Big Steps In Building: Make LEED Mandatory for Condos
by Lloyd Alter, Toronto on 03.24.08
Peter Gorrie, Enviromental reporter for the Star, writes about what we have been saying for years: 1) purchasers would rather pay for granite counters than energy efficiency, and 2) Developers build as cheaply as possible and don't care about efficiency when it is the purchasers who pay the operating costs. He interviews mechanical contractor Vittorio Zorzit, who installs vertical fan coils that heat and cool apartments.
"There are two versions of the fan. One costs about $100, the other $500. The more expensive consumes only about half as much electricity to do the same job. It has been on the market for 20 years. The developers decide which fan goes in.
The fan coils are a small part of any condo building, but they're a good sign of how the development business has operated, and mainly still does, to the detriment of the environment.
"Nobody was using it because of the cost," Zorzit says. It pays for itself in energy savings within two or three years, but "the developer doesn't care. He's not paying the final (electricity) bill."
The same goes for the large boilers, he says. Most are 70 per cent efficient. Others are better than 80 per cent, but "no one wants to pay the upfront cost," even though, "in a couple of years you save the difference" in reduced natural gas bills." ::The Star
Image: Minto Skyy, one of the 15% of condos that are being built to exceed code standards and go for LEED.
Gorrie also interviews Rick Tripodi, who is building 1200 units that are heated and cooled by a geothermal system. "We're taking the leap. I'm sure you'll see more in the near future"- "The green additions to the Remington project will raise the construction cost by about $9 a square foot, Tripodi says. The company plans to eat the cost to keep its prices competitive.
Tridel [another Toronto builder going for LEED on some of its condos] thinks consumers are ready to pay a little more to be green, says senior vice-president Jim Ritchie. "There is a premium. It's manageable and at such a level it can be accepted in the marketplace. . . . We can demonstrate the costs and benefits to consumers."
Upgrading the building code would create a level playing field, Ritchie says. "We think that will happen over time." ::The Star See also Tridel on Discovery Network's Daily Planet.
Tridel Ecosuite
Jim Ritchie nails it, the playing field should be level. Buildings last a long time and retrofitting them is a lot more costly than building it in upfront. Big Step in building:
-LEED Silver should be a minimum standard for residential highrise construction.
-Building codes and zoning bylaws should be revised to demand this.
-Builders and developers should have to guarantee energy efficiency as part of their warranty.
These are all shoulds. In an ideal world, we would require every new building to be LEED Platinum and every new car to be zero emission hydrogen vehicles.
Commercial buildings have just as much insentive to build green as condos developers. The only fair argument you have is in the post-occupancy savings, but if the people buying condos have a demand for it, it will be built, just the same that if commercial owners have a demand for green building it will be built. The standards for LEED certification will rise in time, but requiring it is a little outlandish. If it were just a standard you had to meet, that would be fine, but who foots the bill for the silly little plaque? They can get expensive for some of these large buildings.
No, the problem is that operating costs are fully tax deductible and are separated from the investment and development costs of a new building.
Further, most developers do not continue to hold and operate the buildings they build, so they are never faced with the energy costs, much less repair and replacement costs of cheap and low quality equipment that they have specced and installed.
Raising building code standards is one way to accomplish this. But it doesn't change the fundamental dynamic at work.
Perhaps with energy costs rising so dramatically, purchasers of buildings and condos will be more aware and concerned about energy efficiency, and will gravitate to more efficient buildings. Developers will see that the more efficient buildings sell faster and for higher prices, and that their advantage will be to supply the market with what it wants, leading them to higher profitability.
Josh V, Your comment:
"Commercial buildings have just as much insentive to build green as condos developers."
Is way off.
Commercial buildings are usually built by the same companies occupying them. They have a direct incentive to build a more efficient building. The commercial building sector is leading the way for LEED projects right now.
I live in an apartment and how first hand how inefficent apartments/condo are. My landloard could care less about my energy costs. He doesn't pay the electricity bill.
I would think the people that put out a request for bid for a large building would have had an architect design (or at least review the specs) of the building. The bid should include specifications for items such as this. It seems a bit unfair to blame the builders if the specifications they were asked to bid the job from included inefficient equipment.
If the specifications didn't include this, I'd look at the architect to see if they failed to make recommendations for quality and efficiency. If they didn't, they weren't doing their part.
If the architects made these recommendations and the people holding the purse strings ignored them, they got what they were willing to pay for, for better or for worse.
It's easy to recoup those costs, advertise the utility savings for condo buyers and relate it back to point out how the initial purchase price premium for these benefits is outweighed in utility costs within a few years.
Alternatively for property management companies, tell people you're going to charge a premium on rent for energy costs, which is equal to the average for a similar non-LEED or energy efficient building, and then profit from the lowered energy costs you incur than that average.
People will pay for this a lot quicker when you point out to them the cost savings in an easily understandable format.
A condo developer would pass the added costs of a green building to the consumer, after which the buyer is responsible for their utilities. A condo developer has no incentive to build green unless customers are demanding it.
On the other hand, developers of rental properties, be it residential or commercial have greater incentive to go green because they likely will manage and rent the building out. The added costs of making a rental project green would be passed on to the tenants in higher rent, and in theory they would save with lower utility bills. Once more green projects are built, and rents on aging green building space will decrease and save the end consumer more.
Consumers have to understand that buying or renting green is a long term investment and shouldn't expect quick and large savings.
In a city like Toronto where there is urban development left and right, if the government would support green initiatives and would be pro-landlord then there would be enormous incentive to make every new development project "green"
A condo developer would pass the added costs of a green building to the consumer, after which the buyer is responsible for their utilities. A condo developer has no incentive to build green unless customers are demanding it.
On the other hand, developers of rental properties, be it residential or commercial have greater incentive to go green because they likely will manage and rent the building out. The added costs of making a rental project green would be passed on to the tenants in higher rent, and in theory they would save with lower utility bills. Once more green projects are built, and rents on aging green building space will decrease and save the end consumer more.
Consumers have to understand that buying or renting green is a long term investment and shouldn't expect quick and large savings.
In a city like Toronto where there is urban development left and right, if the government would support green initiatives and would be pro-landlord then there would be enormous incentive to make every new development project "green"