January was a wild ride. A massive storm called Jonas headed straight for the Northeast and was estimated to cost cities as much as $1.8 million per inch of snow – and cost the economy an estimated $1 BILLION overall. By the time this is published, the roads have cleared and the power is back on but it will take more than snow plows and salt to recover from the worst storm in 95 years.
While we were all hunkering down, the economy weathered a storm of its own. The stock market took a sharp drop, and showed a rocky recovery through the end of the month. But why this slump and rally is happening is what got my attention.
You can thank the dropping temperatures for the rising price of crude and the stock market rally.
Why? There was an increased demand for heating oil because of the storm – which pushed the crude oil price per barrel to more than $31 dollars, which in turn got investors excited again.
Good news! Wait, I’m conflicted. I want renewables to be in demand, not oil.
Reducing energy costs is one of the best reasons that building owners and operators invest in green programs. And the commitments tied to COP21 mean that further investments will be made to reduce carbon and increase use of renewables. And those are good things!
But there’s a rub. As we move to renewable energy sources, we may encounter a headwind of economic difficulties. And popular thinking is that lack of growth means lack of investment. And investment is what we need for our economy move from oil dependence to sun and wind reliance.
To meet our climate change commitments, we need to engage at every level of our economy. The green building movement has created a huge wave in the market place and has proven to deliver significant financial value. Investors who have long hitched their wagons to oil will see the money to be made by investing in sustainable businesses, green energy, and the future economy. But we have to show them, and make the business case by publishing the results of our R&D, documenting our improved operational efficiency through sustainability reporting, and committing to renewable energy sources to build a more robust renewable market.
Each thermostat that was turned up during Jonas sent a signal to the market that oil is the best investment. Think of that – each household; each building; each business has the power to send its own signal. Imagine what we could do if we signaled for something better and more sustainable than oil?
Rachel Sowards, LEED AP O+M, is Executive Director, National Business Development for Paladino and Company.