CMD Group is now a ConstructConnect™ company. Learn more

Budgeting & Financing Green Construction

03/02/2012 by Joseph Macaluso, CCC, Andy Walker, PhD, PE

Share

Budgeting & Financing Green Construction

Green buildings present the same budgeting challenges that conventional buildings do, but with some added twists. For example, since sustainability is a main objective, how do you decide which sustainable features should get special consideration? A popular approach is to get the most “bang for the buck” by incorporating as many low- or no-cost green measures as possible or, for LEED® projects, to earn the most credits at the lowest cost. Sometimes, however, in order to highlight a particular green feature, a bit of “conspicuous conservation” may be employed—even if it’s not the most cost effective strategy. Also, there’s the question of which rating system, if any, will be used, and what rating level should be the goal? Funding and financing are often tied to specific rating systems and levels, so this will factor into the choice. The challenge is to find a balance between lower initial costs vs. long-term savings, all the while striving for the greenest building and staying within the budget. After all, what good is a green building if it can’t be built?


Estimators are well suited for being part of a green project team. Building involves architects, engineers, and other skilled professionals—all vital to the process—but when it comes to determining cost, the task falls not to architects, engineers, economists, or accountants, but to estimators. This often requires the estimators to work with other building professionals in order to distill all the facets of building down to the bottom line. With green building, the group of professionals is expanded, and the scope goes beyond human capital, to include earth capital as well.


Estimators should be brought into the design process as early as possible to help the designers decide which green strategies (or LEED points) are most cost effective. The cost of mechanical, plumbing, and site work systems tends to be influenced more by green attributes than other building components. Some material and product selections start much sooner than they would with conventional buildings, to assure that the sustainable preference for using locally sourced materials is met. Therefore, the estimator will be called in to obtain actual quotes sooner. As a consequence, cost estimates on green buildings are often more detailed and accurate earlier on in the process than with conventional buildings.


When working on LEED projects, cost estimates are required in order to determine eligibility for specific credits. To earn credit in the Material Reuse category, a percentage is required to document the amount of salvaged, refurbished, or reused materials. To find the percentage, the cost of the reused materials is divided by the cost of all the materials on the project. The quotient will determine if that requirement is met for the credit. The quotient method is used to determine if the requirements for other LEED credits have been met, as well.


For Recycled Content credits, a percentage of recycled content (postconsumer recycled content plus one-half of the pre-consumer content) is required, based on the cost of the total of the materials in the project. The recycled content value of a material assembly, however, is determined by weight. The recycled fraction of the assembly is multiplied by the cost of the assembly to determine the recycled content value. Post-consumer material is defined as waste material generated by households or by commercial, industrial, and institutional facilities in their role as end-users of the product, which can no longer be used for its intended purpose. Pre-consumer material is defined as material diverted from the waste stream during the manufacturing process. Excluded is reutilization of materials such as rework, regrind, or scrap generated in a process and capable of being reclaimed within the same process that generated it.


In the Regional Materials section, a percentage of building materials or products extracted, harvested, or recovered, as well as manufactured, within 500 miles of the project site (based on cost) is required for these credits. If only a fraction of a product or material is extracted, harvested, recovered, or manufactured locally, then only that percentage (by weight) will contribute to the regional value. In the Rapidly Renewable Materials section, credits require a percentage of the total value of all building materials and products used in the project, based on cost, be derived from rapidly renewable materials (made from plants that are typically harvested within a ten-year cycle or shorter). Under the Certified Wood section, a percentage of wood-based materials and products in wood building components must be certified in accordance with the Forest Stewardship Council’s (FSC) principles and criteria. These components include, but are not limited to, structural and general dimensional framing, flooring, subflooring, wood doors, and finishes. The specific percentages required for these credits depend on the LEED system and rating level that is being sought. Mechanical, electrical, plumbing components, specialty items, and equipment are not included in the calculations, and only materials permanently installed in the project are included. Furniture may be included, depending on the LEED rating system used and the level sought.


Excerpted from Green Building: Project Planning & Cost Estimating, available through RSMeans.

