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Yannick Millet – EE and Sustainable construction professional

Yan.millet@gmail.com 1

GREENBIZ 2016 Phnom Penh Green is Riel

Green Buildings

Presentation structure

1- Green Building definition

2- GB rating tools Vs Regulations

3- GB development triggers and obstacles

4- Financial aspect of GB

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1- GB definition

Source: Capital E

17% of fresh water consumption

25% of wood harvest

33% of CO2

emissions

30-40% of energy

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40-50% of raw materials

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Global Building Impacts

1. GB definition

What is a green building?

• Environmentally responsible and resource-efficient throughout their life-cycle.

• Designed, constructed and operated to reduce the overall impact on human health and the natural environment by:

Efficiently using energy, water, and other resources

Reducing waste, pollution and environmental degradation

Protecting occupant health and improving employee productivity

1. GB definition

• GHG Emission reduction potential

• Healthier working/living place

• Higher productivity

• Occupant Brand Value

• Lower operating costs

• Increased selling and renting value

Green Building benefits and savings

30% ENERGY

35% CARBON

30-50% WATER USE

50-90% WASTE COST

Source WorldGBC

1. GB definition

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2- GB rating tools VS regulation

How Green is my Building?

2- GB rating tools VS regulation

2. GB rating tools VS regulation

Sustainable Building (Zero Energy – Positive Energy)

Green Building (Certified against a Rating Scheme)

Resource Efficient Building (EDGE – IFC tool)

Energy Efficient Building (Building Code – Regulation)

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Building performance classification

What is a Green Building Rating Tool?

A framework for:

o benchmarking building performance

o encouraging integrated building design & construction

o raising awareness of „GB‟ benefits

o meeting legal obligations

o attaining resource security

o 3rd party verification of environmental credentials

2. GB rating tools VS regulation

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2. GB Rating Tools VS regulation

GB rating tools in Asia

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3- GB development triggers

and obstacles

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3- GB development triggers and obstacles

Main triggers worldwide Main obstacles worldwide

Source: World green building trend 2016 (WGBC) – Dogde Data & Analytics

In Vietnam

Industry:

• Wrong perception of GB cost premium

• Lack of technical/management skills

• Scarce “green” products

• Highly speculative market

Government

• Insufficient regulation & law enforcement

• Insufficient guidance & lack of incentives

• Highly subsidised energy cost

Users:

• Lack of clear demand from end users

3- GB development triggers and obstacles

What drives green initiatives in Vietnam?

• MNC corporate guidelines

• Financial long term benefits of investors/operators

• Sales and marketing considerations

• Implementation of more stringent EE and environmental codes

• Increasing awareness of global environmental issues

3- GB development triggers and obstacles

Country Rating Tool Certified projects

Registered Projects

Singapore Green Mark >2500 -

Malaysia GBI 327 650

Indonesia Greenship 14 50

Thailand TREES ? 60

Philippines Berde 50 ?

GB development in South East Asia

A growing interest and substantial development since 2009. Mainly through voluntary systems run by non for profit organisations. This global momentum has been coordinated through the World GBC platform. Only in Singapore and China, government has been leading GB development. Recently IFC introduced EDGE, a resources efficiency tool, to address social housing and other lower end construction segments.

3- GB development triggers and obstacles

UDENRIGSMINISTERIET, MINISTRY OF FOREIGN AFFAIRS OF DENMARK

Rating Tool Certified projects

Registered Projects

LOTUS 10 7

LEED 16 25

Green Mark 2 -

EDGE* (* Resource Efficiency)

6 2

GB development in Vietnam

3- GB development triggers and obstacles

GB development in Vietnam

Source Solidiance –VGBC 2013

3- GB development triggers and obstacles

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4- Financial aspects of GB

Life Cycle Cost analysis

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Viewed over a 30 year period: Initial building costs account for approximately just 2% of the total, while operations and maintenance costs equal 6%, and personnel costs equal 92%. O&M costs = 2 X cumulated design and construction costs. This clearly illustrates the importance of planning and running operations at an optimised level.

