Building-Related Renewable Energy and the Case of 360 State Street

By Bronin, Sara C. | Vanderbilt Law Review, November 2012 | Go to article overview

Building-Related Renewable Energy and the Case of 360 State Street


Bronin, Sara C., Vanderbilt Law Review


I. INTRODUCTION ..........1876

II. BUILDING-RELATED RENEWABLE ENERGY.......... 1880

A. Definition of Building -Related Renewable Energy ..........1881

B. Reducing the Negative Impact of Buildings ..........1884

1. Energy Efficiency ..........1884

2. BRRE ..........1888

III. SCHOLARLY APPROACHES TO BRRE ..........1891

A. Treatment of BRRE Installation Issues ..........1892

1. Third-Party Objections ..........1892

2. Ambiguities in Public Legal Frameworks ..........1896

B. Treatment of BRRE Operation Issues ..........1899

1. Submetering ..........1900

2. NetMetering ..........1904

3. Rates Related to Renewable Energy ..........1909

IV. INSTALLATION AND OPERATION OF BRRE AT 360 STATE STREET ..........1912

A. Site Disposition ..........1912

1. Site History ..........1913

2. Picking a New Owner ..........1915

3. Terms of Disposition & BRRE Requirements ..........1917

B. Program, Design, and BRRE ..........1919

1. Energy Demands ..........1919

2. Why BRRE? ..........1920

3. Four BRRE Alternatives ..........1921

C. Legal Issues Regarding BRRE Operation ..........1924

1. A Word on Project Financing ..........1926

2. Strategies for Submetering ..........1928

3. Lessons from 360 State Street ..........1931

V. CONCLUSION ..........1933

I. INTRODUCTION

Currently, our buildings consume 40% of our energy,1 use twothirds of our electricity,2 and emit 40% of our greenhouse gases.3 To reduce this negative environmental impact, public policymakers and advocates have encouraged demand reductions, while private industry has made building systems more efficient. Yet, with population growth and the expansion of human activity, energy consumption shows no sign of abating.4 Thus, while continuing demand-side, consumptionreduction strategies, it will be important to develop and facilitate supply-side solutions, including the construction of building-related renewable energy ("BRRE") - that is, renewable energy incorporated into inhabited structures and used by those structures' occupants. Because most human activity takes place in buildings, a wellconceived policy approach to BRRE could transform the American energy landscape.

The vast majority of Americans favor renewable energy.5 Renewable energy has two primary selling points: it minimizes the negative impact of energy production on the environment, and it enhances energy security by reducing American rebanee on foreign oil. Despite these positive attributes and favorable public opinion, the latest numbers show that renewable energy comprises just 8% of total domestic energy consumption6 and 10.3% of total domestic electricity.7 Moreover, the types of renewable energy that can be most readily incorporated into building design - solar, wind, and geothermal -comprise just 15% of the renewable energy share, or about 1.2% of total energy consumption.8 Fuel cells, a fourth type of arguably renewable technology, are devices that use fuel and oxygen to create electricity and can be incorporated into a building.9 Exact figures of U.S. generating capacity for fuel cells have not been compiled, but it is important to note here that fuel cells generate additional energy.10

Anecdotally, much of the 1.2% figure for solar, wind, and geo thermal appears to be made up primarily of rural, large-scale generating facilities meant to serve many end users in urban areas. The challenges that out-of-the-way generating facilities pose to both energy efficiency and land consumption required to accommodate energy infrastructure (deemed "energy sprawl") are well documented.11 By contrast, on-site (or near-site) BRRE that is located near end users presents the possibility of maximizing efficiency while simultaneously minimizing energy sprawl.

If the benefits of BRRE are clear, then why is there so little of it? The most widely recognized and obvious reason is that there are high financial barriers to entry, given initial cost and limited financing options for BRRE. …

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