About 18 months ago Auden Schendler and Randy Udall wrote a piece in Grist, “LEED is Broken; Let’s Fix It.” The U.S. Green Building Council (USGBC) did, at least in part, respond to the complaints about its bureaucracy by creating LEED Online, a paperless submission system that is relatively easy to use and which does ease some of the paperwork nightmares associated with LEED. It remains to be seen whether once the LEED submissions actually reach the evaluators, the process moves any faster. Many of the other issues cited by Schendler and Udall remain irritants to project teams involved in the LEED process ... more about this in a future blog.
Although there has been progress with respect to bureaucracy there is another problem that has not been addressed at all, namely the growing and dangerous trend of green building advocates making increaslingly outlandish and unsupportable claims about green buildings. Equally alarming is the uncritical acceptance of reports touting the benefits of going ‘green’ in the design and construction of buildings. A relatively recent October 2006 report by Capital E, “Greening America’s Schools: Costs and Benefits” is widely accepted as gospel by the green building community. Indeed the CEO of the USGBC, Rick Fedrizzi, gave it effusive praise at the annual GreenBuild Conference held in
Financial Benefits of Green Schools ($/ft2)
Energy $ 9
Emissions $ 1
Water and Wastewater $ 1
Increased Earnings $49
Asthma Reduction $ 3
Cold and Flu Reduction $ 5
Teacher Retention $ 4
Employment Impact $ 2
COST OF GREENING ($3)
NET FINANCIAL BENEFITS $71
The results are based on a life cycle costing analysis over a period of 20 years with a discount rate of 7%, a general inflation rate of 2%, and an energy inflation rate of 5%. In the table above the results are expressed as the present value of costs and savings per square foot over the 20 year analysis.
What struck me immediately was that the claimed savings of $71 per square foot were based almost entirely on soft costs. The Increased Earnings claim of $49 per square foot was clearly the dominant source of the savings, with $13 dollars of additional per square foot savings for other soft costs (asthma reduction, cold and flu reduction, teacher retention, and employment impact). Thus the soft costs totaled $62 of the claimed $74 worth of savings. I found this quite an extraordinary way to compute green building savings and I decided to finally sit down and read the Capital-E report word for word. I also did a critique of this report as a classroom exercise with graduate students in
The Increased Earnings Claim
A good place to start in reviewing the Capital-E report is to look at the big ticket savings claimed for green schools, the Increased Earnings claim of $49. The authors state, and rightfully so, that “Faster learning and higher test scores are significantly and positively associated with higher earnings.” They cite an International Monetary Fund (IMF) study that states that one standard deviation improvement in average math scores, which would put a student in the 84th percentile, results in an average 12% higher annual earnings throughout the student's lifetime. Based on a study of Chicago and Washington, DC schools it was found that “…better school facilities can add 3 to 4 percentage points to a school’s standard test scores, even controlling for demographic factors.” Note that the study was about better facilities, not green schools. In fact any new school is almost certainly going to be classified as a “better facility.” Not satisfied with connecting the dots in this incredible manner, the authors then take this improvement in test scores and translate it to “…an earnings increase of $532 per year for each graduate of a green school.” Green schools were not mentioned in the IMF report nor in the Chicago/Washington, DC reports. The authors of the Capital-E report simply substituted the word green for the words better facilities in the report on Chicago and Washington, DC schools. Thus the authors imply that only green schools are better facilities, but do not acknowledge that new schools that are not green are certainly better facilities and may also improve test scores. The earning increase of $532 per graduate was further translated into a present value of increased earnings of $6,800 per student, and further to $49 per square foot. Even my graduate students immediately recognized this badly flawed methodology and results that should not have seen the light of day. The actual result should have been stated as: "We have no idea what the actual increase in earnings of students attending green schools versus non-green or non-LEED schools is." The USGBC should immediately repudiate this and all other similar claims that are based on unsupported assumptions, interpolations, and extrapolations and not on a dispassionate, rigorous and scientific analysis with well-structured protocols.
The Energy Savings Claim
The methodology for determining energy savings, claimed as $9 per square foot, is similarly flawed. Table B in the report summarized key information for 30 schools used as a baseline for parts of the report. It showed energy and water savings, the cost premium for the green schools, and dates of completion. I was initially struck by the claims for energy savings for several schools completed in 2006 because the Capital-E report was dated October 2006 and thus it would not have been possible to gather useful data about energy consumption in just a few months. It appears that the energy and water savings are not based on actual data but on the models used by the design teams to forecast energy and water consumption. It is well-known, particularly in the era of LEED-NC 2.1, which all of the schools probably followed for certification, that energy modeling using ASHRAE Standard 90.1-1999 produced very inaccurate results. The modeled energy savings of the 30 schools were compared to the average energy use for all operating schools during 2005-2006, which was stated as $1.15 per square foot. Note that the comparisons were not with non-LEED or non-green schools built at the same time, which would have been a far more useful comparison, but with all operating schools. This is a consistent analytical flaw in the Capital-E report on green schools, their comparison of new green schools to the existing stock of all schools when it would have been far more useful to use real data from both green and non-green schools built in the same time frame. Note that a school can be LEED certified even with zero energy savings depending on the project team’s strategy for getting points.
