The Future of Green Buildings in the Region. Faridah Shafii Institute Sultan Iskandar Universiti Teknologi Malaysia

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1 The Future of Green Buildings in the Region Faridah Shafii Institute Sultan Iskandar Universiti Teknologi Malaysia

2 ENVIRONMENTAL IMPACTS OF BUILDINGS Buildings have significant impacts upon the environment through the way they are planned, designed, operated and demolished. Building sector represents 40% of the world s energy consumption Contribute to one-third of global GHG emissions

3 Due to its high share of emissions the building sector has the responsibility and potential to take the global lead in reduction strategies. Buildings represents the most direct, immediate and cost-effective opportunities to help tackle climate change

4 Buildings and Emissions GHGases result from burning fossil fuels -oil, natural gas and coal (CO2), the most widespread greenhouse gas. Related building emissions : construction operation demolition debris that degrades in landfills the extraction, manufacturing and transporation of building materials Reducing the energy use and greenhouse gas emissions produced by buildings is therefore fundamental to the effort to slow the pace of global climate change.

5 CO2 EMISSIONS

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7 Buildings are the biggest and lowest-hanging fruit in dealing with greenhouse gases in the atmosphere

8 Building Emissions Compared with operating energy calculated the carbon from a building s water use ranges from 0.17% to 29% of the carbon associated with operating energy (USGBC). Carbon embodied in a building typically represents 13% to 18% of the carbon emissions over the life of the building.

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10 Industrialized countries have the highest emissions, but emissions from developing countries are increasing at a much faster rate. After 2020 major parts of CO2 emissions will come from developing countries (Fossil fuel CO2 in the IPCC SRES scenario A1F)

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12 GREEN BUILDINGS Green Buildings are environmentally responsible and resource efficient throughout a building s lifecycle, from site to design, construction, operation, maintenance, renovation and deconstruction

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14 GREEN BUILDING Improve building performance Reduces energy use by % Reduces carbon dioxide (CO2) emissions by % Reduces water consumption by 40 % Reduces solid waste by 70 percent. Economics Benefits Decreases in operating costs Increases in building value and return on investment. Social Benefits Health and safety of the occupants

15 The Path to Sustainability

16 SOME FACTS.. If 50 % of new commercial buildings were built to use 50-percent less energy, more than 6 million metric tons of CO 2 would be saved annually for the life of the buildings (50 to 100 years)? It costs about 3-4 % more to build a green building than a less energy efficient one, but will reduce less carbon over its lifetime through reduced energy use.

17 Stern report Global GHG emissions to be reduced by 50% by 2050 GHG emissions must be reduced by 40% by 2020 (Prime Minister of Malaysia)

18 MEASURES NEEDED IN BUILDING & CONSTRUCTION Top priority for energy efficiency in buildings Use economic renewables Ensure that buildings will be able to adapt to a variety of future energy scenarios In all cases, a high degree of energy efficiency will be essential

19 ENERGY EFFICIENT SYSTEMS Energy efficient systemprovides good in-door conditions without consuming too much energy (as yet maintaining the indoor comfort) EE can be achieved by: Passive design strategies Active design solutions

20 PASSIVE DESIGN Building envelope design : Passive solar design Orientation Site Glazing size and location Natural ventilation Shading strategies -positioning of windows in strategic locations to capture sunrays / daylighting (but avoid glaring) After optimizing passive solutions, only then consider the use of energy efficient materials, such as high-efficiency windows, insulation, roofs, walls, interior finishing products

21 ACTIVE SOLUTIONS Active solutions -for increasing the building s energy performance Examples: Energy saving appliances Lighting controls and thermostats Activated blinds, fans Efficient heating and cooling systems Solar water heating systems and heat recovery systems Wind turbines Photovoltaic cells.

22 Low Energy Office Malaysia Key data: Gross Floor Area: 20,000 m² Energy Index: 114 kwh/m²/year Additional EE construction cost: 5% Payback: 5 years Annual energy savings: ~ RM 600, Winner of: ASEAN Building Energy Award Energy Efficiency (EE) Features: Ministry of Energy, Water and Telecommunications, Putrajaya, Malaysia - Daylighting - EE lighting - EE office equipment - EE ventilation - Controls & Sensors - Orientation - Insulation - Energy management

23 Green Energy Office (GEO) HQ Malaysia Energy Centre

24 THE FUTURE OF GREEN BUILDINGS?

25 Standards The Leadership in Energy and Environmental Design (LEED) - most widespread certifier of green building and is beginning to be seen as the gold standard for the region. Local standards BCA Green Mark scheme in Singapore Green Building Index (Malaysia)

26 EXISTING ACCREDITATION TOOLS Checklist approach Design rating for buildings Unable to quantify carbon emissions and measure real performance of buildings High premiums for accreditation

27 BUILDING S CARBON FOOTPRINT

28 Calculating the carbon footprint

29 COMMON CARBON METRIC MRV approach Carbon common Metric is a tool that has not exist today, a way to measure, report, and verify reductions in a consistent and comparable way. With its high share of emissions the building sector has the responsibility and opportunity to take the global lead in reduction strategies. The Carbon Common Metric provides the foundation for accurate performance baselines to be drawn, national target set, and carbon traded on a playing field- Pilot Project in Putrajaya

