Sustainia Sector Guide to Buildings by Sustainia

SUSTAINIA SECTOR GUIDE

D L I BU S G N I ng the Explori uildings b e l b a sustain rrow of tomo

SUSTAINIA

Sydhavnsskolen Sydhavnsskolen (South Harbor School – under construction) in Copenhagen is built with a strong focus on energy efficiency, physical activity and integration with the surrounding cityscape. The school area will be part of the central public area in the newly developed neighborhood. Builder: City of Copenhagen Architects: JJW Arkitekter Photo (incl. front page): JJW Arkitekter. 3 SETTING THE SCENE

SUSTAINIA SECTOR GUIDE

D L I BU S G IN ng the s Explori building e l b a n i susta rrow of tomo

CONTENTS FOREWORD 4-5

SETTING THE SCENE 6-14 8 The view from 2030 11

What we mean by “sustainable”

Sustainia building principles

THE ESSENTIAL INTRODUCTION TO SUSTAINABLE BUILDINGS 15-21 16

Building owners and investors

City planners and developers

20 Policy makers

WHY BUILDINGS MATTER 22-37 24

The challenge

The opportunity

SUSTAINIA SECTOR GUIDE

BENEFITS OF SUSTAINABLE BUILDINGS 38-63 44

Health benefits

Creating new jobs

TOOLS FOR CHANGE 64-95

Saving energy

Why donÂ´t we just do it?

Turning waste into resources

Creating better neighborhoods

Designing the sustainable building

Creating better return on building investments

Check list for buildings in Sustainia

Planning tools

Practical tools

Policy tools

Financial tools

40 Higher productivity

METHODS 96-97

FOREWORD

REBUILDING OUR HABITAT Humans live in buildings. Though we may love the outdoors, people in all parts of the world spend the majority of their time inside. We work, sleep, eat, learn, live and love in buildings. Buildings have become our natural habitat, with a profound impact on our lives and a great impact on the environment both locally and globally.

LAURA STORM, Executive Director, Sustainia

For that reason it is obvious to us that the first sector guide from Sustainia will focus on buildings. This sector has a tremendous potential to contribute to and enhance the vibrant and sustainable future that Sustainia promotes. Without sustainable buildings there will be no sustainable future, and making a strong push towards making the building sector sustainable will bring that future a very large step closer. Buildings in Sustainia are of course resource efficient, using far less energy as well as less and more sustainable materials than today. But we require even more of them. Sustainia’s buildings are safe, inviting and affordable. They are spaces for living and working that are a pleasure to be in, and they keep us healthy, active and productive, while reinventing the ways our built environment interacts with nature. Sustainia’s buildings embrace the three dimensions of sustainability – economic, social and environmental – and are integrated with the surrounding nature, society and systems to create a net benefit to the health of humans and nature alike. Sustainia’s buildings are within our reach. Today’s design and construction technology allows us to build houses that are sustainable in every definition of the word. This will help a foreseeable building boom in the emerging economies to be sustainable, and retrofit the existing building mass to be healthier, more inspiring to be in and more efficient. At the same time the buildings will have to be adaptable to the changing needs of the users as populations in many countries grow older in the coming decades. Flexibility in design and thorough planning is the key. “When reading the guide it should become obvious that the benefits to humans, nature and the economy from building sustainably are many

4 FOREWORD

“ BENEFITS TO HUMANS, NATURE AND THE ECONOMY FROM BUILDING SUSTAINABLY ARE MANY AND SUBSTANTIAL .” and substantial.” Many investments in sustainable buildings are directly cost efficient, creating greater savings than the investment needed. On top of that they have an indirect positive effect on productivity, health and the economy. While harder to predict accurately, the indirect effects should not be overlooked, not just because they directly affect the quality of life for people but also because the economic effects look to be great indeed. Considering these benefits, it is clear that it is of vital importance to address the barriers that slow down a transformation towards a sustainable building sector. This is important for all – whether it be policy makers, investors or home owners. The chances are that we will all benefit tremendously from a concerted effort across sectors to build more sustainably. We may all live longer and better and free more resources for each of our core concerns. In our first publication, the Guide to Sustainia, we explored the sustainable society of tomorrow at a general level. In our Sustainia City Guides we develop a vision for how a particular city or region can become a desirable and sustainable place to live and work in the future. The Guide to Copenhagen 2025 is the first example of this. In the Sustainia Sector Guides we present the arguments, facts and ideas that will stimulate the market for sustainable solutions in a specific industry sector. We are proud to present this first sector guide to buildings and no less proud to announce that the next guide is already under way.

5 FOREWORD

SUSTAINIA

We hope you will enjoy and be inspired by the guide and that you will spread the inspiration. THE FUTURE IS BUILT TODAY.

6 SETTING THE SCENE

7 SETTING THE SCENE

THE VIEW FROM 2030

FROM BABY STEPS TO GIANT LEAPS In Sustainia buildings are part of the solution, not part of the problem. It wasn´t always like this. For some time, reducing the negative impact of the building sector was considered enough. Now, however, we have moved beyond this approach, first to buildings that aim for a zero negative impact and then on to buildings that now work with the environment and the systems of utilities and transport available to have a net positive effect on both nature and the health of the people using them. We measure our success in achieving these goals by the wellbeing of the humans using the buildings, by the biodiversity of the land- or cityscape the buildings are part of and by the amount of resources generated by the buildings during their lifetime. The hard part in getting here was changing the way we think about buildings. To realize that we could take giant steps towards the positive impact buildings of Sustainia and still meet the needs of a growing population. The good part was the realization that a world of new solutions was opened. What was considered to be waste has been used as valuable building materials. Developing new areas doesn´t have to bring the degradation of the natural environment along with it. Instead, restoration of many former industrial sites has improved local biodiversity and the health of the inhabitants. Cleverly designed and sited buildings encourage people to live more active, healthy lives, and the standard new building today generates more power than it consumes.

8 SETTING THE SCENE

EXHIBIT 1.7

NO BUILDING IS AN ISLAND Energy efficiency is great. But why stop there? Building sustainably is essentially about designing our surroundings to support both nature and society. Small but positive steps can be taken when you focus on the building itself, but when you see buildings as an integrated part of the surrounding society and systems, larger strides towards sustainability are possible.

Buildings seen as part of an integrated system

Regeneration Buildings are seen as an integrated part of the surroundings and seek to empower both nature and humans.

Restoration Building and retrofitting must seek to redress damage done by human activities Net positive impact

Net negative impact

Paradigm shift Buildings move from being part of the problem to being part of the solution

Sustainability Buildings must not have a negative impact on environment or users.

Eco-efficiency Buildings must gradually become less of a burden to sustainability

Business as usual Little or no consideration given to sustainability of building

9 SETTING THE SCENE

Buildings seen as isolated things cut off from the surroundings

Inspired by: UNEP-SBCI, ”Case studies of High Performance Sustainable Buildings”, Hartkopf et al., 2009; Ministry for the Environment, New Zealand, ”Rethinking our built environment”, Jenkins & Zari, 2009

Perhaps the biggest challenge has been the great inertia within the building mass and in the framework conditions the building sector is working within. Buildings are around for a long time, and are costly to retrofit. In many areas of Europe only about one percent of the building mass is being built new each year. Retrofitting has done a lot to create a more sustainable building sector, but in many places we have had to balance the need to reduce the amount of harmful impact from old buildings with the need to protect the cultural heritage. This has raised the bar for the rest of the building mass, but we are getting there, and the next steps are looking even more promising. Using development to restore the damage done previously to the environment has proven a beneficial approach, but we realize we can do even better. In the coming decades we aim to learn not only to act as custodians of the environment, but also to use buildings and development to create or restore capacity in the ecosystem as well as in human societies and for the individual. After all, buildings are our habitat, and our habitat should support us.

10 SETTING THE SCENE

WHAT IS SUSTANIA? Sustainia is a clear and realistic vision of a sustainable society. It is a demonstration of how we could live tomorrow, and a collaborative platform to make it real. Sustainia is a alliance of partners representing civil society, businesses and experts. The concept of “Sustainia” has been developed by the Scandinavian think tank Monday Morning in a collaborative effort with global companies and foundations. Sustainia promotes the transformation to sustainability in several ways. The sector guides aims to stimulate the market for sustainable solutions in individual industry sectors.

WHAT WE MEAN BY “SUSTAINABLE” There is no simple definition of what constitutes sustainability in buildings. The broader concept of sustainability itself is open to a variety of definitions, and these to some extent reflect the different positions of the persons or institutions proposing the definition. Sustainia is based on the wisdom of the holistic approach to sustainability as expressed in the UN definition of three mutually dependent pillars of sustainability: economically, environmentally and socially. Transforming these into usable concepts in the building sector is not simple. There are today a number of standards and rating systems that all in some way address the need to create more sustainable buildings. In writing this guide we have been inspired by many of them, but we have chosen not to adhere to a single standard or rating scheme, realizing that these often reflect the special social, geographical and economic circumstances they are developed to address. That said, we do believe in being ambitious in relation to legislation, standards, framework conditions and rating systems. The Sustainia Building principles define how we see sustainability in buildings. They are based on the vision that is Sustainia: that we can build a society where sustainability – all three pillars – is the natural choice for businesses, regulators and policy makers.

DRIVERS OF SUSTAINABILITY The transformation of the building sector towards sustainability is driven by several factors. To speed up the transformation it is important to pay attention to: • Policy • Legislation • Markets • Standards • Technology • Rating systems • Investment capital

11 SETTING THE SCENE

SUSTAINIA BUILDING PRINCIPLES 1

12â&#x20AC;&#x192;SETTING THE SCENEâ&#x20AC;&#x192;

Buildings are integrated into the surrounding environment and systems to provide a net benefit to nature, human health and quality of life. Buildings are constructed and renovated with the environmental, social and economic aspect of sustainability in mind. Buildings are vehicles for innovation , constantly used in exploring, developing and scaling solutions for sustainable construction. Homes are safe, inviting and affordable , providing every person a reasonable amount of privacy and comfort. Buildings are designed to make full use of the natural assets in their surroundings, including daylight and water to reduce energy and materials consumption and create a better indoor environment.

13â&#x20AC;&#x192;SETTING THE SCENEâ&#x20AC;&#x192;

From design to demolition and recycling, sustainable buildings are planned with a whole life cycle perspective on both environmental and economic impact. Relevant stakeholders including local communities, authorities and others are involved early in transparent collaboration about the planning of buildings and developments. Buildings are adapted to the local conditions including using the local resources, utilities and infrastructure to provide the best overall solution â&#x20AC;&#x201C; not the suboptimal one. Buildings built to last must be flexible enough to accommodate future users. Buildings built for short term use must be easy to demolish and recycle to accommodate the need for space and materials for new buildings. Buildings and surrounding areas are built to be accessible, giving equal opportunity for all users to use them.

”YOU NEVER CHANGE THINGS BY FIGHTING THE EXISTING REALITY. TO CHANGE SOMETHING, BUILD A NEW MODEL, THAT MAKES THE EXISTING MODEL OBSOLETE” RICHARD RICHARD BUCKMINSTER BUCKMINSTER FULLER FULLER

14 SETTING THE SCENE

IF YOU’VE ONLY GOT 5 MINUTES The essential introduction to sustainable buildings for the:

BUILDING OWNER OR INVESTOR

CITYPLANNER

POLICYMAKER

15 IF YOU’VE ONLY GOT 5 MINUTES

BUILDING OWNER OR INVESTOR

Why build sustainably? • Building and retrofitting for sustainability gives a strong return on investment PAGE 62 • Reduced operating costs

PAGE 62

• Sustainable buildings raise the productivity of employees

PAGE 40

• Better indoor air quality and better use of daylight improve capacity for learning PAGE 40 • Building and retrofitting sustainably offers planning tools to guard your investment against external threats, e.g. rising energy prices and stronger regulation PAGE 68

The essential pictures to take home! IT´S NOT AS COSTLY AS YOU – PROBABLY – THINK PAGE 32 Extra cost of building sustainably 20%

How much people think it costs

CONSTRUCTION COSTS ARE ONLY THE BEGINNING PAGE 36

Cost of construction

15%

Operations cost incl. energy consumption

10%

16 IF YOU’VE ONLY GOT 5 MINUTES

How much it really costs

Value of the work being carried out in the building, including wages

What should I do? • Plan for the total life of the building. If you intend to own the building for a long time, this will give you more useful information on how to minimize costs. If you plan to sell quickly you will have a better prospect for the buyer. • Plan extensively and early. The further you are in the process, the more costly it will be to make changes. • Get professional aid. Architects, engineers, utility companies, sustainability consultants and auditors are all valuable partners when building sustainably. • When your building needs renovating, use the opportunity to make it sustainable. Seizing the opportunity can dramatically cut the cost of upgrading to sustainability. • Remember that buildings with a long life time need to be flexible to accommodate the needs of future generations of users. Buildings with a short life time need to be made from reusable or recyclable materials. • Search for non-traditional investing partners such as pension funds, energy service companies etc. to overcome the initial costs. • Use standards and rating systems suited to your type of building, and go for the most ambitious rating systems – ambition pays off. • Remember to follow up. Measuring and auditing are key to ensuring you get the most from your investment in sustainability.

Essential tools I should know about: • CHECK LIST FOR SUSTAINABILITY DESIGN PAGE 69 • LIFE CYCLE COSTS ANALYSIS PAGE 80 • LIFE CYCLE ASSESSMENT PAGE 78 • RATING SYSTEMS PAGE 75 • ENERGY PERFORMANCE CONTRACTING/ESCO PAGE 93

17 IF YOU’VE ONLY GOT 5 MINUTES

CITY PLANNER Why build sustainably?

• Reduced operating expenses free funds in public budgets

PAGE 62

• The building sector offers the most readily available and often cheapest solutions to many political goals regarding sustainability. • Building sustainably increases capacity for water management, lowering consumption and protecting against flooding PAGE 58 • The sustainable building process offers tools to reduce the amount of waste created from construction and demolition PAGE 54 • Building sustainably creates neighborhoods that promote health and wellbeing in residents PAGE 58 • Better indoor air quality and better use of daylight improve capacity for learning PAGE 40 • An increased rate of renovation for sustainability will increase economic activity and create new jobs, many of them local. Subsequent energy savings by residents can be re-spent in the community, thus aiding local businesses PAGE 46

The essential pictures to take home! IT´S NOT AS COSTLY AS YOU – PROBABLY – THINK PAGE 32 Extra cost of building sustainably 20%

How much people think it costs

THE POWER OF PLANNING

PAGE 35

Sustainable buildings requires greater eff ort in planning in three dimensions

Wider

15%

10%

Deeper 5%

18 IF YOU’VE ONLY GOT 5 MINUTES

How much it really costs Longer

What should I do? • When your building needs renovating, use the opportunity to make it sustainable. Seizing the opportunity can dramatically cut the cost of upgrading to sustainability. • Plan extensively and early. The further you are in the planning and design process, the more costly it will be to make changes. • Involve residents, authorities and other relevant stakeholders early and extensively in the planning process. • Remember that cities develop over time. Is your planning flexible enough to accommodate the needs of future residents? • Search for non-traditional investing partners such as pension funds, energy performance contracting (EPC) companies etc. to overcome the initial costs. They might jump at the chance to contribute to a healthier, lovelier city. • Use the standards and rating systems that include extensive focus on neighborhoods, and go for the most ambitious rating systems – ambition pays off. • Remember to follow up. Make sure you measure and audit the effect from the investment in sustainability on both policy goals and in concrete projects.

