Showing posts with label Rob Rafson. Show all posts
Showing posts with label Rob Rafson. Show all posts

Sunday, January 11, 2009

Saving Money by Going Green

Rob Rafson, P.E., is V.P. Engineering of Full Circle, a Chicago-based sustainability management solutions firm. He is also co-author, with Harold J. Rafson, of Brownfields: Redeveloping Environmentally Distressed Properties (1999). What follows is Part 4 of a four-part interview.

BPGL: Give an example of a design-positive economic driver to going green.

The one light in every building that is always left on.

The one light in every building that is always left on.

RAFSON: There’s one light in every building that’s on 24 hours a day: the exit sign. It’s the least paid-attention-to light in every building, and probably the most expensive.

There are two 30-Watt light bulbs in an exit sign. Replace those with two 1.2 Watt light-emitting diode [LED] bulbs. Now, you replace the LED bulbs every 10 years instead of every year, which has a financial impact on its own. Incandescent light bulbs cost about $2 each, and LEDS are down to $7.50 each now. The energy savings per exit sign is around $60 year. So, the ROI is three months, if you look at simple payback of the energy savings.

You can save in other ways, too. In rough numbers, the air conditioning cost to cool the energy created by the light bulbs is about 20 percent [of your air conditioning bill]. You will pay for the LEDs in 1 1/2 years just by saving air conditioning costs — and that’s on top of the electrical savings.

If you add together the electrical energy savings, reduced labor savings of having a 10-year bulb, and reduced air condition cost, the total payback is in about two months.

This is a great example of people focusing on the business they’re in. In a building managed by an outside firm, they pay attention to things like exit signs, because that’s their job. It’s their job to make the building more profitable. But, if the building owner is in the business of manufacturing an item, they’re very unlikely to focus on a little thing like an exit sign. They need to pay attention to things outside and inside their business that affect their economic opportunities. There are real opportunities to save and, therefore, to make money by going green.

Businesses need to look outside and inside their business.

Businesses need to look at their supply chain and other factors.

The key thing is that you have to look around at the things that are both inside and outside of your business that affect the economic viability of your business. If you focus only on your product or service, you miss the large-scale opportunities and the most important parts of a sustainable strategy. Looking at your supply chain and other factors… you really have to look at your core business. And when you have a solid understanding of your core impact, look outside your business at ancillary impact points. The results can be enlightening and create opportunity.

BPGL: What other green strategies will you be implementing in projects by Full Circle?

RAFSON: We are really covering a wide berth in Full Circle’s customers. In some cases we’re combining solar PV and lighting programs, in others we’re doing a wholesale re-engineering of a national waste program. Ultimately, after we complete a sustainability analysis, we offer a customer a range of projects from simple and immediate ROI to long-term changes that take investment and patience to realize return. All of these are worthwhile, but sometimes you have to walk before you run.

Look at green roofs, as an example. I’m not a fan of green roofs; they’re not economical. I believe it’s a great strategy in some situations, but not as a general rule. Now, if you’re growing vegetables on your roof, that might be worth doing. In Chicago, there’s a health food store that makes its own spices and grows them on a green roof. A coffee shop grows produce for their sandwiches on their roof. Both are great uses of space and make economic sense.

Green roofs are generally not economical, according to Rafson.

Green roofs are generally not economical, according to Rafson.

But to do it to offset carbon is ridiculous. Economically, the costs of doing that — as opposed to putting trees on the sidewalk or parkways — are skewed terribly. You have to build a building that supports the extra weight, then provide the maintenance and the infrastructure. It doesn’t balance out. But to my earlier point about doing the strategies with the best payback, you could have the opportunity to look at a green roof as a strategy, if you look at the things that make economic sense first.

BPGL: Give an example of a strategy that would make economic sense for most businesses.

RAFSON: Anyone who hasn’t done extensive energy efficiency work can save — from day one — 30% on their electricity bill. At one building recently, they had nearly 40% too much light, and employees were getting headaches and complaining because it was too bright. We calculated the proper light density for all the offices and warehouse space. — You could do surgery in the washroom. — They saved 38% on lighting alone. All they did was de-lamp.

That was one savings, but that wasn’t the big thing. They already had very efficient lighting fixtures, just too many of them for [a building use that required] less light density than originally planned. The problem was partly too much design, but they also left too many lights on.

Now they’ve got motion sensors in the individual offices. It’s more convenient once you get used to it, to walk into an office, and the light turns on. They have motion-sensor power strips that turn the monitor and stereo on, things that actually would annoy the person next door if they were running with no one in that space.

BPGL: So, you’re saying that pretty much everyone can realize savings with a little self-examination.

RAFSON: If the general population, property owners, and business managers would just grasp the opportunity, they could change the way they look at everything. Opportunities to make a cultural change can also have a positive economic and environmental impact.

