Inside Philadelphia's energy innovation hub

By Heather M. Higgins, CNN

Philadelphia (CNN) –  There's a monstrous industrial eyesore that sits ominously along Philadelphia's Delaware River waterfront. However, behind the cobalt blue gates at the southernmost tip of Broad Street is a booming energy innovation center that has the potential to put the City of Brotherly Love back on the national map.

“This area was lifeless and look at it now – it's really special,” said Dave Ziel, chief development officer of Urban Outfitters, Inc, which, along with others, is helping revitalize the Navy Yard area. “The isolation is what gives it the opportunity itself.”

The hipster-friendly retailer, which also operates the Free People and Anthroplogie brands, moved its headquarters into the 19th century red brick workshops at Philadelphia’s Navy Yard in 2005. The workspace promotes a culture of socialization and connectivity while maintaining the integrity of each brand.

“This site is part of our DNA -- it’s historic and gritty. We are a creative group and these buildings match our brands,” said Ziel who is currently developing the company’s eighth and ninth structures.

    The campus-style collaboration is ubiquitous.

    It is felt among the 20-something girls who wear flowing vintage-inspired dresses and artisan jewelry while conversing at neon green picnic tables outside Shop 543, a cafeteria located in the Navy Yard’s historic core. It’s apparent when you pass by the lush Marine parade grounds where employees from the Tasty Baking Company participate in a variety of sports leagues.

    One of the groups reaping the benefits of this cross-collaboration is a class of 27 high school students who utilize an empty hanger owned by Urban Outfitters to build hybrid and electric cars.

    Ziel says the company isn't participating in this partnership for a personal advantage but simply because the company believes it’s a great initiative for students.

    The high school seniors attend the Sustainability Workshop -- a privately funded full day school program that embraces a project-based learning model.

    “This DOE (Department of Energy) grant that’s going on down at the Navy Yard, the Energy Efficient Buildings Hub, was our first doorway into starting a school,” said Simon Hauger, the group's 42-year-old  co-founder.

    Last year, the U.S. Department of Energy, which has a real interest in improving energy-efficient buildings, invested $125 million over five years in the EEB Hub located on the 1200-acre peninsula once home to the country's first naval shipyard.

    The research consortium, led by Pennsylvania State University and 21 other partners, is a sort of multidisciplinary think tank whose overall mission is to reduce energy consumption in regional commercial buildings by 20 percent at the end of the next eight years.

    Ten months ago, the oldest building at the Navy Yard, a 137-year-old historic white house called Quarters A, became a home to the workshop.

    Under the tutelage of Hauger, the students from this year's first graduating class built a flashy orange hybrid sports car, an electric go-kart, and they pursued other assignments like Bright Ideas! -- a project that required them to go out into real homes and discuss the cost and savings of using safe energy-efficient light bulbs.

    Christine Knapp, manager of public and client relations for the EEB Hub, says the school has accomplished more than she anticipated.

    “I've been extremely impressed with the amount of real world development that they've done; creating a business plan around swapping out light bulbs is something that any entrepreneur with an MBA might be out there doing, and it's coming from high school students,” said Knapp.

    Equally amazed is Philadelphia Mayor Michael Nutter, who outlined a challenge.

    “I gave them maybe my version of some homework, to figure out how to make their own school building more energy efficient. And some of that work is already started,” he said.

    Nutter, who pledged to make Philadelphia the greenest city in America during his inaugural address in January 2008, created Greenworks Philadelphia, an ambitious plan to reduce overall energy costs in city buildings by 30% and citywide in all buildings by 10%.

    The Philadelphia mayor says it makes sense to have high school students actively engaged with one of the greatest turnarounds of any closed naval facility in the U.S.

    Knapp hopes this level of engagement will introduce a new pipeline for people who want to get involved in building retrofit jobs.

    “One of our fundamental cultural issues is that kids don’t want to grow up to be building managers or building engineers. They want to grow up to be, you know, baseball players and race car drivers,” Knapp said. “So we have a cultural problem in that buildings aren’t sexy.”

    During the glory days of World War II, 60 wartime ships were built at the bustling naval facility. But the Department of Defense's decision to shut down operations in 1996 left the massive space a dilapidated shell complete with hollow buildings and an eerie ghost-town feel.

    For some, it is the perfect laboratory.

    “The Navy Yard has its own electrical grid so it is the ideal test bed for us -- it is a playground to tinker with air conditioning, lighting, control systems and better windows,” said Colin McCormick, senior technical adviser at the Department of Energy.

    The grand smoky-gray ships are a reminder of the Navy Yard's illustrious past, but the grungy structures and mismatched architecture create an unconventional beauty that is certainly a sign of its future. You only have to walk through this city within a city to notice its appeal.

    According to Mark Seltzer, director of the Philadelphia Industrial Development Corporation (PIDC), the entity that operates the Navy Yard, there are currently 120 companies and 8,500 employees working inside the iron gates. That is expected to reach 10,000 once pharmaceutical giant GlaxoSmithKline completes its three-mile exodus from Center City at the end of this year.

    This kind of urbanization is attractive to ecologically minded businesses and the yard’s designation as a Keystone Innovation Zone draws startup tech and energy companies looking for tax incentives.

    The Department of Energy wants to integrate sustainability in the real world spectrum and the itch to be a part of that process is inspiring Hauger’s students.

    “We want to see the kids be a part of making exciting buildings that perform better,” said McCormick.

    You can learn more about the Sustainability Workshop students and their fascinating projects at Philadelphia’s Navy Yard on "The Next List" this Sunday at 2 p.m. ET on CNN.