Earlier this year, Pat Penfield of Syracuse’s Whitman School of Management and Rene Germain at SUNY’s College of Environmental Science and Forestry published a study titled “The Potential Certified Wood Supply Chain Bottleneck and Its Impact on LEED Construction Projects in New York State,” which was recently profiled on the Science Blog. The study is interesting because its conclusions echo – from a practical perspective – the calls by many in the industry for USGBC to open up its MR-7 Certified Wood credit to wood products certified under other sustainable forest management systems apart from FSC. It’s also of particular personal interest to me because of its focus on the timber industry as it exists here in New York State.
Penfield and Germain’s purpose in performing the study was to determine whether end users in New York are having difficulty in sourcing FSC-certified wood products, as well as to assess exactly how FSC wood is being specified and used on LEED-certified projects across the Empire State. The authors identified these questions based on “anecdotal evidence from suppliers and users over the past several years suggesting a supply shortfall,” as well as a 2008 study from the Yale Program on Forest Policy and Governance. According to the data that the authors were able to assemble, 38 million board feet of FSC-certified sawlogs were produced in New York State in 2010 on 1.46 million acres of FSC-certified forest. However, because only 1 FSC-certified sawmill exists in New York State, and FSC certification requires an intact chain-of-custody, the authors calculated that 28 million board feet of FSC-certified sawlogs leave New York State’s supply chain annually.
Using USGBC’s database of LEED-certified projects, the authors identified 48 public LEED projects in New York State. 14 of those 48 projects (29 percent) used FSC-certified wood (i.e., earned the MR-7 credit). The authors then proceeded to contact the architects for each of those projects, and administered a 20-question telephone survey which yielded some interesting results about architect attitudes towards FSC:
- 92 percent said they used FSC because of the available “LEED points” and “good stewardship.”
- 25 percent said FSC products were requested by the client;
- 27 percent had difficulty identifying an FSC supplier;
- 42 percent perceived a shortage of FSC-certified wood in the marketplace; and
- 73 percent said they paid a premium for FSC-certified products.
These last two points lead Penfield and Germain to make some interesting conclusions. First, they were “surprised” to find a price premium for FSC-certified wood products given that “[m]ost of the literature on certified wood products has reported that price premiums are rare (Jenson et al. 2003, Anderson et al. 2005, Perera et al 2008). . . . [I]t is noteworthy that most LEED projects were rquired to purchase FSC-certified wood at a premium price from neighboring states, which suggests a lack of product in New York and evidence of supplier leverage on a regional basis.”
Critcally, they also note that “[a]nother alternative for alleviating this potential shortage of certified wood in the marketplace is for the USGBC to reconsider their certified wood criteria for LEED to possibly include other certification programs, such as the SFI. The SFI-certified products are recognized by many leading green building rating programs in the United States, Canada, and overseas, including the National Green Building Standard, National Association of Home Builders, and Green Globes. Including the SFI program would add a considerable area of certified forestland and stumpage, which in turn would make more certified logs available for processing.”
This study is a timely addition to the antitrust aspects of the debate – which we’ve noted previously here at GRELJ - as USGBC reviews the most recent public comments to the proposed revisions to MR-7.