The NY Times has an important editorial up today, arguing for the extension of the Treasury Cash Grants for renewable energy. 

Some background: last year, in response to the most significant economic downturn in several decades, the Treasury Grant Program was enacted in the Recovery Act (ARRA) to help support our growing renewable energy industry.  Essentially, as we’ve written about here and here, tax credits were previously a vital deployment mechanism for renewables that were rendered ineffective as an incentive to development by the drying up of tax equity investment market.  In response, a short-term fix was included in ARRA that allowed renewable energy companies to take an upfront cash grant based on project capital costs in lieu of tax credits. 

The cash grant was welcomed by the renewable industry (and investors), and for good reason.  It provides a fiscally efficient, timely and transparent cash incentive than is easily monetizable to help fund project capital needs. In 2009, in the face of a brutal recession, the wind industry (the primary recipient of cash grants on an aggregate dollar basis) actually grew, impressively installing over 10GW of capacity.  Early numbers on solar in certain states (New Jersey, California) have been extremely bullish as well.  More detail is found in this early analysis of the program from LBNL.  Privately, we’ve heard from developers, bankers and attorneys that the vast majority of renewables projects being funded are using the cash grant. (while the tax credit has been an effective deployment mechanism, it is less lucrative for most projects, and more difficult to utilize). 

Unfortunately for developers, the cash grant expires at the end of 2010. This expiration is problematic for a few reasons:

1)     It could stifle a growing industry in a still weak economy.  Due to a recession-induced fall-off in electricity consumption, constrained capital markets, and a decrease in natural gas prices, demand for renewables projects is currently limited in most states (those with strong renewable portfolio standards being the exception). Several renewable technologies (especially wind and solar) are at key inflexion points in terms of their ability to compete with conventional energy technologies, and need to continue expanding to ensure manufacturing facilities, supply chains and labor resources remain viable and accessible.  Once electricity demand recovers, capital markets improve, and natural gas prices potentially revert back to historically higher, more volatile levels, renewables will be in a much stronger position.  Until then, the elimination of the cash grant could severely hamper renewables growth in the short term and have negative longer term repercussions.

2)     Policy uncertainty leads to investment uncertainty which leads to an earlier halt to growth.  The longer the cash grant extension remains in limbo, the less likely investors are to provide capital to projects.  Given this, any project unable to guarantee construction completion by December 31 of this year (and thus access to the cash grant) will face considerable challenges raising funds.  This will likely mean that fairly soon, we will begin to see and immediate and dramatic slowdown in project development, which will take 12-18 months to clear out, even with a last minute cash grant extension in December. 

3)     The rush to complete projects could lead to bad projects.   Given the above, we’re now seeing a rush of additional projects from developers seeking to take advantage of the cash grant before its expiration.  This is stressing the range of regulatory agencies in charge of permitting new projects and could lead to bad decisions and bad projects.  Extending the cash grant would give understaffed regulators more time to review projects and ensure renewable facilities are environmentally sound. 

There are certainly challenges with the cash grant approach, which we’ve raised in previous blogs, among them that it could lead to inflation of project costs and lower capacity factor projects.  It’s also pretty expensive (almost $4 billion in a recent Joint Committee on Taxation analysis).  However, given the current headwinds facing the renewables industry, we believe it to be an important short-term policy to maintain growth in this new industry (with commensurate job and local tax revenues) and ensure a successful U.S. renewables industry in the long-term.  

Above is a GIS-coded map of metropolitan Baltimore, a region approximately 70 miles north to south and, at its widest point, about 60 miles east to west.  Below are similar maps of the San Francisco Bay Area and metropolitan Portland, Oregon.  The colored portions in each indicate preferred locations for smart, green development using criteria from LEED for Neighborhood Development. 

There is now heightened interest in using LEED-ND not just as a structured program for evaluating and rewarding worthy development proposals, but also as a template for policy decisions.  This has been spurred in part by HUD secretary Shaun Donovan’s announcement that his agency intends to use location criteria from LEED-ND to assist in evaluating potential HUD grantmaking.  Since many of us involved in constructing the program have hoped all along that public officials would borrow from the system’s criteria and methodology for various purposes, all this is great news.

It has led to frenzied questioning by some in the field, however, as to what “using LEED-ND” to identify good locations should mean, exactly.  (Never mind that some of us just spent eight years sorting that out.  Most people aren't yet familiar with the system.)  Ad hoc work groups have formed; meetings have been held and scheduled; concepts have been developed and floated.

