France’s New Environmental Legislation: What It Means for the US

A new French law requires that all new buildings in commercial zones must be partially covered (50%) with either solar panels, or plants. The benefits are obvious. Solar panels generate electricity, plus roof-mounted panels also provide shading and help deflect the radiant heat. Plants provide cooling through shade and extra insulation, as well as preventing runoff and establishing wildlife friendly environments.

Still, the new law wasn’t just for the birds. To better understand the law and its relevance to the US, let’s dig into the facts behind it.

What it means for France

France is still fighting high unemployment and a weak business climate due to the European debt crisis. In April 2014, unemployment hit 11%, and commercial construction projects are only now creeping forward after five bad years.

Not surprisingly, the French legislature wanted to avoid imposing higher additional costs on its struggling businesses while still addressing the both popular environmental concerns, and the government’s policy to adopt more renewable energy sources. France relies upon nuclear power for over 80% of its energy generation, which is owned and subsidized by the French government. The government seeks to shift away from nuclear in order to improve its grid capacity. Because of the bad economy, solar investment in France is sputtering, even in spite of the government’s 2014 tax incentive plan. France has lagged behind other European countries with utility grade solar installations —just 5 gigawatts as of 2014.

What it means for the US

Conditions in the US are very different with a (comparatively) robust economy. The US Energy Information Agency (EIA) Commercial Buildings Energy Consumption Survey (CBECS) estimates the number of commercial buildings in the United States increased from 2003 by 14% to 5.6 million in 2012. Newer buildings also tend to be larger than older buildings. Average floor space rose from 12,000 sq.ft. for buildings dating before 1960, all the way to 19,000 sq.ft. for buildings constructed between 2000-2012. From 2003 to 2012 alone, commercial floor space increased by 21% to 87 billion square feet. Currently, there’s a construction backlog from high demand. Most telling is since all these buildings use energy, state building codes now incorporate some form of energy efficiency requirement. The 2010/2012 International Energy Conservation Code, for example, covered design and construction requirements adopted in 19 states.

More than just solar panels

Which brings us to green commercial construction. The National Green Building Adoption Index for 2014 found that 8,405 office buildings (about 1.9 billion square feet) were awarded an Energy Star Label and 5,470 office buildings (900 million square feet) had Leadership in Energy and Environmental Design (LEED) certification . In 2005, 0.1% of the total number of commercial office buildings were LEED certified. By 2013, that number had jumped to 5.1%.

What’s behind ramping up Energy Star and LEED certified commercial construction?

US businesses have long profited from corporate sustainability policies through tax credits, prestige, and good PR. But it has now grown beyond merely tacking up a few solar panels on the company’s roof. According to Ernst and Young investment bankers who have been watching sustainability for years, the emerging trend is for corporations to maximize growth opportunities while “remaining within the energy threshold and environmental carrying capacity.” This  improves efficiency, employee morale, and motivates suppliers and consumers to be more environmentally conscious —all of which preserves company growth.

The news of the French law played well on US social media. This underscores the popular value of sustainability—but not the law’s practical application here. With corporate sustainability now evolving beyond mere energy efficiency savings (American biotechnology company Biogen Idec as an example),  similar US legislation would likely be seen as governmental over-reach, and could do more damage in persuading more companies to pursue sustainability.

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