Model A to Solar

December 20, 2008

As reported in Huffington Post Green

The spacious, airy offices of the SunPower Corporation here in Richmond, California, tell an interesting story of America’s industrial evolution. The building was constructed as a Model A Ford assembly line. Then, during World War II, it became a tank factory where the legendary Rosie the Riveter worked. Now it houses both the corporate and manufacturing facilities of SunPower. And within a month, it will be powered entirely by photovoltaics.

Former Stanford President Donald Kennedy and I are here to lunch with Tom Dinwoodie, the head of SunPower, to help figure out how we can make sure that the forthcoming economic stimulus and reform agendas from the Obama administration are as effective as possible in revitalizing the renewable energy sector, which is currently stalling out because of the credit crunch and economic meltdown.

Dinwoodie identifies the key barrier — interest rates have just soared, putting capital-intensive solar and wind projects on hold. The solution would appear to be tapping into government capital, which carries effectively zero interest rate, perhaps combining it with some of the money that the Treasury lent to the big banks but which, thus far, the banks have been unwilling to lend back out.

Wonderful as the space in this building is, it’s a painful reminder that when we don’t move quickly to do the right thing, we end up doing the wrong thing. Even as we’re meeting, Congress is trying to figure out how to keep General Motors and Chrysler from failing — and Ford, which originally built this, won’t be far behind if an agreement isn’t reached. But what’s slowing it up today? Unbelievably, Republicans in the Congress are objecting to provisions in the bill that would preclude the companies getting bailed out from lobbying or litigating against improved fuel-efficiency standards:

“The Democrats’ call to include the California waiver provision in the auto bailout bill would mean Detroit would gain next to nothing in terms of help from Washington,” said Sen. James Inhofe (R-Okla.), the ranking member of the Environment and Public Works Committee.

Has no one learned anything? Detroit’s dedication to fighting technological innovations in fuel economy was the biggest factor in costing the Big Three so much market share that a recession could send them into bankruptcy. None of the innovative companies — Toyota, Honda — are in this kind of trouble, even though their sales, too, are down — because they have been growing and profiting, not shrinking and bleeding red ink.

A recent story in the New York Times directly traced GM’s travails to its consistent unwillingness to invest in innovation because the profits would come in the future. It’s short-sighted, bottom-line greed that threatens to destroy the company — and much of America with it.

Somehow, somehow, Congress and President Obama must find a way to rekindle the innovative spirit that created the Model A and won WWII — perhaps from SunPower to the Big Three.


Hey Army,

I’ve told you this all along — our addiction to foreign oil could bring us to our knees, and there wouldn’t be a damn thing we could do about it. Now take a look at today’s headlines. OPEC just announced it’s cutting production by 2.2 million barrels. Remember – this is on top of the 2 million barrels in cuts they’ve already made since this summer! These guys are serious about getting the price of oil back up right where they like it: $75 a barrel, $100 a barrel, $150 a barrel.

This is exactly why now is the time to pull together and Push the Pickens Plan. Every time the price of oil drops, America falls asleep. The Saudis don’t. The Iranians don’t. The Venezuelans don’t. But we do.

President-elect Obama said it best a few weeks ago on 60 Minutes. “Oil prices go up, gas prices at the pump go up, everybody goes into a flurry of activity. And then the prices go back down and suddenly we act like it’s not important, and we start, you know, filling up our SUVs again. And, as a consequence, we never make any progress. It’s part of the addiction, all right. That has to be broken. Now is the time to break it.”

I couldn’t agree more. We’ve got to break that addiction now. Before it breaks us.

Click here to join your Pickens Plan District Group. Better yet, sign up to be the leader if there isn’t one already so you can help bring in 500 more members to the New Energy Army in your Congressional District before Inauguration Day. Those first 100 days are right around the corner, and the way OPEC is playing we’re going to have to move fast.


Our Perspective:

Let’s not take our eye off the ball. This happened once before in the early 70’s. I can remember being in college and we had to implement odd/even gas rationing. People were very vocal saying,:

” We got to do something!”!

“Never again”!

Well, almost 40 years have passed and we find ourselves saying the same thing.

This is our time to act.  The nation that takes the lead in the energy evolution will be on the cutting edge and will define our path to the future.  The world will be looking to this nation to partner in their efforts to attain their energy independence.

This is our time!

This is our time to lead!

Let us know your thoughts? Leave a comment or email


Published: December 15, 2008
WASHINGTON — The team President-elect Barack Obama introduced on Monday to carry out his energy and environmental policies faces a host of political, economic, diplomatic and scientific challenges that could impede his plans to address global warming and America’s growing dependence on dirty and uncertain sources of energy.

Acknowledging that a succession of presidents and Congresses had failed to make much progress on the issues, Mr. Obama vowed to press ahead despite the faltering economy and suggested that he would invest his political capital in trying to break logjams.