30 Types of GHG in metric tonnes

31 CCM PILOT PROJECT UN-SBCI Ministry of Energy Green Technology & Water Malaysian Green Technology Corporation (Formerly Malaysia Energy Centre)

32 Opportunities in C02 reduction - Putrajaya Institutional buildings (universities /colleges) Hotels Office buildings -Existing Buildings -made up the majority of the building stock

33 POST-KYOTO PROTOCOL DIRECTIONS Objective: To drastically cut down the global carbon emissions Every nation has to report on their carbon reduction performance. Measure, Report and Verify (MRV approach) CURRENT SITUATION Existing rating tools for green buildings and other green initiatives are basically checklists. Performance of a building / green development is evaluated based on scoring points over the total score. NOT in terms of CARBON EMISSIONS No reliable / consistent CARBON CALCULATOR

34 Drivers for green buildings (Market forces) The green building agenda is driven by the latest research /findings from sustainable building projects in Europe, Australia and the US -(from individual case studies as well large-scale research projects). Findings show evidence for operational cost savings which make up around 85% of total lifecycle costs (from individual case studies as well large-scale research projects). In addition, increased rental yields, occupancy levels and valuations are cementing the business case for green building.

35 Key driver for investment Financial benefits Other benefits being observed and quantified, eg. employee issues such as health and safety to productivity in the workplace. Corporate Social Responsibility (CSR) policies -are gradually becoming a prerequisite for multinational companies (MNCs) operating in the region. High profile companies are not only using their new, resource efficient headquarters to strengthen corporate communications, but they are playing a part in inspiring local companies in developing markets to also build green.

36 Stern report Global GHG emissions to be reduced by 50% by 2050 GHG emissions must be reduced by 40% by 2020 (Prime Minister of Malaysia)

37 FUTURE ECONOMIC IMPACT Due to focus on the potential for future economic impact, Governments are starting to: plan their own emissions reduction strategies Establish new regulations and funding initiatives. Malaysia has committed to 40% reduction in GHG by 2020 from 2005 level.

38 Clean Development Mechanism (CDM) (CDM) building efficiency projects have the potential to support the greening of developing Asia s building stock. Projects have yet to make headway but could be encouraged if countries proceed with bundled NAMA (Nationally Appropriate Mitigation Actions) proposals which group together building efficiency projects by sector, under one mitigation proposal, making investor engagement more straightforward. The focus on energy efficiency additionally allows developing economies to increase their energy security for future economic growth, by relying less on imported fossil fuels.

39 Understanding risks and opportunities Companies and investors must develop a full understanding of the associated risks and opportunities of climate change in the real estate and construction sectors, as well as in their own real estate portfolios. Financial benefits of going green Benchmarking their own property and other asset portfolios for energy efficiency in order to reduce wastage in highest impact developments.

40 RETROFITTED BUILDINGS Research shows that that 60% of the buildings that will exist in 2050 have already been built. The importance of retrofitting existing building stock to improve energy efficiency and reduce emissions cannot be overstated. Energy Service Companys (ESCOs) are increasingly using structured project financing in order to absorb some of the risks and share in the rewards of successful energy saving practice implementation.

41 RETROFITTED BUILDINGS Many energy efficiency projects are relatively low risk and high return compared to other developing projects. Investors, therefore, will look towards underwriting deals with ESCOs to deliver returns from green building projects. The slow development of these energy efficiency funds in the region is disappointing for many, hope of fully this will improve with time especially in the context of climate change mitigation needs.

42 ECONOMICS Perception that green building is an expensive choice for developers Research shows that these additional costs, seem insignificant when developers synchronise energy efficiency improvements with scheduled capital improvement projects such as new cladding, flooring and HVAC systems.

43 ECONOMICS 2 A winning strategy - is to ensure appropriate paybacks for repayment of the upfront costs of green building. This means that the owner or developer shares the financial benefits with tenants. Green leases have been developed to structure these relationships. They incentivise tenants to develop environmentally responsible behaviours whilst allowing the developer to recoup any up front investments.

44 CERTIFICATION STANDARDS The wide range of green certification standards in Asia which are beginning to encourage best practices, there is still a concern that these will become selfs-serving marketing schemes, particularly in countries with small numbers of powerful developers close to the government, or those countries with low level of transparency

45 CERTIFICATION STANDARDS Claims of green washing by consumer groups or civil society may reduce the credibility of the green building industry as a result, which could threaten to undermine the advances already made. Consideration of financial market regulation is vital to highlight the importance of effective disclosure to inform investment decisions.

46 CONCLUSIONS The region has reached a tipping point for action to occur. There is a greater understanding of the role that green building can play in mitigating climate change. The future of green building lies with its performance from the environmental, economics and social perspectives. A performance-based tool is the way forward to examine real building performance Certification will play a significant role in for the credibility of the green building industry and inform investment decisions. Strong government support

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