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Green Value Inferences of rated green buildings in India Saurabh Verma, Dr. Anil Kashyap
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Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Mar 11, 2018

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Page 1: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Green Value Inferences of rated green buildings in India

Saurabh Verma, Dr. Anil Kashyap

Page 2: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Resources Crisis – Efficient Management

► Cities Engine of Growth – 62% GDP (75% by 2021) Commercial Building Stock

to Triple But

► Commercial Energy shortage of 41% in 2012

► Water Demand Supply Imbalance 50% by 2030

► 50% increase solid waste Mgmt. 2001 to 2011, 7% CAGR

► Building materials – Resource challenges, Hyper Inflation, Supply Bottle necks

► 2341 MT of Carbon Emissions annually; Will be top emitter along with China by 2030

Alternative – Green rated buildings – Resource Efficient & Environmental Friendly

Source – Planning Commission, GOI 2013, McKinsey-2009, UNDP 2011

Motivation to Research

Page 3: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Importance – Global Context

Buildings negative impact on Environment Green House Gas Emissions Climate Change

Buildings major consumer of resources Energy Electricity & Water Building Materials - Steel, Glass & Cement

Buildings operations creates Solid Waste – Needs Management Grey/Black Water – Needs Treatment

Building contribute 30% of Co2 emissions, 40 % Energy requirements, 20% water usage, 30% solid landfill waste, 40% raw materials and 70% Electricity consumption ( Source -Centre for International Economics, 2007)

Page 4: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Top to Bottom Approach

Does investment in Green Buildings over Conventional give financial benefits to the Investors/Developers and Financial institutions

Aim and Research Questions

► RQ.1 What is the Institutional framework surrounding green building in India?

► RQ.2 What are the various rating systems, comparative analysis and spatial and geographic distribution of the Green building stock in India?

► RQ.3 Does green buildings have better rental premium over conventional building in the NCR Region?

Page 5: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Green Buildings – Sustainability concepts applied to construct building which are Environmentally responsible and Resource Efficient throughout the life-cycle.

Green Buildings in India

► Footprint – 3.18 B sq.ft & more than 3500 Buildings

► LEED, GRIHA and IGBC Rating Systems

1883 LEED certified projects with decade of presence

LEED Rating – Certified, Silver, Gold and Platinum

GRIHA – Star Rating system One to Five Star

BEE Star Rating System of Building per ECBC Codes

LEED and IGBC popular with Businesses; LEED specially with Multinational Companies

GRIHA popular with Government Buildings and places where Extra FAR given by Local Authorities

Page 6: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Researched Costs & Financial Benefits

International Literature Review

Rated Green Buildings costs 2 – 15% more based on level of rating

(Eang 2008, CBRE 2009, Langdon 2007, Kats and Capital 2003, Syphers 2003)

Rental Premium (2.1% - 17%) and Occupancy rate premium ( 0 – 18%) ( Miller et al 2008, Eichholtz ( 2010a, 2010b, Pivo and Fishes 2010, Wiley et al 2010, Fuerst McAllister 2011)

Varied payback period based on levelof Rating – US LEED Experience; 7 – 25 years ( Brotman 2014, Gabay 2014)

Page 7: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Renewable Energy & Passive Techniques

Literature Review National

Costs 2 – 18% based on level of rating and Payback period 3- 7 years (Source – CII 2010)

Two out of every nine green rated building doesn’t qualify for BEE star rating in day office

commercial buildings (CSE 2014)

Renewable Energy for buildings – Hot Tropical climate with average eight months of sun light makes solar energy a good diversified power source (Info Dev, World Bank Group2014)

MNRE - Install 22 GW of solar capacity;40 GW of wind power by 2022 (Ministry of New and

Renewable Energy-India, 2012a; GWEC, 2013; GWEC, 2012)

Page 8: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Business Case for Green Building

Research Methods

► Basic classical ethnographic research method

► Field visits, Secondary Data Analysis and Exploratory Interviews

► Unstructured Interviews conducted at Conferences

Stakeholders – Rating Agencies, Architects, Green Consultants and Developers

50 Unstructured Interviews Conducted

Page 9: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Finding - Secondary Data Analysis

Initial lot of platinum Green Ratings had significant incremental costs 8 – 18%

Solar and Photovoltaic pushes payback period and incremental costs significantly

Incremental costs can be minimal with use of Passive Design Strategies

Gold or three star is the Optimal rating with optimal Payback period of 3 -4 years

using Passive Design Strategies

Page 10: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Passive Design, Green design in Pre-Design Phase and optimal star rating

Unstructured Interviews Findings

Green Construction Costs can be same as Conventional Buildings

Co-ordination Costs – Part of design costs can be significant

Start with green mandate and level of rating in Pre-design phase

Selection of experienced project design teams with rating experience

Integrated team working to reduce time taken and re-work costs

Defined common design, material selection, specification sheet and execution strategy reduces Design, Material and Construction Costs.

In 0-3% incremental costs green rating up to gold or three star is possible

Page 11: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Operational Efficiency – Financial Benefits

With Solar Panels Savings – 45 % and above achievable

Without Solar Panels < 40 % Savings

Water Savings Significant; possible more with GRIHA rating as compared to LEED

GRIHA rating more energy and water efficiency possible but lacks in material selection

Ratings Claim - 20 – 30 % Energy Saving ; 30 – 50 % Water Savings

Page 12: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Perceptions in the market place

Perceptions/Findings – Exploratory Interviews

GRIHA rating can be market unfriendly and stringent but more suited to Indian conditions

Rating Agencies - Regular monitoring and efficiency measuring mechanisms are needed

North Indian Developers – Ceremonial Greening

South Indian Developers – More Informed Decisions

Data Driven Research Needed for establishing Tangible Benefits of Green Buildings >

Data Collection Important

Page 13: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Financial Benefits – Data and Evidence based research

Conclusion

► Evidence based research needed to establish Green Premium

► Data Collection and Analysis on Green vs. Conventional buildings in same location

► Variables to be looked at for Tangible benefits

► Rental Premium

► Occupancy rates

► Operating Savings

► Intangible benefits – Branding, Productivity and Health benefits need

further studies

Page 14: Green Value Inferences of rated green buildings in India ...library.eres.org/eres2016/presentationupload/311.pdfLEED, GRIHA and IGBC Rating Systems

Data analysis of Financial Benefits

Recommendations

Quantitative Research on Tangible benefits

– Rental Premium

– Occupancy rates

– Operating Savings

Tenant Side Demand, Mandate, Awareness and Willingness to pay studies needs to be further conducted