Enter the ever-analytical and creative Eliot Allen of Criterion Planners (Eliot has been involved with LEED-ND almost as long as I have) to remind us that it really may not be all that complicated.  The three GIS maps shown here, all developed by Criterion, apply a single LEED-ND criterion (SLLc3 for you ND nerds, and you know who you are), which awards credit points for the following:

“Locate the project within a region served by a metropolitan planning organization (MPO) and within a transportation analysis zone where the current annual home-based vehicle miles traveled (VMT) per capita does not exceed 90% of the average of the metropolitan region. The research must be derived from household transportation surveys conducted by the MPO within ten years of the date of submission for LEED for Neighborhood Development certification. Additional credit may be awarded for increasing levels of performance, as indicated . . .”

In other words, if a location reduces the amount of driving its residents do, on average, compared to its metro region as a whole, it is worth crediting.  If it beats the regional average by a lot, it is worth crediting with more points (up to a maximum of seven). 

More specifically, residents of the locations shown in color on Criterion's maps drive no more than 90 percent, on average, of the vehicle miles traveled by an average person in the region as a whole; the darker the color, the lower the driving rate.  To illustrate, if the average person in the greater Baltimore region drives 30 miles per day (hypothetical amount), the average person in one of the marked locations drives 27 miles or fewer.  In the darkest portions of the map, the average person would drive 9 miles or fewer.  Since all metro regions are required by federal transportation law to maintain these data, they are generally available to an analyst who knows what she is doing.

Note that these superior locations include not just about everywhere in central cities, but also some suburban locations:  for example, they include sites (among others) in and near Santa Rosa, Concord, Walnut Creek, San Rafael, and Palo Alto in the San Francisco Bay Area; Timonium, Reisterstown and Havre de Grace outside Baltimore; McMinnville, Vancouver (WA) and Gresham outside Portland.  Much of the area shown in gray comprises rural land, small towns and low-density sprawl where relatively poor accessibility leads to high rates of driving and consequent emissions.  (As an added benefit, the metro Portland map also shows how that region’s urban growth boundary has done a decent job of containing the spread of development.)

Eliot recommends this kind of analysis to assist "place-based planning," which makes a ton of sense for an agency like HUD, as well as for the environment and for conserving infrastructure costs.  It's a great corollary to the Center for Neighborhood Technology's Housing + Transportation Affordability Index, which identifies locations where residents can reduce household expenses associated with transportation.  I bet the best sites identified under each methodology match up very well.

That locations certifiable under LEED-ND are likely to reduce driving compared to average locations is also being suggested by an analysis of development projects certified under the LEED-ND pilot.  Undertaken by Reid Ewing of the University of Utah along with Meghan Bogearts, Michael Greenwald, and Ming Zhang, and pending publication (Reid was kind enough to allow me to view a preliminary copy), the study applied sophisticated transportation modeling to 12 certified projects.  The analysis predicts average trip lengths, showing that average vehicle miles traveled per household trip from the group of 12 will likely amount to only 29 to 69 percent of their regional averages, depending on the particular project.  The researchers believe this is due to the superior regional accessibility of the studied LEED-ND locations.  Eight of the locations also have a predicted walk mode share (the percentage of all trips made by walking) above ten percent, which is outstanding.

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Kaid Benfield writes (almost) daily about community, development, and the environment.  For more posts, see his blog's home page. 

Denver’s Highlands’ Garden Village is justly regarded as one of the country’s best exemplars of smart, green urbanism.  As I wrote in yesterday’s post, it has some of just about everything we look for in a great neighborhood development, from mixed uses and incomes to parks and green landscaping to great walkability and access, and more.

I ended yesterday’s post with a provocative question: as good as it is, could HGV have been better?  My answer: yes and no.  Read on.

If I have a complaint, it is probably with the project's commercial areas - which, compared to the residential sections, look more suburban to me and definitely less dense.  Notice in the site plan above and Google Earth image just underneath it how much of the land in the northwestern portion of the site, a commercial area, is given to surface parking.

Here are a few photos of that part of the neighborhood, some taken from Google Earth’s street view feature and some from HGV’s developer, Perry Rose:

Now, to be fair, Google Earth’s street views can be very wide-angle and a bit distorting, and the colors and ‘composition’ considerably less than flattering.  The trees shown in the site plan for the parking lots and barely visible in the images are far from mature and will begin to enhance the appearance of the lots quickly as they grow canopies.  That will also provide more environmental functionality, particularly in shading and helping cool the parking surface.  In addition, the commercial buildings do address the street, not a parking lot, on the 38th Avenue side.  But, so far at least, I think the commercial sections don’t quite match up to the residential sections in variety, density, walkability, or environmental function.

