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The Fed looks to a 'Green Recovery'

Marc Lefkowitz  |  04/09/10 @ 7:00pm  |  Posted in Home efficiency, Green buildings

The Federal Reserve Bank of Cleveland highlighted research on the prospects for a 'green recovery', with one architect of the Stimulus Act's energy plan emphasizing that so much depends on how states invest their share.

Ohio should expect $1.1 billion to create jobs for renewable energy generation and retrofits to make buildings more energy efficient. If Cleveland alone were to invest its share of the Stimulus to shift workers from fossil fuel industries to clean energy, the city would create 10,241 jobs and reduce unemployment by one full percentage point, Robert Pollin, University of Massachusetts-Amherst professor and author of 'Green Recovery' told The Fed's Applied Research conference on the subject yesterday.

As an aside, The Fed has a research area on green economies. (Imagine if it started churning out reports on 'green economic recovery' that stimulated new policy. Wouldn't it be a tremendous boost to 'weak market' cities like Cleveland, and offer support for changing the corporate paradigm of 'take, make, waste.')

"Why haven't retrofits taken off in Cleveland?" asked Pollin. "That's something The Fed should help figure out, and help mobilize the investment community to get this moving."

Each $1 million Cleveland takes out of the fossil fuel economy and invests in the green economy will be a net creator of 12 jobs, added Pollin, whose 'Green Recovery' paper was incorporated into the Stimulus program and got him a gig as a consultant on the energy aspects of the Stimulus. "Are they good jobs? It is true on average fossil fuel jobs pay 20% higher than a green jobs, but you still have better economic impact overall.

"Investing in a green economy could be an engine of job opportunity for low income people. It could engender pathways out of poverty."

Pollin suggest the proper allocation of Cleveland's Stimulus funds that have a 'green energy' focus should be 70% in energy efficiency and 30% in smart grid and renewables.

"Building retrofits are a no brainer. They create a lot of jobs and reduce fossil fuel use. Second is the smart grid. Third are renewables. We need to help make projects like the Great Lakes Energy Task Force Lake Erie wind farm cost competitive."

Green building retrofits are a good investment for building owners, even in a down economy, reports University of California Berkeley professor John Quigley whose research compared rental and resale rates for green and non-green buildings in the U.S.

Quigley and an army of grad students analyzed a cross-section of the 28,000 LEED-certified and Energy Star buildings and compared them to non-green buildings in a ¼ mile radius in 2007 and in 2009. They found that green buildings rent for 5% more than non-green buildings-even as supply increased and as the economy tanked.

"Having a more energy efficient building is profitable to the landlord," Quigley said. "Tenants are willing to pay higher rents for a green building, and the increased energy efficiency is fully capitalized into the selling rate of the building."

The heads of ReImagine a more sustainable Greater Cleveland and the Evergreen Cooperatives gave updates on their flagship green 'self help economy' projects.

ReImagine looks at a Cleveland 'portfolio' (3,300 acres) of vacant land and, instead of undermining the value of urban neighborhoods, it can be reused to promote self sufficiency, local food and repairing damage to ecosystems, says Cleveland Urban Design Collaborative interim director Terry Schwarz.

The 56 vacant land reuse pilot projects starting this spring will shed some light on what small-scale strategies are most effective, Schwarz said.

The city invested $500,000 from its HUD/Neighborhood Stabilization Funds in the pilots, but ReImagine needs the private sector to see the value if movement building is in the future, adds Neighborhood Progress, Inc. Senior VP Bobbi Reichtell.

"We have to raise up the heroes in your community because they are not getting paid to do (the ReImagine pilots)," Reichtell said. "We want to share the learning that comes out of this process and celebrate these early adopters."

Reichtell sees ReImagine saving the city tons of money – right now Cleveland mows lawns on 13,000 of the 20,000 vacant parcels in the city – and expect it to shape land-use policy.

"We're working to figure out, is there a way of fostering community stewardship with the city's maintenance efforts, and catalyze land with larger efforts."

An audience member asked, can ReImagine and hyper-local food production become a job driver?

"It might not be full time, but you might earn $8,000-10,000 a year to supplement your income," Reichtell said. "I'm seeing a lot of college-age folks moving back to the city, and they're attracted to urban agriculture."

How ReImagine scales up from pilot to catalytic is the current hot topic at Cleveland City Hall. Signs point to the first 'catalytic' project being a commercial greenhouse in the Central neighborhood that would bring five acres of lettuce production under glass. Called Green City Growers, the greenhouse will be the third employee-owned venture for the Evergreen Cooperative. It promises to create a job for 50 Cleveland residents with an ownership stake and personal wealth creation as goals. The city and Evergreen, which was formed by the Cleveland Foundation and Shorebank, are working on assembling the land and directing public and philanthropic funds to the start up.

The first two coops-the Evergreen Cooperative Laundry in Glenville and the Ohio Solar Cooperative-are in operation. The laundry is in its predicted 18-month loss period, but it is taking on linen contracts, as expected, from Cleveland Clinic and University Hospitals. The laundry is 'green' because it uses .8 gallons per load compared to 50 gallons in a conventional setting. National press coverage from Time and Business Week established the Coops as 'The Cleveland Model' of green economic development, says Ted Howard of the Democracy Collaborative at the University of Maryland. It also opened doors: Local hotel chains are interested. Howard was hired as a consultant to work on Evergreen, and its success has led to him and his wife to plan on moving to Cleveland.

Elena Irwin, OSU Department of Agricultural, Environmental and Development Economies, presented "Research on Homeowners' Demand for Improved Water Quality in Lake Erie". She found that home values in Northeast Ohio improved when the lake was clearer and fewer beach advisories are posted. The research supports land use policy that protects Lake Erie waterways and promotes organic farm methods.

Professor Stuart Rosenthal at Syracuse University said cities looking for new residents sell their quality of life amenities or business friendliness. Cleveland, in eyes of households, doesn't compete with warm, coastal cities, but it ranks a little higher, 91st out of 360 cities, in his study for business attractiveness. "Could we stabilize Cleveland's population by improving quality of life features like the quality of the lake?" Rosenthal answered, it depends on the age group. Post-grads and retirees are looking at urban amenities, so that could be cause for Cleveland to improve its connectivity, walkability and urban sustainability.

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