Anyone predicting the emergence of a large and lucrative market at our nation’s present economic ebb is going to get attention, but Greg Kats deserves more attention than, say, Larry Kudlow or the clowns who wrote Dow Eleventy Zillion. A former member of Bill Clinton’s Department of Energy, Kats is now the senior director of the New York-based venture capital firm Good Energies Inc., and he recently issued the results of a two-year, independently-financed report in a book called Greening Our Built World. To call Kats’ conclusions bullish is, frankly, kind of an insult to bulls. But while Kats’ projection that 50 percent of the non-residential building stock in the U.S. will qualify as “green” by 2015 is dramatic — especially since the current figure is 15 percent — it’s not exactly James Glassman and Kevin Hassett predicting that the Dow will hit infinity by 2002 as long as we repeal the Glass-Steagall Act. That is to say, Kats actually makes it seem possible.
As summarized by the Wall Street Journal’s Sari Krieger, Kats’ study used LEED standards — not LEED registration or certification — as his green baseline, and interviewed 100 architects and drew information from a host of sources to come up with his ultra-robust growth estimate. His 50 percent estimate is a step up from the McGraw-Hill study released in October of 2008 that foresaw an expansion of up to 20-to-30 percent in the retrofit market. “We now have a large enough, detailed enough body of data to say that the presumption is ‘why wouldn’t you do a green building?’” Kats told Krieger. “It’s very cost-effective and it reduces risk in a number of areas including health, exposure to energy and water prices and obsolescence.”
Obviously gbNYC agrees with that sentiment, and obviously more competition in a growing green building/retrofit market could help narrow the cost difference between green building and conventional construction (which is currently just two percent, anyway). As difficult as it is to be optimistic about any impending economic booms at the moment — note: this may have something to do with the fact that I write words for a living, which is currently somewhere between Yugo Repairman and Bear Taunter in terms of Hot Jobs — it’s clear that the green retrofit market is a good place to be at the moment, comparatively speaking. It will be interesting to see how prescient Kats’ predictions wind up being, but obviously we’re hoping that he’s more right about this than Glassman/Hassett were about the viability of our Pets.com stock.