Smart Buildings

Will Biden Inauguration Mark a Turning Point for the Smart Buildings Market?

Today Joe Biden will be sworn in as the 46th president of the US, marking the end of the Trump administration. During four years in office, Trump reversed more than 100 environmental regulations, dismantling major climate policies, and rolling back numerous green policies, including many that sought to bring about efficiency in our buildings. This set back the US smart buildings market and the global battle against climate change. So, what can we expect from the incoming administration? Biden has promised to sign a series of new executive orders that demand congress enacts legislation to establish an enforcement mechanism for milestone environmental targets. He will rejoin the Paris accord and vows to make a historic investment in clean energy and climate research and innovation, which will incentivize the rapid deployment of clean energy innovations across the economy. He has also committed to smart infrastructure investments for buildings, water, transportation, and energy infrastructure to help prevent, […]

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Today Joe Biden will be sworn in as the 46th president of the US, marking the end of the Trump administration. During four years in office, Trump reversed more than 100 environmental regulations, dismantling major climate policies, and rolling back numerous green policies, including many that sought to bring about efficiency in our buildings. This set back the US smart buildings market and the global battle against climate change. So, what can we expect from the incoming administration?

Biden has promised to sign a series of new executive orders that demand congress enacts legislation to establish an enforcement mechanism for milestone environmental targets. He will rejoin the Paris accord and vows to make a historic investment in clean energy and climate research and innovation, which will incentivize the rapid deployment of clean energy innovations across the economy. He has also committed to smart infrastructure investments for buildings, water, transportation, and energy infrastructure to help prevent, reduce, and withstand a rapidly changing climate.

“It will be a starkly different approach to the Trump administration on almost every front,” said Helen Mountford, vice-president for climate at the World Resources Institute. “Science will once again guide America’s policymaking and inauguration day will mark a new era for climate ambition in the US. He will have a lot on his plate but there’s no doubt that Biden intends to make a full-court press on climate change.”

The incoming president has not just made bold campaign promises on climate change, he has set out a broad plan that offers specific actions on buildings, infrastructure, and many other important environmental issues. Through the ‘Green New Deal’ the Biden administration intends to upgrade four million commercial buildings, and return nearly a quarter of the savings from those retrofits to state and local governments. This specifically includes the installation and maintenance of high-efficiency LED lighting, electric appliances, and advanced heating and cooling systems in buildings. Consistently promising to use products manufactured in the US to drive job creation and spur the economy.

Through major investment in energy upgrades for homes, offices, warehouses, and public buildings, the Biden administration expects to create at least one million jobs in construction, engineering, and manufacturing while improving indoor air quality and environmental health. They promise to reform the building code process with the goal of establishing nationwide building performance standards for existing buildings and support this effort with new funding mechanisms for states, local governments, and tribes. The new president will also launch a national effort to modernize schools, driving the construction of energy-efficient campuses, and expand broadband coverage with the specific aim of enabling the adoption of efficient smart devices.

In the residential sector, Biden promises the construction of 1.5 million homes and public housing units that are energy-efficient from the outset and incentivize regional planning that connects housing, transit, and jobs. The new administration will offer direct cash rebates and low-cost financing to upgrade and electrify home appliances, install more efficient windows, and cut residential energy bills. The incoming president will expand building weatherization policies to reach more than two million homes within four years, vowing to reverse the disproportionately high energy burden for low-income rural households and rural communities of color, thereby redrawing the relationship between poverty and efficiency in the US.

Through the Green New Deal, the US is set to get a Green New President that will introduce a wide range of policies that will drive the energy-efficient buildings agenda. In doing so, they will create the foundation for the expansion of smart building systems designed for occupant health, wellness, and productivity. However, the promises of the incoming president are one thing and his ability to enact such change is another thing altogether. Even with a senate majority, the Biden administration will have to overcome entrenched support for fossil fuels in US politics, which sees energy efficiency as fundamentally bad for business. At the heart of this dilemma is an electricity market governed by established and often old-fashioned utilities.

“Key to achieving a successful transition of the electricity market is assigning an appropriate role to utilities. Electric utilities can provide the future platform upon which renewable energy and distributed resources, efficiency, smart building systems, and storage can be integrated to provide clean, reliable services,” reads the Biden-Harris clean energy policy recommendations report. “When considering the importance of the electrification of buildings and transportation to meeting climate goals, the enormous opportunity for utilities to grow their investment and returns in a greening world is apparent.”

Obtaining the full support of utilities for the expansion of renewable energy resources, however, and particularly for the adoption of customer-side, on-site distributed resources such as roof-top solar, energy efficiency, smart energy management systems, and energy storage, will require major policy shifts.

First, utilities must be unbundled, allowing them to focus on building and managing a smart and resilient grid capable of integrating a growing array of smart building solutions. Second, utility revenue collection should be decoupled from sales or consumption by consumers, but any policy with the potential to reduce kilowatt-hours sold will threaten utility management and their shareholders, and therefore face strong resistance.

Today, the US inaugurates a new president with bold promises and a clear intention to tackle climate change, offering huge growth potential to the US smart buildings market. However, this does not represent a victory for the environment or the buildings sector. Instead, today’s inauguration marks the beginning of the path towards a greener and more energy-efficient US economy.

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