The Regional Environmental Reconstruction Programme for South Eastern Europe REReP Record

Pay now, save later By Pavel Antonov Innovative green architecture is a key toward building a sustainable future; while initial costs can be high, green buildings are proving to save money and energy over the long term. Thee Romanian architects drawing up plans for the 19 Tomescu Street project in Bucharest knew one thing for certain: It had to be special. There were also difficulties, such as the tiny construction site and neighbourhood restrictions owing to the location’s historical importance. Both architects, Gabriela Tabacu and Cosmin Caciuc, were knowledgeable and experienced enough to face these sorts of challenges, but an additional test of their professional abilities was that the client was keen to invest in building a home equipped with unconventional, environment-friendly energy and heating technology. This innovative project offer didn’t come as a complete surprise for the architects. Tabacu, a professor at Bucharest’s Ion Mincu University of Architecture and Urban Planning and the recipient of several awards for building restoration and renewal, has focused recently on sustainable buildings and green architecture. Her long-time colleague Caciuc, who teaches at the same university, specialises in relations between architecture and technology. This was a pair that seemed uniquely qualified for the Tomescu job. The client, in fact born and raised just across the street from the new building site in the same neighbourhood, bought this particular plot to build his dream house. And, according to Tabacu, it will be the kind of house that dreams are made of. The 250sqm plot will accommodate 400sqm of living space, featuring a master bedroom, spacious kitchen and living room, library, office and guest rooms, as well as a basement workshop and garage. Tabacu describes the interior conceptually as having a “fluid structure,” with direct access from one room into the other and a large staircase providing “communication” between different floor levels. It became clear early on that the home would require a powerful, though economical, air-conditioning unit. “Building such a house with a classical heating and air-conditioning would involve very high running costs,” said Tabacu. The fact that the client is an old friend presented a somewhat tricky dynamic for the two architects. “We wanted everything perfect for him,” Tabacu explained. She and Caciuc went about trying to make this happen by supplying the house with a heat pump using: thermal, subterranean water; convection heaters; a solar panel on the upper terrace to heat the water for domestic use; and an enhanced degree of automation to allow combined and coordinated energy sources according to consumption levels. In spite of an expected increase in electricity consumption by 30–50 percent, the plan should result in an overall 50–60 percent decrease in running costs, compared to a standard project. The owner stands to benefit in several ways when the home is finished: financially, with energy savings quickly offsetting initial building and installation costs; lifestyle-wise, with optimal use of space and greater thermal comfort; and morally, with a sense of fulfilled responsibility to nature and reduced consumption of fossil fuels. Of course, this all depends on everything working according to plan. Designing this project involved a steep learning curve for the two architects, and they often felt they were doing pioneering work—although the pioneering has less to do with architecture and more with installation. “Finding an installation engineer was rather difficult, and even now we are not convinced that the project is ‘okay’,” Tabacu admitted. “What we’re trying now is to find someone to check the project and reassure us and the client—who is investing a lot of money—that the project will function.” But it isn’t easy to find green building experts in Romania. And Tabacu suspects that their project might actually be the first residential house of its kind in the country. The reason for this, Tabacu explains, is that it’s simpler to do construction in the classic way—and cheaper, too. As simple an explanation as it may be, Tabacu seems to have grasped in a nutshell the key misconceptions that have slowed the advance of green building, not only in Romania and Central and Eastern Europe (CEE) but worldwide. “Why would anyone want to make life more difficult by committing to unknowns that also happen to cost more?” Of course, attempts to counter with arguments for protecting the environment and preventing climate change win little more than raised eyebrows. But the key to point out here is that the reason why business and investor interest in green building is sky-high right now is that green building actually makes money—at least when it’s carried out properly. All about the money The UNEP Finance Initiative, a global collaborative group, has identified many examples of good environmental and/or social practices receiving backing from solid financial mechanisms, according to Andrew Szyman, sustainability manager at London-based F&C Property Asset Management. He added that sustainability needs to be backed by return, and described what he calls a ‘circle of blame,’ in which contractors, developers, investors and occupants alike blame the other parties for lack of interest in sustainable buildings. “It’s the occupants who can now break up the circle,” Szyman claimed. “Once they start demanding green buildings, contractors, developers and investors will most certainly react and start providing. Otherwise, there will be no return on their investments.” People need not even be concerned about the environment; it’s enough to simply be price-conscious, said