“This time must be different,” Mr. Obama said at a news conference in Chicago. “This will be a leading priority of my presidency and a defining test of our time. We cannot accept complacency, nor accept any more broken promises.”

Shortly after Mr. Obama spoke, transition officials confirmed that he would select Senator Ken Salazar, a first-term Democrat from Colorado, as interior secretary. Mr. Salazar’s appointment will complete the team of environmental and energy officials in the new administration.

The most pressing environmental issue for the incoming team will almost certainly be settling on an effective and politically tenable approach to the intertwined issues of energy security and global warming.

The point person for these issues will be Carol M. Browner, who was named on Monday to the new position of White House coordinator for energy and climate. Ms. Browner, the administrator of the Environmental Protection Agency under President Bill Clinton, will oversee two former aides, Lisa P. Jackson, who was selected as the new agency administrator, and Nancy Sutley, who will be the chairwoman of the White House Council on Environmental Quality. Joining the group will be Steven Chu, a Nobel laureate in physics whom Mr. Obama designated to lead the Energy Department.

Mr. Salazar, a former director of the Colorado Department of Natural Resources and state attorney general, is a farmer and rancher whose family has lived in Colorado for five generations. He is known as a staunch conservationist and an opponent of developing oil shale on public lands.

His appointment will leave a Democratic vacancy in the Senate. Colorado, which voted for Mr. Obama 53 percent to 45 percent, has a Democratic governor, Bill Ritter, who will name a replacement to complete the final two years of Mr. Salazar’s term. Mr. Salazar’s brother John, a congressman, is among potential appointees to fill the Senate seat.

The intense ideological and regional rivalries that have stalled climate change legislation in Congress for years have not suddenly melted away. And even though Mr. Obama promises to give energy legislation a high priority, he first must stabilize an economy that is shedding jobs by the hundreds of thousands each month.

The new team faces political urgency to deliver on promises made by Mr. Obama on the campaign trail. One was his pledge to use a cap-and-trade bill for curbing heat-trapping gases as both the means of shifting investments away from energy sources that cause emissions of such gases and also as the source of the $15 billion a year he promised to invest in advanced energy technology. That figure may be dwarfed by spending on stimulus programs, including so-called green projects like building wind farms and making buildings more energy efficient.

Previous efforts to move a comprehensive climate bill through Congress stalled even without the deepening recession the nation confronts today, said Rafe Pomerance, a negotiator in the Clinton administration on international climate agreements and the president of Clean Air-Cool Planet, a Washington nonprofit group.

Mr. Pomerance said the challenge would be to devise a scientifically rigorous bill that would satisfy lawmakers who fear the costs.

Left unclear on Monday was how the new president’s advisers intend to use the levers of government to get to the “new energy economy” Mr. Obama described. Also uncertain was what relationship they would forge with his powerful economic advisers.

“In policy terms, I think there are big questions about what priority will be given to direct public infrastructure spending versus tax-based incentives versus environmental markets versus direct regulation,” said Paul Bledsoe of the National Commission on Energy Policy, a bipartisan advisory group. “There is still a very profound debate on all of that.”

The diplomatic tension is driven by the steps required to work toward a new global climate treaty, which the United States and nearly all other nations have committed to completing by December 2009. The last round of talks ended last weekend in Poland with few signs of progress on the main goal, limiting emissions of heat-trapping gases without hampering economic development.

It is widely felt that if the United States does not demonstrate concrete domestic steps to curb its emissions from burning fossil fuels, fast-growing developing countries will continue to balk at taking on obligations to cut their emissions. And while Mr. Obama will enjoy a larger Democratic majority than Mr. Clinton did in his two terms, the Senate has long made such steps a prerequisite for its required consent to any climate treaty.

The scientific urgency comes from the unanticipated recent growth in emissions of carbon dioxide in China, India and other countries with fast-expanding economies. This heat-trapping gas is the biggest concern because its long life, once the gas is released, causes it to build in the atmosphere, something like unpaid credit-card debt, as long as reductions are not made.

Additional pressure comes from growing recognition that market forces alone are unlikely to drive the spread of nonpolluting energy technologies fast enough to matter where all the growth in energy use is at its peak, in the rapidly growing countries of Asia and Latin America.

Nathan Lewis, who leads a team at Caltech pursuing ways to greatly improve solar energy technologies, said the appointment of Dr. Chu as energy secretary sent a strong signal that Mr. Obama understood that any program on climate-friendly energy had to have three prongs: increasing efficiency, moving existing nonpolluting energy technologies more quickly into the market, and advancing on the frontiers of energy science in search of radical breakthroughs.

