Building a Better Future; Government LEEDs the Way

Imagine the following scenario. You enter your office and the lights come on automatically, while you continue admiring your department’s recent productivity statistics. The new statistics document the 11 percent improvement you and your colleagues posted in the three months since moving into the new building. While pleased, you have heard that other departments posted gains of as much as 23 percent.

Your professional jealousy dissipates, however, as the clouds outside finally break, and sunlight fills the office. The energy-efficient building responds by automatically dimming the overhead lights. As the humidity outside subsides, the air-conditioning system shuts off, and you hear the slight rumble of the exterior vents opening to allow fresh air to enter the building.

Pleased to see the sun after several cloudy days, you decide to stroll up to the park on the building’s roof. Working your way through the building, the entire workplace seems to be bathed in sunlight. You admire the bamboo and recycled-content flooring materials, along with the brightly colored walls that are covered with environmentally friendly paint. You remember hearing that all of the materials used to construct the building were selected because they are safer than some of the older, conventional building materials, which were known to release various chemical residues.

When you reach the park on the roof, you stand in the grass, admiring the decorative water fountain across from some of the building’s solar panels. The sign next to the fountain explains how the building collects rainwater to irrigate the landscaping and flush toilets. “What a great place to work,” you think to yourself.

While the situation outlined above might sound like science fiction, it is a growing reality for many government workers across the country. In fact, the green building movement is expanding beyond offices to include apartment buildings, schools, retail stores, private homes, museums, and sports complexes. Building owners across the country are going green for both financial and environmental reasons.

Defining Green Buildings

Green buildings are high-performance structures designed to meet all of a building owner’s needs, while remaining within the tight construction schedules and budgets typical of most projects. The buildings are constructed to meet unique, local conditions of the building site. Design factors include positioning the structure at an optimum location to absorb additional sunlight (and heat) during the winter, while reflecting this light and heat during the summer to reduce energy costs.

Construction materials used throughout a green building are selected to better protect human health and the environment, plus include locally made materials whenever possible. Green buildings also offer significant energy- and water-efficiency improvements, which drastically reduce the costs of operating and maintaining each structure.

To further define green buildings, the U.S. Green Building Council (USGBC) developed the Leader-ship in Energy and Environmental Design (LEED) criteria. LEED is a green-building rating system that includes mandatory requirements for factors such as energy and water efficiency. The rating system awards additional points for criteria in the following six categories:

• Sustainable Sites
• Water Efficiency
• Energy and Atmosphere
• Materials and Resources
• Indoor Air Quality
• Innovation and Design Process.

The resulting point total determines a building’s final rating. For new construction projects, basic certification is awarded for buildings scoring 26 to 32 points. Higher certification levels include LEED Silver (33 to 38 points), LEED Gold (39 to 51 points), and LEED Platinum (52 to 69 points).

Overall, the LEED rating system has proved so successful that the
USGBC has developed similar scoring systems for existing buildings (LEED-EB), commercial interiors (LEED-CI), core and shell projects (LEED-CS), neighborhood development (LEED-ND), and homes (LEED-H).

Governments Build Green

Many of the initial LEED-certified buildings were built by government agencies at the federal, state, and local levels. “Government has been key to the success of green building and the LEED green-building rating system,” notes Rick Fedrizzi, President, Chief Executive Officer, and Founding Chair of the USGBC.

Why have governments played such an important role in advancing the green building movement? One reason relates to the beliefs of many government officials, who recognize that the buildings they create stand as a testament to the hopes, dreams, and concerns of the present. Constructing green buildings is just one way to demonstrate concern for the future and to influence the impact that today’s buildings will have on future generations.

Building owners in the private sector initially seemed reluctant to invest in an approach that had not yet been proven. As governments began quantifying the benefits, such as significant employee productivity gains, reduced operating costs, increased occupancy rates, and higher rents, the private sector began to look more closely into the advantages of green buildings.

