Fast Company

Cash for Clunker Buildings

As the U.S., Germany, and other nations pay people to scrap their polluting cars, what other clunkers are in the marketplace that might respond to an incentive? How about buildings?

Consumers, businesses, and governments spend billions to fight air pollution. The question is not whether to spend money for a healthier environment (and therefore a healthier population), because if we don't solve the problem, we pay for it with higher health care costs and lost productivity (to name just two consequences of air pollution). The question is--what programs give us the highest return on invested capital?

The cash for clunker cars program has proven effective in California on a dollars-per-ton of pollution removed basis. It will likely prove equally effective on the national level, so how about a national "cash for clunker buildings" program, but instead of a trade in, you get a few dollars to tune it up. California has started just such a program, beginning with its own state government buildings. Governor Schwarzenegger's Energy Efficiency Executive Order of July 27, 2004, commits state government to "reduce grid-based energy purchases for state-owned buildings by 20% by 2015, through cost-effective efficiency measures and distributed generation technologies."

That mandate includes retro-commissioning and retro-fitting. The former means going through a building to ensure all electrical devices are working as designed. No new equipment is installed. The latter means replacing inefficient lighting, heating and air conditioning, insulation, elevator motors, and so on with new efficient versions. Both programs save energy and money, but obviously the former delivers results immediately for very little investment, while the latter takes months and many thousands of dollars.

But how much improvement can you get with just a tune-up and not a major overhaul? To date, California has performed tune-ups on nearly 50 state buildings and has realized on average a 11% reduction in electricity consumption and a 16% reduction in natural gas consumption. That's a lot of energy saving for the cost of a few hours of snooping around and tweaking the equipment. That's also a very cheap cost-per-ton of air pollution reduced.

The feds should take a page from the California playbook (again!) and pay for inspections, training, and tune ups of older buildings. It would cost little and save a lot. It would create jobs that pay for themselves. Best of all, we would all breathe easier, both financially and physically. Say, do you think with the money saved and a healthier population we might even be able to afford health care for everyone?

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