“Energy efficiency cannot be seen as Job 1 and the other stuff Job 2,” Dr. Lewis said. “You’ve got to do them all as Job 1 because they all have to work.”

Dr. Chu has spoken of using coal to generate electricity as an environmental “nightmare,” but he acknowledges that the nation lacks the technology to replace it or clean it up in the near term. Tom Kuhn, president of the Edison Electric Institute, a trade group for utilities, said that any solution to the climate problem must address these costs and provide consumers and electricity producers time to adjust.

“There will be major costs,” Mr. Kuhn said. “It’s a question of trying to mitigate the costs as much as possible.”

As reported in Huffington Post Green


WASHINGTON — When Bill Clinton took office in 1993, global warming was a slow-moving environmental problem that was easy to ignore. Now it is a ticking time bomb that President-elect Barack Obama can’t avoid.

Since Clinton’s inauguration, summer Arctic sea ice has lost the equivalent of Alaska, California and Texas. The 10 hottest years on record have occurred since Clinton’s second inauguration. Global warming is accelerating. Time is close to running out, and Obama knows it.

“The time for delay is over; the time for denial is over,” he said on Tuesday after meeting with former Vice President Al Gore, who won a Nobel Peace Prize for his work on global warming. “We all believe what the scientists have been telling us for years now that this is a matter of urgency and national security and it has to be dealt with in a serious way.”

But there are powerful political and economic realities that must be quickly overcome for Obama to succeed. Despite the urgency he expresses, it’s not at all clear that he and Congress will agree on an approach during a worldwide financial crisis in time to meet some of the more crucial deadlines.

Obama is pushing changes in the way Americans use energy, and produce greenhouse gases, as part of what will be a massive economic stimulus. He called it an opportunity “to re-power America.”

After years of inaction on global warming, 2009 might be different. Obama replaces a president who opposed mandatory cuts of greenhouse gas pollution and it appears he will have a willing Congress. Also, next year, diplomats will try to agree on a major new international treaty to curb the gases that promote global warming.

“We need to start in January making significant changes,” Gore said in a recent telephone interview with The Associated Press. “This year coming up is the most important opportunity the world has ever had to make progress in really solving the climate crisis.”

Scientists are increasingly anxious, talking more often and more urgently about exceeding “tipping points.”

“We’re out of time,” Stanford University biologist Terry Root said. “Things are going extinct.”

U.S. emissions have increased by 20 percent since 1992. China has more than doubled its carbon dioxide pollution in that time. World carbon dioxide emissions have grown faster than scientists’ worst-case scenarios. Methane, the next most potent greenhouse gas, suddenly is on the rise again and scientists fear that vast amounts of the trapped gas will escape from thawing Arctic permafrost.

The amount of carbon dioxide in Earth’s atmosphere has already pushed past what some scientists say is the safe level.

In the early 1990s, many scientists figured that the world was about a century away from a truly dangerous amount of carbon dioxide in the atmosphere, said Mike MacCracken, who was a top climate scientist in the Clinton administration. But as they studied the greenhouse effect further, scientists realized that harmful changes kick in at far lower levels of carbon dioxide than they thought. Now some scientists, but not all, say the safe carbon dioxide level for Earth is about 10 percent below what it is now.

Gore called the situation “the equivalent of a five-alarm fire that has to be addressed immediately.”

Scientists fear that what’s happening with Arctic ice melt will be amplified so that ominous sea level rise will occur sooner than they expected. They predict Arctic waters could be ice-free in summers, perhaps by 2013, decades earlier than they thought only a few years ago.

In December 2009, diplomats are charged with forging a new treaty replacing the 1997 Kyoto Protocol, which set limits on greenhouse gases, and which the United States didn’t ratify. This time European officials have high expectations for the U.S. to take the lead. But many experts don’t see Congress passing a climate bill in time because of pressing economic and war issues.

“The reality is, it may take more than the first year to get it all done,” Senate Energy Committee Chairman Jeff Bingaman, D-N.M., said recently.

Complicating everything is the worldwide financial meltdown. Frank Maisano, a Washington energy specialist and spokesman who represents coal-fired utilities and refineries, sees the poor economy as “a huge factor” that could stop everything. That’s because global warming efforts are aimed at restricting coal power, which is cheap. That would likely mean higher utility bills and more damage to ailing economies that depend on coal production, he said.

Obama is stacking his Cabinet and inner circle with advocates who have pushed for deep mandatory cuts in greenhouse gas pollution and even with government officials who have achieved results at the local level.

The President-elect has said that one of the first things he will do when he gets to Washington is grant California and other states permission to control car tailpipe emissions, something the Bush administration denied.

And though congressional action may take time, the incoming Congress will be more inclined to act on global warming. In the House, liberal California Democrat Henry Waxman’s unseating of Michigan Rep. John Dingell _ a staunch defender of Detroit automakers _ as head of the House Energy and Commerce Committee was a sign that global warming will be on the fast track.

