1. Understanding challenges and opportunities of investing in green buildings

2. Contents

3. A Green Building… Minimizes depletion of natural resources during its construction and operation Minimizes pollution : Water pollution, Air pollution, Soil degradation, Erosion, Solid waste Uses minimum energy to power itself Uses efficient equipments : lighting, air conditioning, etc. Maximizes the use of renewable energy sources Uses efficient building materials and construction practices Uses efficient waste and water management practices Provides comfortable and hygienic indoor environment

4. Minimal impact on site and surroundings Erosion control Storm water management Pollution control Tree protection Heat island control Benefits of Green Buildings

5. Saves water by upto 30-40% By reducing irrigation water requirement Use of efficient fixtures Rain water harvesting Waste water treatment on site Recycle and reuse of water Benefits of Green Buildings

6. Saves energy by 40-50% Minimize building energy demand through: Solar Passive Design Use of efficient building systems Maximum use of renewable energy Benefits of Green Buildings

7. Solid waste management Reduction in waste during construction Efficient waste segregation at source Suitable storage and disposal at building level Resource recovery from waste Benefits of Green Buildings

8. Use of recycled material: Fly ash, blast furnace slag Adopting efficient technologies Use of low-energy materials www.luxuryhousingtrends.com Very high energyAluminum, stainless steel, plastics, copper High energySteel, lead, glass, cement, plaster board Medium energyLime, clay bricks and tiles, gypsum plaster, concrete (in situ, blocks, pre-cast) Low energySand, fly ash, blast furnace slag www.science.edu/ Use of sustainable building materials Benefits of Green Buildings

9. Minimal negative impact on people Healthy and productive work environment Clean environment for construction workers Day lighting/natural ventilation Universal accessibility

10. 10 Each of these environmental interventions gives ~ 300% or more return on investment ProgramSavings for every dollar spent Immunizations (reference value) Lead paint hazard Improved water & sanitation Sustainable/active transport $27 $17- $221 $3 - $34 $3 -30 Preventive interventions paid for by other sectors are not being used

11. Co benefits: health, safety, reducing pollution loads Workers working with stones or other such activities which involve a lot of dust, are to be given face masks as depicted here Wheel washing facility at site entrance

12. Some common myths about green buildings

13. Green buildings are expensive No! They are invariably cheaper  If green is the design paradigm Yes. They are slightly expensive  If you green is an afterthought

14. Are green projects expensive? Graphic Courtesy: Environmental Design Solutions

15. Green Buildings take more time Time=Cost Solutions: Follow integrated design process Set your green goals at start of project Get your team right Appropriate Costing Assign responsibilities Carry out life cycle costing to take investment decisions Solutions: Follow integrated design process Set your green goals at start of project Get your team right Appropriate Costing Assign responsibilities Carry out life cycle costing to take investment decisions

16. Green is just energy efficiency! Adhoc-ism in applying green: –Paint your roof white and your house is cool. –Seal the windows and you are done. –Use BEE Star Labelled appliances if you can. –Compliance with Energy Code = Green –Only AC buildings can be green? –Who defines thermal and visual comfort? ENERGY IS NOT JUST ABOUT GREEN!! Adhoc-ism in applying green: –Paint your roof white and your house is cool. –Seal the windows and you are done. –Use BEE Star Labelled appliances if you can. –Compliance with Energy Code = Green –Only AC buildings can be green? –Who defines thermal and visual comfort? ENERGY IS NOT JUST ABOUT GREEN!!

17. Aren’t green products inferior? Blended cements –Set slower but last longer and cost lesser Solar water heaters –May not complement but can supplement Waterless urinals –Need maintenance but not water Photovoltaic panels –Not cost-effective but does India have a choice? Blended cements –Set slower but last longer and cost lesser Solar water heaters –May not complement but can supplement Waterless urinals –Need maintenance but not water Photovoltaic panels –Not cost-effective but does India have a choice?

18. Green Buildings don’t work well: why should I invest Lack of maintenance not unique to green Improper understanding of new technologies Training for maintenance personnel missing Gap between design intent and operation Lack of maintenance not unique to green Improper understanding of new technologies Training for maintenance personnel missing Gap between design intent and operation

19. Customer doesn’t care for green Do we always give what customer cares for? Do we declare the Energy Performance Index of our buildings? If fuel efficient automobiles sell better, why would low-maintenance buildings not sell? Do we always give what customer cares for? Do we declare the Energy Performance Index of our buildings? If fuel efficient automobiles sell better, why would low-maintenance buildings not sell?

