CNBC Guest Blog

Published: Sunday, 4 Oct 2009 | 9:59 AM ET

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Terry Tamminen
Former Secretary
California EPA

Millions of people come and go from New York’s iconic Empire State Building every year. The 102 floors bristle with keyboard-clicking, ballpoint-wielding, paper-shredding cubicle dwellers, none of which would appear out of place in an episode of “The Office”. But something very different is happening on the fifth floor — a magical workplace that may soon transform the entire skyline of a big city near you.

At the recent Clinton Global Initiative conference (CGI) in New York, I caught up with Clay Nesler of Johnson Controls. He’s part of a team working on the Empire State Building, doing a

AP

retrofit of windows, insulation, and electric motors that will cut the energy consumption — and the carbon footprint — by nearly 40%. Old radiators on brick walls were transmitting much of the heat outside, so just by adding insulation between the two, the energy needed to warm the interior drops by half. Replacing windows with an energy-saving model keeps warmth inside during winter and heat outside during summer. But how can you replace thousands of old windows when people have to work near them every day?

“We have a workshop on the fifth floor,” Clay told me. “Every day we rebuild fifty windows and every night, after the workers have gone home, we pull fifty old ones out and put the rebuilt ones in their place.” With 6,500 windows, the project will take half a year, but not a single office work day will be lost to the remodeling project. This clever workaround is the key to getting more skyscrapers to join the energy-saving revolution, as I learned from another CGI hallway conversation.

A JP Morgan Chase banker told me they approached several major real estate owners about financing such retrofits and were told that tenants (notably big law firms) demanded huge “inconvenience fees” to give owners access to install energy-efficient light fixtures, not to mention outright refusal to allow any displacement for something like replacing windows. The workaround project at the Empire State Building solves that problem.

As for the lighting, what if you could cut energy consumption by up to 80% with a new bulb instead of a new fixture? That’s what Lighting Science Group has engineered — LED bulbs that screw in or plug into existing fixtures, saving big upfront costs and tenant displacement. Up to now, such bulbs cost upwards of $100 each, but Lighting Science cut that cost for some of the most popular types to well under ten bucks. The energy savings pays for the retrofit in months and no one is inconvenienced.

That’s what all of these stories have in common — profitable ways to cut carbon. The Empire State Building project will be repaid in 3.1 years from savings on energy bills. The guy from JP Morgan Chase said all of their branches are being built or remodeled with the highest efficiency materials, lighting, and electrical appliances that will slash operating costs 30%. The recently announced retrofit of Chicago’s Sears Tower will save 80% of that building’s energy consumption.

There’s a long-term benefit to this trend too. A lot of work is going into perfecting electric cars (battery or hydrogen fuel cell powered) as a means to fight climate change, but the grid is at the breaking point already and can’t handle parking lots full of plugged-in cars. But if buildings cut energy consumption somewhere between 40 and 80%, think of all the extra infrastructure serving those structures — many with parking garages already — that could then be used to recharge batteries or electrolyze water to make hydrogen.

The Empire State Building is one of America’s oldest skyscrapers, but is proving that you can teach an old dog new tricks. The real question is not “what is happening on the fifth floor?”, but “why hasn’t every building owner done the same thing?”

More from Tamminen ...

• Green Profits: Room Temperature Ice Cream
• Why China is Winning the Green Game

Update: This post has been updated to reflect a clarification of the company and people involved in this project. 

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Terry Tamminen, former Secretary of the California Environmental Protection Agency, is a partner at Pegasus Sustainable Century Merchant Bank and the Cullman Senior Fellow at the New America Foundation. (Cracking The Carbon Code is a registered trademark of Terry Tamminen).

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