I doubt that the developers would disagree much, actually.  But Chuck Perry of Perry Rose pointed out in helpful email correspondence that the low-density, high-parking design was largely required by the retail tenants:

“We were successful in reducing the city’s parking requirement from one space per 200 square feet (of retail space) to one per 350 square feet.  [But] all of the retail tenants have required at least one space per 200 square feet.  On the one block built with one space per 350 square feet we have actually had potential retail tenants reject the space because they did not feel there was enough parking.  In fairness, parking is at a premium at times.  However, over time I think we will see parking demand diminish as the younger generation begins to drive less and use alternative modes of transportation.”

On the plus side, Chuck reports that the Sunflower market, the project’s LEED-certified supermarket and the building in the site’s northwest corner (more photos just below), has been immensely successful commercially.

Parking for both commercial and residential portions of the project was one of the many concerns raised by NIMBY opponents of HGV when its approval was being considered by municipal authorities.  In flyers headlined “Too Dense Makes No Sense,” the “Coalition for Responsible Elitch Development” also pushed for a maximum residential density of 200 units on the 27-acre site, a minimum of 50 percent of the site devoted to park space, and “safe street widths.”

By "safe street widths," they were essentially asking for wider streets.  Narrower streets are generally preferred for smart growth because they slow traffic, place less runoff-inducing impervious surface over the ground, and allow more efficient use of land compared to wider streets.  But fire departments push for wider streets to give their ever-widening vehicles more maneuvering room.  HGV's street widths are the proiduct of compromise:  Jonathan Rose (the Rose of Perry Rose; in the interest of disclosure, I should mention again that Jonathan is a friend and an NRDC trustee) reports that HGV’s developers sought 28-foot street widths, while the fire department insisted on 36.  The city of Denver eventually permitted 32 feet.  Jonathan says he would have preferred that additional land that could have been made available for other uses by using the narrower width be given over to park space instead.  I agree, but I’m glad they accomplished at least some accommodation on that point.

Chuck and Jonathan also have said that they wish the project could have had a bit more residential density with, for example, accessory flats on every for-sale house.  (HGV's alleys, above, are ideal for accommodating accessory apartments.)  HGV does have such units but, in a concession to community demands, they appear on only one of every three of the single-family homes.   The developers also would have liked to have had additional types of housing (though, as noted yesterday, HGV as built contains a remarkably diverse array of housing choices), such as three- to four-story condos, perhaps where one of the commercial buildings now stands and, interestingly, some one-story townhouses as end units, providing options for residents who might have difficulty accessing stairs.  But the first was infeasible given community resistance to density and the second because it would have made grading issues more difficult.

I am actually fine with the residential density as it now stands.  The average density of the residential portion of the project is 22 homes per acre, which is more than adequate to encourage walkability and make good use of the site.  It is also an increase from nearby residential density.  In most cases I prefer that we increase density incrementally on infill and redevelopment sites, to respect the existing character of the community, and that seems to be what HGV has done here.

Chuck also reports that, in retrospect, he would have swapped the sites for the commercial gym (the second building from the left on the north boundary of the site) and the retail building to its east.  That would have allowed the retail building to attract restaurant tenants, which are currently discouraged because liquor licenses are not allowed within 500 feet of the school on the eastern edge of the site:

“We made a very conscious decision to include a charter school as part of the project because improving the quality of education in urban neighborhoods is critical to attracting young families back to the city.  [But] we realized that locating the school on Tennyson Street [running north-south by the park with the pavilion] would preclude liquor licenses from the line retail.”

Jonathan also wishes they could have incorporated more contemporary design.  (The neighbors preferred traditional.)

All that said, the developers are clearly proud of their accomplishments with HGV, as well they should be.  Jonathan stresses that he is especially pleased with the co-housing, which puts “advanced community” in the center of the development, and with the concept of a “garden community,” with the enjoyment of actual gardens and diverse, native landscaping tended by resident volunteers.

