This week’s Green Scene column in Crain’s Chicago Business: Evanston shop aims to sell homeowners on water conservation

Water conservation is poised to be the next big concern for eco-minded people, and Mitchell Furlett aims to be well-positioned to sell products designed to do something about it. His new store, opening in Evanston this week, sells water-conservation retrofit kits and other products designed to increase home energy efficiency.

Mitchell Furlett

Mr. Furlett has spent the last three years selling water-conservation retrofit programs to multifamily building owners in Chicago, Evanston and parts of Wisconsin through his YES Conservation. He learned about water and plumbing matters while working at his family’s home kitchen and bath supply company in the late 1990s. But Mr. Furlett, 33, found a way to blend his beliefs about reducing waste with his technical water knowledge by launching YES Conservation in 2007.

Last year, Mr. Furlett installed water plumbing retrofits in 1,200 apartments, and he expects to complete about 1,600 units by yearend. Mr. Furlett declines to provide specifics but says revenue has risen 200% each year. Building owners buying the retrofits are reaping early benefits, too — Mr. Furlett says they get a return on their investment in a year or sooner.

Water experts warn our planet is running out of clean water and we need to be more mindful about conserving the fresh, clean water that’s still available. Water supply issues already are an urgent matter in other parts of the world, but the U.S. Environmental Protection Agency states at least two-thirds of the U.S. has experienced or is on the brink of having local, regional or statewide water shortages.

To spread his message of conservation and grow his business, Mr. Furlett wanted to widen his customer base to reach the single-family homeowner market. He intends to do that with YES Green Living — his storefront on Central Street.

Crain’s got a sneak peek of Mr. Furlett’s store this week.

Crain’s: What’s the biggest source of water that’s wasted in an apartment or home?

Mr. Furlett: The biggest water wasters are humans, hands down. What we do is retrofit the shower heads and the aerators inside the toilet tanks. Those are places where you can save quite a bit of money, and we found inexpensive ways to do that. We have pieces that help our toilet flush the same way but reduce the amount of water lost on the fill, which most people don’t even know about. You can have a 1.6-gallon-per-flush toilet, but you’re really using three gallons because you’re losing an extra gallon-and-a-half on the fill.

We end up saving building owners 6,000 gallons of water per user per year, and if you do the kitchen, it’s an extra 2,500 gallons of water savings per year. Depending on how much your water bill is, it’s about a one-year return on investment for one user. If you have an apartment with one bathroom and three users, your return on investment is going to be even better.

Crain’s: What’s the most dramatic way people can save money by cutting back on water usage?

Mr. Furlett: You can make the most significant savings in the shower, and you don’t need participation from the user. I’m lowering their water usage whether they participate or not. If you installed a new shower in the last 10 years and didn’t make these changes, you’ll save some money with our retrofit program. If your building is older than that, you’ll save even more money.

We have a service called a “water return calculator” where we can plug in figures and show you what you can expect to save. We also have a product called Leak Alert where we monitor water usage once the retrofits are done and will notify the building owner if we see any sudden increase. That could mean there’s a leak somewhere in the building. Small leaks can really add up in a water bill if they’re not found and fixed right away.

Crain’s: Why are you opening a store to expand to the single-family market when your multifamily housing sales have been growing at a healthy clip?

Mr. Furlett: I’ve always wanted to sell to the single-family market, but they really want to see and touch and feel what they’re doing, especially when it comes to something that will affect their lives on a daily basis, like showering, usage of lights or energy consumption. Single-family homeowners want to be more involved in understanding these things, but without having a store to show people what we’re doing, it was pretty hard. We tried to break into that market before with letters and ads, but it didn’t work.

We also know that most of us don’t have the time to do all the research about how to conserve water and energy usage in our homes — we don’t even want to look for it online. Most people think renewable energy involves huge solar panels and wind turbines, and they think it’s out of their reach.

The impetus for the retail space was to show them there’s lots of stuff they can do. It’s a museum idea — we want people to come here to learn first, then remember us when they’re ready to buy. We want to encourage people to start with small baby steps and show them how they can overcome the disconnect between excitement and doing something about it.

Crain’s: Are water-conservation programs going to be the main emphasis of this store or do you plan on demonstrating and selling more than that?

