Another way to think of “Green Building”
The mention of “green building” may invoke different thoughts, dependant on your beliefs of climate change. Doing better for environmental reasons has been one of the biggest motivators to stepping outside of conventional building techniques. However, building green is not only good for the earth, it can be very beneficial for the pocket book as well. My goal here is to offer an alternative way to think about green building, from a financially wise standpoint.
According to the World Green Building Council and Zero Energy Project websites, a home or a building that is built using green building practices will likely have more initial upfront costs, and this of course varies based on what systems are installed, upgrades are made and the size of the home. You’re probably thinking, homes are already expensive, how can one afford those additional costs? What if we thought of it like this, if costs of construction were $150 per sq ft, designing a home that is 2000 sq ft. instead of one that is 2300 sq ft. would potentially save $45,000. That small downsize in square footage would essentially pay for your upgrades to a green energy efficient home. Plus you would begin seeing utility savings start on day 1 of ownership, meaning the cost of ownership over the years would end up being less than a conventional home.
A 2014 study published by the Zero Energy Project found that on average a custom built Net Zero Energy home in Oregon added an additional cost of around $51,000. These homes were around 1500 sq ft and the average list price during that time was around $400,000. These homes included an upgrade in the exterior shell (insulation, framing, doors and windows), HVAC upgrades (heating, cooling, ERV, electrical and plumbing), solar PV (photovoltaics) and hot water. After rebates and tax deductions from the federal government and the state of Oregon, the total added cost for these custom-built zero energy homes was $10,000 to $14,000, which is less than 5% of the sales price.
So now you have a slightly smaller green built home that was completed for the about the same price as a little larger conventionally built home. What's the resale value like? Based on recent studies, a green home will sell, dependant on the region, for 5 - 12% more than a conventionally built home and will be on the market for a shorter period of time. Green homes are sought out and are in more limited supply.
Retrofitting an already built home or building is gaining in popularity as well. Adding additional insulation, more efficient heating and cooling options, solar PV and hot water and sealing the building envelope will result in substantial savings.
Once payback for these upgrades is achieved, the property owner will benefit from reduced utility bills for the life of the systems and be rewarded with financial and energy security no matter what the future holds.
Green buildings are more comfortable, healthier, have higher resale value and lower total cost of ownership. Regardless of the division in beliefs about the state of the planet, we can all get behind making smart investments and saving money.