Senate Environment and Public Works Chairman Barbara Boxer, D-Calif., vowed to push two global warming bills starting in January: one to promote energy efficiency as an economic stimulus and the other to create a cap-and-trade system to reduce greenhouse gas emissions from utilities. “The time is now,” she wrote in a Dec. 8 letter to Obama.

Mother Nature, of course, is oblivious to the federal government’s machinations. Ironically, 2008 is on pace to be a slightly cooler year in a steadily rising temperature trend line. Experts say it’s thanks to a La Nina weather variation. While skeptics are already using it as evidence of some kind of cooling trend, it actually illustrates how fast the world is warming.

The average global temperature in 2008 is likely to wind up slightly under 57.9 degrees Fahrenheit, about a tenth of a degree cooler than last year. When Clinton was inaugurated, 57.9 easily would have been the warmest year on record. Now, that temperature would qualify as the ninth warmest year.


Associated Press writer Dina Cappiello contributed to this report.

As reported in Huffington Post Green


Ask most people about the benefits of residential renewable energygeothermal, rooftop solar photovoltaic and solar thermal, and backyard wind turbines, primarily–and the response is usually the same: they are good for the environment, raise property value and lower or eliminate utility bills. While undoubtedly true, these responses present an incomplete picture of the benefits of distributed renewable energy. In certain instances, such as last week when a single ice storm left over 1 million homes and businesses in New England without power, a residential energy system can mean the difference between seeking shelter and being able to shelter others. Other times, particularly during peak demand, renewables stabilize the grid and lower costs for all utility customers.

The Grid Can Fail, and It’s Expensive When It Does
America’s electricity grid is an engineering marvel, but it is also old, outdated, overstrained and susceptible to failure from storms, terrorism, accidents and high energy demand. And when the grid fails, not only is the loss of power inconvenient, it is also dangerous and costly. For example, the 2003 blackout that stretched from Canada to New York was estimated to have an economic cost of “between $7 and $10 billion. . .due to food spoilage, lost production and overtime wages” as well as the cost of repairing and upgrading the affected parts of the grid. While the 2003 grid failure was one of the most extraordinary outages to hit the United States, smaller scale blackouts, particularly from storms and natural disasters, are rather common.

Advantages of Distributed Energy
Distributed energy has the distinct advantage of functioning regardless of the state of the electrical grid as a whole. What’s more, small, residential energy systems actually make the grid more stable by reducing peak demand–the times during which power lines strain to carry enough power to enough homes. Even better, reducing peak demand goes a long way towards reducing electricity prices. In fact, according to the Department of Energy “a 1% reduction in load during high peak periods can reduce wholesale electricity prices by 10%, and a 5% reduction in load can reduce peak prices by as much as 19%.” In other words, distributed wind, solar and geothermal can reduce the high demand for energy that often leads to outages and mitigate the impacts of blackouts when they do occur in a way that large scale renewable energy cannot. That is, even massive wind farms in the Midwest and solar concentrating plants in the Southwest are reliant on an energy grid to bring the power from where it is produced to where it is consumed. So while these large scale operations are necessary if we are to tackle rapidly rising greenhouse gas emissions, it is imperative that the true advantages of residential scale, distributed energy be taken into full consideration as well.

Dreaming of Solar Rooftops
The day after last week’s ice storm in New England the sky was crisp and clear, and puddles of sunshine flooded rooftops across Providence, Rhode Island. Even though the blackout didn’t affect my hometown, I couldn’t help but think about the potential for millions of homes and businesses to be soaking up the sun to produce electricity and hot water (that can be used for showering as well as heating a home through radiant floor heating). The reductions in the emissions of greenhouse gases and other pollutants are well documented, as well as the potential cost savings to the owner of a renewable energy system. However, the cost savings to society–in terms of jobs created from installation and manufacturing, stability provided to the grid, and avoided health care costs due to reduced pollution, to name a few–are not. In order to establish proper incentives for these systems, their internalized value must be estimated and built into subsidies.

Financing is Essential
Finally, as I argued last week, new and innovative mechanisms for financing the up-front cost of renewable energy and energy efficiency need to become policy priorities. After all, no matter how much time advocates spend touting the benefits of wind, solar, geothermal, and efficiency, if people can’t afford them, the benefits will never fully be realized. Fortunately, companies like Solar City, Sun Run, and Sun Edison, and cities such as Berkeley, San Francisco and Milwaukee, are blazing a path towards making renewables affordable and accessible to all.

Obama’s new Green Team

December 12, 2008

Washington Post Staff Writer
Friday, December 12, 2008; Page A09


The Obama administration has ambitions for a radical change in U.S. environmental policy. But President-elect  Barack Obama did not pick radicals to lead it.

