Interview: Sustainable Life Now and in the Future with Tom Paladino

Tom Paladino headshotTom Paladino, founder of Paladino and Company

Our team recently had the rare opportunity to discuss sustainable life with Tom Paladino, the founder of Paladino and Company, and a pioneer in green building. In addition to his work personally shaping the LEED rating system, Tom and his company have also provided sustainability consulting for more than 2000 green building projects around the world. This qualified Tom for some pretty serious questions and the answers he gave did not disappoint. 

Since your work is mainly focused on sustainable life, what would you say is more important -spending less energy or producing energy from renewable sources?

They are both important – but the opportunity is greatest for those that commit to spending less energy. You don’t have to care about sustainability to understand that wasting energy is a terrible business strategy. Businesses can make low-cost investments in smarter energy management in the short-term, and benefit for the long-term. 

Producing energy from renewable sources has two key benefits and a bonus:

  1. Reduce operating costs for utility provided energy
  2. Increase resilience to climate events and other disasters by producing your own off-grid energy. If something comes along like a hurricane, or if the power grid is knocked offline by some other cause, businesses that have their own renewable energy sources can continue to operate
  3. Bonus: People – including investors – prefer sustainable businesses. Investors have recognized the correlation between sustainable operations and profitable operations.

The better question is ‘How can we design the system so that it can be powered entirely by renewables? By stating the question this way, a business innovation is forced, design is aligned to sustainability. That’s what we call Abundance thinking.

Sustainability in the business sector requires a lot of investing. In your experience, do companies focus on ROI solely through energy savings, or do they have a larger plan that involves the company's image and boosted revenue streams?

Ah – this is such an interesting question.

An investment implies additional capital above the basic spend. What if the basic spend required a high degree of sustainability? What paths are opened up when sustainability is redefined as simply ‘the ability to continue’? In this situation, the base spend is designed to endure, to survive unanticipated changes; whether market, climate, or workforce. Isn’t that simply protecting the spend? The business process or asset remains in service for an appropriate period of time. 

It’s important for businesses and real estate owners to understand that they don’t necessarily need to spend more to achieve sustainability, but they may need to build differently. Of course you can’t build differently if the building is already built – so existing buildings  may require investments in sustainable retrofits- and in those cases, the ROI is certainly a critical factor. It’s most important for businesses to align any investment – including those into sustainability – with their existing business values. So sustainability can be used to achieve operational efficiency, topline growth, employee/resident/tenant wellness, and as a platform for the company’s global vision. 

Interview: Sustainable Life Now and in the Future with Tom Paladino

We have a tool called Upshot that owners use during the value engineering process to make sure that the combination of sustainability strategies add up to the maximum value for the company, based on what they value most. 

Energy savings are one of the easiest ROI metrics to understand, but energy costs are just a fraction of the value that can be achieved through sustainability. So if sustainability must be considered an ‘investment’ then another innovation is to monetize the soft benefits of reputation enhancement, worker productivity or brand loyalty. Consider the Tower at PNC Plaza in Pittsburgh. It’s recognized as the greenest high rise building in the world, and they invested in sustainability for a lot more than energy cost savings. Look at One World Trade Centre – Durst Corporation used sustainability because it was good for their overall business.

Your efforts to make the new Hertz US HQ more sustainable have resulted in a decrease of energy cost by 43.6% -tell us more about it. How long did this project last? Were you able to implement all of the improvements you initially planned?  

Yes. The strategy we use is something we call the Six Block Model. We cascade the 6 variables of building energy use across the project schedule, and tackle the variable most easily manipulated in the correct phase. So the orientation of the building and the floor plates are optimized in the first third of the project; the loads and the systems are optimized in the middle third; and the sequence of operations and the renewables are optimized in the last third of the project. Each optimization leverages the precedent ones. 

Sustainable life projects often gravitate to zero-net, but that's still far from grid defection. Do you feel that companies who've done considerable efforts towards producing their own energy can one day defect the grid? 

