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Only the Future is at Stake

A new report from Anirban Basu, chairman & CEO of Sage Policy Group and Chief Economist of the Modular Building Institute

Anirban Basu is chairman & CEO of Sage Policy Group and Chief Economist of the Modular Building Institute

Climate Debates Get Heated

As of this writing, many of the world’s leaders are engaged in discussions at the 28th meeting of the Conference of the Parties to the United Nations Framework Convention on Climate Change, known simply as COP28. This year, the President of COP28 is none other than Sultan Al Jaber of the United Arab Emirates (UAE), who got the festivities started by suggesting that there is “no science” indicating that a phase-out of fossil fuels is required to restrict global temperate increase to 1.5 Celsius or 2.7 degrees Fahrenheit.

Many disagreed, loudly. As indicated by The Guardian, more than 100 nations already support phasing out fossil fuels. Whether the final COP28 agreement will call for a phase-out or will adopt diluted language is one of the most contentious issues at the summit.

As with many economic matters, there is underlying the tension between social goals and perceived economic well-being. For oil producing nations, the move away from fossil fuels represents something approaching an existential threat. According to the US Energy Information Administration’s International Energy Statistics database, the UAE was the world’s seventh-largest total liquid fuels producer in 2022 and third largest among OPEC members.

Anirban Basu, CEO of Sage Policy Group and Chief Economist of the Modular Building Institute

Anirban Basu speaks at MBI's annual World of Modular conference and tradeshow.

The movement away from fossil fuels also represents a source of inconvenience and cost among many American households. Many Americans like the flexibility and associated range of their gasoline-fired V-6s and V-8s. They like their gas stoves, propane-powered grills, and the rumble of a lawnmowers. Electrification would require abandoning many of the appliances and vehicles to which Americans have become accustomed. The transition to electric appliances and vehicles also stands to be expensive, as does electricity as utilities also shift away from fossil fuels.

For many onlookers, the world is engaged in a race. If the movement toward cleaner, greener economic activity takes too long, the world will suffer. While there are climate change skeptics, many leading scientists have concluded that the world will be fundamentally altered if the world warms by 1.5 degrees Celsius or more. Some conclude that at 1.5 degrees Celsius, 70 to 90 percent of coral reefs will die globally. At 2 degrees, the figure rises to approximately 99 percent. About 500 million people depend on those reefs for both food and livelihoods according to information acquired by NPR climate correspondent Lauren Summer.

Still others warn that at 1.5 degrees Celsius, the Greenland Ice Sheet would collapse, altering ocean currents. Degradation of the Amazon rainforest would further elevate emissions. Flooding would become rampant, destroying waterfront communities and tax bases in the process. Some scientists believe that the world is destined to surpass 1.5 degrees Celsius of warming, and the question is really what can be done to get the globe back to workable temperatures.

How Modular Building Can Help

Construction is infamous among the pantheon of industries in terms of its resistance to change. It is associated with slow productivity growth and modest evolutions in the mechanisms by which construction services are delivered. The reluctance to change is evident in the, which suggests that modular’s market share is edging higher as opposed to ramping higher aggressively.

That may be about to change, and environmental conditions have much to do with that. The bad news is that building operations and construction account for nearly 40 percent of global energy-related CO2 emissions. The good news is that changes in how construction services are delivered can supply major benefits in the war on climate change.

Environmental implications extend beyond waste produced. Noise pollution from construction sites disrupts local ecosystems, including impacting wildlife communication and behavior. Moreover, the industry stands as a major global consumer of resources, a fact highlighted by European Union data indicating that building construction consumes 40 percent of materials and primary energy while generating 40 percent of waste. Traditional construction techniques also impact water quality by injecting diesel, fossil fuels, paints, solvents, and other toxic chemicals into the environment.

Enter modular construction. By prefabricating components in a controlled factory setting, modular building minimizes waste, reduces onsite construction activities, and, as a result, significantly lowers overall environmental impacts. A noteworthy study by Professor Mohammed Al-Hussein at the University of Alberta reveals that modular construction could cut CO2 emissions by 43 percent on standard projects. This reduction is attributable to efficient use of resources and reduced construction time associated with modular methods.

There is more. A peer-reviewed study published in the Journal of Industrial Ecology and conducted by the University of Virginia indicates that modular homes typically use about 17 percent less material. If one extends that result to global housing requirements, the implications are mind-bending.