The authors, in spite of these obvious major flaws in methodology claim direct energy cost present value savings of $6 per square foot. But even more flawed is the claim of $3 per square foot of indirect savings. In determing the indirect energy savings, the authors cite a 2005 report by a national laboratory which found a 1% reduction in demand for natural gas results in a 0.75% to 2.5% reduction in average wellhead prices for natural gas. Through an unclear methodology, they translate this into indirect present value cost savings of $3 per square foot for schools. However neither the $6 direct cost savings nor the $3 indirect cost savings can be proven using the assumptions, interpolations, and abstractions contained in the report. To claim that green schools are going to result in reductions in natural gas prices is absurd. Natural gas prices are likely to increase over time because of increasing demand by a wide variety of actors. In short, the energy savings claimed in the report are not the least bit reliable. Again, the USGBC should reject these findings and either perform or support the performance of research that will produce outcomes in an unbiased, scientific manner. I will address the probable energy savings of green schools at the end of this critique.
The Asthma Reduction and Cold/Flu Reduction Claims
The savings for asthma reduction ($3 per square foot) and cold/flu reduction ($5 per square foot) are about the same as energy savings, a red flag that yet another flawed methodology was used for determining these figures.
Moving on to cold/flu reductions, the author relies on CMU and Lawrence Berkeley National Laboratory studies. The CMU study found an average 51% reduction in cold/flu occurrences due to improved air quality. The LBNL study states that better ventilation and air quality could reduce these occurrences by 9-20% in the general population with annual savings of $6-14 billion. Again the author calculates the savings due to green schools reducing these occurrences by extrapolating $10 billion of savings per the LBNL study, spreading the savings over the entire
The Teacher Retention Claim
The report claims that green schools reduce teacher turnover based on a report by Paladino and Company. The Capital-E report states: “A recent report on green schools in
The Employment Impacts Claim
The Capital-E report states that the employment impacts of green schools are a benefit of $2 per square foot. This result is based on a 2004 report by the Massachusetts Division of Energy Resources and the Consumer Affairs and Business Regulation Agencies that states that each $10 million investment in energy efficiency improvements contributes 160 short-term and 30 long-term jobs. Capital-E extrapolates this information to somehow attribute 3 short-tem and ½ long-term job per green school based on $200,000 of additional investments in energy efficiency compared to a conventional school. There are several serious flaws in this line of thinking. First, taking the results of the 2004
Revisiting the Summary Table
In reviewing the criticisms of the Capital-E report on the financial benefits of green schools, few of their claims stand up to scrutiny. It is laced with unfounded assumptions, interpolations, and extrapolations that are not supported by the evidence. The table below was derived by setting aside the Capital-E claims that cannot be supported. The water savings and emissions savings were simply retained. The direct energy savings were recalculated using a more reasonable 20% savings and based on inflating the Capital-E assumption of annual average energy costs of $1.15 per square foot to $1.25 per square foot. This is a better comparison of potential energy savings for new green schools versus new conventional schools where there are probably significant energy conservation measures being implemented. The 20% reduction results in a $4 present value savings per square foot. If the $3 increase in construction cost is maintained, the net present value of savings over a 20 year period is about $3 per square foot, a far cry from the $71 per square foot claimed in the Capital-E report.
The Provable Financial Benefits of Green Schools ($/ft2)
Energy $ 4
Emissions $ 1
Water and Wastewater $ 1
Increased Earnings $ 0
Asthma Reduction $ 0
Cold and Flu Reduction $ 0
Teacher Retention $ 0
Employment Impact $ 0
TOTAL $ 6
COST OF GREENING ($3)
NET FINANCIAL BENEFITS $ 3
I challenge the USGBC to address these inaccurate and unsupportable claims, to cease supporting and repeating them, and to organize a rigorous research agenda that finds the truth. The Capital-E report is but one of many that need to be scrutinized and criticized to set the record straight. It is not only the intergity of the USGBC that is at stake, it is also the integrity of every one of us associated with the high performance green building movement.