Count The Cost

Posted on Aug 1, 2010 :: Green Business
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Posted by , Insight on Business Staff Writer

Photo Courtesy of Miron Construction

When Lawrence University in Appleton built its newest residence hall in 2003, it built to sustainable guidelines, but did not seek LEED certification. But by 2007, as it planned what has now become the Warch Campus Center, LEED certification was a part of the equation from the very beginning.
What changed? In large part, it was Lawrence’s “Green Roots” initiative to integrate sustainable principles through educational policies, activities and eco-friendly behavior.

“Pursuing LEED certification is a statement about the value we place on making choices and decisions that are good for the university and our students,” says Nancy Truesdell, vice president of student affairs and dean of students at Lawrence.

LEED, which stands for Leadership in Energy and Environmental Design, is a nationally accepted benchmark for the design, construction and operation of green buildings. More than 35,000 projects have been registered to follow LEED guidelines since they were established in 1998, and just over 5,000 of these have become certified.

Some companies opt for LEED certification because it’s a broadly accepted standard, conducted by a third party. Others do so because they want the recognition certification brings or because government contracts require it. Also, building to LEED standards and making sure the building is performing accordingly can help a company recoup dollars to offset the certification cost.
Cost is the main reason some companies opt not to certify. The “commissioning” phase alone – paying a third party to verify that energy-saving equipment is designed correctly, installed correctly and functioning correctly – adds $1 per square foot to the overall cost.

The office and clinic building of the Neuroscience Group of Northeast Wisconsin in Neenah, for example, was built by Miron Construction in 2007 to LEED Silver standards, but the owners decided not to apply for certification. That would have cost $40,000 to $50,000.

Mark Hanson, director of sustainable services at Hoffman LLC, estimates that 10 to 15 percent of its clients choose to certify. Hoffman designed and built Holy Wisdom Monastery in Middleton (Insight, February 2010), which was recently certified as the highest rated LEED Platinum project in the country. Yet, when it decided to renovate a former major retail department store in downtown Appleton for its own offices, Hoffman could not justify the added expense of LEED certification.

“We asked ourselves the same question we ask of our clients: ‘Is this the right business solution?’” says Paul Hoffman, owner and president of Hoffman. “To have met LEED standards would have added $4 per square foot, without producing any true benefit to the environment or our bottom line.”
Instead, they came up with a creative, effective and less expensive method of air-quality control. It did not meet the specific criteria for LEED certification, but it was a more responsible business solution.

Whether to seek certification is an individual decision. Each company must ask the ultimate question about each project: “Will certification benefit our organization today and in the future?”
“There has been a huge change of attitude, not only with customers, but with the marketplace,” says Tom Boldt, chief executive officer of The Boldt Company, which built Lawrence’s Warch Center. “Twenty years ago manufacturers had difficulty interesting their customers in green products. Now almost 100 percent are asking ‘how can my building be greener?’”

There is solid evidence that while obtaining LEED certification adds cost to a project, simply building green does not. The 2006 “Cost of Green Revisited” study by global construction consultant Davis Langdon comes to the same conclusion as a similar study two years earlier: “There is no significant difference in average costs for green buildings as compared to non-green buildings.”
The new Plexus Corp. global headquarters in downtown Neenah was also built by Miron to LEED Silver standards, but Plexus decided against seeking certification because of costs.

One piece of advice from Theresa Lehman, Miron’s director of sustainable services and a member of the U.S. Green Building Council’s LEED Faculty: “Demand that your team design according to LEED standards so that if you change your mind along the way about certification, you won’t have to make major, costly changes