The climate plan outlined by U.S. President-elect Joe Biden’s administration is significant in that it reaffirms a commitment to addressing climate challenges, said panelists participating in a recent webinar hosted by the ULI Center for Sustainability and Economic Performance. The plan would also provide considerable resources to support and propel innovation throughout the real estate industry in key areas such as energy efficiency, carbon emission mitigation, and climate change resilience.

The webinar is now available on demand on Knowledge Finder.

Moderated by Billy Grayson, executive director of the ULI Center for Sustainability and Economic Performance, the event featured Brad Dockser, chief executive officer of Green Generation, a Bethesda, Maryland–based company that advises real estate companies and governments at all levels on energy efficiency and healthy building strategies; Amy Erixon, global president of investment management at Avison Young, a global commercial real estate services firm with headquarters in Toronto; and Diane Hoskins, co–chief executive officer of Gensler, a global design and architecture firm headquartered in San Francisco.

Major goals of the Biden climate plan include the following: 1) net-zero carbon emissions from new construction in commercial real estate by 2030; 2) a net-zero electric grid by 2035; and 3) a net-zero economy by 2050. Incorporated into these goals are significant targets for job creation, as well as efforts to promote social equity and environmental justice.

The plan provides for the following:

  • $500 billion in annual federal procurement targeting lower-carbon buildings, vehicles, and other procurement, for a total of $2 trillion over the next four years.
  • $1.7 trillion–plus for a “climate-ready” infrastructure plan that focuses on clean energy, green jobs, and transportation emission reductions, with a goal of catalyzing $5 trillion in private-sector investments.
  • $2 trillion over the next four years for clean energy innovation; decarbonizing buildings, homes, and schools through retrofits; and driving climate investment and innovation in the automotive, utility, and agriculture sectors.

Grayson noted that the plan—which is based more on implementation by regulation rather than by legislation—suggests some significant regulations that could affect real estate and infrastructure, such as the creation of national building codes to expedite building construction to net zero; performance  standards for existing buildings to improve energy efficiency; federal procurement standards that include climate change mitigation and resilience as criteria, including buildings occupied by the General Services Administration (the nation’s largest building tenant); an accelerated transition to electronic vehicles; and building material standards focused on reducing carbon emitted by construction materials.

While the plan is ambitious, it is “dependent on a number of factors, including congressional action to approve funding, the fact that we are still in a pandemic and we are still reckoning with racial injustice in this country, the state of the economy, and the reality that even the components that can be implemented by the president through executive order will take time to put in place,” Grayson said.

The plan will help advance decades-long efforts by the real estate industry to improve energy efficiency in buildings, said Hoskins. “What we have lacked for several years is a unifying external driver that allows us to act in a more cohesive way as an industry. This is the opportunity that the Biden plan can provide us,” she said. “While many cities have set ambitious [carbon reduction] goals of their own, having the federal government influencing more consistency with building codes, building performance standards, and material standards will have a positive impact and drive toward solutions that can be scaled and utilized across markets.”

Dockser predicted that the plan would generate numerous initiatives that rely on existing congressional appropriations, existing congressional authorizations, and existing federal programs. “We expect that instead of the federal government slowing things down, you will see it acting as a catalyst,” he said, noting that “the U.S. will be playing catch-up” to match or exceed climate commitments of other countries. The plan will help position the United States as a climate leader related to buildings, codes, materials, and technology,” he said.

“A lot of this plan is about pulling the levers that the federal government has,” said Erixon, including climate criteria in U.S. General Services Administration (GSA) leasing agreements and by reinstating regulations. “It is more of a carrot than stick approach in that it is relying on voluntary participation in various programs more than mandating major changes,” she said. “While the devil is in the details, setting out the goals and targets is a really good start.”

It is important to focus on what the plan will catalyze, Dockser said. “Adding the word resiliency as a criterion at the GSA level and putting a value on that is significant. Adding that [electronic vehicle] charging infrastructure can now be part of an energy savings performance contract at the GSA level is significant. Making these small changes can unlock hundreds of billions of dollars in investment capital,” he said. “I am excited to see a focus not just on the plan’s costs, but on the broad return on investment.”

Erixon noted that the plan’s goal of net zero for new construction in commercial real estate by 2030 is ambitious but doable, pointing out that similar goals have been achieved for new buildings in Canada’s harsher climate. More challenging will be retrofitting existing buildings—80 percent of which will still be standing in 2030—to become carbon neutral, she said.

Hoskins pointed to the opportunities presented by the plan’s incentives for decarbonizing the production of carbon-creating construction materials such as steel and concrete. “What this says is that the Biden administration is thinking beyond net-zero building operations to net zero in the building construction,” she said. “We need to see these issues addressed. We have to leverage government incentives to solve this for our industry, so we can solve this faster and do it at scale.”

Dockser noted that in addition to constructing net-zero buildings, a pressing need exists for property owners and managers to help tenants—many of whom are demanding green workspaces—to understand their role in reducing energy and carbon emissions. (Commercial tenants consume an average of 40 to 60 percent of the total energy used in buildings.) “It’s a whole mind-set change,” he said. “Occupiers and tenants are a critical part of operating at a net-zero level and reducing emissions in the environment.”

The plan’s goal of a renewal-based grid by 2035 might be the most ambitious target and the most impactful aspect of the plan, Erixon said. “The more you drive the process for renewable-powered buildings, the cheaper renewables become. And, it embeds the growth of the renewable business into the economy,” she said.

Hoskins agreed that greening the grid is likely to have the most far-reaching effect on moving toward net zero for the built environment and the economy in general. “We have a long way to go with micro grids, smaller nuclear plants, battery-powered buildings—all of this needs government investment to move these efforts more quickly,” she said. “On the demand side, it [calls for green power] is growing. Some major corporations are already including green grids in criteria for site selection, and this will escalate.”

Regarding the plan’s provision for national building codes, Hoskins cautioned against the implementation of codes that are specific to the environment without recognizing the equally pressing issue of human health. This, she said, should be a lesson learned from the construction of energy-efficient buildings in the 1970s that limited fresh air intake and circulation, ultimately contributing to the spread of contagious diseases. Through the plan, “We have an incredible opportunity to address energy efficiency as well as creating healthful environments for people,” Hoskins said.

Such a focus could lead to more federal support for cities’ efforts to advance environmental justice in disadvantaged neighborhoods, she added.

Dockser predicted that soon after the inauguration, the Biden administration would rejoin the Paris Agreement, an environmental accord adopted by more than 190 countries in 2015 to address climate change by reducing global greenhouse gas emissions. “There is essentially a climate arms race between countries trying to have a more onerous climate mitigation policy. By rejoining the agreement, the U.S. is saying, ‘We are going to be a significant part of this,’” he said.

“Rejoining [the accord] is of great symbolic importance around the world, but it also triggers an obligation for the U.S. to concretely spell out how it is going to achieve its targets,” Erixon added.

In general, the plan “is going to make it easier—for the real estate industry—to create great places and achieve green building goals,” Hoskins said.

Added Dockser: “It’s about recognizing that dealing with climate safety is profitable. It makes economic sense.”

The webinar was the latest in a series of webinars hosted by ULI to help members understand the role that they can play in advancing sustainability, health, and social equity throughout the built environment.

TRISH RIGGS is a freelance writer based in Falls Church, Virginia.