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2 The Motivation

2.1 Central government energy use and CO2 emissions, and associated costs

Government, including overseas accommodation, has an annual energy use of 673 GWh1 with associated CO2 emissions of 110kt-e.

Central government is the most significant owner and lessee of commercial buildings in New Zealand. Following is a snapshot of current office accommodation and energy use and CO2 emissions, and their associated costs. Central government:

  • occupies approximately 900,000 m² of office-type accommodation

  • consumes 135–170 GWh energy per annum

  • emits 22,000–28,000 tonnes of CO2 per annum

  • incurs $20–25 million, or $22–28/m², energy costs per annum

  • incurs $0.66–0.84 million, or $0.73–0.93/m², potential carbon charges per annum.

Government also has a significant role in new construction and is responsible for 16 per cent of commercial construction undertaken annually.

2.2 Potential for central government office fit-outs to reduce costs and improve environmental performance

There are significant advantages to sustainable fit-outs of buildings for housing government tenants, including:

  • lower hard operating costs (energy, water and other operating costs)

  • lower soft operating costs (healthier, more comfortable, satisfying and productive workplaces for employees)

  • increased workplace performance (more efficient, flexible office space with better space use).

Typically, total occupancy cost savings of 20–25 per cent can be achieved by a sustainable building fit-out, as demonstrated by these value cases.

There is also the potential for fit-outs to make a large-scale impact in the short term on central government occupancy costs. This is due to their application to both new buildings (5 per cent of buildings) and existing buildings (the remaining 95 per cent), and to the frequency of renewal, which is typically six to nine years.

In environmental terms, fit-outs present the opportunity to improve the sustainability of the built environment from the inside out and to overcome the barrier of how to upgrade the majority of existing buildings with life-spans of 50 years or more in a relatively short period. Adopting minimum Green Star standards for all government accommodation provides a far greater opportunity than the previously mandated minimum standards for new leased government buildings.

2.3 Demonstrating government leadership

Internationally, governments are pursuing opportunities to mitigate greenhouse gas emissions and improve energy efficiency by setting targets for their agencies and mandating best practice. This activity has helped drive wider, market-led changes. In New Zealand, examples in the building sector have shown how government leadership can prompt positive change in the market.

The New Zealand Energy Efficiency and Conservation Strategy (EECA, 2007) has a target for all new government buildings to meet a minimum 5-star Green Star rating from 2012.

2.4 Leveraging government spending power to support more sustainable development

Government spending power can help drive innovation, cleaner production and improved cost-effectiveness over the whole life cycle of goods and services. In sectors associated with office fit-outs – such as building, office supplies and IT equipment – central government purchasing in New Zealand comprises the single largest share of the market. Core public service agencies and some other entities are responsible for approximately $6 billion a year of operational expenditure. This expenditure can be leveraged to support more sustainable development.

2.5 Driving more sustainable development through public and private sector participation

The development of the Green Star Office – Interiors rating tool has been sponsored by 10 commercial/construction industry partners contributing over 80 per cent of the funding and the Ministry for the Environment contributing just over 15 per cent. These partnerships exemplify the public and private sector working together to promote sustainable development.

In contrast to government regulation via the New Zealand Building Code, the New Zealand Green Building Council Green Star rating system is voluntary and promotes significantly higher standards than the minimums prescribed by regulation. The Ministry for the Environment has encouraged the Green Star system by sponsoring the initial establishment of the New Zealand Green Building Council and its rating tools and by promoting the adoption of its standards for government buildings. This is seen as an important and continuing catalyst by the market and has encouraged a much wider uptake by the construction industry.

2.6 Cost-effective carbon abatement

The cost abatement curve in Figure 1 shows there is considerable cost-effective potential for reducing emissions using energy efficiency measures with a ‘negative cost’ (ie, measures that finance themselves through reduced energy costs). The curve identifies the easily achieved or ‘low-hanging fruit’ of energy efficiency in commercial buildings and energy-efficient products. These two opportunities are directly related to the sustainable fitting out of commercial office buildings.

Figure 1: New Zealand energy sector carbon abatement curve

Thumbnail of image. See figure at its full size (including text description).

2.7 Ensuring the predicted outcomes are achieved

The Green Star system provides an easily recognisable standard and quality assurance system for delivering the predicted outcomes of this value case. As evidence that the predicted outcomes can be achieved by adopting these standards, the new Ministry for the Environment head office in Wellington has measured a 60 per cent reduction in energy use compared to Property Council measured averages. The new Meridian corporate office in Wellington has measured a 65 per cent reduction in energy use in its first year of use (with improvements targeted through further building tuning), and user satisfaction improved from -6 to +9 compared to previous premises (on a -10 to +10 scale).

The replacement of Housing New Zealand’s nationwide network of 450 older computers was carried out successfully using sustainable procurement principles. Replacement computers were selected for their energy efficiency, low environmental impact and cost-effectiveness. As part of the replacement programme, a specialist company was also contracted to reuse, recycle and dispose of the existing computers in an environmentally friendly manner.

 

1 2006 EECA data.

 

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