Analysis of Project Costs for Green Buildings in the UAE – A Case Study
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Date
2014-09
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The British University in Dubai (BUiD)
Abstract
Green buildings, or as they are sometimes called, ‘Sustainable Buildings,’ or ‘High Performing Buildings,’ are buildings which aim to fulfill occupant or user’ needs and still be efficient in using power, water and other resources. They also help to protect the well being and health of occupants and users, while reducing the waste, pollution, and environmental impact.
Governments are being challenged to reduce their carbon footprint in a stepped approach by a specified timeline. Information on global energy provided in a commissioned report by the International Energy Agency (IEA), revealed that existing buildings of all types, consume above 40% of all power consumption, globally, and at the same time, create more than a quarter of the total carbon emissions throughout the world (Howe 2010). The seriousness of these findings and others, have led some governments to take strong measures to reduce the energy and natural resource consumption of buildings, along with their environmental impacts. One of the ways they have attempted to do this has been by using more rigorous approaches in the development and adoption of ‘green building’ standards for their building projects.
However, one of the barriers hindering other governments adopting sustainable building codes and practices is the issue of ‘cost.’ The general perception of green buildings is that they cost considerably more to design and construct than conventional buildings (buildings that have not incorporated sustainable features throughout their design and construction). The important question, therefore, is, ‘are these claims that green buildings cost more and require more initial investment, actually true?’ And if so, by how much?
From the literature review, there was a general agreement that green buildings are more environmental friendly than the conventional ones. Green buildings also outperform conventional buildings on many aspects such as operational cost saving, indoor air quality, lower energy and water consumption and better productivity. However, there have been many studies into the concept of cost premium of green buildings. Some of these studies have supported the ‘higher cost premium’ viewpoint, while others have refuted it. This has lead to a great deal of confusion among developers, government bodies and other relevant parties investigating or involved in the implementation of green initiatives.
In order to support or reject any of these studies, there is a very real need to conduct a proper, controlled study approach to determine the true additional cost green buildings will incur over and above conventional ones, if any. For this study the cost premium of green buildings in the UAE will be examined and analyzed in comparison to conventional ones. Therefore two methods have been used:
Method 1: Cost Comparative Approach
Two recent green buildings will be compared with two similar conventional buildings in terms of construction cost per square meter at a shell and core level. The comparison will include: HVAC (but will exclude air conditioning as the green buildings are connected to a centralized district cooling plant), completion of associated public spaces, and above or underground parking spaces. This comparative study will exclude the design fee, land price and finishing items.
Method 2: Interviewing all key stakeholders of the Masdar Headquarters Building project as a case study to understand the different cost elements of green buildings and to identify the practices that have been adopted to ensure the cost effectiveness of green buildings.
The outcome of the first method, it was evident that green buildings were not necessarily more expensive than conventional ones at the core and shell level. Any cost premium therefore could be attributed to other factors such as the meeting of client requirements on the finishing level, or the technology, which was installed and used, regardless of whether the building was green or conventional.
From the analysis of the feedback from interviewee, it was clear that sustainable buildings don’t necessarily require any additional investment compared to conventional ones If they done properly, as the cost driver is related primarily to the client’s specifications and the subsequent design, rather than sustainable elements. What was evident that a green building project team needs to work in an integrated way, particularly during the design stage, to control the overall project cost.
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Keywords
project costs, green buildings, United Arab Emirates (UAE), sustainable buildings