20. How do you prove that green buildings make economic sense Understanding components of green design that are “no cost”, ”low cost” and “high cost” What are the costs and benefits? Life cycle cost approach Understanding design case and base case Opportunities in new and existing buildings Renewable energy options: how cost effective are they? Tools

21. How does green affect my building cost?The GRIHA framework SITE Cost impact Adhering to byelaws, master plans, etc. No Locating building in the vicinity of basic public services No Proper timing of construction No Soil & erosion control No Preservation of top soil Low Preservation of existing vegetation Low Planting of trees No Include existing site features in design No Reduce hard paving on-site No Provide shaded hard-paved surfaces Low Optimize on-site circulation efficiency No Provide minimum level of sanitation/safety facilities for construction workers No Reduce air pollution during construction No

22. How does green affect my building cost? WATER Cost impact Reduce landscape water requirement No Reduce the water use by the building through efficient fixtures Yes Efficient water use during construction No Provision for treatment of waste water generated on site, as per standard Yes Rain water harvesting and use of recycled water Yes Water quality confirming to IS standards No Source: www.ctm.co.za Source: innovation.ihgplc.com Lawn grass= More water requirement Native trees/plants= 0 / low water requirement

23. How does green affect my building cost? WASTE Cost impact Reduction in waste during construction No Recycling and safe disposal of segregated waste No Efficient waste segregation strategies like - provision of multi colored bins No Provision of space for hygienic storage of segregated waste Yes

24. How does green affect my building cost? MATERIALS Cost impact Utilization of fly ash in building structure- Concrete, masonry, plaster, mortar No Adopt efficient technologies to reduce volume and weight, and time of construction- Pre stressed slab, light weight concrete blocks, pre-cast stone blocks, etc. No Use low energy materials in interiors- bamboo, rubber tree wood, products made of wood waste/ coir, gypsum board, terrazzo flooring, etc. No Use of low VOC paints/adhesives/sealants No Use of CFC/HCFC free materials No AAC blocksGypsum boardsMDF boards made from recycled wood scrap

25. How does green affect my building cost? ENERGY Cost impact Low energy building design No Optimum window shading No Energy efficient envelope Yes Roof & wall insulation Yes Efficient glazing Yes Use of efficient lighting system Design No Fixtures Yes Controls Yes Efficient HVAC system Design No Equipments Yes Controls Yes Maximum cost increment due to: Efficient envelope, systems and lighting Which are ECBC recommendations When ECBC becomes mandatory, these will no longer be extra cost

26. Cost impact Tobacco smoke control No Minimum accessibility for persons with disabilities No Adequate O & M measures No Audit & validation yes How does green affect my building cost? OTHERS Certification fee for Green Rating + Cost of hiring Green Consultant

27. So…. Most of the Green Building Features can be incorporated in a building by just: Employment & co-ordination of all building consultants from the beginning of the project- Concept stage Adhering to basic building design standards Judicious building & systems design Careful selection of building materials Ensuring that site contractors are aware of all the necessary measures to be taken during construction INTEGRATED DESIGN APPROACH

28. How to decide whether a green building project is financially feasible or not? Tools to assess financial feasibility Procedure to conduct the financial assessment

29. Tools to assess financial feasibility Discounted payback period (DPP): Discounted payback period is the time required for cumulative savings to recover initial incremental investment, taking into account the time value of money. Investment is profitable if DPP < study period Life cycle cost (LCC): Measure to calculate total cost of a building over its entire life time Project alternative with lowest LCC is most cost effective Savings to investment ratio (SIR): Relation between annual savings & difference in capital investment costs Project with SIR>1 is economically feasible

30. Economics of Green Buildings Initial investment cost of Green Buildings is higher than conventional So, why should one invest in a green building? TERI conducted a study to assess financial feasibility of green buildings in India

31. Objective: To assess whether green buildings make financial sense Case study selection 7 green buildings (5 Star GRIHA or LEED Platinum) Institutional and Office buildings Day use buildings Study : Financial feasibility assessment of green buildings (commercial) in India

32. Methodology Building design, system and cost details collected (from all the project teams through primary survey, basic thumb rules were used in consultation with subject experts for filling in data gaps) Green case was developed based on the collected data For conducting comparative analysis, conventional case was established (Building details and costs of the conventional case were taken in consultation with subject experts and market survey) Various costs associated with the buildings over their life time were calculated o Single costs: Initial investment costs, capital replacement costs and resale value of building o Uniform annually recurring costs: Operation & Maintenance costs o Non-uniform annually recurring costs: Energy costs of the building Life of building taken to be 25 years Study : Financial feasibility assessment of green buildings (commercial) in India

33. The collected data was analyzed to Compare the costs of green buildings with their respective conventional cases. Study the factors contributing to the increment in the initial investment costs of green buildings. Evaluate the financial viability of incorporating energy efficiency features in buildings with reference to improvement in their energy performance, with use of financial tools like o Discounted Payback Period, o Life Cycle Cost Analysis, o Savings to Investment Ratio Study : Financial feasibility assessment of green buildings (commercial) in India