Looking Ahead

The Modular Building Institute along with other sources of leadership have been advocating for modular construction along several key dimensions, including cost containment, delivery speed, precision, appeal to emerging workforce members, and now the environment. As the race to reverse global warming intensifies, there is little doubt that modular techniques will be adopted with far greater frequency than has been the case to date. Meanwhile, modular building continues to offer its more traditional benefits to project owners, but the issues facing society are far more pressing these days than simply helping project owners make their pro-formas pencil out.

More from Modular Advantage

Repetition, Communication, and Coordination: A QSR Case Study

This modular QSR project seemed like any another modular building on the surface. Inside, it was anything but. The rhythm, the desire to iterate and repeat, and the constant communication between all parties made it stand out.

Modular Architecture: Thinking Outside of the Box with Sara.Ann Logan

At a time when modular buildings were still seen as less than by many in the architecture and construction world, Sara.Ann Logan took the plunge and partnered to launch a design-build firm that designed, built, and constructed modular high-end single-family homes. But even though she could see the value of this kind of construction, it wasn’t universally accepted.

Colorado Developer ‘Attacks’ Attainable Housing Crisis

City, county, and state government bodies are reaching out to Fading West Development, a modular manufacturer and developer in Buena Vista, CO, to learn more about how they are using modular construction to solve the affordable housing crisis in Colorado. Governments are eager to learn how they’ve made modular development successful and profitable while meeting the growing need for affordable housing.

CES Group’s Stuart Cameron Will Convince You the Moon Is Achievable with Modularized MEP

While most people think of construction as a gradually layered process, MEP assemblies—such as the modular ones—tend to provide all-in-one installs, like a car factory. A modular MEP product helps developers, architects, and fellow modular manufacturers reach their goals through early integration and planning. MEP assemblies address all the unseen things like electrical, heating, and plumbing when looking at a finalized building. The very nature of MEP assemblies are crucial to any initial prospectus.

Automation: The Future for Offsite Modular Construction

Offsite modular construction lags far behind other industries in embracing and adopting automation. Some people believe it will decrease jobs. Others feel they’ve done okay without it, so why change? In reality, conventional construction methods simply cannot keep up. Cooper Lane of Brave Control Solutions points to the labor shortage and the housing crisis that’s rampant in Canada, the U.S., and globally.

Seizing the Modular Construction Opportunity

The CSA Public Policy Centre’s new report, Seizing the Modular Construction Opportunity, highlights how innovative modular methods can help to bring various building forms—from single unit housing to complex high-rises—online more quickly. Owing to efficient manufacturing practices and controlled factory environments, modular can achieve completion rates that are 25% to 50% faster than conventional construction approaches.

Structural versus Cyclical: What Matters More?

A new set of considerations have induced leaders of major global manufacturing enterprises to reconsider their site selection decisions. Among these are: 1) a desire for simpler logistics emphasizing shorter transit distances and times; 2) a need to better protect intellectual property; 3) more reliable court systems; 4) incentives offered by the USMCA, America’s trade deal with Canada and Mexico; and 5) a recent set of subsidies offered under packages like the Chips and Science Act and the Inflation Reduction Act.

How Air Caster Technology Has Helped Improve Modular Building Manufacturing

Air casters mean flexibility, not just in terms of movement but also in terms of change. For example, one structure might be 56-feet-long and another 76-feet-long. Air casters allow manufacturers to easily accommodate a variety of shapes and sizes of boxes and then make changes on the fly.

The Building Industry Needs a Moonshot Speech

In his “Moonshot” speech in 1962, President Kennedy challenged his fellow citizens to land a man on the moon and bring him safely back to earth before 1970. He showed leadership, reimagining human potential and progress, and this famous speech has been an inspiration for many to get things done. Likewise, a “Home-shot” speech that challenges citizens to remove lengthy procedures and “carefully” remove some of the mountain of red tape required for permitting before 2030 would certainly make a huge difference.

How Issa Nesheiwat Conquered the Great Manufacturer/Design Divide

Born in Jordan forty years ago, Nesheiwat is something of an outsider to the modular housing world. His entrepreneurial spirit led him from a childhood growing up in Yonkers, New York, to the more provincial location of Poughkeepsie where he delved into many unique business ventures. Not one to shy away from a challenge, he took on projects that seemed impossible, often in the housing sector. His innate sense of the fundamentals in finance, corporate branding, and business expansion have led him to where he is today.