19 IF YOU’VE ONLY GOT 5 MINUTES

POLICY MAKER

Why build sustainably? • Reduced operating costs free funds in public budgets PAGE 62

• An increased rate of renovation for sustainability will increase economic activity and create new jobs PAGE 46 • Making buildings sustainable is the most effective and cost effective way to reach policy goals on reducing emissions of greenhouse gasses PAGE 30 • Better indoor air quality and better use of daylight improve capacity for learning PAGE 44 • Building sustainably increases capacity for water management, lowering consumption and protecting against flooding PAGE 58 • The sustainable building process offers tools to reduce the amount of waste created from construction and demolition PAGE 54

The essential pictures to take home! THE MOST POTENT – AND CHEAPEST – WAY OF REDUCING GREENHOUSE GAS EMISSIONS PAGE 30 AMBITION PAYS OF

Potential for GHG savings

PAGE 47

Economic effects

Buildings

Extent of retrofitting

20 IF YOU’VE ONLY GOT 5 MINUTES

What should I do? • Get the incentives right. Use building regulations, fiscal incentives and other policy tools ambitiously to save public funds, increase health, create jobs and spur innovation. • Building, maintaining and operating sustainable buildings takes new skills. Create education and training incentives for professionals in all parts of the building sector to learn the skills needed to create a sustainable building mass. • Be ambitious when retrofitting or building for sustainability. The buildings will be around for a long time before they are retrofitted again or demolished, so halfway sustainability represents large extra utility bills for future residents. • When buildings need renovating, use the opportunity to make them sustainable. This can dramatically cut the cost of upgrading to sustainability. • Build and retrofit sustainably in public buildings. Setting the example pays off in reduced operating costs and stimulates innovation in the building sector. • Plan and implement your plans with a view to create synergies at regional or national level. Conventional ‘island thinking’ within a single municipality is at risk of sub-optimising rather than contributing to sustainable solutions. • Build new and renovate existing buildings with a clear focus on lowering operational costs and improving the health and productivity of the users of the buildings rather than simply buying the cheapest solutions – the cheapest solution could turn out more expensive over time in energy use and in terms of sick days or low productivity.

Essential tools I should know about:

• CHECK LIST FOR SUSTAINABILITY DESIGN PAGE 69 • LIFE CYCLE COSTS ANALYSIS PAGE 80 • LIFE CYCLE ASSESSMENT PAGE 78 • RATING SYSTEMS PAGE 75 • ENERGY PERFORMANCE CONTRACTING/ESCO PAGE 93

21 IF YOU’VE ONLY GOT 5 MINUTES

– facts, ﬁgures & concepts to change mindsets

22 WHY BUILDINGS MATTER

23窶ジHY BUILDINGS MATTER

THE CHALLENGE We live in buildings; it’s as simple as that. This is also the case in Sustainia. Though Sustainians may love the outdoors and ride their bikes both for fun and transport, they eventually get to their destination and spend quite a lot of time there. So sustainable buildings must provide spaces for living, working and public life that are comfortable and healthy to be in, and leave only a small ecological footprint. The bulk of the buildings today are far from meeting these demands. In fact:

40%

•

Buildings account for one third of humanity´s resource consumption1, including 3 billion tons of raw materials each year 2.

•

55% of the wood cut for non-fuel uses3 and 25% of global water4 goes to buildings.

•

40% of our solid waste comes from constructing or demolishing buildings5.

•

Buildings consume 40% of the energy worldwide, contributing significantly to global warming6.

Buildings … … account for 40 % of energy use in most countries 7

1/5

… are identified by The International Energy Agency as the most costefficient sector for reducing energy consumption. 8 … consume one-fifth of the world’s available water. 9

24 WHY BUILDINGS MATTER

UNEP-SBCI, Draft briefing on the sustainable building index, Paris:France,mai 2010, 28p. 2 Roodman, D. M. and N. Lenssen. 1995. A Building Revolution: How Ecology and Health Concerns are Transforming Construction. 3 WORLDWATCH Institute, David Malin Roodman and Nicholas Lenssen , A Building Revolution: How Ecology and Health Concerns Are Transforming Construction,1995,67p. 4 UNEP-SBCI website, consulted 27/06/12. 5 UNEP-SBCI, Draft briefing on the sustainable building index, Paris:France,mai 2010, 28p. 6 UNEP (2007), Buildings and climate change,Status, Challenges and Opportunities, online www.unep.fr/ shared/publications/pdf/DTIx0916xPA-BuildingsClimate.pdf, 87p. 7 IEA 2010, ”Energy performance in buildings”, p. 5 8 Ibid. 9 UNEP-SBCI website, conslted 27/06/12. 1

Buildings … … are places where people globally spend approximately 70 % of their time.10 In developed countries it is close to 90 %.11

70% 90%

Indoor pollution are linked to lower respiratory infections estimated to cause about 11 % of all human deaths globally each year.12

US Environmental Protection Agency, www.epa.gov/iaq/pubs/ insidestory.html#Intro1, consulted 12/07/12; SMITH K.R., “Looking for pollution where the people are”, East West Center, 1994, n 10, 8p.; 11 Ibid. 12 Statistics on-line, in UNEPSBCI, Draft briefing on the sustainable building index, Paris, France, May 2010, 28p. 13 IEA World Energy Outlook, 2008 14 McKinsey Global Institute, ”Resource revolution”, 2012 10

The challenge may get tougher considering the context. According to the International Energy Agency (IEA) if nothing dramatic is done about energy consumption and generation, energy prices are going to continue their upward spiral13. Resources are getting scarcer, whilst many transitional and developing countries are experiencing a building boom that will most likely continue, as up to 3 bn people are expected to experience a social rise to the middle classes before 203014. In the developed economies, most of the buildings we will live in during the coming decades have already been built – and are not very sustainable. Retrofitting these will take huge investments. At the same time the demographic makeup of the population is changing, tilting globally towards an ageing society where the needs of elderly citizens will need to be addressed. This means that longstanding buildings will need to be adaptable to meet the needs of future generations of building occupiers.

25 WHY BUILDINGS MATTER

By 2020 … … the global middle class will have grown by 3 bn people. They will want bigger homes.15 … the majority of buildings in Asia are less than 20 years old.16

>20 years

By 2050 …

90 %

… over 90 % of the buildings standing today in Europe will still be here.17 … 6 bn people are expected to live in cities.18

Buildings are essentially a shelter, and they provide a base for place attachment and identity. That means more than having a roof over one´s head. Today, the United Nations Human Development Program (UNDP) estimates that although over 200 million people have recently been lifted out of slum conditions, 1.1 billion people live in inadequate housing conditions in urban areas alone. An estimated 100 million people have no housing at all9. By 2030, the number of people living in slum areas could very well have risen to 2 billion10. For these people, building sustainably takes on a very direct urgency not experienced by the richer part of the world’s population. Access to safe, affordable housing for the poorest is one of the key priorities for creating a building sector that can be said to be truly sustainable. This area does not receive the focus that more expensive buildings do, but it is one of the biggest challenges yet to be faced for a sustainable building sector. And it is one of the biggest opportunities for change that matters.

26 WHY BUILDINGS MATTER

Homi Kharas,”The emerging middle class in developing countries”, OECD Development Centre Working paper #285, Jan. 2010. 16 UNEP SBCI, ”Draft Briefing on Sustainable Building Index”, May 2010 17 Annual demolition of 0,2%, “Europes Buildings Under Microscope”, BPIE 2011 18 United Nations Human Settlements Program 2012, ”Training for better cities”. 19 UNCHS, ”Basic Facts on Urbanisation”, 1999, p. 9; UN-HABITAT, ”The State of the World’s Cities 2010/2011; Bridging the Urban Divide”, p 224 20 www.unhabitat.org/downloads/ docs/4631_46759_GC%2021%20 Slum%20dwellers%20to%20double.pdf accessed 12-09-2012 15

7,500 BILLION DOLLARS THE GLOBAL WORTH OF THE BUILDING SECTOR PER YEAR.

111 MILLION PEOPLE THE NUMBER EMPLOYED IN CONSTRUCTION WORLDWIDE.

2,500 BILLION DOLLARS THE INVESTMENT IN SUSTAINABLE BUILDINGS FROM 2010 TO 2030 REQUIRED TO KEEP BUILDING ENERGY USE IN CHECK IN THE PERIOD.

5,000 BILLION

DOLLARS

ENERGY SAVINGS FROM THE INVESTMENT. Sources: Betts & Farell: Global construction, 2020: Global Construction perspectives and Oxford Economics (2009), ILO, 2001, “The construction industry in the twenty-first century”, IEA: World Energy Outlook 2009.

27 WHY BUILDINGS MATTER

NOT ONLY GOOD FOR THE CLIMATE Building sustainably offers a range of positive effects for the building owner as well as the surrounding community and the larger world.

BUILDING LEV EL Reduced operating expenses Energy efficient office buildings have been shown to have approx. 30 % lower operating expenses than standard buildings. 21

Improved resale value

Higher productivity

Studies have shown that the use of daylighting in buildings not only saves energy but also increases productivity by up to 40% . 25

Health of residents and users

Energy efficient office buildings have been found to have a resale value up to 35 % higher than comparable standard buildings. 22

Better indoor environment and design that stimulates physical activity can increase the health of residents and users . 26

Increased rental rates

Increased capacity for learning

Owners get up to 17 % higher rental rates in “green buildings” than in standard buildings 23 , and the occupancy rates are up to 18 % higher . 24

Increased access to fresh air in primary schools improves the performance of pupils . 27

COMMUNITY LEVEL Health Reduced energy consumption reduces local pollution from power generation, leading to lower incidence of respiratory illnesses . A reduction of a ton of CO2 emissions also reduces emissions of SO2 by 2,000 g, of NOx by 2,200 g and of particular matter (PM10) by 250 g. 28 Water management

Sustainable buildings use water efficiently, often attaining a reduction of 75 % of water use 29. Rainwater collection and green roofs also offer protection against rain floods . 30

Reduced waste Buildings produce more than a third of the world’s waste. Building sustain-

28 WHY BUILDINGS MATTER

ably reduces waste dramatically by reusing and recycling building materials.

Stimulating the local economy Building, renovating and recycling businesses are often smaller, locally based companies. Consumer savings on energy stimulate other spending. A one million dollar investment in sustainable building creates 11 years of work from consumer savings alone . 31

Comfortable local climate Sustainable building features such as green roofs reduce the local heat island effect in cities, thus cooling the area for the greater comfort of people living there – and even greater savings in A/C . 32

NATIONAL LEVEL New jobs Retrofitting older buildings and building new creates jobs, and the same goes for recycling building materials. Many of these jobs are local and often offer job opportunities to people with low- or midlevel education. An investment in green building improvements of $ 1 m will generate 16.4 years of work over a 20year period . 33

Creating jobs now and better budgets in the future

in other sectors or further investment in such areas as health, education or cleaner energy. The International Energy Agency estimated in 2009 that investments of $ 2,500 bn in energy savings over the years 2010 to 2030 will repay at a rate of 2 to 1 over the lifetime of the investment . 34

Reduced energy dependency An energy efficient building sector is a key factor in reducing the need for the import of energy .

Investing in energy efficient buildings will create jobs now, and the subsequent energy savings will free money for growth

GLOBAL LEVEL Environment Reduced energy consumption is a key factor in reducing the use of fossil fuels and opens opportunities to mitigate global warming 35 and reduce emissions of sulphur and mercury.

More stable energy supply

Resource efficiency Many resources are stretched, and commodity prices have risen sharply over the past decade. Recycling and choosing sustainable materials reduces the pressure on stretched resources .

Reducing the energy consumption in buildings will make it easier to meet the world’s energy demands and contribute to a more stable energy market, avoiding the dramatic price fluctuations seen in oil .

Miller, N et al. ”Does Green Pay Off”, Journal of Real Estate Portfolio Management, vol. 14, no. 4, 2008 22 Fuerst, F. and McAllister, P. “New Evidence on the Green Building rent and Price Premium”, Univ. of Reading, 2009. 23 Wiley et al, “Green Design and the market for Commercial Office Space”, Journal of Real Estate Finance and Economics, Vol 41, no. 2, 2010 24 Ibid. 21

29 WHY BUILDINGS MATTER

Loftnes et al, “Linking energy to health and productivity in the built environment”, USGBC, 2003. 26 Lee & Paffenberger, “Physical Activity and Stroke Incidence : The Harvard Alumni Health Study”, Stroke 1998; Greening America’s Schools, Capital E, 2006 27 Wargocki, P. and Wyon, D.P. (2007) “The effects of outdoor air supply rate and supply air filter condition in classrooms on the performance of schoolwork by children (1257-RP)”, HVAC&R Research, 13(2). 25

Kats, Greg et al. “National Review of Green Schools: Costs, Benefits and Implications for Massachusetts,” a report for the Massachusetts Technology Collaborative (MTC), 2005 29 Von Weizsäcker et al, “Factor Five: Transforming the Global Economy through 80 per cent improvements in resource productivity”, 2009. 30 EPA, “Reducing Urban Heat Islands: Compendium of Strategies – Green Roofs”, available at: www. epa.gov/hiri/resources/ pdf/GreenRoofsCompendium.pdf accessed 15-08-2012. 28

Kats, G. (2010) Greening our built world: costs benefits and strategies. 32 EPA, “Reducing Urban Heat Islands: Compendium of Strategies – Green Roofs”, available at: www. epa.gov/hiri/resources/ pdf/GreenRoofsCompendium.pdf accessed 15-08-2012. 33 Kats, G. (2010) Greening our built world: costs benefits and strategies. 34 IEA, World Energy Outlook, 2009, p. 280 35 IPCC, 2007, AR4, Summary for Policymakers. 31

THE OPPORTUNITY Some might consider the challenges as too big to be overcome, but from the “sustainian” perspective they are the greatest opportunities to move towards a sustainable society. The building boom in developing economies is not only a challenge; it is also a chance to develop the sustainable construction principles, materials and systems that can create the sustainable buildings of 2030 and 2050. And while most existing buildings are not built for sustainability, there is no need to wait for them to be replaced by new ones. Not all parts of an existing building last for its full life cycle. This opens the opportunity to retrofit buildings, as windows, roofs, heating systems with a shorter life than the whole building naturally need replacing. Done wisely this can improve the comfort of buildings, dramatically reduce the extra investment needed for reducing the use of energy, include new renewable energy systems and reduce the environmental impact of existing buildings significantly, while more radical solutions are being brought into play when building new.