Part 1: The Positive Economics of Going Green

Part 2: Tax Incentives Boost Green ROI

Part 3: Going Green Requires a Cultural Change

Part 4: Saving Money By Going Green (Top of Page)

Julia Wasson

Blue Planet Green Living (Home Page)

Related Post:

Tailgating for a Common Green Purpose

Going Green Requires a Cultural Change

Rob Rafson, P.E., is VP Engineering of Full Circle, a Chicago-based sustainability management solutions firm. He is also co-author, with Harold J. Rafson, of Brownfields: Redeveloping Environmentally Distressed Properties (1999). What follows is Part 3 of a four-part interview.

BPGL: You mentioned that making changes in the way companies do business isn’t just a matter of changing the equipment, it also requires a cultural change. Tell us more about how that looks to you.

RAFSON: The biggest thing to my mind is that the cultural change has to happen on all levels. Consumers need to look for green businesses, and there need to be watchdog organizations on the alert for “green washing” — companies proclaiming they’re environmentally responsible just for show.

Telecommuting is an attractive and economical option for some employees and companies.

There also needs to be a cultural change in the business community — to take the time to understand the opportunities created by our changing financial, economic, and technological worlds. These changes are happening so rapidly, and they offer opportunities for telecommuting and other cost-saving strategies.

For example, Johnson & Johnson has implemented a lot of wonderful strategies to decrease their carbon footprint. A friend of mine works for them, and because of their no-travel policy, he’s visiting with clients more, spending more time on their accounts, and creating more information for his clients. He can look up more information and actually get more work done, because he’s not transporting himself. He saves money and resources by not traveling. And he’s got more free time for himself, because he’s not spending all his time on the road.

BPGL: How do you see the movement toward sustainability changing?

RAFSON: The interesting thing is that there is a social conscience component to going green. That is not a new thing, but a growing portion of the change in corporate culture. It’s also something that becomes part of this sea change that must happen, a way of thinking that is happening and must happen.

BPGL: Do you believe the change is consumer driven?

LEED-certified buildings supply economic benefits.

RAFSON: Partially. In my opinion, the big improvements and changes need to happen on a higher level, up the corporate chain. These ideas in cultural change have to come from corporate management, in that the driver is on the consumer side to push the corporate managers into understanding that there are economic consequences.

BPGL: What are some of the economic consequences of going green?

RAFSON: Real Estate management company, Jones Lange LaSalle did a study on the economic differences between LEED-certified versus non LEED-certified properties. They estimated that a LEED-certified office building would be able to charge $11 more per square foot, per year, over a non LEED-certified building. That’s a huge economic driver to go green and get LEED certified.

Another study showed that as a company goes green, or starts to move in that direction, employees are happier, work longer hours, and are healthier. Blue Cross Blue Shield [health insurance provider] is starting to look at reduced claims at companies that have gone green. And therefore they’re may reduce pricing for companies that have gone green.

So, as support for going green grows and is sustained, roots of this change start to reach into other industries and feed back to the main corporations that started the process. They’ve planted the seedlings and, as it reaches their suppliers and vendors, they gain benefits because of the strategies they’ve implemented.

BPGL: So companies benefit from the investment they make in being green. If they pay more upfront on renting a green space, for example, they pay less on their insurance plan?

Employees who have healthy lifestyles might gain lower health insurance premiums.

RAFSON: The strategy of deciding to put your business in a LEED building is a component of going green. If the business itself looks more at the LEED certification and the strategies it takes to get there, my belief is you’ll see positive ROI just doing that. Making the building more energy efficient, reducing waste, recycling, and all the stuff that goes into LEED certification have their own paybacks. And, you’ll have additional, subsequent benefits by gaining increased market share and providing increased product and service value to your customers. It’s hard to define those numbers, but there are other opportunities to increase value like the example of decreased sick days and potentially decreased medical insurance costs.

I’m not sure they’ve come to the numbers yet, but there are a lot of health providers that believe companies that do green strategies have healthier employees. Take a look at the idea of bicycle commuting; I’m sure some bike federation is studying now what the health impacts of bike commuting are. This is an obvious one; biking is healthier than driving. How much that affects the premiums of an employee who is healthier and has fewer claims is an interesting question. It’s exciting that the insurance companies are entertaining the idea of figuring it out.

From my perspective, there’s a huge gap in knowledge and understanding of the idea that there is an economic driver to going green, and a quite design-positive one at that.

Part 1: The Positive Economics of Going Green

Part 2: Tax Incentives Boost Green ROI

Part 3: Going Green Requires a Cultural Change (Top of Page)

Part 4: Saving Money By Going Green

Julia Wasson

Blue Planet Green Living (Home Page)

Related Post:

Tailgating for a Common Green Purpose