Green versus conventional: consider the long-term costs
A common perception in the building industry is that building green costs more than building conventionally. The fact is, with a well-thought-out construction budget and clear green-building goals, building a sustainable structure can be done for the same price—or less—than that of a conventionally built building.
There is substantial evidence that a reasonable level of sustainable design can be incorporated into most building types at little or no additional cost. For example, it’s fairly easy to design water-efficient, low-maintenance landscaping and incorporate more daylighting into spaces—both of which help to reduce costs. Of course, you could also run costs right out your green-living roof by going after all of the sustainable-design bells and whistles.
For many years, conventional architecture focused solely on designing buildings that are nice to look at and satisfy the owner’s ultimate purpose for construction.
These days, a focus gaining attention is the cost of building operations over the life of a structure. This is known in the building industry as Life Cycle Cost (LCC). The National Institute of Standards and Technology (NIST) Handbook 135, 1995 edition, defines LCC as “the total discounted dollar cost of owning, operating, maintaining and disposing of a building or a building system” over a period of time.
Life Cycle Cost Analysis (LCCA) is an economic evaluation technique that determines the total cost of owning and operating a facility over a period of time.
First off …
All building projects incur three major types of expenses: first costs, lifecycle costs and maintenance costs. First cost is easy to understand; it’s what you actually pay to buy the material or product and install it in your project. Some green-building materials have the same or much lower first costs. Using bamboo flooring in place of a traditional wood flooring, for example, involves the same exact labor to install and the material costs are comparable.
Some green materials do cost more—sometimes much more—than their traditional counterparts, but they may also have long-term benefits, such as protecting the environment and preserving our dwindling resources.
Well worth it
LCCA is important to the green-building industry because it can be used to convince owners that their first-cost investment, which may be higher for a green building, can show substantial economic benefits over a building’s life expectancy, making the green-design decision well worth the initial cost investment.
A good example is to compare a building designed with and without the use of a photovoltaic (PV) system, which uses the power of the sun to provide electricity. If an owner focuses only on the initial cost of installing the system, the conventional building will of course cost less, making the decision to install it seem uneconomical. However, the LCCA for the same system could prove to the owner that it will pay for itself 10 times over the life of the building, since PV immediately begins producing energy and offsetting the building’s monthly electricity bill.
If the building produces more electricity than it consumes, the excess energy can be sold back to the power grid using a system referred to as “net metering.” In the case of the green-building design that includes a renewable energy system, such as PV, it’s important to remember that the payback isn’t at the moment of purchase and installation, but over time.
Tax rebates, which can be thought of as a one-time payback, can also help to encourage owners to install green designs by reducing the systems’ initial cost and making the green investment an even more valuable and economical decision.