EXHIBIT 1.1

Mitigation potential <$20/t (GtCO2 -eq/yr)

THE GREATEST OPPORTUNITY FOR CHANGE

The buildings sector offers the largest potential for low-cost (cost less than $20 per ton CO2-eq) mitigation of greenhouse gas emissions in all world regions by 2030. Based on 80 studies in 36 countries the IPCC concludes that 29 % of greenhouse gas emissions from buildings can be eliminated at zero cost.

Great potential at low cost in sustainable buildings

1 Source: Adapted from: IPCC, 2007, AR4, summary for policymakers, fig. 10.

30 WHY BUILDINGS MATTER

te W as

ry st re

ul ic gr A

ry du

gs In

in ld ui B

po ns Tr a

The sustainable buildings envisioned by Sustainia are available today; they require no technological developments before they can be realized, and they have a tremendous potential to turn buildings from burdens into opportunities. This is why the building sector, although it can be seen as one the most consuming and polluting sectors in society, is seen by Sustainia as one of the best targets to start a change for the better. Of course there are still many opportunities for development and innovation both technically and with regard to how we overcome the barriers for transforming the building sector to sustainability in such areas as financing. Studies show that on the macroeconomic level buildings offer the cheapest – and in many cases most cost-effective – means of reducing energy consumption (see exhibit 1.1). In this sense, sustainable buildings are key to meeting national and international targets on reducing energy use and greenhouse gas emissions. While households hold the largest potential for energy savings, buildings in the service sector and industry buildings can be the source of large reductions if they are renovated with a focus on sustainability (see exhibit 1.2). It is important to note that in industrial buildings utility management also holds great potential for energy savings (see p. 50) .

EXHIBIT 1.2

POTENTIAL FOR OPERATIONAL SAVINGS IN ALL SECTORS (Mtoe)

HOUSEHOLDS Heating and insulation

HOUSEHOLDS Water heating

100

SERVICE SECTOR Heating and insulation SERVICE SECTOR Appliances

80 60

INDUSTRY Heating LIGHTING

40 20 0

Saving potential, cost effective scenario (2030)

31 WHY BUILDINGS MATTER

Saving potential, technically feasible scenario (2030)

Note: “Heating” includes savings from improvement/upgrade of heating systems, such as more effective oil fired heaters or replacing heaters with e.g. heat pumps and refurbishment of buildings, such as improved insulation, replacement of e.g. windows, and improved ventilation Note:In the cost-effective scenario all investments will create savings greater than the investment, in the technically feasible scenario both cost-effective and not cost-effective investments are made but not experimental or extremely expensive investments. Source: “Report on the Multiple Benefits of Energy Efficient Buildings in the EU”, Copenhagen Economics for The Renovate Europe Campaign, 2012

BETTER BUILDINGS – BETTER HEALTH The really good part of this is that while energy efficiency in itself is good for both planet and profit, the added benefits to people – namely health and productivity – from building sustainably look to be considerably greater. In industrialized countries people spend approximately 90 percent of their time indoors. In developing countries it is close to 70 percent36. Considering this, the quality of the indoor environment is crucial to human wellbeing and especially to the most vulnerable: the elderly and the children.

US Environmental Protection Agency, www. epa.gov/iaq/pubs/insidestory.html#Intro1, consulted the 12/07/12; SMITH K.R., “Looking for pollution where the people are”, East West Center, 1994, n 10, 8p.; 37 US EPA, The inside story: a guide to indoor air quality, available online : www.epa.gov/iaq/ pubs/insidestory.html#Intro 38 WHO Statistics on-line, in UNEP-SBCI, ”Draft briefing on the sustainable building index”,2010, 28p. 39 Commission for Environmental Cooperation, ”Green Building in North America: Opportunities and Challenges” (2008) 40 DUFLO E., GREENSTONE M., REMA H., “Indoor air pollution, health and economic wellbeing”, S.A.P.I.EN.S sapiens.revues.org/130 36

EXHIBIT 1.3

NOT AS EXPENSIVE AS YOU – PROBABLY – THOUGHT

20%

Extra cost of building sustainably

How much people think it costs

17% 15%

The cost of building sustainably is often much lower than people expect. The extra costs associated with 146 energy efficient buildings were between 0 and 3 per cent compared to normal houses. The public perception, however, was that building “green” would add an average of 17 per cent to the cost of building.

10%

How much it really costs

1.5%

32 WHY BUILDINGS MATTER

Source: Adapted from Kats, G (2010) “Greening our built world: Costs, benefits and strategies”, Island Press. Based on 2007 opinion survey by WBCSD.

We have a tendency to think that air pollution is the smog we see outside when the levels of pollution are said to be high. In fact, indoor levels of pollutants are often 2.5 times to 5 times – and occasionally 100 times – higher than outdoor levels37. The effects of poor indoor air quality range from headaches and allergies to respiratory and infectious diseases and, according to the World Health Organization (WHO), lower respiratory infections linked to indoor pollution cause about 11 percent of all human deaths globally each year38. In the United States alone, building related sickness has an estimated annual cost of $ 58 bn.39 Many of these health problems are a result of poor ventilation and hazardous compounds from building materials, furniture or appliances. In many developing countries, the use of solid fuel for cooking and heating on open fi res or on traditional stoves represents a major respiratory health risk40. Good indoor air quality and ample access to daylight can also improve productivity greatly in both workplaces and schools (see p. 40). This is why in Sustainia´s vision for sustainable buildings there is a focus on providing a healthy indoor as well as outdoor environment. For this purpose the buildings provide good access to outdoor air and daylight, shield inhabitants from detrimental noise and provide them with a large degree of control over temperature, ventilation and light. EXHIBIT 1.4

EXPENSIVE RESOURCES The building sector uses energy and materials extensively. Over a third of the world’s materials, and subsequently also its waste, come from the construction, use or demolition of buildings.

Commodity price index (100=years 1999-2001)

Commodity rices rise sharply from 2000

Source: Adapted from McKinsey Global Institute, MGI Commodity price Index, 2011

33 WHY BUILDINGS MATTER

II ar w ld W

19 O 70 il sh 's oc k

or W

100 de P pr os es t w si a r on de pr G e s re si at on

See figure below from McKinsey Global Institute.A further rise in commodity prices will make it even more vital for the building sector to reduce its consumption of materials and energy.

Approx. 40 % of the world’s energy is used in buildings. In the 20th century commodity prices declined gradually, making them in reality half as expensive by the end of the century as they were at the beginning. However since 2000 200 commodity prices have risen dramatically, wiping out the decline in prices over the past century.

0 1900

1950

2000

2011

PLANNING DEEPER, WIDER AND LONGER Building and renovating sustainably is all about planning and taking the life cycle perspective on buildings. Traditionally many building investors have had a limited planning horizon of one to five years, taking into account availability and price of materials but only to a limited degree their impact on the environment and human health. Likewise the considerations regarding integration between the buildings and the society and nature have most often been limited. These are strong barriers to creating a sustainable building sector. Investments in sustainability often show their upside after several years and in other areas than those where building investors normally look for benefits. Positive effects on human health and productivity or on the local economy and sense of community are not reflected in the traditional business case for investing in buildings. Planning for sustainable buildings takes quite a lot more effort, but it is well worth one’s while. When building sustainably – whether new or retrofitted houses – the traditional planning has to be extended in three dimensions: deeper, wider and longer.

EXHIBIT 1.5

ENERGY USE IN BUILDINGS (END-USE, USA 2010)

14.4

1.9 3.1 1.9 2.6

3.9

SPACE HEATING

VENTILATION

SPACE COOLING

COMPUTERS

LIGHTING

COOKING

WATER HEATING

WET CLEANING

REFRIGERATION

OTHER AND DATA DISCREPANCIES

ELECTRONICS

4.1 12.3

9.6 9.2

34 WHY BUILDINGS MATTER

Source: Buildings energy data book, Department of Energy, buildingsdatabook.eren.doe. gov consulted on 10-09-2012

EXHIBIT 1.6

THE POWER OF PLANNING Sustainability in buildings is all about planning. Once built, buildings are around for a very long time, and planning should include three dimensions: the full lifetime of the building, the full impact of the building and the integration into the surrounding society. Planning extensively in these three dimensions is a key factor in building sustainably, and the earlier in the process you do it, the easier and cheaper it is to find the best solution.

Wider

Deeper

Consider the surroundings not only geographically but also take into account the options for utilities, available transport solutions of the building users, possibilities for using natural resources such as daylight and rainwater and integration into the local community.

Consider not only costs but also impact on environment and the health and wellbeing of the users for every part of the building and its connected systems.

Longer Consider the impact on environment, human health, wellbeing and costs over the full life of the building (or the upgrades in case of retrofit). Find the balance between long life and flexibility. Long lived buildings will have to be adaptable to the needs of users many decades from now, and the cost and resource efficiency during use is of huge importance. Shorter lived buildings like many production facilities will need stronger emphasis on building materials suitable for reuse and recycling.

Ability to influence Cost and effort of changes

Project start

35窶ジHY BUILDINGS MATTER

Project completion

The economic rationale for more intensive planning is obvious when you consider the costs associated with the different parts of a building’s life and use. The construction cost is often the smallest part by far of the total cost of owning and running a building (see exhibit 1.7).

EXHIBIT 1.7

CONSTRUCTION COSTS ARE ONLY THE BEGINNING The costs associated with owning a building are much higher than the cost of construction. The figure shows the costs associated with owning and operating an office building over 30 years. Operating exceeds construction by a factor of five in this example, but the really big part is the value of the work created in the building. As a better indoor environment can raise productivity considerably (see section on benefits), investing in this area can be returned generously. Source:Adapted from Davis Langdon Management Consulting (2007), “Towards a European methodology for Life Cycle Costing (LCC) – Guidance document”. Note: source document does not specify if costs are real or discounted.

Value of the work being carried out in the building, including wages

Operations cost incl. energy consumption Cost of construction

36 WHY BUILDINGS MATTER

The costs associated with maintenance and operations are often in themselves higher than the construction cost, and investing in such things as reducing energy consumption during the operations phase are often repaid several times over the life of the investment41. The effects on waste and water management from building sustainably also bring significant savings (see exhibit 1.8). But the really big benefits become apparent when you consider the cost of operations – the work to be done in the building. For an office building they can be one or even two orders of magnitude higher than the construction cost considered over a 30-year span. Many sustainable solutions for buildings bring benefits to health, wellbeing and productivity, so the benefits from increased productivity and higher work attendance can easily outweigh an investment in sustainable construction (see also exhibit 2.1).

Over a 20-year period investments in resource efficiency are returned 4-6 times. Kats, G. (2010) “Greening our Built World: Costs, benefits and strategies”, Island Press. 41

EXHIBIT 1.8

THE TRUE VALUE OF SUSTAINABLE BUILDINGS The table shows the benefits of building sustainably (in this case following the LEED rating system) over a 20-year period. All figures are in net present value (NPV) comparable to the initial extra investment in building sustainably. Most of the benefits are not considered in the traditional business case for building or retrofitting. Productivity and health stands out as very substantial – but often overlooked – benefits.

BENEFITS CATEGORY

20-YEAR NPV ($/M2)

Initial investment in sustainability

-43.1

Traditionally considered benefits: Value of energy savings Water savings value

62.3 5.5

Extra benefits: Value of emission savings Waste value (only in construction period – 1 year) Commissioning O&M value Productivity and health value (certified and silver) Productivity and health value (gold and platinum)

12.7 0.3 91.2 397 596

TOTAL 20-YEAR NPV (CERTIFIED AND SILVER) TOTAL 20-YEAR NPV (GOLD AND PLATINUM)

526 725

37 WHY BUILDINGS MATTER

Source: Adapted from Kats, G. (2010) Greening our built world: Costs, benefits and strategies. Island Press.

â&#x20AC;&#x201C; the upsides and the pitfalls

BENEFIT 1

HIGHER PRODUCTIVITY Building sustainably means having a greater focus on the comfort and health of the users of the buildings. Air quality is often much worse inside buildings than outside 42, and ample access to outside air, ventilation and temperature control are key features when creating sustainable buildings, as is the ability to control the acoustic environment e.g. reduce the negative impact from outside noise. Visual comfort, including the use of natural light in buildings instead of artificial, and control of the lighting, has also been shown to have a great positive impact on comfort and health (see also following pages). While some retrofitting projects link energy savings with concern for the indoor climate, the economic effect of better indoor climate is often overlooked. Greater comfort and benefits to health are key elements in perhaps the most important economic effect of building sustainably – it increases productivity. Considering that for commercial buildings the value of the work being done in the building is often one or two orders of magnitude higher than the construction or operating costs (see exhibit 1.7), the economic impact of higher productivity can multiply the effects of the direct savings on energy and other resources. As seen in exhibit 2.1, even a small increase in productivity of one per cent can turn a retrofitting business case from net loss to net gain. The actual measured impacts of better indoor environment vary widely, and there is considerable uncertainty in the estimates, but the effects are generally reported as higher than this one per cent (see textbox).

REPORTED BENEFITS IN WORKPLACESFROM IMPROVEMENTS IN INDOOR ENVIRONMENT: Indoor air quality: 6-9 per cent gain in productivity Natural ventilation: 3-18 per cent gain in productivity Local thermal control: 3.5-3.7 per cent gain in productivity Daylight: 3-40 per cent gain in productivity and sales.

A study from December 2011 estimates that increasing ventilation rates in offices in USA to 15 l/pers/s will in itself increase productivity by one per cent among 12 million workers, bringing in a benefit of more than $ 10 bn. The overall net benefits including health effects were even higher.43 A recent Danish study has taken the argument a step further and aims to show the full benefits of better indoor air quality in schools. Danish primary schools generally have lower air quality than the schools in many neighbouring countries. Only 44 per cent of classrooms meet the national regulations.

40 BENEFITS OF SUSTAINABLE BUILDINGS

Sources: UNDP (2011) Buildings: investing in energy and resource efficiency.

US EPA, The inside story: a guide to indoor air quality, available online: www.epa.gov/iaq/ pubs/insidestory.html#Intro 43 Fisk, W.J. et al, “Benefits and costs of improved IEQ in U.S. Offices”, Indoor Air, vol. 21, issue 3, p. 357-367. 42

EXHIBIT 2.1

BEYOND THE TRADITIONAL BUSINESS CASE Costs and benefits from retrofitting 100 million sq. ft. of office space in the USA. Scenario 1 shows the classic “low-hanging fruits” scenario of early retrofitting. Because of the easy gains from e.g. changing light bulbs to LED-lights a modest investment of 1 $ pr. sq. ft. saves 10 % energy. Scenario 2 explores the business case of a more ambitious scenario, where an initial investment of 25 $ pr. sq. ft. is saving 40 per cent energy.

