Integrated Assessments: The Implication for Developers

Increasingly, in Councils across Australia, planners are now requiring an integrated assessment of environmental sustainability for buildings as part of the planning and development process.  The emerging trend is that more and more Councils are insisting that planning permit and development approval applications be accompanied by some form of comprehensive report, management plan, statement or assessment that tests and demonstrates a developers commitment to sustainability, utilising one or a combination of integrated assessment tools.  Some Councils have been requiring preparation of this sort of assessment as a condition of permit prior to the commencement of construction, but increasingly, this information is now sought at the front end of the process.   It is no longer sufficient to provide a Green Star/FirstRate/NatHERS assessment confirming the energy efficiency star rating of the building and compliance with BCA – instead information addressing the broader range of environmental performance indicators is now required addressing factors such as embedded energy, renewable energy sources, waster treatment, water recycling, urban ecology and sustainable transportation.

On the one hand this can be viewed as yet another regulatory and cost burden on development  – more consultants need to be engaged in the planning process, more scope for potential disputes and delays to achieving planning approval, and additional construction costs imposed on development.

However, on the other hand, for the developer/operator the sustainability of the building presents a marketing opportunity, or the chance to raise the developers community profile, showcase the developments ‘green’ credentials and increase return on investment, and ongoing savings in terms of operational costs.   The ‘sustainability’ of a building can also be a key factor in winning community support (or at least reducing community outrage) regarding a proposed development.  Within local government decision making spheres, a sound environmental strategy for a building is viewed favourably, and can be a strong leverage tool in negotiations around issues such as height and car-parking, and could potentially be the difference in getting the project over the line.

Sustainable precincts and infrastructure – who pays?

The Green Star rating of buildings places significant demands on developers to emulate sustainability infrastructure functions; but limited to the building level.  It can be argued that renewable energy generation, sewer mining, distributed generation, water efficiency measures, etc. benefit the local community within which the building is located.  Yet the cost of providing this infrastructure is expected to be paid for by the developers alone.  It is entirely possible that two Green Star rated buildings may share a common boundary, but we are not aware of regulatory and commercial frameworks that would allow or facilitate these two buildings to share their respective sustainability infrastructure or to provide sustainability service to their non-rated neighbours.  We consider this apparent gap in planning and commercial frameworks as one of the key impediments to the development and sharing of precinct wide sustainability infrastructure.

The development of frameworks that facilitate efficient allocation of construction and infrastructure capital may bring about changes sought by the AGBC’s Communities National Framework and could plug the gaps exposed in the current approach to planning and economic infrastructure.

Is a two-tier green building rating system the answer?

The above example highlights a dichotomy in green building procurement and operation where different building design and operational elements are delineated at both building level and site level.

Green Star, LEED and other green building rating schemes, in their current form, have largely accomplished their task of raising awareness of sustainability issues in the built environment.  This phase is drawing to an end.  There is much less need for signs of ‘visible sustainability’ on buildings.  What is required now is a framework that differentiates between resource efficient and comfortable buildings and the infrastructure environment they operate in; a framework which better aligns sustainability costs and benefits among community stakeholders and helps environmental sustainability becoming commercially sustainable.

In order to encourage and promote sustainability infrastructure as an integral part of the sustainable built environment we propose a two-tier green building rating system.  The building level sustainability features impacting water and energy efficiency and indoor environment quality are assessed separately to the larger precinct level features such as protection of local ecology and the provision of renewable energy, recycled water, sustainable transport and other infrastructure.

The objective of the first tier is the assessment of the building level sustainability features based on metrics such as water use reduction, energy consumption minimisation, thermal comfort and the provision of a healthy indoor environment, e.g. elements that can be directly controlled by the developer or building owner.

The objective of the second tier is to assess the provision and integration of the site level sustainability infrastructure with the building.  This staged assessment creates a more equitable and fair comparison of environmental performance of buildings, where the efficiency of building operation is not obscured by points gained, or lost, by the virtue of its location.  The infrastructure rating process evaluates the availability of district energy networks, renewable energy options, recycled water supply and reticulation etc which, the building could tap into, as well as the availability of sustainable transport routes and how the building caters for the use of these facilities through allocation of bike storage, etc.

The second tier assessment will build awareness of sustainability infrastructure and its role in achieving sustainable community outcomes.  Importantly, it also increases equity in sustainable infrastructure development and encourages economic activity through access to this infrastructure.  The implementation of building level sustainability features is the responsibility of the developer, or the building owner, whereas the provision of the site level sustainable infrastructure also involves the local government and wider community as stakeholders in the building’s use and operation.

To achieve this, provision of district level sustainable infrastructure must be encouraged by strong environmental commitments from governments and be supported by the local government policy and planning instruments and economic infrastructure.  A two-tiered system provides for better social inclusion and equity as sustainable infrastructure is made available and accessible to all community stakeholders.  A two tiered system also makes efficient building construction and operation more feasible as the large-scale sustainable infrastructure is provided at the precinct level and the cost shared by all stakeholders and not only the developer.  Independent and transparent assessment of sustainability infrastructure will provide a platform for councils to demonstrate their environmental credentials as well as an instrument to attract like-minded commercial partners to further foster local economic and community development.

The challenge for Councils will be to balance technical and ecological solutions with commercial solutions.  It doesn’t have to be more burdensome for them in terms of workload or finances; and we certainly don’t want to overregulate the space but as an industry we will have to be more innovative in reconciling these outcomes.  We need to acknowledge that it is a 2-stage process.

Environmental sustainability doesn’t have to be a subsidised business, and the reality is that unless it is commercially sustainable things will not happen.  Councils can be the catalyst and driving force behind bringing stakeholders together to create a business model for sustainable development that looks at the wider picture, including planning, ESD, infrastructure and a more efficient allocation of capital.