Mr. Furlett: Water conservation won’t be the biggest piece, but it will be easy to show people that water conservation is inexpensive and very effective. We plan on doing a lot of education here. We’re building a small eco-house display with a solar panel on it and a water-conservation toilet inside. With this house we’re bringing the roof line closer to the eye so people can see a photovoltaic solar panel up close. There will also be a small display of a wind turbine. The water-conservation toilet on display will be a working toilet on a base, and you’ll be able to see it actually flushes. We’re debating whether we’ll have things to flush.

Throughout the store we’ll have lots of different services and products people can learn about and purchase. We’ll have $600 solar panels to a $9 bracelet made out of a bike spoke. We found lots of great eco-gifts. We have purses made out of gum wrappers that are weaved together beautifully. We have tote bags made from burlap coffee sacs and old vinyl record albums re-purposed into bowls.

We have tile and outside pavers from Earth Stone Midwest that recycle granite products that would have been thrown into the waste stream. We’ll also have small pieces of used furniture that were repainted because we like the idea of up-cycling things. We’re also creating a kids educational program called Eco-Heroes, and we’ll have adult workshops on renewable energy, indoor air quality and how you can get tax credits on various energy programs.

Crain’s: Do you have other expansion plans beyond this store that’s opening next week?

Mr. Furlett: Our five-year plan is to take this retail piece slowly and then expand it to other markets like Evanston, where there’s an eco-minded community with people who are somewhat affluent but very busy. We do all the footwork for them and focus on being a neighborhood-based store. The idea behind renewable energy is that it pays itself back, but you’re asking people to pay upfront so we need to be in places that are affluent.

I wouldn’t do this in California because it’s already happening there. It’s not so prevalent in the Midwest and other places. I plan on testing this in Madison, (Wis.), and we’re looking at Ann Arbor, Mich., and Austin,Texas.

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This week’s Green Scene column in Crain’s Chicago Business: A look back at the Greenbuild conference at McCormick Place

An estimated 25,000 people engaged in eco-friendly building and design descended upon McCormick Place this week to swap ideas and business cards at the annual Greenbuild conference sponsored by the U.S. Green Building Council (USGBC).

Since its first gathering in 2002, the annual Greenbuild has grown each year and set a new attendance record this year in Chicago, according to event organizers. More than 1,000 companies from 112 countries exhibited their products and services in McCormick’s massive Exhibit Hall. Conference attendees also could choose among 200 educational seminars. Many sessions focused on various aspects of LEED, or Leadership in Energy and Environmental Design, an assessment and rating system the USBGC created to determine whether a building is eco-friendly and sustainable. A green jobs fair was on the agenda and attendees were entertained by an all-day film festival featuring documentaries with sustainable building themes.

Some highlights and observations from this week’s conference:

More than 10,000 people filled McCormick Place to hear Gen. Colin Powell give the opening keynote address on Wednesday that focused on the need for leadership and passion. Political pundits Mary Matalin and James Carville offered their sometimes differing views from Washington, and noted that Americans are in agreement about their concern over future energy issues and finding solutions in green buildings.

Two new LEED accreditation categories were introduced at Greenbuild to streamline the process for retailers, as well as high-volume property developers. The new retail track was designed to take into account the specialty design and construction needs of retailers, which varies significantly from corporate interiors in an office building or other commercial structures. Storeowners increasingly are seeking LEED certification for branding purposes and to take advantage of green incentives and tax credits, observes Doug Gatlin, vice-president of market development at the USBGC during his announcement of the new categories. Applications from retailers nationwide seeking LEED status doubled this year to about 1,300 compared to 2009, he says. Many of those retailers include banks, grocery stores, restaurants and big-box and department stores.

The new volume program will benefit developers seeking LEED certification on 25 or more properties. The high-volume process is expected to reduce developers’ certification fees by 17% and as much as 70% with registration of more than 100 projects, notes Mr. Gatlin.

The event has taken on a more corporate feel in recent years — more suits, fewer Birkenstocks. Still, the Exhibit Hall was filled with a passionate crowd of people eager to boost their sustainable businesses and help green the planet along the way.

Bigger corporate players packed the aisles on the exhibit floor with new services and products. Underwriters Laboratories from suburban Northbrook is a new entrant to the sustainability arena and was there touting its new spinoff UL Environment Inc. The company, now in its second year, is working on new sets of standards to create uniformity in building materials. “When a company says their product is made from 80% recycled materials, we think consumers should know exactly what that means,” notes Christopher Nelson, director of global commercial development. UL was instrumental in creating safety standards for electricity more than 100 years ago to prevent major fires in Chicago and elsewhere.

