HEQDF Forum – Delivering Sustainable Buildings in the HE Sector
9th October 2012
Sustainable Refurbishment – Myth, Magic or Mandatory | Nick Hayes [email protected]
Delivering Sustainable Buildings in the Higher Education Sector
What are the Key Sector Challenges?
What are the Key Sector Challenges?
1. How can high performance buildings meet customer expectations, whilst reducing energy and carbon use?
2. How do we select methods and materials which give the biggest ‘bang for bucks’ in relation to cost and carbon reduction?
3. How can we positively influence staff and students to encourage reduction of carbon through behavioural change?
October 2012HEQDF Forum 3
What are the Key Sector Challenges?
1. How do we recognise the role buildings play in meeting the key priorities of the University?
2. How can high performance buildings meet customer expectations, whilst reducing energy and carbon use?
3. How do we select methods and materials which give the biggest ‘bang for bucks’ in relation to cost and carbon reduction?
4. How can we positively influence staff and students to encourage reduction of carbon through behavioural change?
5. Who gains and who pays?
6. How do you bring it all together?
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How Sustainable Buildings Deliver Key Priorities
Key Drivers for Sustainable Buildings
Sustainable buildings driven by a range of mandatory, sector and local priorities
� Climate change act - zero carbon non-domestic by 2019 � Planning requirements
� Energy Performance Certificates (EPCs) required for all commercial buildings on construction, refurbishment, sale, lease or renewal (Predicted rating)
� Corporate Social Responsibility (CSR) – Reputation and Positioning
� Display energy certificates (DECs) not mandatory for commercial buildings but leading organistaions voluntarily undertaking
� Peer Group positioning, Russell Group, Green University league table
� Energy Act – F and G rated EPCs outlawed by 2018 � Competitive advantage, marketing, student intake
� Carbon reduction commitment (CRC) mandatory for all organisations consuming > 6000 MWh/year (approx £500,000)
� Financial plans and business case
� Fines for non-compliance with EPCs, DECs and CRC � High performing facilities, high attainment levels, building flexibility
� Future Policy – A Code for Sustainable Buildings including mandatory energy performance standards?
� The need to differentiate
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13%
19%
19%
31%
69%
75%
75%
75%
88%
88%
0% 20% 40% 60% 80% 100%
Reduction of greenhouse gas (GHG) liability
Operational cost savings from water efficiency
Higher occupancy rates
Greater overall building value
Attraction and retention of quality workforce
Operational cost savings from energy effiency
Greater workforce productivity
Value of public relations and free publicity
Corporate environment commitment
Greater indoor air and environmental quality
% of Respondents
Why Do Users Want Sustainable Buildings?
Deloitte & Lockwood Report July 2008
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Meeting Customer Expectations, Whilst Reducing Energy and Carbon Use
■ There are opportunities to learn from outside the sector – approaches and technologies work across sector boundaries (and exemplars within!)
■ Win, win opportunities – lower costs and better working environments
■ The simple things are important – commisioning and user guidance
■ Behavioural change matters – and is the easiest way to reduce costs and carbon
■ Whole life costing is key....
Meeting Customer Expectations, Whilst Reducing Energy and Carbon Use
What Lessons Have We Learned?
13%
19%
31%
31%
37%
38%
40%
62%
69%
7%
29%
38%
19%
56%
50%
38%
49%
53%
25%
31%
93%
86%
57%
49%
62%
13%
19%
25%
13%
7%
13%
7%
7%
7%
7%
0% 20% 40% 60% 80% 100%
Insurance Rates
Permit Processing Time
Total Renovation time
Property Value
Occupancy Levels
Workforce Productivity
Ability to Retain Talent
Employee Health
Employee Well-Being
Ability to Attract Talent
Employee Comfort
Goodwill / Brand…
Increased Significantly Increased SlightlyNo Change Decreased SignificantlyDecreased Slightly
Broader Studies
The Value and Impact of Green Buildings
The link between people and buildings is key to achieve and demonstrate benefits
Energy Saving (EPC D to B)
€ 24 /m2/year
Water Saving (Part L to BREEAM VG)
€1 /m2/year
Sickness Reduction (39% reduction)
€180 /m2/year
Productivity Improvement (5% increase)
€690 /m2/year
TOTAL €895 /m 2/year
Other Benefits to OccupierBrand, CSR, Recruitment and Retention
Other Benefits to InvestorMarketability, longer life, stable cashflows
Value of Occupying Sustainable Buildings Impact of Green Development
Deloitte & Lockwood Report July 2008
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Market Value...