Recent Comments




Article Archive

Date Article
11/17/14 Top 10 largest construction project starts in the U.S. - October 2014
11/14/14 Non-residential Construction Starts Rose Gently in October
07/10/14 The Importance of Matching Volume to Contractor Capacity in JOC Procurement Strategy
07/10/14 Consider a Seed Project as Part of Your JOC Procurement Strategy
07/10/14 The Best Unit Price Book for Your Job Order Contract
07/02/14 ECONOMIC NUGGETS – July 1, 2014
10/23/14 Twenty major upcoming Water Treatment Plants and Manufacturing & Warehousing construction projects - U.S. - October 2014
10/23/14 Twenty major upcoming Alberta and British Columbia construction projects - Canada - October 2014
10/15/14 Trend lines of construction starts in Canada - September 2014
10/15/14 Top 10 largest construction project starts in Canada - September 2014
09/17/14 Twenty major upcoming midwest and northwest construction projects - U.S. - September 2014
09/17/14 Twenty major upcoming medical and educational construction projects - Canada - September 2014
09/17/14 Trend lines of construction starts in Canada - August 2014
09/17/14 Top 10 largest construction project starts in Canada - August 2014
08/15/14 Twenty major upcoming medical and educational construction projects - U.S. - August 2014
08/15/14 Twenty major upcoming industrial and water treatment construction projects - Canada - July 2014
08/15/14 Trend lines of construction starts in Canada - July 2014
08/15/14 Top 10 largest construction project starts in Canada - July 2014
07/24/14 Twenty major upcoming entertainment facility and stadium/arena construction projects - U.S. - July 2014
07/24/14 Twenty major upcoming Ontario and Quebec construction projects - Canada - July 2014
07/24/14 Trend lines of construction starts in Canada - June 2014
07/24/14 Top 10 largest construction project starts in Canada - June 2014
07/16/14
07/14/14 Top 10 largest construction project starts in the U.S. - June 2014
02/03/14 Infographic: Where Can You Use Project Leads in the Construction Process?
11/19/13 RSMeans White Paper Examines Break-even Point for LED Versus Fluorescent Lighting
11/20/13 RSMeans White Paper Examines Break-even for LED vs. Fluorescent Lighting
07/25/13 The Canadian Economy’s Two Great Blessings
02/15/13 Construction Economic Notes – February, 2013
11/05/12 Recycled-Content Tile
10/05/12 Fiber-Cement Siding
09/18/12 Return on Your Green Home Improvement Investment
08/09/12 Green Building Solutions to Stormwater Runoff
08/07/12 An “Aha” Moment Solves Challenge of Cost Estimating Local Circus Roof
07/19/12 Estimate Types
06/20/12 Ground-Source Heat Pump
05/14/12 Universal Design for Outdoor Living
04/23/12 What Is Universal Design?
04/09/12 Natural Landscaping
03/14/12 Green Material Alternatives for Plumbing Fixtures
03/02/12 Budgeting & Financing Green Construction
02/22/12 Greening Your Firm
02/10/12 Roofing Defects
02/06/12 Roofs: energy efficiency strategies
01/18/12 Commercial Real Estate and Green Construction
12/14/11 Renewable Energy & Distributed Generation Technologies
11/04/11 Tubular Skylights
10/04/11 Are Online Ads An Endangered Species?
09/27/11 Performance Bonds Guarantee Clients Receive Exceptional Service
09/15/11 Deconstruction for Green and Economic Benefit
09/01/11 4 Ways for Businesses to Create a Good First Impression on Twitter
08/11/11 Building Information Modeling (BIM) for Green Building
07/21/11 Green Alternatives for Concrete
07/12/11 Evaluating Products Over Their Life Cycle
06/30/11 Low-Cost Green Strategies
06/28/11 Bricks are from Venus, Clicks are from Mars
06/17/11 Zombie Avoidance Techniques for Building Product Manufacturers
06/08/11 Blogs & Websites: The 5 Signs of Website Wellness
06/06/11 Building Product Manufacturers & Green Products
06/01/11 Is Fear of Sharing Information Costing Your Company Sales?
05/26/11 What Are Green Products?
05/20/11 The Building Envelope
05/16/11 Blogging: Website Heal Thyself
05/03/11 Metals Compared to Wood for Sustainable Construction
04/12/11 Storm Water Collection & Infiltration
03/23/11 Commissioning the Green Building
02/23/11 Building Program for Green Design
01/21/11 Building Deconstruction Process
05/02/11 Why Building Product Manufacturers and Social Media Are a Marriage Made in Heaven
05/06/11 Building Product Manufacturers: How Understanding Architects Can Help Your Business
10/21/09 Distributors & Manufacturer Representatives
07/15/10 Estimating Doors: Tips from the Experts
07/06/10 How to Handle Construction Materials to Prevent Mold
06/21/10 How to Maximize the Benefits of Exterior Security Lighting
06/04/10 SmartBuilding Index
06/01/10 Regional Housing Construction Tracking and Forecast Information
05/28/10 How to Find Regional Construction Tracking and Forecast Information
05/24/10 Building Product Manufacturers
