Encouraging Investment: Calculating the True Value of Building Energy Retrofits
True measures of value and risk must be integrated into decision-making for energy retrofit projects, says Scott Muldavin, Executive Director of the Green Building Finance Consortium and Senior Advisor, Finance and Valuation, to the Rocky Mountain Institute. He observes that investors are more likely to finance projects if they can envision an increase in value returned for their money while minimizing or mitigating the investment risk. He also notes that occupants and investors perceive value differently: Occupants are concerned with energy and resource savings but also with benefits such as employee satisfaction, health and productivity, and the economic value of these needs to be calculated. He advocates supplementing a building lifecycle cost assessment with a report that includes these additional value elements.
Visit the Green Building Finance Consortium for more on valuing sustainable buildings and for a free download of Scott’s book, Value Beyond Cost Savings: How to Underwrite Sustainable Properties.