FM Frequency: A New Regulatory “Environment”

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By Jeff Crane, P.E., LEED® AP
Published in the February 2009 issue of Today’s Facility Manager

Facility managers (fms) monitoring the fall political campaigns probably noticed several candidates promising government intervention for limiting carbon dioxide (CO2) emissions. While it’s beyond the scope of this column to debate whether all the Earth’s occupants are apathetic polluters for constantly and recklessly exhaling or if all the trees should be destroyed to lessen CO2 addiction, let’s ponder what those campaign promises might bring (personally and professionally) in the not so distant future.

A straightforward and constitutionally sound approach to reducing CO2 would be for Congress to pass laws levying additional federal taxes on carbon—namely gasoline, diesel, coal, natural gas, and other prime sources of these emissions. While it would be politically perilous with constituents, raising the price of energy through taxation would be a fairly simple means of accomplishing the objective and encouraging alternative energy investments.

That said, intellectual honesty, fairness, and equal protection under the law (i.e., things not usually associated with career politicians or tax policies) would also suggest imposing federal carbon taxes on people and animals based on their individual metabolic levels. For example, if my neighbor goes for a run with his dog or rides a bicycle to work, shouldn’t he pay a CO2 tax for the higher metabolism and release of excess CO2? And if I choose to skip work and stay indoors watching sports with my dog, shouldn’t I enjoy tax-exempt status or even a rebate check from the feds as long as I don’t shout at the TV, eat bean burritos, kick the dog, or otherwise raise our respective metabolic levels (releasing more CO2)?

To implement and regulate individual carbon taxes properly, people and animals could be equipped with federally licensed heart, weight, and respiration monitors that constantly send metabolic data to the Environmental Protection Agency (EPA) and the National Institutes of Health (NIH). The government and citizens could enjoy a secondary benefit by using these monitors to promote good health. We could even levy fat taxes (sorry, let’s say, “gravitationally challenged carbon taxes”), since we know larger folks proportionally consume more calories (a unit of energy) and natural resources than they would if living a government endorsed, “sustainable” lifestyle.

But we shouldn’t hold our breath (pun intended) for any of the aforementioned legislation to occur. We know all too well that executive orders, judicial activism, regulatory decrees, and heavy fines can be used in order to avoid the inconvenient political consequences associated with honest tax policy debate. The carbon cap and trade scheme being suggested by some is a great illustration of how government can creatively rule without consent of the governed.

In a cap and trade scheme, a baseline would establish allowable CO2 emission levels for power plants, factories, facilities, and, perhaps, even individuals. Those generating emissions above the government imposed baseline would purchase or “trade” carbon credits with others whose emissions are beneath the government imposed baseline. One of the most disturbing components of such a scheme would be in creating baselines and emission limits; career politicians would summarily pick winners and losers after evaluating green guidance (pun again intended) from lobbyists and the positions of political opponents.

Since voters don’t often agree to heavier tax yokes, a complex cap and trade scheme is probably more likely than a simple carbon tax. What does this mean for our industry, and why should fms care? Because facilities (notably office buildings) are some of the largest consumers of energy, and those facilities are likely to be viewed as major targets—I mean “opportunities”—for the schemers. One of the major problems with establishing arbitrary carbon caps or baselines on facilities is that it can potentially punish responsible fms. How?

Well, suppose you manage an extremely well run, finely tuned, and super efficient office facility. Now suppose I manage an office building of identical size and occupancy (in the same city), but as a result of my incompetence, poor building construction, or limited maintenance and capital resources my building uses 25% more energy than yours. Now let’s suppose that EPA establishes 2010 as a baseline year for all office buildings and mandates a 10% reduction in energy consumption (or CO2 emissions) by 2012. If your consumption stays flat and I shed 10%, my facility would still be 12.5% less efficient than yours.

Despite my inefficiency (compared to yours), I would be issuing green press releases and collecting accolades in 2012 for meeting an arbitrary EPA mandate. Meanwhile you might be publicly humiliated, reprimanded, or even fined for failing to meet the 10% reduction target.

These might not be precise previews of what’s to come, but as industry participants and voters, we should keep a close watch on the political developments and let our local, state, nationally elected officials, and, more importantly, our superiors know how government policies could impact our organizations.

The current environment (final pun intended) of celebrity panic mongering and media sensationalism about these issues makes it very difficult to detach fact from propaganda or to find objective reporting on opposing viewpoints. Perhaps a fragile economy, higher unemployment, a very snowy winter, and an increasingly vocal scientific community that thoughtfully questions theories about man-made global warming (see Web link to a recent report below) will result in a more cautious, intelligent debate and wise national policy.

Crane is a mechanical engineer and regional property manager with Childress Klein Properties, a leading real estate developer and property management service provider in the Southeast. 

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