SCENARIO 2

SCENARIO 1

Shows what we already know: Significant energy savings can be made with a modest effort. The productivity effects are however even greater.

Benefits (m $ NPV)

2810

Shows what we should consider. With productivity effects taken into account, even the ambitious energy retrofit option produces net benefits. And the more ambitious retrofit is more resistant to e.g. rising energy prices.

Benefits (m $ NPV) 2600

2600

1240

1340

310 -100 Note: Direct energy benefits and indirect productivity benefits are in net present value. Lifetime of the retrofit measures is assumed to be 15 years; the expected effect on productivity is a conservative plus 1 per cent.

INITIAL INVESTMENT DIRECT ENERGY SAVINGS INDIRECT PRODUCTIVITY GAINS NET GAINS -2500

The study shows that raising the air quality to meet the regulations would raise the level of education and save € 36 m yearly on the national budget after ten years. Not only this, but the resulting positive effect on the concentration of the pupils and subsequently on their grades would also lead to higher productivity in the long run, as better educational results are transformed into higher productivity levels. This effect is estimated to be approx. € 175 m yearly 20 years after the initial investment.44

41 BENEFITS OF SUSTAINABLE BUILDINGS

Source: Adapted from World Business Council for Sustainable Development (2009) Energy Efficiency in Buildings: Transforming the market.

“Socioeconomic consequences of better air quality in primary schools”, Slotsholm 2012, available at: http://www.velux. com/ar-DZ/Sustainable_living/ ventilation/facts_ventilation/ did_you_know/Documents/ socio-economic-consequencesog-better-air-quality-in-primaryschools_slotsholm_uk.pdf 44

SUSTAINABLE SUPERMARKET

REWEﾂｮ Where: Berlin What: New built grocery carbon neutral store Effects: Compared to a standard store of the same size, this building uses 48 percent less energy and appr. 40 percent of the energy used is produced by the buildingﾂｴs photovoltaic cells and geothermal energy system. Details: The 2,550 m2 store (of which 1,830 m2 is store area) is one of the first of its kind to let in great amounts of daylight. This saves energy and creates a very different shopping experience compared to the classic supermarket with no views to the outside world.

Structure: Twelve 46 m glued laminated timber frames span the store at intervals of 6.38 m, forming the supporting structure. The walls are made with prefabricated wood sandwiched elements filled with cellulose insulation enabling simple, fast and safe assembly.

Lighting: A 280 meter strip of windows combined with 18 domed skylights lets in daylight. Light sensors turn artificial lighting on and off as needed. Heating and cooling.

Excess heat from coolers and refrigerators are stored in a buffer tank and reused for heating the building. Geothermal energy is used for both heating and cooling the store.

Rainwater retention: Rainwater is collected and used for toilets, watering of the grounds and floor cleaning.

Energy:

1,600 m2 of solar photovoltaic cells are on the roof. 331 m2 of photovoltaic cells are integrated in the glass on the projecting roof. Together with the geothermal energy system this makes the building app. 40% selfsufficient in energy.

42窶ィENEFITS OF SUSTAINABLE BUILDINGS

Building materials are chosen for sustainability. In this case, wood is used extensively, which reduces CO2 emissions by 435 tons compared to more commonly used materials. The prefabricated elements makes the construction process less cumbersome, and the building concept with laminated timber frames can be copied in many sizes for different kinds of stores.

CASE: NEW BUILD GROCERY STORE BUILDING

SOURCE AND PHOTO CREDIT: KOCH ARCHITEKTEN/REWE® GROUP

43 BENEFITS OF SUSTAINABLE BUILDINGS

BENEFIT 2

HEALTH BENEFITS Closely related to productivity benefits are the positive effects on the health of the users from building sustainably. Increased ventilation control can improve indoor air quality, reducing such things as the incidence of asthma and allergies, colds and respiratory diseases and the ailment known simply as Sick Building Syndrome (SBS), which covers a range of symptoms from irritation in eyes, nose and throat to skin problems and general health problems. Choosing sustainable building materials that do not emit volatile organic compounds or other harmful chemicals is also very effective (see exhibit 2.2). Reducing the incidence of disease can be expected to reduce health care costs. EXHIBIT 2.2

MULTIPLE STUDIES DOCUMENT EFFECT OF BETTER INDOOR AIR QUALITY INCREASED OUTSIDE AIR MOISTURE CONTROL INDIVIDUAL CONTROL/TASK AIR POLLUTANT SOURCE CONTROLS

A series of studies have shown the substantial effects on health from creating better indoor air quality. Greater access to outside air is one of the easiest and most effective ways to create healthier buildings.

Improvement/ Reduction in symptoms 100% 87 % Flu 80%

73 % Asthma

67 % SBS* *Sick Building Syndrome

60% 46 % Respiratory 35 % SBS*

40%

34 % SBS*

33 % SBS* 24 % 20 % Respira-Headache 20 % tory Headache

20%

15 % Colds

et an m us

ox C

al N 20 PH 0 I 2

r 20 et 0 al 5

en 1 9 zi e 97 s

-G H

yk 20 et 0 al 2

en 1 9 fe ld 97

n 19 de 9 6 ll sk

ou B

u e 19 t a 97 l

os R

& sk

en 1 9 fe ld 97

e e 19 t a 88 l

44窶ィENEFITS OF SUSTAINABLE BUILDINGS

a e 19 t a 96 l

tt i 19 ne 95 n

Reducing energy consumption has the added effect of reducing the concentration of air pollutants like small particle matter, NOx and SO2, when production at local power plants is reduced. In themselves these effects on health have quite a small socioeconomic impact compared to the initial investment in energy efficiency, but the effect is still one of many benefits to be considered. A recent study has shown an anual socioeconomic benefit of € 5 bn from this specific effect on health from an annualized investment cost of € 40 bn in the years 2012-2020.45 A number of studies have shown the positive effects of sunlight on patients, ranging from a 22 % decrease in the use of analgesic medicine 46 in recovering surgery patients to reduced time in hospital for bipolar patients. Access to daylight and views has also been shown to have the effect of reducing stress and depression in both post-operative patients and patients with Alzheimer’s. Finally better lighting conditions have been linked to a decrease in faults in medication by hospital staff.47 Design with a focus on the movement patterns of the users can also have a strong effect on health. The clever use of staircases, the aesthetic quality of corridors and other transport routes within buildings and the integration of the building into the surrounding city- or landscape – e.g. proximity to lunch vendors and public transportation – can all motivate users to be more physically active during the day. Bicycle parking and showers can encourage users to bike to work. A study of more than 11,000 men showed that men who average at least eight flights of stairs a day enjoy a 33% lower mortality rate than men who are sedentary, and walking for two kilometers a day lowers the mortality rate by 22 %.48

85 % Colds

“Report on the Multiple Benefits of Energy Efficient Buildings in the EU”, Copenhagen Economics for The Renovate Europe Campaign, 2012 46 Walch, JM et al., “The effect of sunlight on postoperative analgesic medication use: a prospective study of patients undergoing spinal surgery.” Psychosom Med. 2005 JanFeb;67(1):156-63. 47 L. Edwards and P. Torcellini (2002), A Literature Review of the Effects of Natural Light on Building Occupants, NREL, 2002. 48 Lee & Paffenberger, “Physical Activity and Stroke Incidence : The Harvard Alumni Health Study”, Stroke 1998 45

62 % Asthma, Allergies

47 % SBS

a e 19 t a 96 l

ol ak

ol ak Ja

an sl ie W

45 BENEFITS OF SUSTAINABLE BUILDINGS

14 % Asthma, Bronchial

a e 19 t a 96 l

r e 19 t a 97 l

21 % Asthma, Mucosal

go 1 9 ck 98 i

W ar

tt e 19 t a 96 l

re ar G

jin Li g u Re et s al ide 19 nc 96 e

24 % Asthma

Source: Carnegie Mellon University Center for Building Performance, 2005/ Greening America’s Schools, Capital E, 2006, sourced from presentation by Greg Katz available on www. cap-e.com/Capital-E/Resources_&_Publications_files/Greg%20Kats%20Presentation%20 -%20Website%20Version%202.pdf

BENEFIT 3

CREATING NEW JOBS Transforming the building sector to sustainability requires large up front investments that in a period of slow economic growth or recession can stimulate growth and create jobs. The construction and building sector employs roughly 5 to 10 % of the national workforces49, totalling a global employment of approx. 111 million people directly employed in the sector50. The number might well be much higher, as people in construction are often unofficially employed and do not show up in statistics. Transforming the building sector to sustainability would encourage further investment in this sector, contributing to creating new jobs both in construction and in dependent industries. On the downside a change towards a more sustainable building sector will naturally mean a loss of jobs in the unsustainable building sector (see textbox). However studies from the EU and the USA indicate that building and retrofitting for energy efficiency creates more jobs than it eliminates51. Investing more strongly in sustainable buildings will in itself stimulate the economy, and the subsequent savings on energy consumption, for example, can be reinvested.

Creating, eliminating and changing jobs Transforming the building sector to sustainability will affect the number of jobs in several ways: • Additional jobs will be created in manufacturing new sustainable materials, products and services – e.g. in manufacturing solar panels or making Life Cycle Costs analyses. • Some jobs will be substituted as sustainable building practices replace unsustainable – e.g. recycling facilities generate jobs at the expense of companies making new building materials. • Certain jobs may be eliminated without obvious replacement jobs – e.g. delivering oil for single house oil burners as these are replaced. • Existing jobs will be transformed – e.g. the construction worker that will need to learn how to build with new materials. Source: UNEP, Green Jobs: Towards decent work in a sustainable, low carbon world, 2008, p. 10

46 BENEFITS OF SUSTAINABLE BUILDINGS

UNEP Sustainable Buildings and Climate Initiative, “Buildings and Climate Change: Status, Challenges and Opportunities”. 2007. 50 ILO, 2001, “The construction industry in the twentyfirst century” 51 UNEP, Green Jobs: Towards decent work in a sustainable, low carbon world, 2008, p. 10 49

A recent study on the effects of energy renovation on the European Union building stock concludes that while renovating at the same rate as now will create on average 200,000 jobs over the years 2011-2050, accelerating the rate of renovation will create on average from 500,000 to more than a million jobs over the same period (see exhibit 2.3 for details).

EXHIBIT 2.3

AMBITION PAYS OFF Building and retrofitting for energy efficiency is a vital part of making buildings more sustainable. It is also a source of new jobs. This graph summarizes the costs and benefits from five scenarios of accelerated renovation with a focus on energy efficiency (reduction in 2050 is compared to 2010) and a business-as-usual baseline scenario. Overall the scenarios show that higher ambition for energy savings leads to higher economic savings and more jobs.

1400

1200

Source: “Europe’s Buildings Under Microscope“, Buildings Performance Institute Europa, 2011

INVESTMENT COST (€BN) SAVINGS (€BN) NET SAVINGS TO CONSUMERS (€BN) AVERAGE ANNUAL NET JOBS CREATED (1,000 JOBS)

1000

800

600

400

200

0 Baseline (-9% energy use in 2050)

Slow & shallow (-34 % energy use in 2050)

47 BENEFITS OF SUSTAINABLE BUILDINGS

Fast & shallow (-32 % energy use in 2050)

Medium (-48% energy use in 2050)

Two-stage (-71% energy use in 2050)

Deep (-68% energy use in 2050)

Rising ambitions

LOCAL BENEFITS The jobs created in the building sector and dependent industries will partly be local, as construction and building renovation in many regions are dominated by smaller local companies. Servicing and monitoring such things as renewable energy installations is also a highly local business. This can help stimulate the local economy. But the job creation potential in sustainable buildings is not limited to the building sector and dependent sectors. Energy savings can be respent back in the community, creating jobs here. This is a great part of the reason that investing one million dollars in sustainable building mass will create 16.4 years of work for one person (see exhibit 2.4). EXHIBIT 2.4

CREATING JOBS An investment of $ 1 m in creating a more sustainable building mass will create a net surplus of 16.4 years of work (job years) over the following twenty years.

Spending category

Impact

Job years created

Construction

Creating sustainable buildings increases construction spending

Consumer savings

Because of extra -6.6 spending on construction, consumers spend less on short term

Consumer savings

Because of energy savings, consumers spend more on the long term

12.0

11.0

Lost utility revenues Utility revenues decrease because of energy savings Loan interest Interest paid on construction loans

-2.4

Net effect

16.4

Kilde: Kats, G. (2010) Greening our built world: costs, benefits and strategies.

48窶ィENEFITS OF SUSTAINABLE BUILDINGS

2.4

BENEFIT 4

SAVING ENERGY Sustainability in buildings has until recently been interpreted mostly as energy efficiency. While this is far from the full picture on sustainable buildings, reducing energy consumption is one of the main benefits of building sustainably for nature, society and building owners. As shown in the initial part of the publication, transforming the building sector towards sustainability will have a huge positive impact on the emissions of greenhouse gasses, free funds for investment in health, education or further GHG reductions, and reduce the dependency on imported energy. The benefits in energy savings for the individual building owner are also considerable. Measures to reduce energy consumption in buildings are often repaid within a few years. It is not unusual for the initial investment to be repaid four to six times over a period of 20 years52, and many of the lowest hanging fruits for saving energy are associated with buildings (see exhibit 2.5).

Kats G. (2010), “Greening our built world: Costs, benefits and strategies”. 52

EXHIBIT 2.5

THE REBOUND EFFECT The term “rebound effect” describes the limitations of energy savings. Historically a higher efficiency in resource consumption has often – contrary to intuition – led to higher consumption rates of the resource. This is also known as the Jevons paradox, named after the British economist William Stanley Jevons, who observed the effect on coal consumption in the middle of the 19th century. The rebound effect is what happens when a person buys an energy-efficient car and then uses the money saved on gas to go further or maybe buy a second car. Or when money saved on energy from living in a sustainable building is used for other, non-sustainable consumption. The magnitude of the effect is the subject of much discussion, but the effect is not seen as offsetting the gains made by investing in resource efficiency.

49 BENEFITS OF SUSTAINABLE BUILDINGS

Rebound effect on energy savings in different systems System Space heating Space cooling Lighting Water heating Automobile

Rebound effect (reducing predicted savings by...) 10-30 0-50 5-20 10-40 10-30

% % % % %

Source: WBCSD (2007), Energy Efficiency in Buildings: Business realities and opportunities. Summary report

LESS DEPENDENCY ON OIL Reducing energy consumption in buildings is not only economically sound. A significant driver behind European Union policies to promote renewable energy sources has been the wish to have a more secure supply of energy less dependent on energy from other – perhaps less politically stable – regions. Reducing the amount of energy used in the building sector will make it possible for renewable – and locally produced – energy to play a larger role in the energy supply of many countries (see exhibit 2.6) and can strengthen the economy as a larger share of the energy is produced in member states .