Despite growing private-sector interest, governments still represent 42 percent of new construction projects that are LEED certified.

Current Requirements

Governments and government agencies are beginning to require that all new buildings meet certain LEED certification thresholds. In 2003, for example, the U.S. General Services Administration, which manages 1,800 federal buildings, began requiring all new building projects to strive for the LEED Silver standard and, at a minimum, to meet the LEED standard for basic certification.

Governors in at least 10 states, including Arizona, California, Colorado, Maryland, New Mexico, and Rhode Island, have signed recent executive orders requiring all new construction to meet LEED requirements. Other state and local governments have enacted similar requirements. (See chart.)

Governments are also creating financial incentives to build green. In July 2005, the Pennsylvania legislature created incentives rewarding new schools that were built to meet LEED Silver certification requirements. Recent studies have suggested that besides providing cost savings for school districts, the green buildings will also help improve student test scores.

In Arlington, VA, innovative incentive programs allow building owners to exceed building height and occupant density limits if a building meets the LEED standard. The permissible zoning variances increase for buildings meeting the higher LEED Silver, Gold, and Platinum standards. In addition, buildings that fail to meet the LEED standard are asked to contribute $0.03 per square foot to a Green Building Fund, which educates the public about the value of green building.

Other communities, including Maryland, New York, and Oregon, provide tax incentives to encourage builders to meet LEED requirements. Santa Monica, CA, as well as Issaquah, WA, even provide for the accelerated review of building permits to boost green construction.

Green Building Benefits

The most obvious benefits from green buildings relate to lower environmental and operating costs, which result from improved energy and water efficiency. Green buildings have documented energy-efficiency improvements ranging from 25 to 65 percent and water-efficiency improvements of up to 90 percent. The resulting financial savings are sufficient to offset any concerns about potential small increases in initial cost.

A particularly dramatic example of financial savings is demonstrated in a pair of Ridgehaven buildings located in San Diego, CA. The two nearly identical 73,000 square-foot buildings were built within a few hundred yards of one another. One of them, however, was later retrofitted with green building principles to improve energy efficiency. After the upgrades, energy consumption decreased 65 percent in the retrofitted building, yielding an annual savings of $70,000 in 1999. Today, annual savings are significantly higher, due to increased energy costs.

Although energy and water savings are a welcomed benefit, the most impressive financial benefit results from increases in worker productivity. Several case studies have documented productivity gains of 10 to 26 percent. Because labor costs are traditionally the highest costs for most businesses, any productivity increase can create significant savings. For instance, the Pentagon estimates that a productivity gain of only 6 percent, resulting from its ongoing green renovations, will produce an annual savings of $72 million.

Other organizations have documented larger improvements, including the following:

• West Bend Mutual Insurance’s new green building improved energy efficiency by 40 percent, plus produced a 16 percent increase in claim-processing productivity.
• ING Bank’s new headquarters uses one-tenth of the energy per square foot of its predecessor. The energy upgrades have also reduced employee absenteeism by 15 percent.

Benefits of green buildings are not just limited to office complexes. Building owners are learning that they can charge higher rents for green offices and green apartments, both of which can attract higher-quality tenants. The retail world has discovered that “daylit” stores generate significantly higher sales, with some studies documenting a 40 percent increase in sales. For instance, Wal-Mart managers recently tested several daylit stores and discovered “significant” sales increases.

Managing Costs

In the early days of the green building movement, many people were reporting that green buildings cost 10 to 15 percent more to construct than traditional buildings. Most of the additional costs were premiums charged by architects and builders who were unfamiliar with LEED and green building techniques. However, even with the additional costs, the lower operating costs offset the initial premium.

As experience with green building has grown, concerns about the premiums have all but disappeared. Green buildings need not cost more to construct than traditional buildings. In fact, the Commonwealth of Pennsylvania currently requires all state projects to be LEED Silver certified and reports no added costs to meet the requirement.

