Green & Global Thinking
For the last seven years the Copper Development Association has recruited a slew of authors and experts from various fields for a thought-provoking conference analyzing global market trends. CDA’s “2008 Global Market Trends Conference” was held in Chicago, Sept. 10-12, and focused mainly on green technologies and sustainable development. I attended several of the programs, and will take this opportunity to share some of the more memorable insights coming out of them.
“Projects not green will be functionally obsolete and economically disadvantaged from the moment a building opens,” said Jerry Yudelson, one of the country’s leading experts on and cheerleaders for green building. His main message was that green building is not only a tree hugging phenomenon, but holds the promise of generating great financial and economic returns.
These derive both directly and indirectly from energy cost savings. Yudelson noted those savings also lead to asset appreciation, less market risk, marketing and PR opportunities, better indoor air quality, along with increases in worker productivity and morale. “You should be able to get a building for free if you build it to the highest green standards,” Yudelson proclaimed. He predicted a robust future for radiant heating and cooling in U.S. commercial buildings, and said that the green imperative is sparking a movement in architecture away from pure design and back to “form follows function.”
Some of Yudelson’s proclamations struck me as pie-in-the-sky. A bit of realism trickled out when he addressed the biggest challenges facing green building. One he identified as a shortage of expertise, which is likely to disappear over time. The more daunting obstacle is a disconnect between who pays and who benefits. Building owners must pay the upfront premium tied to sustainable development, while the green benefits accrue to the building tenants. Passing along those costs is difficult during tough economic times in particular.
Wharton Professor Dr. Philip Nichols spoke on “How Emerging Economies Are Changing the Global Socioeconomic Environment,” presenting globalization as a phenomenon related not only to supply and demand, but a shift of business culture in many societies. He noted that in many cultures around the world, particularly in Asia and Africa, economic transactions traditionally have centered around personal relationships. From major deals to everyday retail transactions, business operated at a laconic pace in these cultures as buyers and sellers got to know one another through conversation, shared meals, family ties and other personal connections before getting down to business. The Chinese historically were among the societies with this cultural heritage.
Now, “China is moving in leaps and bounds to form economic relationships with strangers,” said Nichols. This cultural shift is leading to changes in global economics with increased potential for optimal business relationships and growth, and decreased potential for cultural backsliding and protectionism. In the long run, this will mean “borders will matter less,” while “regional alliances will matter more” - the European Union being a prime example.
Another speaker, Dr. Robert Shapiro, is a former U.S. Under Secretary of Commerce for Economic Affairs and economic advisor to the presidential campaigns of Bill Clinton, Al Gore and John Kerry. His presentation, titled “Futurecast” after a book he authored by the same name, can be summarized by the saying “demographics is destiny.”
Shapiro noted that the declining ratio of taxpayers to beneficiaries of Social Security and Medicare “will dominate domestic politics” in the foreseeable future. Although the U.S. ratio is becoming worrisome, our nation is in a little better shape than many European nations and Japan because of higher fertility - due mainly to immigrants - and less generous social welfare benefits. He added, “The (historical) relationships between growth and jobs, and productivity and wages, are breaking down. This will be the central challenge facing President Obama or President McCain.”
Travis Buford, founder and president of the Prometheus Institute for Sustainable Development, called his presentation: “Solar Revolution: The Economic Transformation of the Global Energy Industry.” The solar in his analysis pertained almost entirely to photovoltaics (PV).
Its main premise was that PV is a “disruptive technology” comparable to cell phones that will “circumvent existing supply chains … and energy architecture.” Buford proclaimed the “economic inevitability of PV” will find it generating 20-30% of European and U.S. energy needs by 2020. He walked the audience through a series of calculations and considerations showing PV to be more cost-effective even at present than most people believe, and said that its costs will continue to go down significantly while fossil fuel prices trend inexorably upward.