Industry potential As the case of Deutsche Bank (see next page) shows, big savings on energy can be achieved in office buildings. Industrial buildings however may have a significantly greater nominal potential for savings. The ventilation need for example can be many times greater in an industrial building than in an administrative building in order to keep up with air quality standards. The potential for process optimization across a company’s industrial processes will also have a positive impact on the overall figures for the utility management of the company. One example is the pharmaceutical company Novo Nordisk, which together with utility company DONG Energy has reduced energy consumption in the company´s Danish buildings by approx. € 6 m. As industry often has access to capital to invest in sustainability there is great potential for savings here, especially if the expected return-on-investment (ROI) time can be extended beyond the normal scope of two to five years. Considering that most companies expect to be in business for far longer than this, it should be possible. Source: www.dongenergy.dk/erhverv/klimapartner/klimapartnernefortaeller/produktionogindustri/ Pages/novonordisk.aspx

50 BENEFITS OF SUSTAINABLE BUILDINGS

EXHIBIT 2.6

KEEPING ENERGY CONSUMPTION IN CHECK The International Energy Agency estimates that energy consumption in buildings can be kept in check over the coming 40 years, even though the total building mass is expected to grow rapidly, especially in developing and transition economies. This however requires strong policy interventions and investment in new technology (the BLUE Map scenario).

SOLAR

The scenario also shows that a strong focus on saving energy and on making a transition in the energy supply dramatically reduces the dependency on oil, gas and coal used directly for energy purposes in houses.

OIL

BIOMASS AND WASTE HEAT ELECTRICITY NATURAL GAS

COAL

Mtoe

Source:IEA, 2011: ”Roadmap: Energy-efficient Buildings: Heating and Cooling Equipment”.

5000

4000

3000

2000

1000

0 2007

51 BENEFITS OF SUSTAINABLE BUILDINGS

2030 baseline

2030 BLUE Map

2050 baseline

2050 BLUE Map

DB GROUP’S HEAD OFFICE

Gmp Architekten von Gerkan, Marg und Partner

Technical architect:

MBA Mario Bellini Architects

Architect:

In 2006 Deutsche Bank decided that that the bank´s twin towers headquarters would have to undergo a major renovation after 22 years. The direct cause was changes in fire regulations, but the bank seized the opportunity to retrofit the entire climate screen as well as the heating, water and lighting systems. The facades have been re-glazed with opening windows.

Details:

DEUTSCHE BANK Where: Frankfurt am Main, Germany What: Office building constructed from 1979 to 1984. Complete renovation, modernization and reoccupation: December 2007-February 2011; formal re-opening: February 2011 Effects: • 67% less heating and cooling energy used – corresponds to the heating power required for approx. 750 family homes • 55% less electricity consumption – corresponds to the electricity used annually by approx. 1,900 family homes • 74% saving in annual water consumption – enough to fill 22 Olympic-sized swimming pools

Workplace capacity in flexible offices: max. 3,000

Height of each office tower: 155 m

Site area: 13,021 m²

Gross floor space: 121,522 m² Rental area: 75,093 m²

52 BENEFITS OF SUSTAINABLE BUILDINGS

• 89% less CO2 emissions p.a. – corresponds to the emissions of 6,000 cars each driving 12,000 km.

CASE: RETROFIT OFFICE BUILDING

Source and Photo credit: Deutsche Bank AG

53 BENEFITS OF SUSTAINABLE BUILDINGS

BENEFIT 5

TURNING WASTE INTO RESOURCES The building sector uses about a third of all materials worldwide, and construction and demolition alone produce more than a third of the world’s waste. Reducing the amount of waste by reusing and recycling, choosing more sustainable materials and better management of the building process is crucial to building sustainable performance, and it will reduce both the costs of waste deposited on the environment and the costs to human health. At the same time more sustainable use of materials and more recycling can temper the effects of scarcity issues that many countries and sectors experience.53 One way of looking at materials efficiency in buildings is to look at the amount of embedded (sometimes called embodied) energy – the sum of all the energy used to produce, transport and use a product – that goes into building materials. These differ vastly among commonly used materials (see exhibit 2.7).

EXHIBIT 2.7

EMBEDDED ENERGY OF COMMONLY USED CONSTRUCTION MATERIALS (numbers relative to wood)

Wood x4

Brick

x 14

Glass

x 124

Concrete x 24 x6

Plastic

Steel

54 BENEFITS OF SUSTAINABLE BUILDINGS

Aluminium

Wood has an embedded energy of 640 kWh per ton. Other commonly used building materials range from 4 to 124 times that. The figure only shows embedded energy of the building materials and not the impact on the environment. A Life Cycle Assessment can demonstrate the impact on several environmental factors (see page 78). Source: Adapted from “Sustainable urban energy, A Sourcebook for Asia”, United Nations Human Settlements Programme (UN-Habitat), 2012

Use of materials is a key consideration in the planning and design phase of new buildings, developments or retrofit projects, but avoiding materials with high embedded energy is not always the best action. For example, metals have some of the highest amounts of embedded energy in building materials, but often have a very high reuse or recycling value, as metal components can be reused or recycled with no or very little deterioration of the material’s properties using a relatively small amount of energy. The service life of the materials should also be considered, as sturdier materials reduce the need for repairs or replacements. A Life Cycle Assessment combined with a sensitivity analysis (read more in the “Tools” section) can give an overview of the options for choosing materials and the impact they have on the environmental footprint of the building. However the lack of properly certified reused building materials, such as reused aluminum, poses a problem, as it is hard to assess the environmental impacts with no knowledge of the source of the raw materials.

REUSE AND RECYCLING Reuse and recycling of building materials offers great savings on the embedded energy of building materials. It costs energy to recycle and reuse, but the amounts required are much less than what is needed to produce new materials. For example it takes 107.7 kg of CO2 to produce a ton of gravel, while recycling requires only 6 kg per ton.54 Reusing and recycling building materials is also economically sound practice. A 2004 survey in New Jersey, USA, showed that there are considerable financial gains in recycling building materials compared to traditional disposal of waste (see exhibit 2.8). In many developing countries recycled building materials are often both cheaper and of better quality than conventional materials.55 EXHIBIT 2.8

RECYCLING IS THE CHEAPER OPTION Cost of recycling is often much lower than cost of depositing (study from New Jersey, USA). Recycling companies often offer to take recyclable materials like concrete and bricks from demolition free of charge.

UNEP, 2011, Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication,www.unep.org/greeneconomy 54 Sára, B. (2001). Application of Life-Cycle assessment (LCA) methodology for valorization of building demolition materials and products. Proceedings of SPIE. 55 UNEP Sustainable Buildings and Climate Initiative, “State of Play of Sustainable Buildings in India”, 2010. 53

Material Average cost to recycle per Ton Asphalt debris Concrete rubble Used bricks and blocks Trees and stumps Wood scrap

$5.70* $4.85*

Average cost of disposal per Ton + $75.00 + $75.00

$5.49*

+ $75.00

$37.69 $46.43

+ $75.00 + $75.00

Survey results based upon 63 respondents. *several of the recycling companies surveyed did not charge for receiving these recyclable materials Source: www.state.nj.us/dep/dshw/recycling/economic.htm, consulted 15-08-12

55 BENEFITS OF SUSTAINABLE BUILDINGS

UPCYCLED

Lendager Arkitekter.

Architect:

Realdania Byg.

Building Owner:

FAMILY HOUSE Where: Nyborg, Denmark What: Family residence for four built from up-cycled waste materials.

Building basis/terrain: Columns of recycled steel, misproduced concrete elements as ground anchors, gravel as stabilizer, insulation from upcycled styrofoam fruit-boxes.

Structural parts columns: 2 tons of recycled steel is added to stabilize the containers.

External walls/faﾃｧade: Container steel substitute concrete. Faﾃｧade plates made of reused paper pressed with bioresin combined with aluminum facade made from beer/soda cans. For insulation mineral wool is replaced by paper from recovered newspapers.

Roof: Container steel substitutes the concrete or steel substructure. Recyclable aluminum sheets, and ventilated paper-insulation substitutes the vapor barrier.

Source: Lendager Architects, www.lendagerark.dk

Interior walls: Bricks are replaced by container steel, partially recycled gypsum sheets and recycled wood, poly-bricks made from upcycled plastic bottles makes for a translucent wall, tiles from upcycled glass, secondary structural support in recycled wood.

Patio:

Made from 95 % upcycled stickers and labels, recovered paper and plastic fibers.

Internal floors:

Rubber tiles made from reused car tires, reused glass and reused champagne corks substitute new tiles and wooden floors.

Faﾃｧade windows:

35 % are reused .

56窶ィENEFITS OF SUSTAINABLE BUILDINGS

Effect: A life cycle assessment has evaluated the potential environmental impacts and shows that impacts can be reduced to less than 25% of a reference house built with the most commonly used materials in Denmark. This applies for both the global warming potential and the total sum of all environmental impacts included in the evaluation. Details: The upcycled house is built from a variety of materials, ranging from used car tires to retired shipping containers. The choice of materials highlights and takes to the extreme the possibilities in upcycling and recycling building materials, and shows the effects of using highly durable and recyclable materials. However not all the solutions used in this case are scalable to broader use due to such factors as the availability of materials.

CASE: UPCYCLED CONCEPT BUILDING

ILLUSTRATION: LENDAGER ARKITEKTER 57窶ィENEFITS OF SUSTAINABLE BUILDINGS

BENEFIT 6

CREATING BETTER NEIGHBORHOODS Building sustainably also includes paying attention to how buildings interact with their surroundings. This is true for homes and offices but maybe to an even greater degree for industry and some public buildings: can a commercial or campus building incorporate walkways, creating new ways of getting around for the people in the neighborhood? Can a parking lot double as a basketball court after office hours? Or can a server center or supermarket that needs cooling be placed close to a communal swimming pool that needs heating. Exchanging heat – or cold depending on how you see it – can greatly reduce energy use. As the case of Kalundborg Symbiosis (see following pages) shows, industry companies can even support each other locally by using waste from one company as raw material for another. Somewhat counterintuitively, cities are in many ways very effective, using fewer resources and less energy than suburbs and sprawls (see exhibit 2.9). Likewise it is essential to take the need for transportation and the integration with existing or planned infrastructure into account when planning for sustainability in buildings. However, city life is not without its challenges. In tropical, subtropical and parts of the temperate climate zones, urban residential areas and downtown areas can get very hot in the summer, when the buildings and roads soak up heat and create the effect known as heat islands. This causes health, productivity and comfort problems and increases the demand for energy intensive air conditioning. Local air pollution can also be a problem, and noise is a major concern in many urban areas.

58 BENEFITS OF SUSTAINABLE BUILDINGS

CITIES VS. SUBURBS Compared to cities, suburban sprawls use: 5 x more pipe and wire 5 x more energy for heating and cooling 2 x as many building materials 3 x more cars (creates 4 x more driving) 35 x as much land 15 x as much pavement e Urban“Sustainable Enrgy, a sourcebook for Asia, United Nations Human Source: Urban Energy, a sourcebook for Asia, United Settlements Programme (UN-Habitat), 2012 Nations Human Settlements Programme (UN-Habitat), 2012

Sustainable building and city planning offer however a great range of benefits for the local community. Reduced use of energy and hazardous chemicals and reduced waste can create a healthier local environment. Increased use of green roofs and walls helps to offset the heat island effect56. A decrease in the area covered by buildings, pavements or roads has a similar effect. Larger areas with open ground or more green roofs can also soak up water under heavy rainfall, keeping pressure off the sewer system and reducing the risk of flooding. Focusing on sustainability in city development also offers social and economic benefits. In the study “Copenhagen – Beyond Green”, Green Growth Leaders calculated the socioeconomic effect of substituting car transport with biking. For every kilometer the net effect (in Copenhagen where the study was conducted) was a reduction in costs caused by pollution, congestion, accidents etc. of 0.45 Dkr. (app. 0.1 US$)57. The same study looks into the effect on real estate prices of cleaning up the harbor and making it clean enough to bathe in. From 2002 to 2011 real estate prices near the Harbor Bath rose by 57 per cent compared to 12 per cent for homes in the same neighborhood but further from the harbor front.

EFFECTS OF SUSTAINABLE CITY PLANNING Older adults who live in areas within walking distance of green areas such parks and tree-lined streets live longer (Takano, et al., 2002) • Older adults who reported shops, parks and beaches close to home were more likely to be physically active (Carnegie, 2002) • Connections between public transit and workplace increase walking trips (O’Sullivan S & Morrall, J., 1996; Seneviratne, P.N., 1985) • Public office buildings are walking trip generators (Zacharias, 2000) • Under the right conditions individuals undertake non-work walking trips at work. These conditions are: 1. Nearby trip destinations 2. Connectedness and integration with surroundings 3. Optimum walking distance Source: “Building Design and Site Attribute Predictors of Physical Activity”, presentation at College of Architecture, Georgia Institute of Technology by Craig Zimring et al., available at: http://216.92.169.205/files/zimring_presentation.pdf

Environmental Protection Agency, Reducing Urban Heat Islands: Compendium of Strategies, available at: http://www.epa.gov/hiri/mitigation/ greenroofs.htm accessed 10-09-2012 57 Green Growth Leaders, “Copenhagen – Beyond Green”, available at: http://greengrowthleaders.org/wp-content/uploads/2011/11/CPH-BeyondGreen.pdf 56

59 BENEFITS OF SUSTAINABLE BUILDINGS

KALUNDBORG

SYMBIOSIS What:Industrial symbiosis system Where: Kalundborg, Denmark Details: Starting in 1961 private and public companies in Kalundborg, Denmark, started selling waste products for use as raw materials by other companies, e.g. fly ash from the power plant to the cement factory. Today more than 30 pipes connect companies exchanging materials that are waste for the one, but a resource for the other.

1. Lakewater from Tissﾃｸ 2. Gas 3. Lakewater from Tissﾃｸ 4. Biomass 5. Fly ash 6. Heat 7. Heat 8. Steam 9. Steam 10. Lake 11. Cooling water 12. Yeast slurry 13. Sulphur fertilizer 14. Technical water 15. Gas 16. Gypsum 17. Waste water 18. Drain water

19. Sludge 20. Fly ash 21. Deionized water 22. Water 23. Gypsym waste 24. Sea water 25. Steam 26. Condensate 27. Straw 28. Bioethanol 29. Lignin 30. C5/C6 sugar

60窶ィENEFITS OF SUSTAINABLE BUILDINGS

Core members of the Symbiosis is now taking the cooperation even further. In the project Kalundborg Integrated Energy Concept (KINEC) a sustainable concept for heating is being developed, based on primarily local sources of biomass, industry residual products and sludge from the wastewater treatment plant. The idea is by 2020 to provide the municipality of Kalundborg with heating and the industry with steam produced from sustainable energy sources.

