| Fall 2007 |
Construction Advisor
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For Contractors, There's Green in Green
Building to environmental standards increases the cost of most
construction projects. "Greening" a new home, for example, can bump up
its price by 3 to 5 percent. But construction to environmental measures
can also save money on taxes and energy, contribute to the owner's image
and help leave a cleaner world for future generations.
Contractors create these benefits, and they are entitled to a fair share of
the value. To turn environmental know-how into profit, however, contractors must
succeed at several tasks:
- Understand the value you create and price accordingly. For example,
project owners can claim federal tax deductions for installing
energy-efficient lighting, HVAC or how water systems, or constructing a
building's envelope to conserve energy.
Energy efficiencies also provide a partial hedge against rising fuel prices. A
25 percent reduction in power usage is not uncommon, and given the volatility
of oil prices that can mean significant savings. The non-financial benefits of
green construction are important too, including an owner's enhanced reputation
and the satisfaction of making a contribution to future generations.
- Understand the environmental standards relevant to your company, as well
as new standards that are coming. Many world bodies, national governments,
municipal councils, professional associations, academic societies and consumer
groups have issued such standards—some voluntary and some not. These
standards are undergoing a consolidation, so stay tuned for changes.
A LEED (Leadership in Energy and Environmental Design) certification, for
example, verifies that a construction project will reduce landfill waste, CO2
emissions and energy and water consumption.
Standard 189, a new and comprehensive standard for commercial buildings that
will be incorporated in many building codes, is discussed in the article
below.
- Organize operations, subs and supply chains to meet the relevant
standards. Virtually every trade has opportunities to strengthen the
environmental profile of a project. Some require changes, like learning to
work with new materials and techniques.
Meanwhile, contractors should find subs and suppliers with strong reputations
for energy-efficient work. As demand grows, for example, a solid partnership
with an insulation manufacturer can be a competitive advantage for an HVAC
contractor.
- Market your environmental expertise confidently. By talking about
sustainable construction practices and trends (and not just to prospects), you
can become known both inside and outside your trade. That's the kind of
marketing that pays long dividends.
What "green opportunities" exist for your company? What will they require of
you? Our firm can help you analyze these questions.
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New Environmental Yardstick is On the Way
Standard 189, the most comprehensive set of green building
guidelines yet established in the United States, is near completion.
Developed by engineering associations and construction industry
leaders, it will define environmentally sound building practices for
years to come.
The standard is designed for new commercial buildings and major
renovations. It's not a rating system, but rather a
certificate-of-occupancy checklist for local code inspectors.
Contractors can expect to see the new standard showing up in
building codes soon.
Some of the main elements of Standard 189 include:
- Energy efficiency. The core goal is a 30 percent reduction of
energy costs over most building-code standards in use today. The
new guidelines call for at least some on-site power generation
through solar or photovoltaic panels.
- Water use. Standard 189 aims to reduce interior water usage at
least 25 percent through more efficient plumbing fixtures and
reclamation processes. It will also require more sophisticated
controls for exterior systems and bar them from using potable
water.
- Sustainable sites. The final version of the standard may call
for restricting construction to "appropriate" sites - places where
construction already exists, "green fields" close to high-density
areas or locations with good access to mass transit.
- Inside air. The standard will require improvements in air
supply quality, and may call for CO2 sensors, cleaner materials
and indoor air quality management plans.
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The Construction Advisor is produced
quarterly by Bober, Markey, Fedorovich
& Company's Construction
Services Team. If you would like additional information about the services that
we can provide to construction companies and contractors, please call or
email our team leader, Dale A. Ruther, CPA, CIT at (330) 762-9785 or dale@bobermarkey.com.
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