05/18/10 Practicing the Art of Sustainability - Why Atlanta's Current Building Codes Need Updating Now
02/23/10 Learning to use EE
11/10/09 Window & Glazing Estimating Tips from RSMeans
01/11/10 Earn AIA CEU Credit Attending RCD Webcasts
07/17/09 Cost Estimators Winning Work With BIM
07/16/09 Becoming an Invited Bidder - More Tips
07/16/09 Becoming an Invited Bidder - Tips
07/16/09 Becoming an Invited Bidder
07/16/09 SmartBIM Object Modeling Guidelines for Revit
07/15/09 Interference Check and BIM
06/26/09 A Look at Contractor Failure: Part 2
06/19/09 RicciGreene Associates
06/19/09 Doug Thornton AIA, LEED A.P. of AERC, PLLC
06/18/09 A Look at Contractor Failure: Part 1
06/12/09 Owners and SmartBIM Objects – What You Need To Do
06/10/09 Dealing with the IRS
06/05/09 Getting Paid on Construction Contracts
06/02/09 BIM Coordination and Collaboration
05/28/09 Marketing Your Construction Firm on the Cheap
05/20/09 Little Habits with Big Payoffs for Contractors
05/12/09 SmartBIM Spaces
05/07/09 AIA Show Recap as Seen by the SmartBIM Solutions Team
04/27/09 Business Case Study - Survey Of Spending Patterns In Educational Facilities
04/23/09 Taking Advantage of the Recession: Hiring the Right People
04/20/09 Cork as a Green Flooring Option
04/08/09 Owners - It's Time to Substantially Increase Your Architect's and Engineer's Fees
03/05/09 There's a Solution to Performing Time Consuming Quantity Take-Offs
02/20/09 SmartBIM Library is Half-Off for a Limited Time Only
02/09/09 You are Wasting Your Money
01/20/09 Obama: 'Dramatic Action' On Economy Needed
01/14/09 Use of BIM Jumps Dramatically Over Last 12 Months
12/10/08 Minimizing the Size of Family Files (Revit Objects)
11/11/08 Maximize Online Advertising Dollars
11/07/08 Architects and Engineers, WE NEED YOU
10/29/08 Why Do You Need SmartBIM Objects
10/28/08 Why Building Information Modeling?
10/29/08 10 Questions To Ask About BIM Objects
10/08/08 The Object Mess
10/07/08 Implementing BIM to Your Office
10/06/08 Meeting the Needs for Governmental BIM Compliance while Avoiding Current Liability Obstacles
09/15/08 The BIM Transformation is Manageable with the NEW SmartBIM Library v3
09/14/08 KOLBE Windows and Doors vs. Building Information Modeling
09/12/08 The Evolution of Building Information Modeling: BIM 1-2-3
08/11/08 BIM 101 Overview - From Hand Drawings, CAD and now BIM
08/12/08 Draper, Inc. on BIM Object Developments
07/08/08 IFD Library Partners work to establish standards for creators of BIM software
06/23/08 Architectural Education
06/17/08 Parametric Revit Objects – Part I - Fundamentals
06/17/08 Window Glazing Coefficients
06/01/08 Frequently Asked Questions About Building Codes
06/05/08 Calling All Current and Prospective Revit Users - This Blog Is For You
05/06/08 System Requirements for SmartBIM Library
05/06/08 SmartBIM Library 2.0 Release Notes
05/05/08 Building Information Modeling Moves into AEC Mainstream, Adding Value to Project Delivery Process
04/08/08 Flooring: Cost Considerations
02/08/10 General Contractors & Trade Contractors
01/24/08 Building Element Models (BEM)
12/21/07 LEED Certification Primer
12/13/07 Building Integrated Photovoltaics (BIPV)
09/24/07 Mixed-mode Building Design Combines Old and New Ideas
10/15/07 Checklists Identify Potential Envelope Design Improvements
10/24/07 Greenroofs as High Performance Design
10/21/07 What Makes a Building Product Green
10/24/07 Lighting Considerations in Green Building
10/24/07 Water Conservation in Green Buildings
10/24/07 Rainwater Collection Systems
10/24/07 Efficient Cooling Methods for Green Buildings
10/24/07 Controlling Heat Transfer in Green Buildings
10/24/07 Limiting Heat Loss Through Windows
10/23/07 Formaldehyde Use in Building Construction
10/23/07 Using Plants to Improve Indoor Air Quality
11/05/07 Greening Healthcare
10/19/07 Daylighting Controls
10/19/07 Use of Windows, Skylights and Light Pipes in Daylighting
10/19/07 An Overview of Daylighting
10/19/07 An Overview of Solar Ventilation Air Heating
10/19/07 Types of Collectors for Solar Water Heating
10/19/07 An Overview of Solar Water Heating
10/19/07 Cooling Load Advoidance
10/19/07 Components of Passive Solar Heating Designs
10/19/07 An Overview of Passive Solar Heating
10/23/07 Improving Indoor Air Quality
10/19/07 An Overview of The LEED Rating System
10/19/07 Cost Considerations in Building Deconstruction
10/17/07 Building Deconstruction
10/25/07 Roofing Considerations in Green Building
10/19/07 Green Site Selection and Development
10/24/07 Reducing Energy Use in Buildings
10/17/07 Green Demolition
10/18/07 Integrating Solar Power Generation into Buildings using Thin Film PV
09/10/07 Compost Company Promotes Green Environment
03/31/06 Green Roof Sets An Example For Minneapolis Sustainable Design

CMD Group- construction industry news-image” title=