ACHRNEWS

Murphy's Law: 2010 Green Outlook Glimmering

March 22, 2010
Mike Murphy

In 2005, the green building movement was relatively small - only about 2 percent of both nonresidential (commercial and institutional) and residential construction, valued at $10 billion, according to McGraw-Hill Construction’s Green Outlook 2009 report. In 2009, the green market was approximately $36 to $49 billion, and is projected to be between $96 and $140 billion by 2013.

Interesting. Despite generally negative market conditions and a teetering economy, expectations are that the green market will continue to grow in the world of construction. How much of this will be in the realm of HVACR? Well, if the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) have any influence on the outcome - and, they do - HVACR contractors should continue to see a bump in green opportunities.

ASHRAE, the International Code Council (ICC), the U.S. Green Building Council (USGBC), and the Illuminating Engineering Society of North America (IES) recently announced the launch of the International Green Construction Code (IGCC), representing the merger of two national efforts to develop adoptable and enforceable green building codes. (See www.achrnews.com, Breaking News, March 15, 2010). The IGCC is said to provide the building industry with language that both broadens and strengthens building codes in a way that will accelerate the construction of green buildings across the United States.

According to conventional wisdom, more than 40 percent of commercial building energy consumption is attributable to mechanical HVAC systems. It only stands to reason that the commercial HVAC play is looking quite green in the foreseeable future.

GREEN; NOT JUST COMMERCIAL ANYMORE

A proposed Home Star program would provide training and accreditation for the development of a new home performance work force, as well as third-party quality assurance on the installed retrofit measures. Also, initially dubbed Cash for Caulkers, Home Star is designed to encourage homeowners to weatherize their homes - a move that could create more than 500,000 new jobs according to the White House administration. The proposed program would provide $23 billion in funding: $18 billion for homeowner incentives, $2 billion for quality assurance audits on efficiency projects, and $3 billion for retailer incentives and awareness-building activities. According to www.whitehouse.gov, the Home Star program has the potential to boost demand for energy-efficiency products and installation services.

Aside from the traditional products that can boost demand sold by HVAC contractors in residential services, the opportunity for whole-house performance-based contracting services should peak with the green residential movement. Weatherization is becoming a big business opportunity. If you don’t think so, last summer’s Weatherization Education Conference in Indianapolis might have changed your mind. More than 3,000 weatherization wannabes came from all corners of the country to learn how to either begin a new career or become more proficient at their existing one. The previous year’s attendance was about 1,400 wannabes.

Recently, green has been more defined in this industry as high-efficiency, though true green has many more far-reaching aspects of compliance. Still, if high efficiency and weatherization is enough to garner a high degree of interest for the time being, then so be it. Do you think that maybe green is a growing market?

GREEN STAYING POWER

The $64,000 Question: But, does it pay well? The answer to this is not as well-scripted as some of the old television game shows of the 1950s era, but there is no doubt that many enterprising people, including some who are HVAC contractors, will continue to find the glimmer of opportunity in green construction, green service work, and green commissioning work.

There are those who assert that green will not necessarily provide additional revenue, that it will simply become the norm for doing business in the commercial and HVAC markets. That norm has not yet been reached. However, if I had to place a bet on astute entrepreneurs finding a way to make a buck …

MURPHY’S LAW: Always bet on the biggest horse in the race.

Publication date: 03/22/2010