My verdict is that while improvements, especially in the commercial sections, would have enhanced HGV’s appearance and function as a smart, green development, for the most part those improvements were only theoretical in this case.  Perry Rose pushed the envelope as far as they could in a green direction given their commercial, regulatory and community situation, and ended up with a terrific result.  Over time, economic conditions may allow for further improvements in the commercial areas (with, for instance, more density and structured instead of surface parking), but the perfect need not become the enemy of the truly excellent.  On balance, I believe the residents, the environment and our shared cause all have a winner in Highlands’ Garden Village.

See Part 1 here.

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Kaid Benfield writes (almost) daily about community, development, and the environment.  For more posts, see his blog's home page. 

Is Information Technology (I.T.) going to save or bake the planet?  Over the past few years, an increasing number of voices from industry have risen to argue that I.T.'s beneficial environmental effects vastly outweigh the direct environmental impact of the electricity it consumes.

The argument for I.T.’s benefits is that it can be used to increase energy and resource efficiency, for example with smart grid and smart building technologies. It can also be used to substitute carbon-intensive activities by lower carbon ones, such as replacing business travel by video conferencing and printed information by online content. And consumer electronics devices such as laptops, tablets and smart phones enable users to access and participate in the digital economy, a model which could potentially support economic growth with lower or even negative resource consumption growth. The Smart2020 report estimates that I.T. can save the equivalent of five times its own greenhouse gas emissions by 2020.

As the new NRDC advocate for energy efficiency in electronics, and having spent 20 years in the I.T. industry, I strongly support and encourage information technology’s potential to increase energy efficiency and help transition towards a low-carbon economy. However this should not eclipse the fact that I.T. also consumes a significant and fast growing amount of electricity. I believe we need to do both: leverage I.T.’s power to transform the way we live and work, AND increase efficiency of computers and the internet.

IDC projects that over 350 million PCs will be sold worldwide in 2010, and the Smart2020 report also estimates that the global PC installed base, including desktops, laptops, netbooks, tablets, will grow from about 1 billion in 2007 to approximately 4 billion by 2020. In addition to their own footprint, most of these devices will be connected to the internet to use so-called “cloud” services, and will therefore be responsible for a share of the internet’s footprint. The explosion in the number of PCs and the associated growth of the internet infrastructure supporting them continue to make energy efficiency of computers and the internet a critical priority.

Energy efficiency of computers has been increasing steadily over the past decades and we can expect this trend to continue. But this does not happen by itself, it requires a sustained effort by all stakeholders such as:

• Industry, to invest in energy efficiency research and development, and to provide leadership in steering the market to adopt the more energy efficient equipment available
• Governments to set voluntary and mandatory standards to enable market transformation
• Consumers to demand more energy efficient devices and purchase them when available
• Advocates to provide independent analysis, expertise and leadership to facilitate the discussion between stakeholders and ensure progress
• All of these stakeholders, to develop standards and test protocols to allow energy efficiency to be compared between competing products and used as a basis for consumer choice and business specification.

Without these efforts, past experience shows that market forces and technology trends by themselves are not sufficient to capture energy efficiency opportunities in information technology at the pace required to meet IPCC climate change targets: this is due to well known market failures, such as lack of awareness by consumers and low electricity prices not including externalities.

One of the best-known examples of how standards can turn around energy efficiency where market forces fail to do so is that of refrigerators in the U.S. The refrigerator energy graph below shows how U.S. refrigerator energy use was going through the roof until 1978 when efficiency standards were first implemented. Note how much efficiency has improved since then while size and performance have continued to increase and price have steadily declined: David Goldstein provides an expert perspective of how efficiency standards work in his new book Invisible Energy.

While computers have already become much more energy efficient over the past decade, they still present considerable untapped opportunities to further reduce their energy consumption, from more efficient power supplies, processors and disks, to smarter operating systems, application software and communications protocols.

A large part of the electricity that goes into each computer is still wasted as heat. Typical servers in data centers run at 5 to 15 percent utilization only, while still using more than 60 to 90 percent of maximum system power (see EPA report to Congress on Data Center Energy Efficiency). Servers and networking equipment in data centers represent the majority of the internet’s greenhouse gas footprint. We cannot ignore this opportunity to contribute to GHG emissions reductions.

The good news is that current best-in-class technologies, such as high efficiency power supplies and ultra-low voltage processors, present numerous opportunities to reduce I.T. energy use, at costs well below the energy savings over the lifetime of the equipment. To capture these opportunities at scale we need smart energy efficiency policies to send the right market signals and align business and environmental interests. So energy efficiency is not about using less I.T., but about using more efficient I.T. to make the economy more efficient.  Information technology can help save the planet without baking it!