Some displays in the Exhibit Hall dazzled. Serious Materials, a Sunnyvale, Calif.-based maker of energy-saving products, had a 20-foot-high replica of the Empire State Building in New York City, complete with King Kong scaling the top floors. Serious refurbished that building’s 6,000-plus windows during its recent energy-saving retrofit, says Valerie Jenkins, director of marketing communications who talked up their products during Greenbuild.

Meanwhile, at a private “soiree” Wednesday night, a few dozen green building thought leaders in town for Greenbuild gathered to engage in a mini-TED-like experience of provocative discussions, test drive the new electric Chevy Volt and sample local, organic fare catered by City Provisions. The event was hosted at the home of Craig Sieben, owner of consulting firm Sieben Energy Associates (and a co-producer of the acclaimed climate change solutions documentary “Carbon Nation”), and produced by Tipping Point Productions, an event-planning firm that brings together sustainably-minded people.

The Bank of America Tower in New York

Speakers included Bob Fox, a New York-based architect whose firm Cook + Fox Architects led the team that designed the new Bank of America Tower in New York City — considered one of the greenest tall buildings in the world and the fourth-tallest building in the U.S. He dug deep into the technical particulars of the $40-million of green technology that was sunk into the project, including: creation of an onsite co-generation energy plant, waterless urinals, and an efficient heating and cooling system that radiates from the floors where each employee gets to regulate their own environment with a personal thermostat.

Another speaker was Michael Italiano, an original founder of the USGBC and CEO of Capital Markets Partnership, a non-profit working closely with Wall Street to push the investment banking community to create a robust market for raising capital and selling investment products to finance green buildings. “Wall Street is the last adopter of sustainability, but it has the potential to be the most powerful,”  he asserts.

One highlight of the evening: attendees were treated to Chicago’s first test drives of the Chevrolet Volt electric car, a division of General Motors. Tony Posawatz, GM’s Vehicle Line Director for the Chevy Volt, jokingly reminded drivers as they waited their turn in the cold: “Remember, Posawatz rhymes with kiloWatts.” The Chevy Volt won’t be for sale in Illinois until next summer, at earliest, for a price tag of about $41,000 — one battery included.

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This week’s Green Scene column in Crain’s Chicago Business: Indie Energy digs deep for renewable heating and cooling

Indie Energy co-founders Daniel Cheifetz, left, and Erik Larson at the Walgreens store in Oak Park that’s now heated via their company’s technology.

Shoppers stepping into a Walgreens that opened this week in Oak Park would probably never guess the store is warmed by heat drawn from a renewable energy source some 600 feet below the rehabbed historic building.

The geothermal energy system in one of Walgreen Co.’s first sustainable and eco-friendly stores was developed and installed by Evanston-based Indie Energy Systems Co. By digging four bore holes 600 feet deep near the drive-through area of the new store and installing a system that pumps naturally available underground energy into the store, Indie Energy’s system is providing all the necessary heating, cooling and refrigeration for that location. The system is expected to reduce Walgreen’s energy costs by 46% compared to a conventional heating, ventilation and air-conditioning setup, according to a Walgreen’s spokeswoman. 

That’s the latest of many geothermal units Indie has been developing and installing in Chicago and the nearby suburbs. The four-year-old company, which focuses on geothermal systems for commercial buildings and other large structures, is poised to benefit from a growing awareness and recent increased demand for geothermal energy. 

The Chicago Climate Action Plan’s updated report in September recommends the city of Chicago retrofit 100 million square feet of existing public buildings and structures with geothermal systems over the next 10 years to help meet its carbon reduction goals. 

Indie Energy was launched in 2006 by Daniel Cheifetz and Erik Larson to ride the clean-tech wave. Mr. Cheifetz, 62, was an Internet software entrepreneur in the 1990s and shifted to geothermal energy when he started getting involved in charity work in Evanston. He began looking for the most cost-effective way to run a sustainable building and ended up starting a geothermal company. Mr. Larson, 31, had worked in sustainability and energy-efficiency consulting both nationally and internationally. 

Mr. Cheifetz contends owners can save at least 35% in energy costs with Indie’s systems and sometimes as much as 65%.

The company won a $2.45-million competitive funding award from the U.S. Department of Energy in October 2009 based on a demonstration project that showcased its transformative technology. That project was a 166,000-square-foot building retrofit of Local 150 of the International Union of Operating Engineers in Countryside.