This Story

Instead, the three officials tapped for leadership posts on the environment are not activists but regulators who have spent years in the weeds of such issues as mercury emissions, brownfields and black-bear hunts.

They will inherit the usual issues — dirty air, dirty water, brownfields and red tides — plus an unprecedented one. Obama has promised to cut back U.S. emissions of greenhouse gases — a proposal that could set off an enormous political fight.

A review of their records and past statements reveals little about the exact policies they would pursue under Obama. It shows they have won over some environmental activists with an open attitude and disappointed others who felt they were not pushing hard enough.

Their expected efforts to limit greenhouse gases would be more ambitious than changes they have sought in previous positions.

“It’s going to be an enormous challenge,” said Felicia Marcus, the western director for the Natural Resources Defense Council. “To call it ‘herding cats’ would be to oversimplify it. It’s like herding dogs, cats, wolves and sheep.”

Democratic sources say Obama plans to name Carol M. Browner, a former administrator of the Environmental Protection Agency, to a new position overseeing energy, environment and climate change policy from the White House. He will choose Lisa P. Jackson, who headed the New Jersey environment agency, as head of the EPA.

And, sources said, he will name Nancy Sutley, a deputy mayor in Los Angeles, to chair the White House Council on Environmental Quality. The president-elect is expected to announce the appointments next week.

Along with Steven Chu — a Nobel Prize-winning physicist who sources say will be named secretary of energy — the three will form the core of Obama’s environmental team.

Word of their appointment was greeted enthusiastically yesterday by some environmental groups. The League of Conservation Voters called the group a “green dream team.”

Industry groups were more cautious. At the U.S. Chamber of Commerce, Vice President William Kovacs said the group worried that the new officials would use their power to limit greenhouse-gas emissions and impose painful new costs on energy use.

“I think that they could be aggressive, and we’re hoping that they’re really going to look at the circumstances” of the economic downturn, Kovacs said. “That is our biggest single concern, because literally all three of them have a regulatory bent.”

Victor Flatt, a law professor at the University of Houston who has studied environmental legislation, said he saw a strategy behind the picks. In a legislative fight about the right way to cut emissions, he said, it would be valuable to have officials who’ve been in similar state-level battles.

“This shows a really good understanding of the negotiations that are going to go on,” Flatt said. He said that Sutley and Chu, who heads the Lawrence Berkeley National Laboratory in California, could bring valuable experience from that state. “California’s just ahead of everybody else” on climate issues, he said.

Yesterday,  Rep. Henry A. Waxman, who will be the new chairman of the House Committee on Energy and Commerce, called Obama’s picks “outstanding people.”

“It’s going to be a dramatic change from what we’ve seen in the last eight years from the Bush administration, where even some of the agencies that were supposed to be working to protect the environment were doing all they could to undermine it,” Waxman said in an interview.

Among the three tapped to be environmental officials, Browner is the best-known. During her eight years at EPA under President Bill Clinton, she led the fight for tougher air pollution standards, which the agency eventually won after a legal fight that led to the U.S. Supreme Court.

Two years ago, Browner was part of a group of former EPA leaders that called on the Bush administration to impose caps on greenhouse gases. Now, she will probably be called on to help Obama do that. The president-elect says he wants to reduce emissions to 1990 levels over 12 years.

Ed Krenik, who worked as the EPA’s liaison to Congress for two years under Bush, said he worried that Browner’s new role could upset government scientists if it is seen as a deadening layer of bureaucracy.

“If there’s a concern out there, it’s probably concern amongst EPA staff” that their director would have a less direct line to Obama, Krenik said. Browner declined a request to comment.

Jackson, who led the New Jersey environmental agency from 2006 to 2008, has impressed both activists and business groups with her open leadership style. An official at the New Jersey State Chamber of Commerce recalled that Browner agreed to give businesses in Paterson, N.J., a brush-up on environmental laws before sending officials in on an enforcement sweep. The leader of Environment New Jersey remembered calling Jackson on her cellphone to warn that legislation was being introduced to try to weaken environmental laws.

Jeff Ruch, executive director of Public Employees for Environmental Responsibility, said employees of the agency complained that Jackson was not tough enough in pushing for cleanups of polluted “brownfields,” or requiring polluters to limit greenhouse gases.

“We called her a pliant technocrat, who sort of time after time did the wrong thing, but did it charmingly,” he said.

But environmentalists credit her with stopping New Jersey’s controversial bear hunt and urging Gov. Jon Corzine (D) to adopt an aggressive goal on climate change. The state committed to reducing emissions 20 percent by 2020 and 80 percent by 2050.