CASE: INDUSTRIAL SYMBIOSIS

FERTILIZER INDUSTRY

KARA/ NOVEREN

CEMENT INDUSTRY 23

29 30 28

GYPROC 13

15 14

FARM

21 11

3 7

PIG FARM

KALUNDBORG UTILITIES

LAKE TISSØ

FISHFARMS

DONG ENERGY

STATOIL

INBICON

NICKEL INDUSTRY 2

RGS 90

WASTEWATER TREATMENT PLANT

WASTE TREATMENT PLANT

NOVO NORDISK

NOVOZYMES

SOURCE: KALUNDBORG SYMBIOSIS

61 BENEFITS OF SUSTAINABLE BUILDINGS

BENEFIT 7

CREATING A GREATER RETURN ON BUILDING INVESTMENTS Building sustainably can reduce energy bills and increase the wellbeing and productivity of the users, but is it worth the extra investment for the investor or owner? A range of studies show that this is very much the case. A survey of the cost of almost 150 energy efficiency certified buildings in USA shows that building sustainably is often less costly than most people believe. The added price of the buildings was between 0 and 3 per cent compared to non-energy efficient buildings. This is far from the public perception –reported in the same study – that “building green” costs on average 17 per cent more than “building brown”.58

WBCSD, 2007,“Energy efficiency in buildings – business realities and opportunities”. 59 UNEP, 2011, “Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication”, www.unep. org/greeneconomy 58

The lower operating expenses will in many cases pay back the investments made in building sustainably. In the study mentioned the average payback time of investments in energy savings was six years, while over 20 years the investment would pay back four to six times.59 These returns and the often added benefits of more productive and healthy users translate into higher value for investors on several parameters. Exhibit 2.10 summarizes a range of studies on the financial effects of investing in sustainable building. The increase in property value is reported to be as high as 64 % and in rent 35 %. Sources to exhibit 2.9 (next page): Eichholtz, P., N. Kok, and J. Quigley, Doing Well By Doing Good? Green Office Buildings, Working paper, Fisher Center for Real Estate and Urban Economics, UC Berkeley, January, 2009. Eichholtz, P., Kok, N., and Quiqley, J. “The Economics of Green Building.” Maastricht University and University of California – Berkeley, August 2010. http://cbey.research.yale.edu/ uploads/Environmental%20. Fuerst, F. and McAllister, P. “New Evidence on the Green Building Rent and Price Premium.” University of Reading, 2009. IPD Australia and New Zealand. “Green Cities 2011: Introducing the PCA/IPD Green Investment Index”. February 2011. Loftness, et al. “Linking Energy to Health and

62 BENEFITS OF SUSTAINABLE BUILDINGS

Productivity in the Built Environment.” Center for Building Performance and Diagnostics, Carnegie Mellon, 2003. McGraw Hill Construction. “Green Building Retrofit & Renovation.” 2009. Miller, N., Spivey, J. Florance, A. “Does Green Pay Off?” Journal of Real Estate Portfolio Management, Vol.14. Pivo, G., and Fischer, J. “Investment Returns from Responsible Property Investments: Energy Efficient, Transit-oriented, and Urban Regeneration Office Properties in the US from 1998-2007.” Indiana University, October 2008. Wiley, J., Benefield, J., and Johnson, K. “Green Design and the market for Commercial Office Space.” Journal of Real Estate Finance and Economics, Vol. 41, no. 2. 2010. CoStar cited from presentation by Greg Kats, Greening Our Built World, May 2010, available at: www.cap-e.com/Capital-E/Resources_&_Publications_files/Greg%20Kats%20Presentation%20 -%20Website%20Version%202.pdf.

EXHIBIT 2.9

SUSTAINED RETURNS ON INVESTMENT Buildings with an energy efficiency rating offer a better return on investment in several areas compared to non-rated buildings. The exhibit shows the reported differences in a number of studies (in per cent) between rated and non-rated buildings. Rating system is in parentheses.

% PIVO 2008 (ENERGY STAR)

EICHHOLTZ 2009 (ENERGY STAR) EICHHOLTZ 2010 (ENERGY STAR/LEED) FUERST 2009 (ENERGY STAR/LEED)

WILEY 2010 (ENERGY STAR) WILEY 2010 (LEED) MILLER 2008 (ENERGY STAR) COSTAR 2008 (LEED)

COSTAR 2008 (ENERGY STAR)

0 Increased rental rates

Improve resale value

Higher occupancy rates

Lower operating expenses

BARRIERS TO INVESTMENT Many building investors however have a shorter horizon for the return on their investments, and in some settings upfront financing for sustainable solutions can be a barrier to investing in future gains. This is particularly the case in areas with the acute housing needs that many cities in developing countries experience. The “split incentive” barrier is the perceived catch-22 of sustainable buildings, but it is perhaps not as big a hindrance as is often thought. The term covers the fact that if a building owner invests in energy efficiency, he will pay for the initial investment, but the occupier receives the benefits of better indoor environment and energy savings. Unless the rent can be raised accordingly, the incentives for building owners to invest in sustainability can be small. However exhibit 2.10 shows that sustainability rated buildings often can carry quite a large rent premium compared to non-rated ones. 63 BENEFITS OF SUSTAINABLE BUILDINGS

64窶サOOLS FOR CHANGE

65窶サOOLS FOR CHANGE

WHY DON´T WE JUST DO IT? Considering the benefits of building sustainably the obvious question is why we don´t do it already – everywhere? The truth is that the road to a sustainable building sector has quite a few bumps and potholes that will need to be overcome to speed up the transition to sustainability. The good part is that it is doable.

$ FINANCIAL

BARRIERS Pay now – gain later

Households and smaller companies often don´t have the funds for the initial investment, even though building or retrofitting for sustainability in most cases pays off handsomely for them. Larger businesses can have the financial capacity to invest in future gains in energy savings, productivity etc. but often require the investment to be paid back in a very short time, sometimes only one or two years. You pay – I profit The benefits from an investment in sustainability in buildings might not always go to the person who needs to make the initial investment. An example of this is when the owner of a multi-family residential building invests in energy efficiency. If it is not possible to change the rent, the building owner will pay for energy savings that benefit the tenants. “It must be very expensive” Even though the actual costs of building sustainably might only be slightly larger than those of building traditionally, the perceived extra cost is often much larger (see also page 32). This could deter building owners from investing in sustainability.

66 TOOLS FOR CHANGE

STRUCTURAL BARRIERS Who to target? Buildings are owned by an extremely large number of landlords, ranging from the single person owning a house or apartment to large institutional investors, industrial giants with facilities in many countries, and national governments. The sheer number and the diversity of building owners makes it difficult to move the sector forwards. Buildings are around for a long time The fact that many buildings stand for decades between retrofits makes it difficult to move fast towards sustainability in the building sector. However a recent study show that accelerated retrofitting pays off (see p. 47). “Do you know how?” New building practices and new skills needed for operating and maintaining sustainable buildings don´t come by themselves. Education and training are needed to upgrade the skills of the workforce. Innovation doesn´t always pay off Tender and procurement regulations sometimes act as a barrier to sustainable buildings. One example is the European Union’s tender rules, which prevent bids from companies that have collaborated in the early stage of the project on developing smarter – and possibly more sustainable – solutions for the tender. This keeps innovative solutions and early planning down. Cheap is not necessarily economical Another barrier in procurement regulation is the way the cost of a project is often divided into construction and operation costs. This hinders the lifetime (or just long term) economic perspective where the advantages of building sustainably becomes clear. In other words the cheapest solution here and now is favored over the most economical one.

67 TOOLS FOR CHANGE

DESIGNING THE SUSTAINABLE BUILDING When planning and designing the process of a sustainable retrofitting or new building project, a change in perspective is often needed. Instead of focusing intently on the short term, whether it be one, two or five years, planning for sustainability offers the possibility of planning for decades. This creates more robust projects that take into account future risks of such things as rising energy prices and stricter regulation, but most importantly it gives the people making vital decisions on the project a much better overview of their options before building commences. But taking the long term perspective also requires more choices to be made. Professional advisors are vital to getting it right. They can help in doing the Life Cycle Assessments (LCA) and Life Cycle Cost (LCC) analyses. ESCO companies and utility suppliers can also be valuable advisors. Architects, engineers and consultants in rating system and indoor environment can help get to terms with the process of retrofitting and building sustainably. In this section we provide you with a checklist of the considerations and questions that will help create an overview of the life of a sustainable building from raw material extraction to end of life management, and we introduce the most important planning, financial and policy tools for the sustainable building sector.

Exhibit 3.1 Change your perspective

Sustainable building projects take the lifetime perspective, planning not only for construction but also for the operation and end of life stage of a building.

Product stage

Construction stage

Use stage

• Raw materials supply • Transport • Manufacturing

• Transport • Construction/Installation

• Use • Maintenance/Repair • Replacements • Refurbishment • Energy/water use

The traditionalist perspective The life cycle perspective 68 TOOLS FOR CHANGE

Source: Adapted from EN 15978:2011 Sustainability of construction works - Assessment of environmental performance of buildings - Calculation method

End of Life and next product system stage • Demolition • Transport • Recycling/re-use of waste • Disposal

CHECK LIST FOR BUILDING IN SUSTAINIA NEED Defining the need for the building and considering how this will change over its lifetime is the first priority when designing a sustainable building.

Questions to consider: • • • •

What is the need the building will fulfill? How much room is needed? Will the need change over time? Will the need be there in 10, 20 or 50 years?

LOCATION Choosing the right site is crucial. Many efforts to create a sustainable building will be wasted if the location causes users to travel more by car, or if the construction causes the destruction of natural environments or older but culturally important buildings.

Questions to consider: • Will the building take up new land or be built in already developed areas. Can brown field development be an option? • How to involve the local community and other stakeholders in planning the building? • How will the site affect the transportation needs and habits of the users? Is it close to public transportation? Can you walk or bike to and from the building – maybe reducing the need for building lots? Is it close to parks, the beach, forests or other areas of recreation? • Will a city, suburb or country location suit your needs best? Cities can in some aspects be considered more resource efficient than suburbs, but an LCA can be used to give a more detailed assessment of the environmental effects of different locations.

69 TOOLS FOR CHANGE

ENERGY AND OTHER UTILITY SUPPLIES Choosing the right solution for energy and other utility supplies is essential when planning for sustainability in retrofitting or building projects. Considering the need for integration with surrounding systems is a key factor in achieving the optimal solution.

Questions to consider • What are the choices for utilities in the area? For example, is there district heating? • Are localized technologies like PV panels a viable choice? • Is fresh water scarce or plentiful in the area?

ARCHITECTURE The architectural qualities of a building affect the health and productivity of the users and how a building integrates with the surroundings. They also have a great influence on energy and resource efficiency.

Questions to consider • What are the building’s aesthetic qualities? Will the neighbors like it? Will the users? • How is it oriented? Office buildings with north/south facades can make use of natural light – possibly shielding the sun side. Homes generally have façades facing east and west, making the most of sunlight in the morning and afternoon. • Will the users have control of temperature, ventilation and lighting? Are you using natural light when possible?

MATERIALS Building materials represent a large portion of the energy needed to construct buildings. They also have an effect on the health of the users. Building today also creates a great amount of waste. Choosing and using the right materials can minimize the amount of waste generated.

Questions to consider • What is the embedded energy of the materials? • Can reused or recycled materials be used? • Are materials available locally? • What is the expected lifetime of the materials used? • Are the materials free of volatile organic compounds or other harmful chemicals? • How to minimize the amount of waste? • Are the materials produced sustainably under proper working conditions? • Are the materials suitable for – and used in a way that promotes – reuse or recycling? 70 TOOLS FOR CHANGE

FINANCING Financing sustainability in buildings can be hard, as some of the benefits (like productivity and job creation) – though demonstrably high in retrospect – are often hard to predict accurately. In a financial environment where funding is scarce or where the need for new homes is acute, it can be difficult to persuade investors that they should build green, as the perceived cost is often higher than the real costs (see p. 32).

Questions to consider: • Have you done your LCC analyses? They can help you predict costs and benefits more accurately. • Is Energy Performance Contracting (see p. 93) an option? • Have you taken the higher resale price and rental premiums (see p. 62) from sustainable buildings into account?

CONSTRUCTION Building sustainably is not fundamentally different from many other building processes – apart perhaps from the heavy focus on planning early in the process. But it does require knowledge that many construction companies do not yet have. Choosing the right solutions for a sustainable building also includes considering the skills available.

Questions to consider: • Do the design and technologies used correspond to the building traditions and skills of the available workforce? • How to prevent inconvenience from noise and dust from the construction site? • How to minimize the amount of waste? • How to minimize harmful effects on groundwater, streams, wildlife or other natural resources?

RETROFITTING If the building is going to be around for a long time, it may need to be refitted later in its life to meet the new needs of the users. Flexibility in design is key, as is the opportunity to scale up or down on piping and wiring if the needs change.

Questions to consider • How long will the building function in its present condition? • Is the design flexible enough to consider a total change of use – e.g. from industry to offices or homes? • What is the lifetime of the fitted components?

71 TOOLS FOR CHANGE

OPERATION Designing cleverly can greatly influence the operation costs of the building. Energy and water consumption are obvious focus areas, but maintenance, cleaning (where applicable), durability of materials and flexibility of use are all considerations that will affect the total cost of ownership of the building. Operating a sustainable building may also take skills different from those used when operating normal buildings and the users will need to accustom themselves to the building to get the full effect of sustainability.

Questions to consider: • Can the design reduce operating expenses in areas like cleaning and maintenance? • Can the energy needs of the building be controlled to reduce consumption and bills? • Is the operating staff ready to handle the sustainable building systems? • Are the users aware of “the ground rules” of the building – e.g. do they open windows for extra ventilation, is lab equipment like fume hoods to be left open or closed? • Do you have a plan for monitoring and auditing your building’s performance? Following up is the key to ensuring you get the most from your investment in sustainability.

DEMOLITION AND END-OF-LIFE MANAGEMENT The last stage in the life of a building is where it will give way to – and provide materials for – new buildings. Recycling and reuse of materials is crucial. Managing the demolition site is also important, and planning for ease of dismantling and recycling can reduce costs and improve recyclability of materials. This is especially important in buildings that are not intended for a long life, e.g. production halls.

Questions to consider • Have you done your LCA, as it will give you an overview of materials used and make recycling easier? • Does your materials supplier offer a take back and recycle service on the materials provided?

