Construction Cost on Development of Safe Sustainable Storey Buildings
Financial incentives will also be necessary, to boost the interest of those people who will
never be compelled by the environmental reasoning behind sustainable building, and also to even
the playing field for those who are compelled. Until better savings recovery arrangements are
worked out, incentives can also serve to lower first costs in cases where the developer, or in-
vestor, is not able to recoup future savings. Economic incentives can be used to promote volun-
tary action (e.g., conservation) where it might not occur otherwise. Tools include tax credits and
rebates, as well as financial assistance, such as loans with favourable terms or outright grants.
Respondents listed a number of economic strategies that have helped them incorporate sustain-
able practices into their projects. The most commonly cited strategies were utility incentives,
such as inspections/audits or rebates for installing new, efficient equipment, which a respondent
described as being “enormously effective in reducing demand” for gas, electricity, and water,
(Pickett, 2007).
Sustainable building rating systems not only educate owners about the environmental
soundness of their homes or facilities, but they provide an indirect economic incentive by provid-
ing a marketing edge for building professionals who build structures that merit the higher ratings,
because their buildings will sell for more (assuming that real estate brokers incorporate the rating
system in their valuation of the sales price). Because of the higher building value and the return
on investment gained through the future savings in utility bills (reflected in the rating level), ap-
plicants can often get larger loans than they would. Colorado’s E-Star program, designed with
help from the federal Department of Housing and Urban Development and the Federal Housing
Administration, is a model rating/mortgage program, (Crawford, et al. 2009).
Despite the great interest in economic incentives, several respondents were “leery” of
them, feeling that “green design should stand on its own.” A few respondents were concerned
about the use of incentives that “perpetuate a false economy.” Instead, they would like to see
“valuation...imposed...on externalities” and elimination of perverse disincentives. In other words,
the view is that it would preferable to tax “bad” activities like non-renewable fuel use (to intern-
alize their costs) or at least to stop subsidizing them, rather than to start subsidizing good things.
For example, one respondent wrote: “Remove subsidies for polluting industries and the energy
supply system we have today, to level the playing field for safe energy and environmental build-
ing.” (Borrett, 2009).
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