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The Cost of Leed Certification
What budget advice can estimators provide to their Clients for going green?
By Joseph J. Perryman MRICS MAPM

As more and more published articles appear that proudly state Projects have achieved LEED® certification, whether they be in newspapers or magazines, more and more Clients are asking their Design Team or Contractor, “Can we afford LEED certification for our Project?” What is the correct advice to give Clients?

In order to provide the advice, estimators must firstly understand the US Green Building Council’s Leadership in Energy and Environmental Design (LEED) standard. Four levels of certification exist – certified, silver, gold, and platinum. Each level is reached by obtaining points from a LEED rating system that offers 7 prerequisite points and 69 elective points. To achieve any certification a Project must comply with the 7 prerequisite points. The elective points are what determine the LEED rating level with Certified requiring between 26 and 32 points, Silver requiring between 33 and 38 points, Gold requiring between 39 and 51points, and Platinum, the highest level, requiring between 52 and 69 points.

The key for estimators therefore is to (a) ascertain whether a particular point is achievable for their particular Project, and (b) evaluate what each valid point will cost. In order to ascertain whether a particular point is achievable, the estimator should join members of the Design Team in participating in a workshop to identify the potential for incorporation of each of the 69 points. This workshop should happen at the earliest opportunity in the design phase as this will allow suitable time for a smooth transition of the selected points into the Project’s design. A significant amount of points are awarded for the designing of mechanical and plumbing systems therefore the mechanical engineer should play a pivotal role at the workshop.

Following the identification of the available points, the estimator can begin to evaluate the cost implications of incorporating each particular point. It is important to remember that the costs may either be pure additional costs, premium costs or may even have no cost implications. For example: incorporating bicycle racks and showers would be a pure additional cost, using certified wood in lieu of non-certified wood may be a premium cost, and proximity to mass transit will have no cost implications as this relates purely to the location of the Project site (unless of course the Project has options with regards to site location).

The author has also found it to be the case that certain points are realized at no additional cost due to the high level construction performance that today’s contractors insist upon as standard practice. Clearly, the higher the certification level, the more it is required to accept the points that have significant additional cost impact. The strategy therefore is to firstly seek the points that have no financial impact, followed by either the insignificant premium costs or the insignificant additional costs. The expensive points are usually only sought when applying for Gold or Platinum certification. It is the author’s experience that, with an early instruction from the Client to seek certification, certified and silver can be achieved at minimal cost however gold and platinum will typically have a significant cost implication.

Estimators should not forget about the administration costs associated with achieving LEED certification. Every point will be monitored during design and construction to ensure it is implemented into the building. Depending upon the contractual relationships that exist, the responsibility for incorporating LEED can lie with the Design Team, the Construction Manager, or the Client. Regardless of where the responsibility lies, the costs involved with writing Specifications, identifying costs within subcontractor bids, filing and management of necessary documentation for final application to the USGBC etc. will all have a cost impact.

Grants exist for Clients who seek LEED certification. The potential amount receivable may not be known at the early stages of a Project but these additional funds should not be forgotten about during presentation of the overall financial implication of seeking LEED certification.

To conclude, the cost of LEED certification depends upon: the level of certification sought, the particular Project demographics and characteristics, the availability of grants for achieving certification, the LEED experience of the Design Team, the LEED experience of the estimator, the stage in the design at which the Client makes the decision to seek certification (the earlier the better), and the Client’s perception of the value and benefits of a more attractive building environment for their occupants. Whilst the factors above may seem numerous, they are quantifiable, they can be priced, and they can be managed.

Joseph Perryman is a both a cost consultant and owner’s representative for a firm that specializes in project and cost management of performing arts and museum facilities. Joseph is also a member of the Association for Project Management, the USGBC, the Royal Institution of Chartered Surveyors, SAVE International, American Society of Professional Estimators and is Chairman of the ASPE LEED/Sustainability Specific Interest Group. Contact Joseph at joseph@dcicost.com

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