As they say, money makes the world go round. No one can claim to not be concerned about money. Whether it’s the strength of the overall economy, amount of profits generated for their companies and corporations, or simply the amount of money they earn. The environmental benefits of green building technology have been expanded upon to a large extent in the previous posts. Today, I will focus more on the economic benefits of green buildings and why it is beneficial to invest in green building technology.
There are a wide variety of economic benefits of green buildings. In today’s blog post, I will elaborate on three different aspects of economic benefits from green buildings.
Firstly, green buildings help to save costs. This can be further divided into construction and operating costs. It is a myth that the construction of a green building costs more than a normal one. This all depends on the effort made by the investor and the contractor to source for recycled materials which would lower the building costs and could decrease construction waste by 95% or more. Re-using the original building structures can also help to reduce demolition costs and production costs as this further reduces the amount of materials used in construction. This also preserves the heritage of the country as certain structures have been retained (Kamschroeder, 2009). This trend is further highlighted in the graph from figure 1 below, which shows that green buildings actually do not cost more per square foot compared to non-green buildings.
Figure 1: Graph comparing cost per square foot and level of building sustainability (Institute for Building Efficiency, 2010).
As for operating costs, green technology helps to reduce costs in many different ways. For example, top tier green buildings that incorporate an integrated design approach had 45% less energy consumption, 53% lower maintenance costs and 39% less water use (Kamschroeder, 2009). This results in decreased electrical and utilities bills for owners and tenants. In the long run, this could help cover the possible higher costs and rents, and help to increase savings.
Secondly, they increase the property value, should the owner of the building wish to sell the building in the future. The asset value of the overall property increases as consumers and investors become more aware and educated about the benefits of building sustainability. This results in better marketability for the building. Based on a study conducted by Insight, the business of workplace design and management, greener buildings are able to attract more tenants and command higher rents and sales prices (Insight, 2013).
Lastly, green technology increases occupant productivity. Numerous studies have shown the positive correlation between increased natural light and fresher air and productivity and quality of work. Also, studies have shown that poor indoor environments have led to decreasing productivity. A study by the Herschong Mahone Group (2013) found that natural lighting and fresher air in a workplace would improve working efficiency by up to 20%.
Accumulatively, investors and building owners would definitely benefit in economic terms, both by reducing costs in the short run and long run as well as increased productivity leading to better work efficiency. In addition, the property prices of the buildings would also increase. Knowing these facts, the BCA could use them to promote the constructions of green buildings in Singapore, to further convince the public of their importance, rather than just merely implementing laws and policies. It is always more effective if you are able to convince rather than enforce.
Herschong Mahone Group. (2013). Windows and Offices: A Study of Office Worker Performance and the Indoor Environment. Retrieved October 7, 2014, from http://h-m-g.com/projects/daylighting/summaries on daylighting.htm
Insight. (2013, March 6). Economic Benefits of Green Buildings Highlighted. Retrieved October 7, 2014, from http://workplaceinsight.net/economic-benefits-of-green-buildings-highlighted/
Institute of Building Efficiency. (2010, April). Economics of Green Building. Retrieved October 7, 2014, from http://www.institutebe.com/clean-energy-finance/green-building-costs.aspx
Kamschroeder, K. (2009, July 16). Benefits of Green Buildings on Costs, the Environment and Jobs. Retrieved October 7, 2014, from http://www.gsa.gov/portal/content/103662