Is retrofitting sustainability measures into existing buildings a cost effective solution?
May 15, 2010
I have been following a discussion of this title initiated by Liz Stanley the Digital Community Manager at UBM Built Environment on Linked-In for the past couple of weeks. Finally after a comment today I just couldn’t keep my opinion to myself any longer. The comment started with:
“Payback is a term that makes me mad. The driver for the fitting of energy saving measures to existing building stock is to payback to the earth some of the resources that we have wasted and stolen from our children. Surely we need to consider what is the most cost effective ways of reducing our energy addiction. ”
This discussion is particularly close to my heart having restored numerous historic structures and renovated many others, both residential and commercial, always paying attention to energy efficiency and maintenance issues besides a slew of other important things—like cost.
In Nirvana or the Kingdom of Heaven compensating for the waste of resources and the polluting of the world might be the soul justification for incorporating sustainability measures into an existing building, but in the real world it is about that “dirty ole money.”
It is about “What’s in it for me, the building owner?” If an existing building is to justify sustainable or energy efficient measures being incorporated into a retrofit–it has to make economic sense. To me, as well as others, it has to have practical, common sense, economic justification. It may not be in terms of payback within 6 years, but it is certainly about the expenditure and what it is going to provide.
If one decides to replace the exterior shell or cladding, the decision is going to be made on initial cost plus what it is going to save the owner in maintenance and replacement costs over a time period.
If one decides to upgrade the thermal envelope, it is going to be based on what it is going to save on the utility bill or by reducing operational costs including maintenance. It does not matter whether the building is a 200,000 SF industrial building or a 2000 SF home.
Example: Say a building owner is going to upgrade their roof/ceiling insulation and its initial cost is $100,000.00 for an environmentally friendly material. This is going to save them $1000/month in utility costs for a payback in 8.5 years, based on today’s energy costs
They find a substitute product that is detrimental to the environment, but it isn’t against code or regulations. This product is going to cost them $75,000. It too is going to save them $1000/month in utility costs for a payback in 6.25 years. Which one do you think the building owner is going to take?
Now if the government is going to give them a tax break or a grant to install the good stuff, then they will install the environmentally proper material. Unfortunately unless you have astronomical dollars at your disposal, allowing you to do right without economic justification, the decision is going to be based on the initial cost in dollars, pounds, lyre, baht, etc. and what the savings are going to be over a time period.
The proper fiscal argument regarding government incentives would be “Why do we have to spend more government money or rely on them? The fact is without incentives it won’t get done. The governments of the world have been subsidizing oil and gas interests since almost the beginning of time, or at least since I was born. If we are ever going to get this world on the right path, the government and its money and its laws have to force it to be done.
I didn’t write the rules. No one believes in upgrading energy efficiency and sustainable building measures into an existing structure more than I do, but I live in the real world of building, both as a builder and a technical consultant. Without financial justification or incentives, be they government grants, tax write off’s, or substantial savings in operational costs, it isn’t going to get done for the sake of the planet. It is about money and its cost effective, common sense application to the project at hand.
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