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4- Financial aspects of GB

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4- Financial aspects of GB

Design change and cost implications

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4- Financial aspects of GB

- Benefits consistent over the globe

- Payback periods vary

depending on countries - Shorter payback time in

developing countries (max 5 years)

Source: World green building trend 2016 (WGBC) – Dogde Data & Analytics

Financial benefits

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4- Financial aspects of GB

What added costs?

1. Consultants / specialist costs – 25 to 200K USD

2. Certification fees – 4.5 to 30K USD

3. Extra documentation

4. Technical choices depending on projects:

Extra metering High COP HVAC equipment Improved glazing Efficient lighting Extra ventilation Water saving fixtures Alternative energy Commissioning Etc.

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4- Financial aspects of GB

Projects premium costs worldwide

Source: WGBC, USGBC, BCA, Green Consult Asia

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4- Financial aspects of GB

Payback time calculated only with energy cost savings

Projects premium costs in Vietnam

Source: Green Consult Asia

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4- Financial aspects of GB

CASE STUDY 1 : VM MOC BAI FACTORY AND OFFICE

Location: Moc Bai, Tay Ninh. GFA: 72,000+ 9800 m2

Certification targets: Prove sustainability credential to NIKE, Improve work place to reduce churn

Certification: Each building achieved LOTUS certified and LEED Silver

Challenges: Unresponsive designer and contractor

Extra costs: 2% over construction costs: • Increased WWTP capacity and standards • Improved landscaping design • Improved daylight and artificial light • Improved ventilation and accessibility • Added solar water heater

Payback: 2.5 years at today‟s rate • Energy cost savings: USD 118,000 p.a. • Water cost savings: USD 47,000 p.a.

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4- Financial aspects of GB

CASE STUDY 2 : POUCHEN KINDERGARDEN

Location: Binh Duong GFA: 3800m2

Certification targets: “Pou Chen sustainability roadmap” ...the biggest employer in VN

Certification: LOTUS Silver

Challenges: Poor documentation skills of design team

Extra costs: 1.8% over construction costs ($93,100 USD) • Added energy and water meters • Improved artificial lighting & AC • Improved disabled access • Water flow reducers • Administrative costs

Payback: 8.5 years at today‟s rate (because of very low annual running costs) • Energy cost saving: between $6,800 & $7,800 USD/annum • Water cost saving: $3,627 per annum

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4- Financial aspects of GB

CASE STUDY 3 : EXIMBANK

Location: HCMC

Certification: LEED GOLD (under going)

Challenges: Unreasonable design assumption

Extra costs: QS pre-FS cost prediction of 3% - Current estimate 0.5% Rainwater recycling toilets and irrigation (50% of water is recycled) Glazing cost increase of 0-4% CO2 monitors to 4 meeting rooms Chiller sizing saving of 10% Payback: Payback 5-8 years (at today‟s electricity & water rates) Annual cost saving of $6,800. Energy saving increased from 4% to 34% Projected operational savings of $26,700 annually Predicted water saving of 37% internally and 100% externally

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CONCLUSION

4- Financial aspects of GB

Building Developers/Owners: • Think long term • Start as early as possible • Set realistic targets • Insure appropriate operations

management to harness benefits Government:

• Set EE and environmental legislation, targets and trainings

• Define and implement incentive policies • Develop pilot projects with public

buildings Construction industry:

• Develop EE/ GB design skills • Develop financial skills

UDENRIGSMINISTERIET, MINISTRY OF FOREIGN AFFAIRS OF DENMARK

Thank you for your attention!

Yannick Millet Energy Efficiency and Green Building specialist

VGBC Executive Board Member EDGE IFC – Technical Advisory Board Member

yan.millet@gmail.com

”The journey of a thousand miles begins with one step”

-Lao Tzu-