Highlands’ Garden Village (HGV) is the kind of neighborhood development that I want to include in almost all of my presentations, partly because it is truly photogenic and partly because it contains so many of the features that people like me advocate as alternatives to sprawl.  Placing some 306 homes, 3 acres of green space, 75,000 square feet of commercial space and 63,000 square feet of civic buildings on 27 redeveloped acres, HGV has it all: diverse and affordable housing; high-end single-family homes; green buildings and landscaping, regular transit service; community gardens; and excellent design.

When my friend Shelley Poticha, now head of sustainability at HUD, was executive director at the Congress for the New Urbanism, she called HGV the best development in America.  High praise, and perhaps a bit of hyperbole, but one could definitely make a case for it then, and I think the project has held up well since.

HGV’s site has a rich history.  It was once home to Elitch’s Zoological Gardens, a theme park dating to 1890 with zoo animals, amusement rides, big-band dances, a theatre, a roller-coaster, and gatherings that hosted the likes of cowboy movie hero Hopalong Cassidy.  The site was abandoned in 1995 when the park relocated to downtown near the Denver Broncos’ football stadium.

Named for the Highlands section of Denver northwest of downtown, Highlands’ Garden Village was developed by Perry Rose, an affiliate of green developer Jonathan Rose Companies (disclosure: Jonathan is a friend and a trustee of NRDC), with site planning by California-based new urban architects Calthorpe Associates.  The project cost $108.2 million to develop.

One of best things they did was restore the old Elitch’s theatre, which had fallen into disrepair, so that it now hosts shows and community events, and to preserve the old round carrousel building that now serves as an all-purpose, open neighborhood pavilion set within one of HGV’s park areas.

The housing is diverse in several senses of the word.  There are 52 single family homes (large photo below), 20 carriage homes above garages, 38 townhomes and condos, 63 apartments for seniors (below left), 74 rental apartments, 33 homes in a co-housing configuration (below right), and 26 live/work lofts.  Twenty percent of the homes were priced to be affordable to households earning 50 percent or less of the area median income.  The remainder all sold at higher than expected prices.  A variety of housing types not only allows residents of different incomes to settle in the same neighborhood; it also allows residents to ‘age in place’ as their housing needs change, without leaving the community.

The development’s site is very good for smart growth performance, not just because of its internal features (which include great street connectivity, too) but also because of its accessibility.  One bus line runs right along the north border, taking passengers downtown in about ten minutes, according to Chuck Perry of Perry Rose.  There are also two other bus lines within a half mile from the center of the site.  (See the blue bus stop markings on the Google Earth image, below.) 

Taking the measurement from the center, the neighborhood can boast a ‘very walkable’ Walk Score of 86.  According to Walk Score’s database, within a half-mile are also the following:

• 4 food markets;
• 6 restaurants;
• 3 coffee shops;
• 6 bars;
• 3 schools (one of which was built by Perry Rose as part of the development concept);
• a city park;
• 4 bookstores;
• 5 fitness, yoga and dance facilities;
• a pharmacy;
• a hardware store; and
• 8 clothing and music shops.

(See Walk Score map just above.)  Commercial establishments come and go, of course, and Walk Score’s information on neighborhood amenities can be out of date.  But, still, that’s a lot.

In addition to the use of a redevelopment site, walkability, accessibility, diversity, preservation of historic buildings and efficient use of land, HGV is loaded with environmental achievements and features.  Here are some notable ones:

• 30 tons of concrete from Elitch’s were recycled into the HGV street network;
• The Sunflower Market building (the largest on the site) is certified LEED-gold;
• All single family homes exceed Energy Star and Colorado Built Green requirements;
• Multifamily buildings feature recycled materials, low-VOC finishes and energy-efficient conditioning and windows;
• All public buildings and infrastructure are powered by solar or (purchased) wind energy;
• Sidewalk plantings (above left) are xeriscape;
• The community lawn in front of the theatre is planted with native buffalo grass, which requires only one-sixth the amount of water needed by blue grass;
• Mature trees from Elitch’s were preserved.

Not too shabby.  Great environmental aspects, and a nice place to live, too.  The residents, designers, developers, and city permitting authorities have a lot to be proud of.  I think I’ll keep it in my presentations.

Next: Could It Have Been Better?

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Kaid Benfield writes (almost) daily about community, development, and the environment.  For more posts, see his blog's home page.