“I think she pushed [Corzine] as far as she could,” said Dena Mottola Jaborska, executive director of Environment New Jersey. Still, New Jersey has found it difficult to say how it will reach those goals. A spokeswoman for the New Jersey Department of Environmental Protection said a climate action plan is overdue but expected next week.

Jackson declined to comment yesterday.

Sutley, tapped to lead the council on environmental quality, had worked for California Gov. Gray Davis (D). Marcus, of the Natural Resources Defense Council, supervised Sutley in the 1990s when she was a senior policy advisor at the EPA. Marcus described her as a quick study, easily able to master the technical details of any controversy.

“She’s one of those people [to whom] you give the toughest issues,” Marcus said. The Obama transition team did not respond to a request to interview Sutley.

Staff writer Philip Rucker and staff researcher Meg Smith contributed to this report.



As reported in Huffington Post Green

Swiss adventurer Louis Palmer drove a solar-powered car 32,000 miles (52,000 kilometers) around the globe, ending his journey at the U.N. climate conference in Poznan. As Vanessa Gera of the Associate Press reported,

Palmer rolled into the climate conference in his solar car Thursday, a man with a mission: To prove that the world can continue its love affair with the car without burning any polluting fossil fuels and still enjoy a smooth ride. Story continues below

Palmer, a teacher on leave from his job, spent 17 months driving his own creation _ a fully solar-powered car built with the help of Swiss scientists _ through 38 countries. The two-seater travels up to 55 mph (90 kph) and covers 185 miles (300 kilometers) on a fully charged battery.

Palmer says there’s no reason why car companies couldn’t make a much better version of his solar-powered car if they set their mind to it.

“These new technologies are ready,” he said. “It’s ecological, it’s economical, it is absolutely reliable. We can stop global warning.”

Our Perspective:

I admire this man, he has proven that the technology exist, we just have to take the steps to refine it and implement it.

The Green Evolution has begun!

Let us know your thoughts?

Thursday December 11, 11:03 am ET
By Christopher S. Rugaber, AP Economics Writer
New unemployment claims rise more than expected as layoffs continue amid recession

WASHINGTON (AP) — New claims for jobless benefits rose more than expected last week, exceeding even gloomy expectations for an economy stuck in a recession that seems to be deepening.
The Labor Department reported Thursday that initial applications for jobless benefits in the week ending Dec. 6 rose to a seasonally adjusted 573,000 from an upwardly revised figure of 515,000 in the previous week. That was far more than the 525,000 claims Wall Street economists expected.


Elsewhere, the U.S. trade deficit rose unexpectedly in October as a spreading global recession dampened the once-strong sales of American exports and the volume of oil imports surged by a record amount, the Commerce Department said.

More layoffs were announced Thursday. New Britain, Conn.-based tool maker Stanley Works said it plans to cut 2,000 jobs and close three manufacturing facilities, while Sara Lee Corp., known for food brands such as Jimmy Dean and Hillshire Farm, said it will cut 700 jobs as the Downers Grove, Ill.-based company outsources parts of its business.

New jobless claims last week reached their highest level since November 1982, though the labor force has grown by about half since then.

The trade deficit rose to $57.2 billion in October, from an imbalance of $56.6 billion in September. Analysts had been looking for the deficit to decline to $53.5 billion on lower oil prices. Oil prices did drop by a record amount, but that was offset by a record surge in the volume of oil imports.

The reports, along with investor concerns that an auto bailout bill may not pass the Senate, sent stock markets slightly lower. The Dow Jones industrial average fell about 15 points in morning trading.

The jump in initial jobless claims is partly due to a rebound in claims from the previous week, which included the Thanksgiving holiday, a Labor Department analyst said. Government offices were open for fewer days that week.

Still, the four-week average, which smooths out fluctuations, was a seasonally-adjusted 540,500, the highest since December 1982, when the economy was emerging from a steep recession.

“Stepping back from the short-term noise … it is very clear that the underlying trend in claims is still rocketing, as companies throw in the towel and prepare for a long, deep recession,” Ian Shepherdson, chief U.S. economist for High Frequency Economics, wrote in a note to clients.

The number of people continuing to claim jobless benefits also jumped much more than expected, increasing by 338,000 to 4.4 million, the Labor Department said. Economists expected a small increase to 4.1 million. The figure for continuing claims lags initial claims by one week.

As a proportion of the work force, the number of people continuing to receive benefits is the highest since August 1992, when the U.S. was recovering from a relatively mild recession. The increase in continuing claims was the largest jump since November 1974, the department said.

Economists consider jobless claims a timely, if volatile, indicator of the health of the labor markets and broader economy. Last year, initial claims were 337,000.

The figures come a day after the Treasury Department reported a record budget deficit for November, driven by lower tax revenues and higher spending on programs such as unemployment insurance and food stamps.