We’re counting on it, but not because the grid is inherently bad. Defecting from the grid is a derisking strategy. It puts the owner in more control of energy costs, so they can influence how energy production and consumption can benefit their business. We want to see companies taking charge of their carbon footprint AND their relationships with energy providers. 

Have business owners expressed a desire to defect the grid?

Most of our clients think in terms of resilience to climate change, reduced carbon footprint, and other benefits of smart energy planning and management. We haven’t had clients asking us to get them off grid for the sake of being off-grid – it’s generally a side effect of a greater purpose. The grid also provides an integral piece of the strategy – it smooths out the supply and demand curves of many buildings, enabling innovative technology and a tighter performance band. 

In our initial conversation, you mentioned your work on The Brando luxury resort in French Polynesia -tell us more about it. Is that the closest to net zero that you've managed to reach in the business sector?

The Brando is an extraordinary example of abundance thinking. While it is a dream to work on a project surrounded by pristine water and natural habitat, it’s not exactly easy to build a full-service luxury resort on an atoll. So hats off to The Brando team for their vision and commitment to a truly sustainable and unique experience. Using seawater for cooling harnessed the timeless power of nature to provide an energy source. The location and cabana designs harnessed the timeless beauty of nature to create an experience. In this case, it would have been foolish to try traditional building techniques when we had an abundance of creative options there – our job was simply to help the team to achieve what they were always capable of, but may not have imagined. 

Interview: Sustainable Life Now and in the Future with Tom Paladino

Having in mind that sustainable life is not equally achievable on all locations and in different business models, should it be a goal for all businesses? 

Absolutely. There’s no one perfect way to achieve sustainability – which is why this field is so exciting. Every sustainable strategy is uniquely local. It needs to consider the local conditions, customs, and resources. The key is to understand what is available to you, and then use it to achieve abundant outcomes for your business, your neighbors, and the local ecology. Whether you want to save money by using energy and water intelligently; or you want to transform the working experience of your employees through natural light and fresh air – all businesses deserve to experience the transformative effect of sustainable design and engineering. Sustainability should not be about scarcity or doing without – sustainability is a celebration of what is possible when you bring the natural world together with the built environment. 

Businesses often coexist in shared spaces, which makes individual sustainable life efforts not as effective. Can small businesses group together to become more sustainable? Have you consulted on such a project? Were there additional challenges?

We talk to large property management firms all the time. The biggest challenge often comes down to “who is incentivized to go green”? When tenants don’t directly benefit from energy cost savings, for example, it’s difficult to make the argument for them to self-fund a CI renovation focused on energy efficiency. But when multiple tenants demand it of their building owner and management, there’s a collective voice that can add up to results. 

Quite a few fortune 500 companies have already added renewable energy capacities. Have any of them expressed interest in leading a more sustainable life? 

Yes – We deal with Fortune 500 and similar companies every day, and we believe that their sustainability programs are the emergence of a corporate conscious. The Latin root of corporation is ‘corpus’ or the body. When a body of people joined in a common purpose define their ‘sustainability vision’ they are really defining the DNA of their organization. They are creating rules for their tribe. These are the rules for living within that tribe. They each have their own reasons for pursuing more sustainability, and the right solutions are always based on their specific situation. 

There has been a big spike in requests for wellness strategies. Businesses are finally recognizing the role that the built environment has in making their employees healthier and more productive. The great news is that wellness and sustainability go hand-in-hand. We can talk about biophilia, circadian light, and natural ventilation in the same breath that we talk about solar energy, green roofs, and heating and cooling systems. 

Are there easy ways to become more sustainable if you've already added renewable capacities?

One of the easiest things that you can do is to track the performance of your existing buildings. Just as cars need tune-ups, so do buildings. We apply real-time tracking technology to building automation systems so that building operators can optimize building performance throughout a building’s lifecycle. As long as they’ve already made an investment in a great green system, they should make sure it’s working properly at all times. 

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