Several recent studies have documented the cost effectiveness of building green:

• A 2003 report prepared for the State of California, based on a study of 36 LEED-registered projects, concluded that the average cost premium is less than 2 percent. The report also documented a steady decline in the cost of building green.
• A July 2004 study concluded that there was no significant cost-per-square-foot difference for buildings seeking LEED certification and buildings not pursuing the certification.
• Another 2004 report documents the cost for each specific LEED point (for instance, the additional cost for energy-efficient heating and cooling or water-efficient plumbing fixtures). The report concludes that the immediate cost savings resulting from some requirements, such as the use of local materials, offset the additional costs for other requirements.

Additional cost ranges for LEED projects, based on the studies, include the following:

LEED Category …… Additional Incemental Cost
LEED Certified ……………. 0 to 3 percent
LEED Silver or Gold ……… 0 to 7 percent
LEED Platinum ……………..7 percent or higher

The best way to minimize costs is to integrate green building requirements into the original design requirements. Make sure the architect knows the project is expected to meet a specific LEED category. Failure to require LEED early in the design process means that owners must pay additional costs to redesign the building. If LEED standards are built into the original requirements, the designers’ creative energies can focus on meeting the owner’s requirements, while simultaneously protecting human health and the environment.

Win-Win Situation

Green buildings offer significant benefits to safeguard human health and the environment, while making tremendous financial sense. What better message could we send to future generations about the priorities of today’s governments than to construct cost-effective, financially sound buildings designed to build a better future?

About the Author

Scot Case is the founder of Responsible Sourcing Solutions, a consulting firm that helps organizations create value by integrating human health, environmental, and social considerations into strategic planning, purchasing, and other critical business decisions. He can be reached at [email protected].

Requiring Green

The following governments and government agencies have passed legislation, executive orders, ordinances, policies, or other incentives for buildings to meet LEED criteria:

Federal Initiatives

• Department of Energy
• Department of Interior
• Department of State
• U.S. Air Force
• U.S. Army
• U.S. Environmental Protection Agency
• U.S. General Services Administration
• U.S. Navy

State Initiatives

• Arizona
• Arkansas
• California
• Colorado
• Connecticut
• Illinois
• Maine
• Maryland
• Massachusetts
• Michigan
• Nevada
• New Jersey
• New Mexico
• New York
• Oregon
• Pennsylvania
• Rhode Island
• Washington

County Government Initiatives

• Alameda County, CA
• Cook County, IL
• County of San Mateo, CA
• King County, WA
• Sarasota County, FL
• Suffolk County, NY

Local Government Initiatives

• Acton, MA
• Albuquerque, NM
• Arlington, MA
• Arlington, VA
• Atlanta, GA
• Austin, TX
• Berkeley, CA
• Boston, MA
• Boulder, CO
• Bowie, MD
• Calabasas, CA
• Calgary, Alberta (Canada)
• Chicago, IL
• Cranford, NJ
• Dallas, TX
• Eugene, OR
• Frisco, TX
• Gainesville, FL\
• Grand Rapids, MI
• Houston, TX
• Issaquah, WA
• Kansas City, MO
• Long Beach, CA
• Los Angeles, CA
• New York, NY
• Normal, IL
• Oakland, CA
• Omaha, NE
• Pasadena, CA
• Phoenix, AZ
• Pleasanton, CA
• Portland, OR
• Princeton, NJ
• Sacramento, CA
• Salt Lake City, UT
• San Diego, CA
• San Francisco, CA
• San Jose, CA
• Santa Monica, CA
• Scottsdale, AZ
• Seattle, WA
• Vancouver, British Columbia (Canada)
• Washington, DC

To read archived copies of Scot Case’s Green Purchaser articles, visit the article archive on www.govpro.com. For additional environmental resources, including news articles, products, and white papers, access the Earth-Friendly Solutions Zone from the GovPro home page.