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Cost and ROI of Green Building +12% & 40% ?

Survey results of perceptions vs. cost of green building and emissions impact

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Realistic Cost Metrics for Green Building

Builders, architects and estate agents massively overestimate the cost of 'green' buildings and underestimate their impact on climate change, according to a global survey by the World Business Council for Sustainable Development (WBCSD).

Estimated Cost: 17% --- Reality: 5%

Respondents to the 1,400-person survey of the construction and real estate industries on average judged that a 'green' building would cost 17% more to construct than a regular building. But the true cost is likely to be under 5% more than buildings which are not built to be, for example, more energy efficient or water efficient, the WBCSD said.

French and Indian property professionals were closest to the true cost, with an average estimate of 12% and 11% more than a standard build, respectively.

Estimated impact: 12% --- Reality: 40%

Asked what percentage of direct and indirect carbon dioxide emissions come from the construction and management of buildings, the average response was 19% – the true figure is around 40%. The US construction and real estate industry put the figure even lower, at 12%.

Björn Stigson, president of the WBCSD, said: "In order to achieve a step change in energy efficiency in buildings, there is a need for strongly supportive policies and regulatory frameworks. Governments and local authorities need to develop sound policies."

Bruno Lafont, chairman and CEO of French cement firm Lafarge, added: "The world is undergoing a rapid transformation, with strong demographic and economic growth driving a move towards urbanisation on an unprecedented scale. We as industry leaders have a responsibility to ensure that this growth is achieved in a sustainable manner."

The Competitive Picture: Only 5% of Building Pros Consider the Option of Green Building vs. 45% of Germans have Direct Green Building Experience

Only one in seven of the industry respondents had directly participated in a green building project, the survey showed. In Japan, this fell to 3%, with only 5% of building professionals even considering the option. By contrast, 45% of German respondents had direct experience of green building practices. Yet, respondents identified "personal know-how" as the most important influence on whether they consider such projects.

The survey forms part of a report on the realities and opportunities for energy efficiency in buildings, which carries further warnings for the building industry on the impact of its rapid expansion.

China's Construction Mushrooms Energy Demand

The report warns that China is constructing 2 billion square metres, or the equivalent of Japan's built-up space, every three years. Energy demand in both China and India is expected to mushroom in the coming years, with buildings set to be a prime driver. The WBCSD plans a further report, setting out a roadmap to encourage energy efficiency in buildings and limit their impact on global emissions and climate change.

London, 23 August 2007

Edited by Carolyn Allen, owner/editor of California Green Solutions
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