Twelve years ago, the U.S. Green Building Council launched a rating system called LEED, or Leadership in Energy and Environmental Design, hoping that architects, engineers, designers and real estate firms would improve energy efficiency and increase the use of recycled materials and nontoxic paint in their projects to win LEED-certified recognition.
Now LEED has grown into a powerful brand and global phenomenon. There are 14,044 LEED-certified commercial projects, covering more than 2 billion square feet, in 140 countries. Another 34,601 projects are in the pipeline. Northern California is home to hundreds of LEED buildings, including San Jose City Hall, San Francisco International Airport's Terminal 2, the California Academy of Sciences in San Francisco and the Oakland Public Library branch on 81st Street.
"Green building is not a curiosity anymore -- it's a huge market," said Aditya Ranade, a senior analyst with Lux Research in Boston. "The green building sector will be a $280 billion global industry by the end of the decade. LEED is dominant around the world, but there are other standards. Malaysia has its own Green Building Index, and China has developed its own three-star-rating system."
The Green Building Council offers four levels of LEED certificates. They range from certified, in which 50 percent of the requirements are met, to platinum, in which at least 80 percent are met. Facebook's data center in Prineville, Ore., for example, achieved LEED gold status.
But as LEED has grown and green building technology evolves, so has the need to update the rating system. The Green Building Council, a nonprofit with 14,000 member companies, on Tuesday will release proposed changes known as LEED v4 that member companies can comment on. The draft changes, which will be subject to a public comment period through Dec. 10, include increased technical rigor for energy performance and new categories that focus on integrated design, life cycle analysis of materials used and issues like indoor air quality.
"In order for LEED to be relevant, it has to evolve," said council spokeswoman Ashley Katz. "In 2000, people didn't know what low VOC (volatile organic compounds) paint was. Now it's what everyone uses."
Lux Capital notes that venture capitalists have pumped more than $4 billion into green building since 2000. Several Silicon Valley companies, including digital lighting startups Redwood Systems and Adura Technologies, are considered ripe acquisition targets for larger companies focusing on building sensors and controls.
The original idea behind LEED was to make buildings more energy efficient and reduce the
carbon footprint of the built environment. But LEED-certified buildings, which are often filled with natural sunlight and access to fresh air, have proved to be popular with employees, improving concentration and boosting productivity.
Hospitals, schools and universities are increasingly turning to LEED standards: The University of California has 100 LEED-certified facilities, followed by Harvard, which has 75. And leading companies increasingly see LEED-certified buildings as a way to recruit top talent.
In June, the Green Building Council's Northern California chapter launched the "California Best Buildings Challenge." Thirteen companies, including Adobe Systems (ADBE), Genentech, Google (GOOG), Prudential Real Estate Investors, SAP and Zynga, have signed on and committed to a 20 percent reduction in energy, water and waste by 2014.
"Improving the environmental performance of our buildings not only helps us reduce waste, save energy and water and improve indoor air quality, but also positively impacts the health and productivity of our employees around the world," David Radcliffe, vice president of real estate and workplace services at Google, said in a statement. "Through our early participation in the California Best Buildings Challenge, we hope to inspire companies of all shapes and sizes to implement innovative approaches to reducing their environmental footprint."
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