Steven Borncamp, managing director of Sopolec, a company specialising in the design, implementation and operation of sustainable construction projects in Romania and CEE. “It’s a good story to tell,” Borncamp added. “The cost is insignificant when you look at the benefits.” Another company sold on the financial upsides of green building is Sonae Sierra, a corporate developer and owner of shopping centres in Europe and South America. According to its website, the company is “passionate about bringing innovation and excitement to the shopping and leisure industry.” Joana Barata Correia, a consultant for Sonae Sierra, detailed several tangible environmental and social benefits of the company’s ‘green shopping mall’ concept. “Today’s industry leaders need to be environmental leaders as well,” Correia concluded. On the negative side, a major obstacle facing sustainable building is a company’s time horizon. Szyman explained: “If a company develops, owns, and manages a property—a shopping centre, for example—with a time horizon of 20 years, everything is fine. But in the area of commercial property investment we typically hold property for only five years, and therefore some of the investments we make may not necessarily receive a payback [from sustainable construction].” Indeed, short-term investment return expectations discourage many investors from green building, agreed AIG/Lincoln’s European construction director, David Lawrence. On the other hand, AIG/Lincoln’s piloting green project in Vecses, Hungary—the Quadrium—did not cost as much as many had feared. “Sustainable construction doesn’t cost a lot of money to implement, as long as you get it early in the design stage,” said Lawrence. Real estate developer AIG/Lincoln operates in eight European countries, including the Czech Republic, Hungary, Poland, Romania and Slovakia. “If you want to build a carbon-neutral building or go very green, it will cost between 5–10 percent [more than conventional construction],” said Lawrence. “But we want it to be a ‘very good’ building, which for us means the rating that we feel we can achieve as a speculative developer. We are [energy-wise] at the minimum [i.e. best possible rating].” The rating Lawrence is referring to derives from BREEAM, a UK-based label for measuring the performance of sustainable construction projects. AIG/Lincoln follows BREEAM guidelines in land acquisition and development, with an emphasis on environmental innovation and energy-efficient technologies. The developer’s 2008 target is an ambitious one: to achieve a ‘very good’ BREEAM rating for all of its commercial office developments. The Quadrium facility received such a rating in 2006. The number of certification inquiries that BREEAM receives in CEE reflects the region’s growing interest in green building. Organisations throughout Hungary, Poland and Romania are now approaching BREEAM to assess their building portfolios, said Anna Surgenor from the sustainability division of BRE, the parent company responsible for the rating. So far, most of the companies are western, Surgenor said, but noted that the tide is flowing east. Taking a step further in terms of demonstrating the benefits of green construction is the Regional Environmental Center’s ‘REC Conference Center’—a project undertaken in Szentendre, Hungary in 2007–08 with financial support from the Italian Ministry for the Environment Land and Sea, along with assistance from the governments of Iceland, Liechtenstein and Norway. Generous donor support has made it possible for the REC to make use of local solar and geothermal energy resources, minimise energy demand with advanced control systems, and accomplish high aesthetic, functional and comfort requirements. The conference centre project features a system combining a light shelf and sensors, which switches off lighting when the facility is empty and provides appropriate dimming according to the natural lighting available. Solar roof panels will enable the generation of 22,300 kilowatt hours of energy per year, which will be used to cover the centre’s own energy needs, while all excess will be sold on the local grid for public use. A ground-source heat pump provides heat and will cool the building, with energy efficiency secured inside a so-called “isolated envelope” of insulation. At a total cost less than EUR 2 million, the building’s energy savings would pay back investment over an estimated 20 years—assuming an increase in energy prices. Sopolec’s Borncamp alleged that there might be greater enthusiasm in Western Europe and his home US for green building projects than in CEE. This is certainly the case where the UK is concerned, and Germany has long played a leading role in green building, he noted. Green building-friendly businesses, policy makers, builders and architects had an opportunity to get together this April in Bucharest at the ‘Build Green CEE’ conference, an event organised by Sopolec. “We know that there’s lots of interest in building green in Romania and the region, but it’s very fragmented,” Borncamp explained. Lawrence from AIG/Lincoln agrees that there is indeed plenty of regional interest, and that the CEE market is definitely ready for sustainable buildings, but said that there is still a great deal of learning and catching up to do. Lawrence’s expectations are rooted in the EU’s Buildings Directive, which introduces obligatory certification from 2009. “This will change people’s perceptions green buildings,” he said. A regulation that businesses want The European Commission (EC) estimates that construction sector energy use could be cut by 28 percent by 2020, and in a cost-effective way. This compares with an 11-percent cut in the bloc’s total energy consumption. Energy use in the construction sector accounts