There's green in being green

Energy-efficient buildings find their place in retail construction

The big boys in retail are tightening up. Companies like Shoppers Drug Mart, Lowe's, and most notably, Walmart Canada, are building energy efficiency into new buildings and improving efficiency in older buildings. But concern for the environment may not be the biggest motivating factor behind the trend.


"Retailers are high-energy users, mostly because of their display lights," says Bill Partridge, executive VP of the Building Owners and Managers Association (BOMA) Calgary. "Their biggest costs are their ongoing operating costs. If they can do things that will reduce their consumption, they are motivated to do it in order to reduce those costs."

The stores Walmart builds today are 30 per cent more energy efficient than those built in the past. One, in Burlington, Ont., is an environmental demonstration store that's 60 percent more energy efficient thanks in part to geothermal heating and cooling.

Walmart's new distribution centre in Balzac, Alta., is expected to be 60 per cent more energy efficient than similar buildings thanks to a host of alternative technologies and energy-efficient techniques. (See separate story, page 68.)

The building incorporates fuel cell technology, LED lighting, solar panels and a wind turbine. The roof is white, reflecting sunlight to help control the temperature of the interior, and air doors are used between areas with different temperatures to minimize the transfer of heat.


DRIVING OUT COST

The fuel cells in the Balzac distribution centre are expected to deliver $2 million over seven years in operating-cost savings, while the LED lighting is forecast to deliver $1 million in operating-cost savings over the same period.

Cost savings are certainly a driver, but the company says there are other motivators as well.

"Every time Walmart successfully reduces energy or minimizes waste, it also reduces costs," says Virginia Garbutt, director strategic network planning and improvement for Walmart Canada. "Many of these green initiatives hold the added bonus of earning an improved return on investment."

Walmart does appear to be taking sustainability seriously, even establishing a website for corporations to share best practices. That's welcome news for those worried about greenhouse gas and climate change.

According to Geared for Change: Energy Efficiency in Canada's Commercial Building Sector, a report put out in 2009 by the National Round Table on Environment and the Economy and Sustainable Development Technology Canada, commercial buildings, which include retail facilities, consume 14 per cent of Canada's energy. They are also responsible for 13 per cent of this country's carbon emissions.

Attention to the environment on the part of major players could lead more retailers and the developers who house them to explore energy efficiency.

Stephen Carruthers is a managing partner with Zeidler Partnership Architects in Calgary who participated in the design of Canada's first Leadership in Energy Efficiency and Design (LEED) Gold mixed-use commercial building, the Bison Courtyard in Banff, Alta. He hasn't worked on any retail projects incorporating the same high level of sustainability and efficiency since that building was designed in 2003 because, he says, the opportunity simply hasn't presented itself.

The Bison Courtyard, completed in 2005, has a high-efficiency building envelope with increased insulation, triple-glazed windows and efficient mechanical and electrical systems.

A green roof adds to the insulation value and doesn't absorb heat, helping to keep the building cool and preventing the radiation of heat onto surrounding buildings. The roof is also designed to retain as much snow as possible to provide additional insulation in the winter.

"It's an excellent example of what can happen when a client is committed to a project," Carruthers says. "You can do a lot of things to the base building technology that are energy effective and thoughtful in terms of sustainability."


PAYING MORE

Getting tenants willing to live up to LEED standards, however, can be more difficult. Fitting out retail space with low-energy lighting or heat exchangers is more expensive and tenants have a difficult time justifying the cost when they don't know how they will perform in the space.

"There are some pretty interesting dynamics with respect to retail because it can be a narrow margin business," Carruthers says. "Tenants are often very concerned about additional costs at the front end."

But developers and large corporations can, if they choose, take a leading role in encouraging the retail industry to embrace energy efficiency. Shopping malls and buildings like The Bow, which will house a retail and food court component, are desirable locations and tenants may be willing to spend more in order to be there.

"The Bison Courtyard is probably the template," says Mike Kehoe, an Alberta-based real estate broker. "This is the future."

Kehoe was responsible for filling the 30,000 sq. ft of commercial space at the Bison Courtyard. It's not just the physical building that impresses him, but the fact that the developer created a triple bottom line lease that encourages tenants to give back to the community and to participate in environmental programs.

Kehoe believes that energy-efficient buildings can help developers attract and retain retail tenants - if they actually perform and the company building them isn't just greenwashing.

The BOMA BESt (Building Environmental Standards) program measures energy performance so owners and tenants can see the operational savings. "There's bonafide criteria that they have to follow in their building operations, and a track record of performance," Kehoe says. "That goes further than just building up to a standard that may not be able to be proven."

Geared for Change recommends government involvement to increase the adoption of energy-efficient technologies and design. This involvement could take the form of energy efficiency standards in building codes, minimum performance, financial incentives and subsidies and information programs.

But those in the know, like Partridge, don't necessarily agree that government needs to be involved, especially in a regulatory capacity.

"Right now, industry will go out and spend millions of dollars to make buildings more efficient in many ways on their own, without any government inducement to do so," he says. "I think if government has to get involved, it needs to get involved in a manner that would reward people for doing things on a voluntary basis and, in effect, punish those who don't."

Partridge suggests altering taxation policy to reward energy conservation and structuring utility rates so that energy becomes more expensive when you use more of it. Ultimately though, he, Kehoe and Carruthers agree that adoption will continue to increase on its own as the price of energy increases, operational cost savings are proven and a new generation that's grown up with the green movement takes the reins of the nation's retail and development companies.


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