In just the first two months of the budget year that started Oct. 1, the budget deficit totaled $401.6 billion, nearly matching the record gap of $455 billion posted for all of last year, the department said Wednesday.

Economists expect the deficit will top $1 trillion in the current budget year, which would be a post-World War II high when measured as a percentage of the economy.

The economy has been hit hard by the ongoing housing slump and financial crisis, which have sharply reduced household wealth as stock prices and home values have declined. Consumers and businesses have dramatically cut back their spending. The National Bureau of Economic Research said this month that the economy fell into a recession in December 2007.

The Labor Department said last week that employers cut a net total of 533,000 jobs in November and the unemployment rate reached 6.7 percent, a 15-year high. The rate would have been higher, except that more than 400,000 Americans gave up looking for a new job and weren’t counted in the labor force.

The latest jobless claims figures indicate that the December unemployment report could be at least as bad as November’s, Abiel Reinhart, an analyst at JPMorgan Chase Bank, wrote in a client note.

Companies have eliminated a net total of 1.9 million jobs this year, and some economists project the total cuts could reach 3 million by the spring of 2010.

A number of large U.S. employers announced layoffs this week, including Dow Chemical Co., 3M Co., Anheuser-Busch InBev, National Public Radio and the National Football League.

Our Perspective:

President Elect Obama is faced with a serious issue. With the economy in the tank and with unemployment projected to increase, his new administration must present a stimulus package that will help restore confidence and stabilize this downward slide. This may present an opportunity to think outside the box.

Let us know your thoughts? You may leave a comment or email

December 5, 2008 As reported in CoStar Advisor
Written by Andrew C. Burr

New Numbers Revealed on Worker Productivity, Cost Premiums, Energy Efficiency

It is difficult to imagine economic turmoil as a good thing for any business sector, but as markets have steadily worsened this year, the outlook for the green building industry appears to be trending the opposite direction.

November was an exceptionally robust month for the publication of green building data, with more than 10 surveys and reports exploring an array of topics such as worker productivity in LEED buildings, the impact of construction declines, cost premiums and payback periods, and perceptions of the business case for green.

Though polling and research has increased in the past few years, new data has been even more in-demand lately as property stakeholders attempt to gauge how the credit crisis and a full year of recession have affected green building.

Almost universally, the data points to another good year in 2009.

One of the more insightful reports is the “Green Building Impact Report 2008” from Greener World Media, which quantifies the overall effects of LEED on industry and the environment.

In its boldest conclusion, the report said that companies in LEED building have realized annual employee productivity gains exceeding $170 million as a result of improved indoor environmental quality — a cause and effect that has been difficult to quantify. That figure is predicted to jump well into the billions by 2015 as the number of employees in LEED buildings grows more than 10-fold, the report said.

On the industry side, LEED-certified projects have specified more than $10 billion of green materials to date, which has been a boon for the manufacturing sector, according to the study. Environmentally, LEED buildings have cumulatively saved 400 million vehicle miles traveled, 9.5 billion gallons of water and 0.03 quadrillion quads of energy.

The report predicts an overall “flattening” of the rate of LEED growth as it begins to saturate markets, but continued growth in the amount of floor area that is certified. “The current economic situation coupled with increased stringency in the LEED requirements will contribute to an expected slowdown” in LEED growth, the report said.

Three studies report on how the downturn in construction will affect green building development — which is not very much, they conclude.

McGraw Hill’s “2009 Green Outlook” study said green building seems to be insulated from the recession and is growing “in spite of the market downturn.” The value of green construction increased five-fold from $10 billion in 2005 to as much as $49 billion this year, and could triple by 2013 to nearly $150 billion, the study reported.

In Turner Construction Co.’s “2008 Green Building Market Barometer”, more than 80 percent of real estate executives said they would be “extremely” or “very likely” to seek LEED certification for new projects in the next three years. And at an Ernst & Young roundtable of construction company financial executives, 99 percent of survey respondents said interest in green development would increase next year, or at least remain the same as it is this year.

All of that is good news for architects, who were polled in the recent “2008 Autodesk/AIA Green Index” survey by the American Institute of Architects (AIA) trade group and architecture software firm Autodesk.

For the second year in a row, architects said that sustainable design is being driven by client demand, which is in turn being driven primarily by perceived energy savings and marketing benefits. More than 20 percent of architects also said that “market demand” was motivating clients to build green. Only 10 percent said that was a factor last year.

Nearly three-fourths of architects polled were concerned that clients are still not willing to pay cost premiums for green design, although according to a new global study written by sustainability expert Greg Kats, premiums for new buildings average just 2 percent.

Called “Greening Buildings and Communities: Costs and Benefits”, the report found that most green buildings cost less than 4 percent more than conventional buildings, with the greatest concentration of premiums in the 0 percent to 1 percent range.