Other installations include several buildings on the campuses of North Central College in Naperville and Garrett-Evangelical Theological Seminary at Northwestern University in Evanston. A system was installed in a 73-unit affordable housing senior facility in Pilsen (the Resurrection Project), as well as one at corporate headquarters at Medline Industries in Mundelein. Indie Energy also will install geothermal as part of the 425,000-square-foot construction of Astellas Pharma’s new U.S. corporate headquarters in Glenview. 

More recently, the company secured a $1.6-million SBA loan from Ridgestone Bank in Schaumburg in June to refinance some debt and fund new technology investments.

Mr. Cheifetz declines to provide exact figures but says Indie’s revenue doubled last year over 2008; he expects it to double again this year over 2009. 

Crain’s spoke with Mr. Cheifetz this week about the challenges of digging deep in tight urban worksites and educating people about how geothermal energy really works.

Crain’s: Can geothermal energy do the entire job of heating and cooling a building with tens of thousands of square feet or do you need other energy sources as a backup?

Daniel Cheifetz

Mr. Cheifetz: Geothermal can do it all, but in larger commercial buildings it’s better to create a hybrid system for cost-effectiveness. One of the ways we bring down the build cost is we identify the times of the year you might get extremely cold and we figure, to take care of that with a geothermal system, you’d need to add more bore holes that cost more. So instead, we put in a standard boiler or cooling tower that can take the load and go on a few times during the year when you have too much heating or cooling demands.

Crain’s: What kinds of smart technologies has your company developed to get the most benefit out of geothermal energy?

Mr. Cheifetz: We have a serious engineering department here that developed a methodology for simulating the whole building and its relationship with the ground. There’s no way to tell exactly how to use the ground as a resource and a heat sink. People used rule-of-thumb kinds of approaches, and in many cases, they oversized the system. We simulate the whole building before we ever build anything. We simulate what the energy load will be, what kinds of activities will be going on in the building, the people flow, etc. . . .Then we figure out how to move that energy around in the most efficient way.

Once you build the system and it’s running, people reasonably ask: How is this going to work and how will I know if it’s working well? We developed what we call a Geopod, which is a standard and compliant way to measure the savings in dollars and carbon. We use the Internet and sensors in the building and powerful servers that run these calculations all the time so we can tell every minute how much energy the building is using and how much they’re saving because they’re measuring the actual energy flow. It gives them a baseline to compare to a conventional system that might use the same amount of energy.

Crain’s: What’s the biggest challenge about digging deep to get geothermal systems installed in an urban setting?

Mr. Cheifetz: Space is a big challenge because in an urban environment your space is constrained. There has been lots of geothermal done in rural areas because there’s lots of land and you can do shallow bore holes. You can’t do that in a city where you might have a small courtyard or a place where other construction is going on.

One of the things we’ve done is developed a technology, with some of it imported from Sweden, that allows us to do geothermal energy field construction with smaller equipment. It also goes deeper than other geothermal equipment, so instead of going down only 300 feet, our average depth of the bore hole is 650. A typical bore hole is more like 300-400 feet because most companies haven’t pushed the envelope in technology like we have.

Crain’s: Do you think geothermal energy is off most people’s radar when they think about renewable energy? How tough is it to educate building owners about geothermal energy when solar and wind power get so much more exposure?

Mr. Cheifetz: Yes, solar and wind get more attention because they’re visible and they require huge infrastructure and investments. Even though people have known for a long time that geothermal is energy efficient, there have been these big obstacles that have kept it from being adopted all these years: how to design it, build it, measure it and prove it. We’ve broken through those barriers.

And now there’s good incentives, too, with federal tax credits. If you do it right, you can get paybacks that are under five years. Retrofits sometimes are more expensive, but even then it’s closer to six to eight years.

The Department of Energy identified basic education as an obstacle to adoption of geothermal. It’s not something that rolls off the tongue and it’s difficult to conceptualize. With any new technology, that will always be the case. I believe if we can educate the market with proof and good stories, we can change that.

Crain’s: You’re scheduled to testify before a congressional committee in Chicago later this month. What are they exploring in this field meeting and what do you hope to contribute to the conversation? 

Mr. Cheifetz: The House Subcommittee on Energy and Environment is meeting on Nov. 15 in Chicago. They asked me to be an expert witness to provide information about ways we can improve our renewable energy infrastructure in this country, especially with R&D and advanced technologies.

Instead of falling behind other countries, we want to show what we can develop to be competitive. Using our clean technology, we need to look at what we can do to develop best practices, and that includes private-public partnerships and cooperation between private companies and universities.

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