"Our human destiny is inextricably linked to the actions of all other living things. Respecting this principle is the fundamental challenge in changing the nature of business."
- Paul Hawken, The Ecology of Commerce


- = Sustainable Economy Initiatives = -

The Phillips Eco-Enterprise Center (PEEC), Minnesota

The Phillips Eco-Enterprise Center in Minneapolis, USA, is a large eco-industrial facility that was built as an alternative to a garbage transfer station, after extensive community protest and involvement.


In the late 1970s, the local county government announced plans to install a major garbage transfer facility in the predominantly low-income, ethnically diverse Phillips neighbourhood of Minneapolis (over 17,500 residents), which would have demolished a residential portion of the neighbourhood. The local residents launched a passionate campaign to stop the facility, and in 1993 two local women formed The Green Institute, with a vision of turning the proposed site into something positive, instead of negative. While researching the nature of the waste-stream, they discovered that 30%-40% of it consisted of construction and demolition debris, which led to the establishment of The Re-Use Center and DeConstruction Services. In 1998 the Institute broke ground on a new project, The Phillips Eco-Enterprise Center (PEEC), which was completed in 1999.

Aims and Objectives

The Green Institute’s mission is to achieve urban development in the Phillips neighbourhood through sustainable enterprise, job creation, and environmental education. As well as employing Phillips residents in new jobs, the Institute’s directors and staff seek to provide leadership and hope by their efforts to improve environmental conditions and create meaningful employment and business opportunities.


The Institute’s first project, The Re-Use Center, was set up to demonstrate that the flow of material to landfills could be stemmed. It consists of a 26,000 square foot retail store that opened in 1995, selling salvaged, re-usable building and construction materials for use in home improvement and commercial projects. The second project, DeConstruction Services, disassembles unwanted homes and commercial buildings and sells the salvaged materials for re-use, as an alternative to mechanized demolition and landfilling. About 60% of the materials gathered from a typical building is sold on site, 30% goes to The Re-Use Center’s warehouse, and 10% is disposed of in an environmentally responsible manner. A third project, GreenSpace Partners, works with local businesses and community groups to support and protect community-controlled gardens, greenspace and urban forests. Together, these activities employ some 40 people.

In November 1997, the Green Institute started on its fourth project, The Phillips Eco-Enterprise Center, a 64,000 square feet state-of-the-art commercial facility intended to showcase environmentally sound businesses, and provide high quality, living wage jobs for local people. With the financing in place (see below), they hired LHB Engineers and Architects to design the building to the highest environmental standards, and used market research about energy and environmental businesses to find tenants. The building’s sustainability goals emphasized high indoor air quality for occupant health and well-being; energy efficient operations incorporating solar, wind, and geothermal energy; extensive day-lighting; resource efficiency though the use of reused and recycled materials; and the use of native plants for landscaping, including a prairie grass roof. The PEEC project manager, Corey Brinkema, went on to found e4 Partners, a consulting firm focused on eco-industrial development and sustainable building design.


The Green Institute is a non-profit corporation, managed by a voluntary Board of Directors, of whom at least 50% must live or work in the Phillips neighbourhood. The Institute employs more than 40 people, and the PEEC operates as a project of the Institute, leasing space to businesses.


The Green Institute has an annual budget of $3.5 million. The ReUse Center has annual retail sales of $650,000, and DeConstruction Services has annual sales around $350,000; both are more-or-less self-sufficient in their operations. By donating a building scheduled for demolition to the non-profit Green Institute, an owner often receives a $20 - $30,000 tax deduction, which more than compensates for the cost of the 2-3 week time delay involved in deconstruction, as opposed to demolition. The project costs for the proposed PEEC were estimated at $5.5 million. The State of Minnesota’s Department of Trade and Economic Development provided a $1.5 million loan that will be forgiven after ten years of successful operation, and further equity funding was provided by local foundations and corporations such as Honeywell which was headquartered in Phillips until 1999. Three Minnesota-based commercial banks bid on the project’s debt-financing, and the Institute selected the Bremer Bank of Saint Paul for a $3,200,000 mortgage. Within a year of opening, the PEEC had 15 tenant companies and a positive cash-flow. It is now fully occupied with 18 tenants, including three energy-efficiency companies, a hospital services construction company, a landscaping services company which has a greenhouse inside the building, a community micro-lending organization, an Internet service provider, a transit construction company, and the Green Institute’s own offices. Taken together, the PEEC’s tenants employ some 100 people.


The PEEC’s performance can be measured as a community enterprise, and as a building. As an enterprise, the management team has successfully overcome the negative stigma associated with the low-income, inner city neighbourhood. As a building, the PEEC incorporates environmental features such as shared facilities (shipping/receiving, recycling, rest-room, conferencing), sun-tracking skylights, windows that open, ground-source heating and cooling, energy recovery and management systems, efficient and low-density lighting, the use of savaged steel joists, brick and wood, recycled and recyclable flooring, zero-emissions coatings, 100% stormwater retention, native landscaping, 100% stormwater retention and a grass roof. Taken together, the eco-features cost an additional $258,000. These features have reduced the building’s energy-use by 40%, delivering a 39% return on the investment with a 2.5 to 4 year payback, saving the Green Institute at least $60,000 a year. The PEEC has received several notable awards, and much national attention.


The success of the PEEC building and the Green Institute’s other projects has generated a strong interest in sustainable enterprise and industrial ecology in the neighbourhood and further afield; the Phillips neighbourhood residents now demand sustainability in all proposed developments. The Green Institute receives many requests for assistance, including from the main Minneapolis downtown library and a baseball arena, which want to become more energy efficient; it is also looking at ways to retrofit an obsolescent shopping centre, at possibilities for a biomass combined heat and power (CHP) plant, and at ways to power a proposed light rail system with distributive energy, in partnership with BP Solarex. The US federal government is becoming engaged in the whole concept of high-performance eco-industrial industrial zones, modelled on the Danish complex at Kalundborg, and a nation-wide eco-industrial network has been formed. Overseas, the Institute is building a partnership with the Confederation of Indian Industry to assist with technology transfer and to develop a Green Business Centre in the city of Hyderabad.

For further information contact :

Michael Krause,
Executive Director, The Green Institute,
2801 21st Ave. S, Suite 110.
Minneapolis, MN 55407

Phone: 612-278-7100
Fax: 612-278-7101

Written by Guy Dauncey for The Planning Exchange, Glasgow, Scotland.