On a wing and a prayer

Over the years, whole life cost experts have developed accurate financial modelling systems that balance the need to minimise capital costs with the advantages of specifying to achieve long-term best value. The calculations can be complex, but as the same cost-based formulae are used for both capital and lifetime costs, comparing results is generally uncontentious.

Take the humble timber door, for example. There is no real argument over how to establish which kind will cost least either initially or over a 30-year period – a flimsy one painted with a single coat of thin paint or a solid one with two, even three, coats of high-quality paint.

But the rise of the sustainability agenda is complicating the issue. On a purely analytical front, the agenda requires more advanced modelling capable of assimilating and processing the many interconnected energy and environmental variables and balancing them against traditional commercial realities. However, while we continue to refine modelling systems that are already capable of taking these variables on board, the policy and legislative framework in which we operate is lagging behind. And fundamental questions concerning how the new green technologies justify their cost and how that justification should be calculated, both financially and environmentally, remain unresolved.

To understand how this is adversely restricting which technologies and solutions should and should not be specified (and the consequences of this), we need to look at the status of key components of the sustainability agenda, starting with arguably the most contentious – embodied energy.

Embodied energy

Measured in kWh per tonne, or m3, embodied energy is the quantity of energy required to manufacture and supply to the point of use, a product, material or service. In our context, this means the energy required to manufacture, transport, install, maintain and ultimately dispose of any given energy-generating technology – energy which impacts on its true ecological efficiency. To specify such technology without knowing its embodied energy can only be, at best, a well-intentioned, though possibly misplaced, leap of faith. And this is as true for a solar panel or individual wind turbine as for the construction of a nuclear power station or wind farm.

Calculating embodied energy, though, is not easy. The sustainable energy research team (SERT) at the University of Bath’s department of mechanical engineering has developed the Inventory of Carbon and Energy (ICE) – a database determining the embodied energy and carbon of 170 different building materials, including aggregates, aluminium, concrete and steel.

It is an invaluable tool, but deals essentially with raw materials and only takes us a small step closer to understanding the embodied energy of manufactured technologies. For example, energy saving light bulbs are in the revisionist spotlight as attention turns from their five-year life and anorexic energy consumption to their toxicity and disposal.

It is highly likely that other ‘green’ technologies will come under similar scrutiny.

Another question is how far should we go in calculating embodied energy? Imagine a single bar electric fire using electricity from a coal-fired power station, for example. Ultimately, the embodied energy of every Kw/h depends on how the miner got to work and what he had for breakfast! Of course, this simply highlights that some compromise and assumption is inevitable, but surely that compromise could, and should, be more sophisticated than the current ‘clean slate’ policy whereby the energy clock only starts ticking once the occupants are in situ? Indeed, life-cycle cost appraisals for housing funded by the Housing Corporation must follow their criteria, yet these make no allowance for either embodied energy or energy use.

Renewable energy

Which one is sustainable? the spotlight is on energy saving light bulbs as attention turns to their toxicity and disposal

The current emphasis on renewables is also inadvertently muddying the waters. Three factors in particular have led to the rise of renewables:

• The government has signed the EU’s commitment to producing 10% of electricity from renewables by 2010 and 20% by 2020. It is an open secret that, Germany aside, this target is somewhat optimistic. The UK is currently achieving 2% and 9% seems to be a more realistic, if still challenging, target. And an expensive one: government figures suggest that reaching even 9% could cost the economy £4bn a year.
• The adoption of the Merton Rule by 150 local authorities to date. This is a policy, pioneered by the London Borough of Merton, that requires any new development (generally 10 dwellings or more) to reduce its carbon emissions by 10% through the use of renewables. And some authorities are even raising the figure – for example North Devon to 15% and Kirklees to 30%.
• Carbon emissions becoming the default benchmark for judging environmental improvement. This favours renewables as they do have genuine low-carbon credentials – at least at the point of delivery.

The effect has been to canonise renewables, setting them above other energies by definition rather than performance. But, unfortunately, just because an energy source is renewable, it doesn’t necessarily make it green or greener. Citing how the wood pellets we use to fuel bio-mass boilers have to be imported from China or Scandinavia may now be a bit of a cliche – but that doesn’t make their carbon footprint any smaller. Some would also challenge wind or solar farms on similar grounds.

Renewable energies obviously have an important role, but they are not a universal solution. Yes, targets should be set, but our hands should not be tied as to the methodologies used to achieve those targets. For example, if the principles of the Merton Rule were to be transposed to a limit on CO2 emissions per m2 of development, we would be able to calculate accordingly and recommend the best all-round technologies. Unfortunately, we are not there yet and the more we are forced away from objective empiricism towards increasingly subjective and politicised assumptions, the harder it becomes to calculate with either conviction or certainty.

Future energy costs

With traditional lifetime costings, the key variable is inflation. Fortunately, because inflation is central to any economy, it is not difficult to obtain an expert consensus. Even dialling in an additional inflationary allowance for, say, China’s demand for raw materials is achievable. However, trying to pin down the future cost of oil, gas or nuclear energy is seemingly impossible as it is subject to market-led inflation, increases in taxation and global politics. We also import significant quantities of gas and oil from highly volatile regions and cannot assume that, in extremis, supplies will not be interrupted.

The future is relevant because a typical new building has an anticipated life of at least 60 years with its energy supply infrastructure expected to last a minimum of 15-20 years. Ideally, therefore, the industry needs a single, expert, independent and apolitical body to make these calculations.

Legislation, planning and funding

Of course, none of these are ‘variables’ – primary legislation is obviously writ in stone, as are the wishes of planning authorities and those allocating grants. The point, though, is that, as we have seen, complying with either proscribed or prescribed methodologies can lead to implementing less than perfect solutions. The law of unintended consequences is very much in force.

Human behaviour

Finally, it doesn’t matter how green a dwelling’s energy source may be if the occupiers don’t use it responsibly. Green energy is as easy to waste as any other – and too many think that because it is renewable, it can be wasted. Arguably, therefore, we should give a more favourable weighting to those technologies that operate automatically – such as motion detectors, timers, sophisticated thermostats – at least until energy becomes too expensive for anyone to waste.

So where are we? At the moment we have no option but to follow the requirements and methodologies of funders, planners, government and other agencies and therefore have to sidestep many of the issues outlined above. Hopefully, though, targets will be re-evaluated, not to make them easier or weaker, but to enforce more beneficial outcomes rather than blanket methodologies. Meanwhile, we continue to develop the tools necessary to assimilate both the varied elements that make up the sustainability agenda and the vital environmental research being undertaken here and abroad. If we can align new targets with sophisticated modelling, we will be in a much stronger position to make genuine environmental improvements.