The National Association of Home Builders and the U.S. Green Building Council have locked horns over which of their respective green building standards should dominate residential construction. This confrontation, regardless of its outcome, presents another opportunity for pro dealers to stake their claim in a burgeoning trend toward eco-friendlier home building that, if more states have their way, will be mandated.
Virtually no one expects one national green building standard to supplant the more than 60 certification programs in place across the country. But NAHB has hegemony in mind when it touts its National Green Building Program, which the trade group launched in February at the International Builders' Show, as a more flexible alternative to USGBC's LEED (Leadership in Energy and Environmental Design) for Homes rating system and certification process, which started officially in January after a year-long pilot.
NAHB's message is clear: widespread builder acceptance of its guidelines–which NAHB submitted for approval as standards to the American National Standards Institute–would create "national recognition" for green design and building practices whose marketability seems finally to be emerging from its "potential" stage.
McGraw-Hill Construction estimates that 10% of all homes could be certified as green by 2010 versus 2% in 2006. As of February, about 100,000 homes were certified under local home builder association-related programs, and 540 houses under LEED for Homes, which had another 13,000 in its registration pipeline, according to Michelle Moore, the council's senior vice president of policy and market development. By comparison, the federal government's Energy Star for Homes program certified about 700,000 houses from 2004 to 2007. Builder polling suggests that "energy efficiency" remains a simpler concept to sell to homeowners than "green."
An unstoppable movement. More builders accept the premise that stronger buyer demand, aggressive marketing, and municipal regulation will conspire to drive green construction beyond its modest projections. Houses account for one-fifth of annual carbon dioxide emissions in the United States, which probably explains why 42 states have introduced green building legislation. In the first two months of 2008 alone, there was plenty of evidence that green is becoming what one real estate expert calls "the new normal" for residential development and construction:
The California Public Employees' Retirement System, the world's third-largest pension fund, now uses a project's sustainability as a criterion for all future investment.
KB Home, the industry's fifth-largest builder, claimed it's the first major production builder to install Energy Star-rated appliances as standard in all new homes.
Concordia Homes opened Sommerset Community, the first residential development in Nevada to feature solar panels as standard.
Green-focused seminars drew overflow crowds at IBS, as builders and suppliers attempt to position themselves for buyers seeking environmentally sounder homes. "We were hoping to see traffic of 50 per week and sales of two to three per month," says Cheryl O'Connor, vice president of sales and marketing for Warmington Homes, whose Vantage of Palo Alto in northern California is the Peninsula's first condo community to feature solar panels as standard. "But we have exceeded those figures with close to 100 [in] traffic per week and four sales per month." This year, Warmington is installing "green rooms" inside new models to showcase the benefits of green building.
Standard Supply and Lumber, a Michigan-based pro dealer with 12 branches, is hoping for "a pretty big boost in business," says president Tim Rottschafer, from a showroom it opened in February that specializes in green products such as Energy Star windows and appliances, low-VOC adhesives, and wood products that fall within the guidelines of the Forest Stewardship Council (FSC). Rottschafer confirms that his company is committed to selling products that comply with the LEED rating system.
Wood credits debated. Locating green products is getting easier as suppliers leap onto that bandwagon. More than 170 companies exhibited green products and services at IBS, including Armstrong World Industries, the floor-covering giant whose Web-enabled ecoScorecard lets builders search for products in its line that match different green rating regimens.
Jeff Donley, president of Ohio-based pro dealer Carter Companies, says his yards can provide whatever products their customers ask for. He also believes his company can play a vital role in helping customers build green by keeping abreast of code and standards changes.
USGBC and NAHB require green builders to hire consultants–called "providers" and "verifiers," respectively–to marshal them through the certification processes. LEED's reputation for tough third-party certification burnished its program's reputation on the commercial side, but could be a mixed blessing as USGBC expands into rating residential construction, community development, and remodeling.
"It has a fairly substantial bureaucratic component," says Bill Dumka, senior vice president with San Diego-based developer Black Mountain Ranch, whose Del Sur community includes a clubhouse built to LEED Platinum specifications.
Another knock against LEED is that it doesn't reward points for wood products certified under ratings systems other than the Forest Stewardship Council (FSC). NAHB's guidelines, on the other hand, accept wood certified under a host of third-party sources, including the Sustainable Forest Initiative (SFI) program and the Canada's Sustainable Forest Management System Standards. This separation was important enough for SFI's president and CEO, Kathy Abusow, to encourage delegates at USGBC's GreenBuild conference last November to give credit to SFI-certified wood for LEED-rated building projects.
Because only a small share of the framing lumber produced in North America is FSC-certified, most dealers argue that LEED is impractical to implement for a lot of wood-based construction and shuts out dealers that sell SFI wood from the market. How big a deal the FSC-SFI debate is for dealers depends on whom you talk to. Seeking simplicity, the National Lumber and Building Material Dealers Association's LBM Institute recently asked the American Lumber Standards Committee to adopt a new eco-forest management standard, certification process, and grade stamp. Many large dealers are at least getting the certification needed to handle FSC wood if demand for something called chain-of-custody certification is required. For instance, 84 Lumber is securing a license that would let it manage and audit the certification process internally for each yard, says Frank Cicero, executive vice president of store operations.
There's also some debate as to whether any kind of wood certification matters to builders. A survey of builders conducted in September 2007 by ProSales' parent company, Hanley Wood LLC, found that only 36% of builders that consider themselves green use certified wood vs. 82% that use Energy Star appliances and 78% that put in high-performance windows. Even more, 22% of the builders say they have no plans to ever specify certified wood.
Whether builders and suppliers opt for the path of least resistance likely will rest on public perceptions of different programs' credibility, especially when "greenwashing"–claiming to be green without being green–is rampant.
"Building green is a lot about marketing and promotion, and LEED clearly has an advantage," says Dumka. NAHB is talking about co-branding its program with those of its HBAs support. The battle for the hearts and minds of eco-conscious builders and home buyers is about to escalate.
–John Caulfield is a contributing editor to ProSales.