Sunday, January 03, 2010

Emissions-Reducing Energy Efficiency Measures Enhance Real Estate Portfolios

From GreenBiz:

Proven, existing efficiency technologies -- in everything from lighting to climate control and more -- can unlock the untapped reserves of efficiency gains buried in many real estate holdings, according to a new report.

Those gains would be a boon to real estate investors' bottom lines — both direct property owners like large pension funds and smaller investors who primarily hold real estate securities — even as they make our buildings far less power-hungry and a big part of America's efforts to combat climate change.

The report, "Energy Efficiency in Real Estate Portfolios: Opportunities for Investors" (PDF), was commissioned by Ceres and authored by the responsible investment group of the investment consulting business Mercer.

The global trend toward putting a price on greenhouse gas emissions — thus ending the practice of disregarding the cost of polluting — tacks a strong business case for limiting buildings' emissions onto the strong environmental case.

But while there are clear opportunities in unlocking efficiency gains, the report also cites a flip side for real estate investors who fail to factor in efficiency: the same trend toward ending free pollution may expose unprepared investors — and fiduciaries of investment portfolios — to unnecessary investment risks. That's because expected higher energy costs, existing and possible legislation demanding increased efficiency, and competition from more efficient buildings could drag down the profits of less efficient portfolios.

As I look back a decade to 2000, this whole green blogosphere was really nowhere to be found.  If you'd have asked most people about the business case, they'd think you had found a sweet new briefcase.

I just hope we can get our act together and implement the policy changes needed to drive the major efficiency and clean energy gains we need before it's forced upon us by a Peak Oil crisis or a Climate Disruption surprise...

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Here's another good piece on energy efficiency from GreenBiz...

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