...and Differentiating Those Who Benefit
Doing Good by Green Responsible Property Owner & Occupier Actions
11
Operating Costs
Rents OccupancyBuilding
Value
3%(21%)
3.5%
7.5%(26%)
8.9%
Laggards Leaders
Outdated assetVoluntarily displaying energy performance
Lack of control Automatic meter reading
PR risk / issues Benchmarking
Unable to respond to market demand Continuous commissioning
Future Setting targets
Built into valuation Incentivising energy efficiency
Upper Quartile Demand Finding savings
Reputation Keeping ahead of R&L
Competition Green Leases
Climate change adaptation Engaging supply chain
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Delivering the business case
‘Easy Wins’ and Whole Life Cost Savings
Project TypePayback
(yrs)
Lighting upgrades 3.3
Insulation (Loft, Cavity Wall, Roof, Double Glazing) 3.8
Lighting controls 3.2
Pipe work Insulation (Cooling, Heating) 2.7
Voltage optimisation 3.4
Heating (e.g. controls, zone control valves) 3.2
BEMS - remotely managed 3.2
Insulation - draught proofing 3.6
Boilers - control systems 3.3
Time switches 1.9
Heating - TRVs 3.2
Hot Water (Distribution improvements, point of use) 3.3
BEMS - bureau remotely managed 3.6
Ventilation (distribution, controls, air handling units) 2.4
‘Easy Wins’
■ Based on a comparison of BREEAM buildings against building compliance standards (BRE Trust/Cyril Sweett)
■ Naturally ventilated office
– Energy savings of 17%
– Water savings of 71%
■ Air conditioned ‘prestige’ office
– Energy savings of 26%
– Water savings of 55%
Whole Life Cost Savings
BRE Trust/Cyril Sweett
October 2012HEQDF Forum 13
Greatest ‘Bang for Buck’
The Whole Life Cost Approach
■ Review of Motors for Baggage Handling System at Gatwick Airport– Compared new PMM technology vs existing
motors■ Benefits / Savings
– 39% more energy efficient with similar carbon footprint
– Initial premium recovered in 2 years– £1m NPV saving in 15 years in energy
savings alone at current prices– Reduce exposure to future energy price rises– Easier maintenance– Facilitates pan airport automatic control– Better conveyor braking– Lower spare stock requirements
Case Study Review and Benefits / Savings
(£) Option 1 Option 2 Option 3 Option 4
Capital Costs 1,821,534 1,589,687 1,162,953 2,043,121
Energy Costs 8,383,944 10,777,924 13,942,028 11,793,006
Replacement Costs 520,839 697,103 675,499 699,280
Maintenance Costs 467,973 423,711 428,153 510,276
Total Whole Life Costs 11,194,290 13,470,425 16,658,633 15,045,683
Ranking 1 2 3 4
Value in Excess of Rank 1 2,276,135 5,464,342 3,851,392
% in Excess of Rank 1 20.33% 48.81% 34.40%
Analysis of Whole Life Costs
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0
4,000,000
8,000,000
12,000,000
16,000,000
20,000,000
SEW P MM SEW LS Siemens
Tot
al C
ost (
€)
Capital Energy Replacement Maintenance
Option 1
Option 2
Option 3Option 4
Cost and Carbon benefits – ‘Dual Currency’ Model
Getting Informed Decisions
Establish comparative costs vs. CO2 emissions of various component options over the life cycle and building a library of green components
■ Making investment decisions on total cost and carbon impact is difficult
■ Create a user friendly tool to compare various design options developed through modelling of whole life cost for financial and carbon impact
■ Defining carbon content for key components though the component life cycle
Challenges
■ Started with a the façade element and compared lifecycle costs over the whole life of the component asset
■ Breakdown of initial capital investment, operational cost and replacement cost for each façade type
■ Measurement of carbon emissions over the whole life cycle of the asset
■ Cost vs. Carbon comparison of different façade options
Outcomes
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Informed Decision Making Tools
User friendly tools to compare various design options developed through modelling of whole life cost for financial and carbon impact
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Who Gains and Who Pays?
