summit this week. Deb is quite an inspiring woman. She brought a lot of energy and innovation to KFBS. Among her many accomplishments the one that lives on is the Sustainable Venture Capital Investment Competition.

Anyway, Deb spoke along with Jessica Thomas from KFBS CSE program and Chris Carmody at the Institute for Sustainable Development in Chapel Hill. Their session was on supporting social entrepreneurs and companies that create green jobs. Deb works for Investors' Circle, a non-profit organization that connects angel investors, venture capitalists, and others interested in investing in making the transition to a more sustainable economy. They brought great experience and advice in supporting businesses that are focused on sustainability, and what those jobs mean to the economy.

Labor Shortage: Several of the speakers at The Summit spoke of the lag in skilled labor available for green economy jobs. It is SUCH an opportunity for folks that have been laid off to seek training at community colleges offering courses, or to encourage kids in high school that there is a future for them in this new green economy.

Government Support: Another topic that came up repeatedly is the role government plays in supporting green businesses. Policy has a dramatic impact on business - if policies are not predictable and long-term, businesses are unlikely to adopt the desired change.

Sufficient Funding: In order for any of the 'Clean Tech' start ups to cross the chasm, sufficient innovation capital must be available. This can come in the form of grants or investment (good message to a group of venture capital gurus, right?).

The cost of capital has increased in the last year or two. Time frames for investing have increased and the competition for investors have decreased as money moves to the sidelines (or disappeared). There are fewer investors in the market ready move on the right opportunity.

For entrepreneurs: More experience is a plus, and a power purchase agreement in place (for renewable energy technologies) makes it much easier for investors to take the plunge. "Many buyers [with capital] view the market as an optimal time to buy."

A Word of Advice: to investors and entrepreneurs - the hottest technology isn't the only opportunity. We're in a time of economic crisis, but that also provides tremendous opportunity for innovators, entrepreneurs, and investors. "A crisis is a terrible thing to waste." Advice: Focus on the gap between actual and perceived risks, and find alternate financing sources. (Did you know that there are 60,000 small foundations in the U.S., and they provide 50% of U.S. foundation grant money??)

Areas to Watch: Renewable Energy and Distributed Generation, efficiency and waste minimization, embedded intelligence, micro & macro energy storage, waste-to-energy technologies. Look for more states and municipalities to adopt a 'total waste stream reduction policy' to address the volume of waste going to the landfills. Recycling is great, but it still requires trucks to drive around for pick up as well as the resources to recycle the materials. The better strategy is to encourage reducing consumption.

Cap and Trade: Caps on emissions are likely in the not-too-distant future. This will be a contentious debate as businesses and individuals learn more about what cap and trade will mean for them. If businesses have to pay for their carbon emissions, they will most certainly pass that along to us. How much do you value reducing carbon and addressing global warming? How much do you value low prices for just about everything? We have a significant shift in thinking ahead of us.

Currently, there is a bill in Congress that gives 85% of permits for free until 2026 to help ease the transition. After that, businesses will have to pay for carbon permits. If we know we will be paying more for our stuff, do you think we can adjust our budgets in advance? How much do you think cap and trade will affect consumerism that has become a hallmark of American culture?

The conference was fantastic. If you missed it, be sure to check it out for next year.

TCREW Luncheon on Sustainable Development:

Lori Eichel of Accent Construction moderated a panel of experienced real estate professionals to talk about lessons learned and their experiences with green building. The panel included Gregg Sandreuter of Hamilton-Merritt, Jim Smith of HagerSmith Design, Shelley McPhatter of BridgePoint Construction Services, and Myron Taschuk, Construction Project Manager at Duke University.

The group talked about the impact of green building, and the challenges of the LEED rating system. Working with the design team from the beginning can help to reduce expenses in the long run because everyone is on the same page about the goals for the project. Calculating the ROI and payback period for specific investments can help your project stay on track (instead of chasing shiny objects b/c they are too cool).

Lastly, focusing on energy reduction can have the greatest impact, especially if you own the building for a period of time (>5 years). Our region is in a period of transition - demand has not grown enough to dictate all construction to be LEED, but within the next few years it appears that may catch up. While building to LEED standards gives you third party verification that a building is green, many private developers in the Triangle have not been able to justify the expense without having demand from a tenant.

There is some movement from municipalities to help drive LEED - Durham County, the City of Raleigh, and the State of North Carolina all have requirements to pursue LEED Certification or LEED Silver (some exceptions for buildings under 10,000 sq. ft.). The federal government also has a requirement for all its new buildings to be LEED buildings, and exisiting buildings rated a minimum of Energy Star (this would likely be an issue upon renewal). Anyone who is interested in a long-term government lease should be aware of these requirements coming down the pike (2012 - 2015).

It was a great session, and I enjoyed hearing from some leaders in the field.

Coming up next: the Green Plus summer event on June 11th, and the North Carolina Economic Developers Association Annual Conference. You can learn more on our fan page on Facebook.