72 TOOLS FOR CHANGE

PLANNING TOOLS International standards set the criteria for sustainability. They need to be applicable in a range of countries, and are at quite a general level. A number of rating systems for sustainable or “green” buildings exist. These are more detailed, offering direct guidance. They differ in the level of ambition and the criteria they focus on, but rating systems are useful tools for creating a more sustainable building sector, and though a more easily comparable set of rating systems could be of value, the differences to some extent reflect the natural differences in criteria set by regional differences, e.g. in water availability.60 Green Building Councils (GBCs) are key players in expanding the use of rating systems. GBCs are member-based organizations working towards a transformation of buildings and communities towards sustainability. More than 80 countries have GBCs.

REED R., BILOS A., WILKINSON S., SHULTE K-W, “International Comparison of Sustainable Rating Tools”, JOS R E, Vo l.1 No. 1, 2009, 22p 60

The Energy Performance in Buildings directive In the European Union the energy performance of buildings is regulated by the Energy Performance of Buildings Directive 2010/31/EU (EPBD). The directive sets the targets for national performance in the area, but it is up to the member countries themselves to determine how to achieve them. They can also set higher targets if they wish. The directive warrants that all new buildings must be nearly zero energy level by December 2020 (December 2018 for public authority buildings). When existing buildings are renovated, the buildings must be made energy efficient to the “cost-optimal” level.

73 TOOLS FOR CHANGE

STANDARDS THE ISO 14000 The ISO standards define an international voluntary environmental management system. The ISO system emphasizes process as well as products but sets less detailed criteria than the rating systems. Of special interest in this connection is the ISO 14040 series on Life Cycle Assessment.

CEN/350 TC Set of standards for “Sustainability of construction works” from the European Committee for Standardization. They describe a methodology for assessment of environmental performance of buildings and life cycle cost performance of buildings as well as the quantifiable performance aspects of health and comfort of buildings. The CEN/350 TC standards are currently being developed. Eight standards have been published, and three are in the pipeline for 2013-2015.

UNEP-SBCI The United Nations Environment Program – Sustainable Buildings and Climate Initiative is currently working on a standard for sustainable buildings called UNEP-SB. The index is not intended to be a rating system, but is planned to be a tool for generating a global annual report on progress made by jurisdictions in improving the sustainability of building stock.

Measuring and accounting – the key to real gains Adhering to a rating system is a good start when building sustainably, but reliable measuring and accounting of the performance of the building is essential in order to actually reap the expected benefits. Users and technical staff can need time and training to learn how to use the building and its systems effectively. Differences in operational practices and schedules, equipment, construction changes and other issues not anticipated in the planning process can also change the performance of a building. Many of these problems can be addressed to make sure that the building performs as intended.

74 TOOLS FOR CHANGE

RATING SYSTEMS GERMAN SUSTAINABLE BUILDING CERTIFICATE (DGNB) DGNB Certification System was developed by the German Sustainable Building Council (DGNB) and the German Government in 2009. It has been adopted in several countries. The 49 criteria are grouped into six categories: • • • • • •

Ecological quality Economic quality Social quality Technical quality Quality of the process Quality of location (does not influence the final score)

Buildings can be rated as bronze, silver and gold according to the score they obtain. At present, the DGNB system can be used to certify some 15 different schemes internationally. More schemes are in development. Used by GBCs in (including): • • • • •

Germany Austria Bulgaria Denmark Switzerland

LEADERSHIP IN ENERGY AND ENVIRONMENTAL DESIGN (LEED) The LEED rating system was developed in 2000 by the USGBC (US Green Building Council). It operates with and operates in up to nine focus areas (dependent on the type of building being certified): • • • • • • • • •

Sustainable Sites Water Efficiency Energy & Atmosphere Materials & Resources Indoor Environmental Quality Locations & Linkage Awareness & Education Innovation in Design Regional Priority.

LEED is a suite of 10 rating systems aiming at different types of building projects from new construction to commercial interiors and neighborhood development. Ratings are given from Certified, Silver and Gold to Platinum. Used by GBCs in (including): • United States • Canada • India

75 TOOLS FOR CHANGE

THE BRE ENVIRONMENTAL ASSESSMENT METHOD (BREEAM) BREEAM was established in 1990 in the UK by the Building Research Establishment (BRE). The system considers performance criteria for sustainability in 10 categories: • • • • • • • • • •

Energy Management Health and Wellbeing Transport Water consumption and efficiency Materials Waste Pollution Land Use: type of site and building footprint Ecology

BREEAM UK is the most developed system, with more than fifteen different rating systems targeting projects at many levels from communities to refurbishment. Projects are rated on a scale of Pass, Good, Very Good, Excellent and Outstanding. Used by GBCs in (including): • • • •

United Kingdom Netherlands Spain Norway

GREEN STAR Developed in Australia, Green Star offers ratings for nine different types of public and commercial buildings. Buildings are rated in nine categories: • • • • • • • • •

Management Indoor Environment Quality Energy Transport Water Materials Land Use & Ecology Emissions Innovation.

Used by GBCs in (including): • Australia • New Zealand • South Africa

76 TOOLS FOR CHANGE

Exhibit 3.1 Varying ambitions

A number of rating systems address sustainability in buildings, but they vary widely. Categories covered, the number of indicators in the system and the level of ambition needed to achieve high ratings differ substantially among systems. The figure shows a range of systems assessing sustainability in a grid showing categories covered and the number of criteria included.

MANY CRITERIA

FEW CRITERIA PRODUCTION/ MATERIALS

Source: Inspired by figure from Tove Malmqvist, Fil. dr., Skolan fﾃｶr Arkitektur och samhﾃ､llsbyggnad, KTH, Stockholm

77窶サOOLS FOR CHANGE

CONSTRUCTION

PLANNING PROCESS

PLANNING TOOL

LIFE CYCLE ASSESSMENT (LCA) Life Cycle Assessment (LCA) is a tool for quantifying and evaluating the environmental impact of a product or service over its entire lifetime â&#x20AC;&#x201C; in this context, a building. LCAs take their starting point in the whole life cycle perspective of the building.

Exhibit 3.2

LIFE CYCLE PERSPECTIVE Building sustainably is closely related to taking the life cycle perspective when assessing both the environmental impact and economy of a building over its full lifetime from extraction of resources to demolition and recycling.

Source: Developed in cooperation with Harpa Birgisdottir, Danish Building Research Institute, Aalborg University

Extraction of resources, production of building materials

Use of building, operation and maintenance phase

78â&#x20AC;&#x192;TOOLS FOR CHANGE

Construction phase

End of life of building, demolition phase

THE LCA IS A MULTISTEP PROCESS, TYPICALLY INCLUDING: Defining what the analysis will focus on and the purpose of doing it – e.g. to reduce specific harmful environmental impacts

This is where you register the parts and processes involved in constructing or retrofitting the building

Where you calculate the impactfrom each of the components in your LCI

Setting the goal and scope of the analysis

The Life Cycle Inventory (LCI)

The Life Cycle Impact Assessment (LCIA)

Interpretation (not always done but highly recommended) The part where you use the impact assessment to explore your options when building. Can show the benefits of changing materials, installing extra systems – or removing them. And it can show how best to reach the goals defined for the building.

Source: adapted from ISO 14040

STRENGTHS OF LCA • Allows a life cycle perspective • Can be used to compare different solutions on a range of criteria • Puts numbers behind claims to (environmental) sustainability • A flexible tool that can be used at any level from planning a city to determining which heating system to install in a retrofitted building

WEAKNESSES • LCAs depend on exhaustive databases covering the properties of materials and systems for precise calculation of impacts. • LCAs provide a set of numbers but not necessarily the means to compare or weight these impacts towards each other.

79 TOOLS FOR CHANGE

PLANNING TOOL

LIFE CYCLE COSTING (LCC) A Life Cycle Costing (LCC) analysis is a tool for determining the economic costs and benefits of a building or specific system e.g. heating over the full life time. Where the LCA can look into the environmental impacts of building sustainably, the LCC expresses the financial gains or losses to be considered, and the two analyses complement each other well.

Exhibit 3.3 Building finances and LCC

An LCC gives an overview of some, but not all of the financial aspects associated with construction, ownership and demolition of a building. Areas in blue are covered by the LCC.

Externalites

Non-construction costs

LCC (Life Cycle Costing)

Income

Materials phase

Construction phase

Operation phase

End of Life

80窶サOOLS FOR CHANGE

Exhibit 3.4 Comparing costs (Lcc)

Model case of an office building in the tropics. Using LCC three different scenarios for the building’s outer envelope are being explored, showing that the initially most expensive solution (also the one saving most energy) after six years of operation will be the cheapest. After seven years the initial investment generates more net income than the other two solutions.

NPV (US$) 1000,000

Minimal Impact Medium performance

800,000

High performance

600,000

400,000

200,000

0 10 Source: UNEP, 2011, Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication, www.unep.org/ greeneconomy

20 years

(200,000)

(400,000)

(600,000)

STRENGTHS OF LCC • Can – combined with an LCA – evaluate the true cost of alternative sustainability solutions • Creates transparency concerning future costs of operation • Analyses result in an exact and comparable figure (cost) • Gives the opportunity to optimize future costs in the design phase • Guards against unforeseen costs

WEAKNESSES • Only looks at economy, not taking into account the impact on other things, e.g. nature. • Lifetime costs are heavily influenced by the scenarios for the future that are taken into account e.g. discount rate and scenarios for energy prices.

81 TOOLS FOR CHANGE

PLANNING TOOL

COMBINING LCA AND LCC An example of the results from an LCA looking into the environmental impact of six different choices of materials for a building – in this case an industry building in Iceland. The LCA shows the score in six categories for each materials choice (low score equals low environmental impact). The LCC analysis of the lifetime costs associated with the materials choices shows that the costs associated with each option in this case only differ a little.

LCA; environmental impacts over 60 years

PE* 25

* ”person equivalents” – the impact in this category of an average person per year.

GLULAM BUILDING WITH MINERAL WOOL CLADDING PANELS GLULAM BUILDING WITH POLYURE-

THANE CLADDING PANELS CONCRETE BUILDING WITH MINERAL WOOL CLADDING PANELS CONCRETE BUILDING WITH POLYURETHANE CLADDING PANELS

STEEL BUILDING WITH MINERAL WOOL CLADDING PANELS 10

STEEL BUILDING WITH POLYURETHANE CLADDING PANELS

Acidification

82 TOOLS FOR CHANGE

Global warming potential

Human toxicity

Nutrient enrichment

LCC: costs associated with 60 years of ownership

MILLIONS (ISK)

DISPOSAL COST

OPERATION COST

MAINTENANCE COST

CONSTRUCTION COST

200

100

Glulam - Mineral wool

Glulam - PU

Concrete -Mineral wool

Concrete -PU

Steel -Mineral wool

Steel -PU

Source: www.ecoprocura.eu/fileadmin/template/events/ecoprocura2009/files/ PDF/B1_HarpaBirgittidor.pdf

creating even better tools

Merging the LCA and LCC into a single analytical tool that can produce readily comparable results across geographical regions has been a longstanding ambition. However the methodological challenges in developing a single “currency” for the impact on both environment and economy – and possibly also including human health and wellbeing – has so far hindered this.

Persistent toxicity

83 TOOLS FOR CHANGE

Photochemical Ozone formation

LICHTAKTIV HAUS Active House radar:

I RO

NM 2

ENT

IND

Annual energy performance

ENERGY

Indoor air quality

OR C LI

Energy demand

2 MA TE

Energy supply

Light and view out

Thermal environment

This radar graph shows how all parameters within the ten Active House principles are balanced against each other, enabling a holistic approach.

ENV

Fresh water consumption and waste water treatment

Environmental impact from emissions to air, soil and water

Consumption of non-renewable energy sources

1 2 3 4

Where: Wilhelmsburg District, Hamburg, Germany What: Typical “settlers house” from Germany (13 million of the same type in Germany), converted into a carbon-neutral home with focus on optimal livability. Fulfi lling the standards for 2020. Effects : Energy surplus (from heatpumps, PV and solar thermal collectors) of 16 kWh/m2/year. Overall good performance on the Activ House principles (see radar graph).

Noise and acoustics

Source: www.iba-hamburg.de

84 TOOLS FOR CHANGE

Details: The LichtAktiv Haus is a renovation project bringing a typical small one-family house up to Active House standards. The house uses solar energy, passive solar gains, natural ventilation, and energy design to turn a classic 1950s semi-detached house into a carbonneutral home. Daylight is ample in every room.

CASE: RETROFIT TYPICAL ONE-FAMILY HOUSE

PHOTO: ADAM MØRK 85 TOOLS FOR CHANGE

Extended retrofit New extension with kitchen, dining room and bathroom is added. Air-to-water heat pump connected to solar thermal collectors provides further reduction of energy bills. 148 m2.

Premium retrofit Extension is larger. Photovoltaic cells are added. 189 m2

Howﾂｴs it performing right now?

LichtAktivHaus is a model home extensively monitored for performance. It has been monitored for two years by TU Darmstadt, TU Braunschweig and Humboldt University in Berlin.

You can follow the blog of the family residing in the house at: lichtaktivhaus.de

You can follow the energy balance of the house in real time at: velux.com/ sustainable_living/model_home_2020/lichtaktiv_haus/energy_balance

86窶サOOLS FOR CHANGE

House before retrofitting A classic 1950s home of a type built extensively throughout Germany. 102 m2

Basic retrofit Basic structure not changed. Exterior is energy renovated. New roof with more windows adds light and more room on top floor. Solar heat collectors and new boiler reduce energy bills. 122 m2

Economy of the retrofit options

5 % energy price escalation

ORIGINAL HOUSE EXTENDED RETROFIT PREMIUM RETROFIT

Results on a Life Cycle Costs analysis over a 50-year period on the extended and the premium retrofit options compared to the original house. The analysis focuses on energy and does not include other operational costs or the revenue from the development of the buildingﾂｴs value.

2 % energy price escalation

EURO 2500

2000

1500

1000 0

1000

The analysis is done for two separate scenarios: one where energy prices rise by 2 % per year, and one with an energy price escalation of 5 % per year. At the higher energy price escalation, the retrofit options are economically sound over the period considered without taking into account the aesthetic and quality aspects of the building. At the lower price escalation these non-cost aspects need to be taken into account to justify the additional investment. Note: discount rate for both scenarios is 4 %. Source: Calculations by Ingenieurbﾃｼro Trinius GMBH

87窶サOOLS FOR CHANGE

PRACTICAL TOOLS Sustainable houses are built with a range of solutions to create resource-efficient, healthy environments for people. Solutions differ according to the type of house, the climate zones and the surrounding society (e.g. access to district heating or not).

Design Design for sustainability can dramatically reduce energy consumption and create settings that encourage us to be more physically active.