As a CoStar study revealed earlier in the year, key indicators of building value such as occupancy, sale prices and lease rates tend to be higher in green buildings than in conventional buildings, the Kats study reported.

It also said that green buildings reduce energy use by an average of 33 percent, and that cost savings from energy efficiency would more than offset the green development premium, often in five years or less.

Kats said those factors have made green buildings remarkably resilient to the economy. “The deep downturn in real estate has not reduced the rapid growth in demand for and construction of green buildings. This suggests a flight to quality as buyers express a market preference for buildings that are more energy efficient, more comfortable and healthier,” he said.

That notion is not lacking for supporters.

Eighty percent of respondents in a survey by the Building Owners and Management Association (BOMA) International, the U.S. Green Building Council (USGBC) and the publication Real Estate Forum said that energy efficiency measures have defrayed costs, and 65 percent said their green investments have generated a positive ROI, which is up about five percent from last year.

Nearly 70 percent of corporate real estate executives responded that sustainability is a “critical business issue” in a survey by Jones Lang LaSalle and corporate real estate trade group CoreNet Global in a recent survey, which is up almost 20 points from last year.

And a majority of North American corporate sustainability executives believe capital remains available for sustainability projects, respondents told Panel Intelligence, a research company, in a survey last month.

Apparently however, green building data could afford to spend a little more time away from the office. Autodesk and research firm Harris Interactive recently asked 2,600 U.S. adults if they knew that buildings are the nation’s leading source of greenhouse gas emissions. About 4 percent said they did.

Our Perspective

The movement to Go Green is coming to the forefront. With the growing demand for energy and the lack of facilities to support this growing demand, steps are finally being taken to address this issue. The alternative energy market is poised to explode and this will also lead to more energy efficient buildings being built or retrofitted.

This issue should not be taken lightly, America faces a grave challenge in the near future. We must all work together to spread the awareness and present viable solutions.

Let us know your thoughts? You may leave a comment or email

As reported in Bloomberg

By Hans Nichols

Dec. 6 (Bloomberg) — President-elect Barack Obama said he’ll make the “single largest new investment” in roads, bridges and public buildings since the Eisenhower Administration to lift the sagging economy and create jobs.

Obama, in his weekly radio speech today, said his plan to create or preserve 2.5 million jobs will also include making public buildings more energy efficient, repairing schools and modernizing health care with electronic medical records.

“We won’t just throw money at the problem,” he said. “We’ll measure progress by the reforms we make and the results we achieve — by the jobs we create, by the energy we save, by whether America is more competitive in the world.”

Obama spoke a day after a government report showed employers in the U.S. slashed 533,000 jobs last month, the biggest decline in 34 years. The losses are “another painful reminder of the serious economic challenge our country is facing,” Obama said.

The speech offered the first details of Obama’s job- creation program. He said the investment in infrastructure will be the largest since President Dwight D. Eisenhower created the interstate highway system a half-century ago.

“When Congress reconvenes in January, I look forward to working with them to pass a plan immediately,” he said. Obama takes office as the 44th president on Jan. 20.

Congressional Democrats

With the economy heading toward the longest and deepest recession since World War II, pressure is rising for a spending program that will create new jobs. Congressional Democrats have said they will send Obama an economic stimulus package as soon as he takes office. New York Senator Charles Schumer late last month put the size of such a program at between $500 billion and $700 billion.

In addition to investing in infrastructure, requiring energy standards on public buildings and updating health-care practices, Obama said that he will start a “sweeping effort to modernize and upgrade school buildings” and will boost broadband access across America.

To the states that will be the conduits for the funding, he had a simple message: “use it or lose it.”

“If a state doesn’t act quickly to invest in roads and bridges in their communities, they’ll lose the money,” he said.

Obama’s plan to make public buildings more energy efficient should reduce the government’s energy bill, which he called the highest in the world. He plans to replace heating systems and install energy-efficient light bulbs.

Internet Upgrade

Obama also plans to upgrade Internet infrastructure, calling it “unacceptable that the United States ranks 15th in the world in broadband adoption.”

Upgrading health care is the final component of the plan. By introducing new technology and electronic medical records, he said health-care workers could “prevent medical mistakes, and help save billions of dollars each year.”

Obama, in Chicago for the weekend, has no public events scheduled for today. Tomorrow, he will mark the anniversary of the 1941 attack on Pearl Harbor with a news conference in Chicago, according to a statement from his transition team.

Obama will announce his choice to lead the Department of Veterans Affairs at the news conference, according to a Democratic aide who spoke on the condition of anonymity.

Our Perspective:

President elect Obama is taking huge strides in turning the economy around. Instead of just throwing money at the problem he is investing in our future. This can be the start of something very special.