34. Components of building cost increment Building envelopeRoof & wall insulation, high performance glazing39% Systems (HVAC system, Electrical system, BMS) Efficient chillers, motors & pumps, VFD, economizers, heat recovery wheel, BMS 35% Lighting& controlsEnergy efficient lamps & fixtures, controls (Daylight & occupancy sensors) 15% Others12% Study : Financial feasibility assessment of green buildings (commercial) in India Incremental cost ranging from 4-32 % Case Study 112% 225% 34% 432% 517% 6 710%

35. Life cycle cost of energy efficient buildings is lower than conventional buildings Savings to investment ratio ranging from 1.9 to 15.3 Analysis Results Discounted payback periods ranging from 1 to 3 years Discounted Payback Periods of Different Case Studies 22 1 2 3 2 1 0 0.5 1 1.5 2 2.5 3 3.5 1234567 Years Study : Financial feasibility assessment of green buildings (commercial) in India

36. Assessment tool for residential buildings

37. Evaluation Tool and Label -Based on the ISO whole-building-approach (Flexibility) -Robust energy performance assessment (Comparability) -Easy to use by architects and auditors (Scalability) -Easy to compare different EE design, material and technology combinations (Optimization) -Basis for Energy Efficiency Label (Communication) -Joint Assessment Tool Developed by Fraunhofer Institute and TERI,

41. IT Tool Kit

42. A study was conducted to calculate incremental cost of incorporating ECMs in residential buildings and the financial viability of making this extra investment Study : Financial feasibility assessment of green buildings (residential with EE measures) Case study: A set of four residential apartments were selected for the study Impact of incorporating some or all of following ECMs in the conventional case has been studied for each building: 1.Use of AAC block masonry instead of bricks for walls 2.Roof insulation with 125 mm expanded polystyrene 3.6 mm reflective glass in windows 4.High SRI paint on the roof 5.Solar water heaters for water heating 6.Use of 3 star/ 5 star window ACs instead of BEE 1 Star AC

43. ECMs in Building 1 1.Use of AAC block masonry instead of bricks for Walls 2.Roof insulation with 125 mm expanded polystyrene 3.6 mm reflective glass in windows 4.High SRI paint on the roof 5.Solar water heaters for water heating 6.Use of 5 star window ACs instead of BEE 1 Star AC Energy Saving: 42% ECMs in Building 2 1.Use of AAC block masonry instead of bricks for Walls 2.Roof insulation with 125 mm expanded polystyrene 3.6 mm reflective glass in windows 4.High SRI paint on the roof 5.Solar water heaters for water heating Energy Saving: 24% ECMs in Building 3 1.Use of AAC block masonry instead of bricks for Walls 2.Roof insulation with 125 mm expanded polystyrene 3.6 mm reflective glass in windows 4.High SRI paint on the roof 5.Solar water heaters for water heating 6.Use of 3 star window ACs instead of BEE 1 Star AC Energy Saving: 31% ECMs in Building 1 1.Use of AAC block masonry instead of bricks for Walls 2.Roof insulation with 125 mm expanded polystyrene 3.6 mm reflective glass in windows 4.High SRI paint on the roof Energy Saving: 22% Study : Financial feasibility assessment of green buildings (residential with EE measures)

44. Building Energy Performance Index EPI (kWh/m 2 /yr) Energy Saving % BuildingConventional CaseGreen Case 1119.4669.0842% 275.2756.9724% 396.1566.5831% 490.6870.8922% BuildingEnergy Saving %Incremental cost % Payback Period 142%4.52%2 224%1.08%1.7 331%2.04%2 422%0.75%1.3 Incremental cost: 0.75% - 4.52% Study : Financial feasibility assessment of green buildings (residential with EE measures)

45. Analysis Results Life cycle cost of energy efficient buildings is lower than conventional buildings Discounted payback periods not more than 2 years Study : Financial feasibility assessment of green buildings (residential with EE measures)

46. Why should banks promote green buildings?

47. Since the initial cost for buying a green home would be slightly higher. Individual will take a loan of higher amount. A simple EMI calculation is shown below: Loan amount= Rs. 40,00,000 Duration = 15 Years Interest Rate = 10.5% Processing Fee = 1% of loan amount Total amount payable to bank = Rs. 79,98,880 Loan amount= Rs. 42,00,000 Duration = 15 Years Interest Rate = 10.25% Processing Fee = 1% of loan amount Total amount payable to bank = Rs. 82,82,040 If Processing Fee is reduced to 0% Total amount payable to bank = Rs. 82,40,040 Difference= Rs.2,41,160 Calculation based on: http://www.axisbank.com/Calculators/loans-emi-calculator.htmlhttp://www.axisbank.com/Calculators/loans-emi-calculator.html Business case