California is Leading the Greening Trend

Perhaps no other state in the country – and few places around the world – has been as active as California in the effort to reduce greenhouse gas emissions by advocating for green technologies and expanding sustainability practices.

"California's energy system contributes about 85% of the state's greenhouse gas emissions. The state's economy, environment and public health depend on reducing greenhouse gas emissions by using less energy," the California Energy Commission (CEC) 2013 Integrated Energy Policy Report stated.¹

The CEC's report added that improving energy efficiency and reducing greenhouse gases is not merely ecological in nature. Those greening efforts are vital to the future of the state's economy and public health.

Here are four ways California is leading the greening trend:

1. California promotes energy efficiency through regulation
Many countries, states, cities and other regions across the globe talk about going green, but few have been as proactive as California. Much of that activity has come in the form of regulation. However, it is often the case that the regulations themselves don't drive the greening trend. Instead, it's the behavioral changes those regulations promote that set the example for the rest of the United States, and the world, to follow.

California's Title 24 Building Efficiency Standards and Title 20 Appliance Efficiency Regulations are two of the most effective regulatory methods the state has pursued. Both measures set the bar high for energy efficiency. More importantly, though, Title 20 and Title 24 lay out a clear set of principles that business owners and managers can follow to improve energy efficiency in their operations.

Title 24, which was updated in July 2014, governs how buildings use energy, mandating that businesses and residences implement sustainable commercial products and other sustainability practices.² Title 20 addresses 23 categories of appliances. The products within those 23 categories are tested for energy efficiency and must meet the most recent sustainable commercial products standards in order to be sold in California.³

On a local level, San Francisco and other California cities are taking further initiative by instituting programs like building benchmarking. Benchmarking tracks and summarizes the energy used by an entire building on a yearly basis. That information is then used to improve sustainability practices in those buildings.

2. California forges green partnerships with utility companies
California's government has been working hand in hand with the state's utility companies to reduce energy consumption. Together, the state and the utility companies offer energy saving tips and guides to sustainability practices that help put California on a surer environmental footing in the years to come, while also setting an example that other states and their utility companies can follow.

The Renewables Portfolio Standard (RPS) Program is one example of how California and the state's utility companies have partnered. The goal of the program is to increase the percentage of renewable energy – solar, wind, geothermal, biomass and hydroelectric – in the state's electricity mix to 33% by 2020.⁴

Utility companies are an integral factor in California's attempts to reach its various energy efficiency goals, including zero-net energy for commercial buildings (wherein the amount of energy provided by on-site renewables is equal to the amount of energy used by the building), by 2030.⁵

3. California companies are putting business energy saving tips in practice
Many California businesses have benefited from expanding their sustainability practices by working with the state and its utility companies. As these case studies gain greater notice, the practices they use are more likely to be adopted in other states.

Some examples of businesses that have worked with California and its utility companies to install green technologies, while also earning higher profits, include:

• Lepe's Foods: Based in Santa Rosa, CA, Lepe's Foods is a food distribution business that realized approximately $12,000 in annual savings by partnering with PG&E. PG&E helped Lepe's upgrade its refrigerators and fans with more efficient products, install strip curtains in walk-in refrigerators and find the right billing options. PG&E also provided Lepe's with thousands of dollars in rebates and incentives to help cover the costs of its energy efficiency upgrades.⁶
• InterContinental Hotel (San Francisco): When the InterContinental San Francisco first opened, it was consuming electricity at a rate that cost approximately $675,000 per year. But after working with PG&E and local lighting and HVAC contractors, the InterContinental was able to reduce that number by $72,000 in the first year alone, making for a four-month payback on the initial cost. The types of technologies and practices the InterContinental introduced – e.g., more efficient lighting, including LEDs, and an economizer for its air conditioning unit – are ones that can be applied to businesses of any size.

4. California green businesses are highly valued
Going green does more than reduce a business's environmental impact or its monthly utility bills. It can also significantly increase the value of the business and/or building. According to the CEC, the selling prices of green buildings are about 16% higher than non-green buildings.⁷

The CEC also found intangible benefits from going green, namely the perceived value and utility of green businesses. Potential customers and buyers tend to view green buildings and businesses with higher regard, which, anecdotally, leads to increased traffic and/or selling prices for the business or building.

California is at the forefront of energy efficiency in large part due to the regulatory lead it has taken on the issue. However, none of the mandates and measures the state has pursued are feasible without cooperation and buy-in from utility companies and businesses. Fortunately, that buy-in is going strong and gaining steam by the day, which bodes well for California's continued leadership in the effort to build a more sustainable environment and economy.

To learn how your business can become more sustainable, download the “20 Sustainable Products to Help Businesses Save Money and Energy” eBook from PG&E.

1. California Energy Commission
2. California Energy Commission
3. California Energy Commission
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5. Pacific Gas and Electric Company
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7. California Energy Commission