for approximately 40 percent of the EU’s total energy consumption. The figure matches IPCC and UNEP data, according to which the construction sector accounts for some 30–40 percent of global energy use. The 2007 Fourth Assessment Report (AR4) by the Intergovernmental Panel on Climate Change concluded that, amongst all sectors studied, the building sector possesses the highest potential to profitably reduce global warming pollution—i.e. by 2030 projected baseline emissions in the residential and commercial building sectors could be reduced by approximately 30 percent, with a net economic benefit. Drawing from a study of residential and commercial buildings (carried out mostly by the Central European University in Budapest), chapter six of the panel assessment argues that improving energy efficiency “encompasses the most diverse, largest and most cost-effective mitigation opportunities in buildings.” Other measures identified in the report include switching to low-carbon fuels, using a higher share renewable energy, and controlling emissions of non-CO2 greenhouse gases. Energy consumption and embodied energy in buildings can be reduced through greater use of existing technologies, such as passive solar design, high-efficiency lighting and appliances, highly efficient ventilation and cooling systems, solar water heaters, insulation materials and techniques, high-reflectivity building materials and multiple glazing. The report adds that government policies and regulations, such as continuously updated appliance standards and building energy codes, can contribute further. The IPPC, while pointing out the sundry benefits and lower life-cycle costs by making emissions cuts in the building sector, warns that particular attention needs to be paid to removing market barriers that have prevented the wide-scale adoption of many available technologies. As far as this particular problem is concerned, the United Nations Environment Programme (UNEP) has proposed a solution: state regulation. UNEP believes that regulatory and control instruments like building codes and appliance standards are the most effective ways to increase energy efficiency, and thus to mitigate industry’s role in global warming. The key precondition to these measures succeeding is that sufficient resources and efforts are invested in their implementation and enforcement, as well as a regular updating of relevant specifications. These at least are the chief conclusions of an assessment of policy instruments for reducing greenhouse gas emissions from buildings, released in 2007 by UNEP’s Sustainable Buildings and Construction Initiative (SBCI). Produced in partnership with Central European University, the UNEP study analysed 20 different types of policy tools in the areas of legislation, information, economic incentives and fiscal measures that targeted energy efficiency in buildings. It examined some 80 case studies from 52 countries and evaluated different policy tools based on effectiveness in terms of reducing CO2 emissions, cost effectiveness and associated success factors. UN Under-Secretary General and UNEP Executive Director Achim Steiner pointed out that the study demonstrates “the critical roles that governments need to take in establishing, implementing, and enforcing regulatory policies so as to realise these emission reductions and these environmental, social and economic gains.” Performing the critical role in regulating building sectors to make them sustainable is a decision that each national government will have to take for itself. Back in January 2006, only ten of the then 25 EU member states met the deadline to transpose into national law 2003’s Energy Performance of Buildings Directive. The EC has since opened infringement proceedings against 17 member states for late or incomplete transposition, ENDS reported. But while the directive requires governments to set their own national efficiency standards, it does not establish bloc-wide norms. A revision of the directive, scheduled for 2008, raised the stakes for binding EU performance requirements that could drive energy efficiency improvements in the worst-performing member states; but in April the commission appeared to be backing away from the idea of proposing the first-ever, EU-wide energy efficiency standards for buildings. In its public consultation paper, announced in April, the EC claimed that setting EU-level energy requirements would be “very complex and challenging.” ENDS interpreted the language from Brussels as heralding a shift to a more cautious stance on the idea. The consultation paper merely floated the idea of establishing a “benchmarking system” to allow comparison of the different performance requirements established by each EU country. The document hinted that a threshold of 1,000 square metres above which all existing buildings undergoing major renovations must meet minimum efficiency requirements—discussed previously—would be scrapped. At the same time, the paper suggested that provisions on energy performance certificates for buildings and inspections of boilers and air-conditioning systems might be strengthened. Public consultation on the issue opened on June 20. Back in Romania, Tabacu remains optimistic. She expects many more green building projects throughout the country in just two to three years’ time; and Borncamp shares the architect’s enthusiasm. Meanwhile, Sopolec launched the Romania Green Building Council in May; the council will bring together developers, investors, operators and others interested in sustainable construction. Being the first organisation of its kind in South-Eastern Europe, the council is open to professionals from neighbouring countries as well, said Borncamp.

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