KB Home to build only 'Energy Star' homes by 2009

NEW YORK (Reuters) - KB Home on Thursday announced a set of environmental standards including compliance of all communities opening in 2009 with the government's "Energy Star" certification requirements.

The company also promised to construct all new homes starting in 2009 using paint and carpet low in chemicals known to cause adverse health effects such as eye irritation, headaches and kidney damage.

"I'm not saying we're green, because we're not. But we're doing the best we can to become greener," Chief Executive Jeff Mezger said in an interview.

"As we go forth with our initiatives, I think we will end up being the green builder among national builders because we're leading the charge now."

KB's new communities will adhere to the federal government's "Energy Star" certification requirements. The U.S. Environmental Protection Agency and the U.S. Department of Energy program provides guidelines for energy-efficient building processes and govern insulation, ducts, and windows among other elements.

KB had been building Energy Star homes and already used environmentally friendly paint, but not companywide.

The company is to conduct an audit this year to reduce job site waste that is expected to produce material cost savings, part of the competitive advantage afforded by green practices, Mezger said.

It is too early to quantify the savings, but the company does plan to measure and disclose them, he said.

AFFORDABILITY ISSUE

Until recently, national home builders avoided building green because demand wasn't there, said Kevin Morrow, of the National Association of Home Builders.

But home buyers have acquired a heightened environmental consciousness and a green reputation generates traffic, Mezger said.

"It will definitely be a brand advantage," Mezger said.

NAHB spokeswoman Calli Schmidt said, "Energy efficiency is the biggest drive to green building," as potential customers seek to lower heating and cooling costs.

By 2012, the market for green construction will grow to between $40 billion and $70 billion, up from this year's estimated $12 billion to $20 billion, according to a report from McGraw-Hill Construction and the NAHB.

But affordability is an issue, said Lisa Kalmbach, who heads KB's environmental task force.

For every thousand dollars added to the price of a house, about 200,000 people can no longer afford it, she said.

Solar panels are an example of a powerful green technology that's too expensive to make the list of green options KB offers its customers. Among the green technology items it does offer are tankless water heaters that provide hot water on demand.

"We can't just add green features for the sake of green features, we have to make sure that our homes sell," Kalmbach said.

(Editing by Steve Orlofsky, Dave Zimmerman, Leslie Gevirtz)