Windows Create views and provide daylight, passive solar energy and natural ventilation to the building windows. By optimal orientation and use windows can provide net energy to the building. Automated shading is essential in warmer climates to keep out heat from the sun. Natural light is benefi cial to productivity, wellbeing and health.

Green roofs and walls Adding plants to rooftops, walls and balconies off ers many benefi ts: added insulation, reduced runoff of water during heavy rainfall, aesthetic qualities, noise reduction and reduced heat island eff ect.

Heat pumps Earth to water or air to water heat pumps can draw energy from the surroundings into the buildings, multiplying the energy used. 1 kWh of electricity can deliver 2-4 kWh of heat.

88窶サOOLS FOR CHANGE

Orientation towards the sun

Solar power

Homes are placed with large facades facing east and west, letting in morning and evening sun. Offices have large facades north and south, letting in high quality daylight (with shielding from direct sun to avoid overheating).

Photovoltaic cells can deliver clean energy to the building on site, eliminating transmission losses. Combined with a heat pump this can create heating too. Falling prices of photovoltaic cells have made them feasible solutions in many parts of the world.

Solar heating Solar heating system can provide heat and hot water and can be combined with heat pumps to create heat depots in hot periods for use when the weather gets colder.

Insulation From mineral wool to aerogel, insulation materials are essential in every climate for keeping heat either in or out of the building.

Building materials Using building materials without harmful chemicals has a large positive impact on the health of the user. Recycling building materials can reduce the environmental impact of the building process dramatically.

Using water several times Reusing water from wash basins or showers to flush toilets reduces water consumption.

Smart homes Monitoring and controlling energy demand in the house can reduce energy consumption by 5-10 per cent.x

Reduce covered ground Reducing the amount of ground covered in buildings, pavements, roads, parking lots etc. reduces both the local heat island effect and the pressure on sewage and drainage, as the earth can soak up more rain water under heavy rainfall.

Rain water retention and collection Rain water can be held in fascines or tanks, reducing runoff of water during heavy rainfall, and the water can be used as toilets.

89窶サOOLS FOR CHANGE

Luhmann, H.J. (2007) Smart metering as neue Energi-(effizienz)quelle, Energi & Management 6. x

POLICY TOOLS In 2007 the United Nations Environment Program - Sustainable Buildings and Climate Initiative (UNEP-SBCI) analyzed 80 case studies of 20 different policy instruments for reducing energy consumption and greenhouse gas emissions world-wide. They conclude that a coalition of “market failures, hidden costs and benefits, fi rst cost barriers, behavioral, informative and structural barriers hinder the realization of the often calculated significant savings potential”. This is where policies have a part to play. Their efficacy is very dependent on the political, cultural and economic settings in which they are embedded. However the UNEP-SBCI study Source: UNEP-SBCI (2007), Assessments of policy instruments for reducing greenhouse gas emissions from building operations.

Exhibit 3.6 Eff ects of diff erent types of policy measures

A case study of 80 policy initiatives worldwide shows quite a large difference in effect measured on a scale from High (value 3) to No effect (value 0). The graph shows average scores for different kinds of policy measures.

Voluntary action e.g. voluntary labelling Fiscal - overall Grants, subsidies Loans Tax exemptions Taxes

Source: Adapted from UNEP-SBCI (2007), Assessments of policy instruments for reducing greenhouse gas emissions from building operations.

Information/ education Control and regulation instruments overall Information regulation - e.g. mandatory labelling

Codes and regulations for buildings Standards and regulations for appliances

0,0

90 TOOLS FOR CHANGE

0,5

1,0

1,5

2,0

2,5

3,0

concluded that though the effects vary, many of the policy tools can achieve high savings at low or even negative costs to society. Generally regulatory instruments appeared to be more efficient and cost-efficient than economic ones (see exhibit 3.5). In developed countries regulatory and control measures are probably the most efficient and also most cost-effective policy instruments. Rebates or grants are important in the developing countries as measures to overcome the barriers of investing now for future gains, and tax exemption seems to be an efficient fiscal instrument. Further information on different policy instruments can be found in the MURE database (muredatabase.org), which describes and briefly assesses a range of policy initiatives from the European Union.

COMBINING POLICY INSTRUMENTS Several policy instruments can have beneficial effects in themselves, but combining them wisely can often enhance the effect greatly. Examples include: 窶｢

Standards, labeling and financial incentives

窶｢

Regulatory instruments and information programs

窶｢

Public leadership programs (where the public sector is the first mover on sustainability) and energy performance contracting (see chapter on financial tools)

PUBLIC PROCUREMENT AND BUDGETING A strong policy instrument is using the public sector as the spearhead for transformation towards a sustainable building sector. This includes revising procurement procedures to include a stronger element of long term costs and benefits and add sustainability as a target to achieve in public buildings. More holistic public budgeting will allow more economical choices to be made. This will allow to take into consideration that setting ambitious targets for sustainability in public buildings not only reduces resource and energy consumption and creates savings in public budgets. It also increases productivity, creates jobs and pushes innovation in the building sector, as well as offering financial incentives for construction companies to transform their building operations towards sustainability (see also section on benefits).

91窶サOOLS FOR CHANGE

EDUCATION AND TRAINING Transforming a sector as big as the building sector to sustainability requires a lot of education and training, and not only with construction companies. Architects, engineers, planners, technical staff and craftsmen need to learn to use new tools; sustainability consultants and auditors need to be trained. Technical staff have to learn to operate new systems in buildings. Supporting training and education in building sustainably is an area where policy makers can directly upgrade the capacity of the building sector to develop and use sustainable building techniques.

GRANTS AND SUBSIDIES Grants and subsidies are among the most efficient fiscal instruments to support sustainable retrofitting and building (see exhibit 3.1). There are several ways of subsidizing sustainable buildings, and it is not within the scope of this publication to evaluate them. One initiative however should be mentioned: the German Kreditanstalt fﾃｼr Wiederaufbau (KfW), meaning Reconstruction Credit Institute. Formed in 1948 as a part of the Marshall Plan the institute has been a driving force in creating a more sustainable building mass in Germany. The institute acts as a second tier bank encouraging banks to lend money to, for example sustainable retrofitting, putting more than 竄ｬ 30 bn into this area of operation. It has developed its own energy standards (KfW-40 and KfW60), which are accepted standards in Germany.

92窶サOOLS FOR CHANGE

FINANCIAL TOOLS Lack of capital to invest in sustainable retrofitting or new buildings is one of the strongest barriers to making the building mass more sustainable.

ESCO, EPC, ESPC The financing vehicle Energy Performance Contract (EPC) – also called Energy Savings Performance Contracts (ESPC) - is increasingly employed to complete upgrades for sustainability. Companies offering these types of financing are also named Energy Service Companies (ESCO). This financing model greatly reduces risk for building owners by bringing in an external financing partner. The external partner invests in retrofitting and guarantees a certain reduction in energy consumption. The savings generated are used to pay back the ESCO company. In the payback period the building owner typically pays the same for energy as before retrofitting (or pays according to a set scheme), after which the savings generated will fall to him or her. EPCs are increasingly employed by both public and private building owners as a vehicle to overcome the barriers of first investment when retrofitting for sustainability.

BRINGING IN NEW MONEY Institutional investors have not traditionally been big investors in sustainability in buildings, but there are signs that the financial crisis might change this. Sustainable buildings – retrofitted or new – can be a new asset class that helps investors to diversify their portfolio and generate a more stable growth in earnings.61 UNEP, 2011, Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication, www.unep.org/greeneconomy 61

93 TOOLS FOR CHANGE

“SUSTAINIA IS A NEW AND NEEDED APPROACH TO COMMUNICATING SUSTAINABILITY” Arnold Schwarzenegger Honorary Chair of Sustainia & Founding Chair of the R20 Regions of Climate Action

“SUSTAINIA CAN HELP PEOPLE GET A CLEAR PICTURE OF WHAT THEIR LIVES COULD BE IN A SUSTAINABLE FUTURE - AND HOW IT WILL IMPROVE OUR HEALTH, OUR ENVIRONMENT, OUR ECONOMY” Connie Hedegaard EU Commissioner for Climate Action 94 TOOLS FOR CHANGE

“SUSTAINIA IS A CLEAR ARTICULATION OF THE FUTURE WE WANT” Georg Kell Executive director of the UN Global Compact

“MOTIVATION AND INSPIRATION FOR POSITIVE ACTION WILL HELP US MOVE FORWARD TOWARDS A BETTER FUTURE FOR ALL” Gro Harlem Brundtland Former Prime Minister of Norway and Former Director General of WHO

95 TOOLS FOR CHANGE

METHODS This guide has been developed on the basis of a desk top study inspired by our partners and guided by interviews with international experts. The guide is a result of a co-creation process involving our partners and selected experts. While we stress the “co” in co-creation, the Sustainia team has the final say and is responsible for the final product. For the sake of keeping this publication small and accessible for most, we have opted to simplify matters in a few ways. We give global warming and the climate relatively little attention. This is not because we consider this to be less important, but we choose to focus on the socioeconomic aspects of sustainability that we believe are the most likely to make a difference for the intended target audience: building owners, city planners and policy makers. We do not address all sustainability issues in buildings , but we do believe that focusing on the chosen aspects will bring readers a long way towards understanding the benefits of building sustainably. This publication looks at buildings. However, as it is an important point that buildings should be seen in the context of the surrounding nature and society, we cannot meaningfully limit ourselves to what happens within the boundaries of the outer shell. To some extent we therefore involve surroundings, e.g. by stressing that the availability of district heating should be considered when planning sustainable building projects. When evaluating the benefits we have not limited ourselves to studies on buildings that live up to certain standards or certification schemes. The benefits of such things as improving energy efficiency, improving indoor air quality or using more natural light can be documented in buildings that are not certified as sustainable.

96 METHODS TOOLS FOR CHANGE

We have included a range of case examples. These are included to illustrate how sustainable solutions are being put to use around the globe, for inspiration and to illustrate a focal point of Sustainia – it is not Utopia; it is real world solutions that are being put to use today. The cases are not representative for the bulk of buildings built or retrofitted for sustainability. When describing the benefits of building sustainably, we rely on referenced sources but we have opted to approach the material with a little less strictness when referencing for our tools section and in the recommendations given to our target readers. Tools and recommendations are to a large extent based on input from external experts and partners, and represent their best advice on how to move forward. The term “sustainable” is used widely in this book to underline the point that sustainability in buildings goes beyond energy and resource efficiency and includes the social effects (e.g. on health and capacity for learning) and the economic effects (e.g. on productivity and job creation) of buildings. Many of the studies we draw upon when describing the benefits focus on buildings that are built or retrofitted with a strong focus on energy and resource efficiency. As the material shows, however, there is a strong body of evidence suggesting that making buildings more energy and resource efficient often brings the other benefits along with it. More recent studies often include these explicitly, giving a clearer picture. We therefore use the term sustainable more often than a strict replication of the terms in the studies cited would require. And if this book should be summarized in a single sentence, it might be just that: That investing in energy efficiency brings with it a lot of other benefits that often are even greater than the effect of direct energy savings.

97 METHODS TOOLS FOR CHANGE

EXPLORE MORE FROM SUSTAINIA

THE BOOK “GUIDE TO SUSTAINIA” – The full vision and integrated storytelling “Guide to Sustainia” describes the overall vision and model of destination Sustainia, and explains in clear and simple language and illustrations how the sustainable society could look in 2020. It demonstrates a new way of communicating about sustainability.

SUSTAINIA CITY AND SECTOR GUIDES – Exploring the sustainable cities and industries of tomorrow The “Sustainia Guide to Copenhagen” is the first publication in our series of Sustainia city and sector guides. Our goal for the series is to visualize the benefits of living in sustainable cities and the opportunities within key sectors and industries.

98 SUSTAINIA TOOLS FOR CHANGE

SUSTAINIA

SUSTAINIA 100 – 100 sustainable solutions from 56 countries “Sustainia 100” is Sustianias yearly catalogue of 100 sustainable solutions with the potential to create real change. Solutions needs to be ready and available, scalable, collaborative, transformative, cost-effective, improve quality of life and of course have an positive environmental impact. In 2012 Sustainia 100 gathered solutions from 56 countries on five continents to inspire communities, businesses and policy makers and highligt investment opportunities. The Sustainia 100 also acts as the list of nominees for the Sustiania Award.

99 SUSTAINIA TOOLS FOR CHANGE

ACKNOWLEDGEMENTS Special thanks to:

Working group: Jørgen Abildgaard (City of Copenhagen), Per Arnold Andersen (VELUX), Stuart D. Brewer (DNV), Lennie Clausen (Realdania), Filip Engel (DONG Energy), Kurt Emil Eriksen (VELUX), Lone Feifer (VELUX), Else Kloppenborg (DONG Energy), Eske Kock Petersen (City of Copenhagen), Ray Pinto (Microsoft), Lykke Schmidt (Novo Nordisk), Jørgen Søndermark (Realdania Byg), Martha Katrine Sørensen (City of Copenhagen), Michael Zarin (Vestas). Experts interviewed:

Harpa Birgisdottir (Statens Byggeforskningsinstitut, Aalborg University), Menzies Gillian (School of the Built Environment, Heriot Watt University), Peter Graham (UNEP SBCI and Global Building Performance Network), Sanne Wall-Gremstrup (Arkitektens Forlag), Jesper Pagh (Arkitektens Forlag), Jean Luc Salagnac (Centre Scientifique et Technique du Bâtiment), Wolfram Trinius (Ingenieurbüro Trinius).

Editorial Team

Morten Jastrup, Marie Drique Design

Lisa Haglund Proofreading

Jon Poole Get involved with Sustainia

Want to get involved with Sustainia? Please Contact Executive Director Laura Storm (lss@mm.dk) Want to know more about sustainable buildings?

Please contact senior analyst Morten Jastrup (mja@mm.dk) The Sustainia Secretariat

C/O Monday Morning Valkendorfsgade 13, P.O. Box 1127 DK-1009 Copenhagen, Denmark

SUSTAINIA

Sustainia is initiated by Monday Morning, Scandinavias largest independent think tank and monthly magazine.

1P ri

n t e d m atter

SUSTAINIA

Sustainia Founding Partners

Green Growth Leaders Founding Partners

Strategic Partners

Green Growth Leaders Strategic Partners

Sustainia Knowledge Partners

The benefits of building sustainably are substantial, whether retrofitting existing buildings or building new, but many benefits are often overlooked. This guide presents the arguments and facts that can change the building sector from being the most resourceguzzling and wasteproducing, to being a sector that creates healthy, environmentally friendly and productive living spaces that improves quality of life. After all, buildings have become our habitat, and our habitat should support us.Read about benefits to: Productivity Health Job creation Energy savings Waste reduction Neighborhoods Investment returns

WELCOME TO THE SUSTAINABLE BUILDING SECTOR.

SUSTAINIA