Cost Concerns

One of the common assumptions about green building is that it costs more than a traditional building. If your idea of green is to install solar panels on the roof to accommodate the huge energy usage of a building, it will cost more. It will also cost more if you approach the design in bits and pieces, such as utilizing energy efficient appliances but not downsizing the need for the appliance by factoring in other energy reduction potentials. Choosing materials that are made from recycled content may or may not increase the cost, and some things will cost more up front but will be economical if you factor in energy and maintenance costs.

If cost is important, and it almost always is a big factor in building, then the earlier green design concepts are introduced, the more you will save financially. For instance, in designing a commercial building, in order to maximize the energy savings, you will want to include energy modeling and commissioning of the building in your early planning. In all buildings, no matter the size, the consideration of passive solar heating, ventilation and natural lighting as part of the design may allow you to reduce the size of your air conditioning and heating equipment, which in turn will reduce energy consumption even more and save initial costs. You might even be able to eliminate a central heating system or air conditioning from a building or choose a less expensive substitute.

A basic principle of green building is to re-use what you can, including a building structure. Using a shell of an old building for the structure of a new one will create substantial savings and generate a lot less waste, which will also save money.

30 Year Cost of a Building

Life cycle analysis can help to evaluate the real costs over time. Some items, such as solar panels, may cost more in the short run but may generate huge energy savings over a number of years.

Additionally, healthy green buildings have been shown to increase productivity, lower employee sick time, and to increase the general well-being of the staff. These factors, when taken into account, can support the idea that a building that feels good to work in will help with staff hiring and retention and will be a financially sound investment.

An excellent publication was released in the Fall of 2003 by the state and is available here by download. The Cost and Financial Benefits of Green Buildings. A Report to California's Sustainable Building Task Force.

The first paragraph:
This study, The Costs and Financial Benefits of Green Building, represents the most definitive cost benefit analysis of green building ever conducted. It demonstrates conclusively that sustainable building is a cost-effective investment, and its findings should encourage communities across the country to "build green."

Download the Full Report.
Download the Executive Summary.

More economic discussion can be found on Seattle City Light's page On the Bottom Line.

An unusual project that reduced the energy consumption by 60% and expects a four year payback period. Ridgehaven was a major renovation and offers an opportunity to compare its energy usage to a sister building that is the same size and which has not been renovated. Ridgehaven’s energy usage is 60% below that of its neighbor.

California Grants and Incentives
Savings by Design, an incentive program by PG&E