Inter-relationship Benefits to Stakeholders
Investors Developers Designers ContractorsOccupiers
Owners Tenants
Reduced Costs Capital costs Maintenance costs and of capital costs, plus cheaper refits and faster lets
Design time and snagging
Resource use and waste on site
Maintenance & operational costs and downtime in using building
Maintenance &operational costs and downtime in using building
Reduced Risks Reduced risk on capital
Letting voids Quicker planning permission
H&S, pollution liabilities and time savings, no over run penalties
Asset value risks and H&S liabilities
H&S liabilities and flexible accommodation forfuture subletting
Higher Returns Faster return of capital Increasing net lettable area and higher rents and occupier retention
Repeat work due to satisfied clients
Improved staff productivity
Improved staff productivity
Satisfaction Personal satisfaction / intellectual challenge
Personal satisfaction / intellectual challenge
Personal satisfaction / intellectual challenge
Improved staff satisfaction / retention
Improved staff satisfaction / retention
Image Demonstrable performance for SRIFTSE4 good eligibility
Profile & distinctive buildings on market
Repeat work due to satisfied clients
Improved image to clients and improvedpublic image
Improved image to clients and improvedpublic image
Experience Gained Future marketability Future marketability Future marketability
Business Flexibility Flexibility of investment potential
Flexibility of letting / sale potential
Flexibility of building use
Flexibility of building use
Stakeholder Benefits
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■ ZERO capital investment from the Client
■ Third Party Funded - all measures paid for by specialist, sustainable funds
■ Energy savings of c30% through a ‘basket’ of measures
■ ‘Savings-shared’ model:
■ Balance of yearly savings used to repay capital investment by Investor
■ Client benefits from 100% of the savings thereafter
■ Energy performance guaranteed and underwritten by reputable ESCOs
■ Saves money and carbon
■ Mitigates risk and facilitates compliance
Who pays? …There Are a Number of Options
Funded Solutions
Bringing it All Together
A Route Map to a Sustainable Asset Portfolio
Rev
iew
Rev
iew
Mandatory Local Compliance Advisory
Improve Management
Do Nothing Improve Asset
Do Both
CAPEX Plan and Benefits Case
DEC and EPC Assessments
CR
C
Pla
nnin
g
DE
C
BIU
SK
A
Whole Life Cost
Peer Review
� HEI Groupings� Green League� AUDE
‘Brokering’ data, managing client
portfolio
Sustainability Strategy and
Benchmarking
Modelled Consumption Performance
Act
ual C
onsu
mpt
ion
Per
form
ance
Prioritisation
EP
C
CS
R
Env
ironm
ent a
nd
Sus
tain
abili
ty
Pol
icy
BR
EE
AM
Action Plan
Audits and Carbon Management
Strategy Plan,ROI, WLC
Energy / Carbon /Sustainability Audits
Portfolio Analysis
Energy Efficiency Funding
October 2012HEQDF Forum 21
22
?
Summary
Sustainable refurbishment – Myth, Magic or Mandatory?
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Mandatory
■ What you have to do
■ Let’s take that as read…
Magic
■ Sprinkle stardust on the scheme
– Aspirations
– Buildings…
– …and how they link with People
■ There are lessons to be learned out of sector (knock on Matt Dickinson’s door – or ours!)
Summary
Sustainable refurbishment – Myth, Magic or Mandatory?
24
Magic (continued)
■ Get the brief right
– Feasibility study to inform objectives, particularly the balance between capex and opex
• Understand the building intimately
• Understand its constraints, particularly services
– Modelling and tools
■ Use the project as an agent of change
– People and behaviours are key winners
– Innovative design can be key enabler
■ Have the right framework/route map
■ Have the right funding mix
Myth
■ Only if you don’t follow some of those rules or top tips above!
Summary
Sustainable refurbishment – Myth, Magic or Mandatory?
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