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MARKET OPPORTUNITIES
AND CHALLENGES
Submitted By
Author: DEVI.T (09C15)
Co-Author: LAKSHMI (09A38)
Abstract on
GREEN BUILDING – MARKET OPPORTUNITIES AND CHALLENGES
Authored by Devi T. PGDM, Mats Institute of Management and Entrepreneurship,
Bangalore
Co-Authored by S. Lakshmi PGDM, Mats Institute of Management and Entrepreneurship,
Bangalore
INTRODUCTION
As per Indian Green Building Council (IGBC), Green building is defined as " green building is
one which uses less water, optimizes energy efficiency, conserves natural resources, generates
less waste and provides healthier spaces for occupants, as compared to a conventional building."
It is also known as “Green Construction” or “Sustainable Building”.
It is a practice of creating structures and using processes that are environmentally responsible
and resource-efficient throughout a building's life-cycle: from siting to design, construction,
operation, maintenance, renovation, and deconstruction. This practice expands and complements
the classical building design concerns of economy, utility, durability, and comfort.
The main objective of designing green building is to reduce the overall impact of the built
environment on human health and natural environment by
• Efficiently using energy, water and other resources
• Protecting occupant health and improving employee productivity
• Reducing waste, pollution and environmental degradation.
A similar concept is natural building, which is usually on a smaller scale and tends to focus on
the use of natural materials that are available locally. This Green building concept is mainly
contributing to the development of Infrastructure Industry which is growing in a rapid phase in
the Indian context.
GROWTH OF INFRASTRUCTURE INDUSTRY
India is the fastest growing economy in terms of business, import, export and also having good
financial strength when compare to all other developing nations like china, Brazil and etc… But
India is a country which is mainly lacking in Infrastructure development that becoming a major
barrier for the development of many businesses. So this industry gained a main focus from the
entire prospect.
The above facts attracted major investment towards this industry from Union Ministry of
Finance. In 2010-2011 Budget, Government allocated 40% of total budget amount to the
infrastructure Industry. Also it allocated around of $425.2 billion in the eleventh five year plan
(2007-12) as against 193.1 billion in tenth plans. This industry is showed the growth rate of 5.1%
year on year in April 2010, compared with 3.7% in April 2009. The private investment
contribution increases to $157.3 billion in eleventh plan, as compared to $47.87 billion in the
tenth plan.
A major Issue of faced by this industry is its contribution to the Global warming. According to
the International Energy Agency (IEA), the buildings sector accounted for the largest share of
India’s final energy use between 1995 and 2005. In 2005, this sector consumed 47% of the total
final energy use. Residential buildings accounted for 93% of the total building energy used in the
same year.
It’s a major issue which is threatening the whole world and all the countries are taken various
measurements towards the reduction of carbon emission and saving natural energy to avoid the
scarcity of renewable energies. Green building i.e. sustainable path is one of the solutions
accepted by many developed countries in the early 2000 to reduce the consumption of air, water
and other renewable energies and utilizing natural resources to reduce their carbon footprints.
However, the Ministry of Power and BEE issued ECBC in 2007. It is the first standalone
national building energy code in India. While it is currently voluntary, ECBC establishes
minimum energy efficiency requirements for building envelope, lighting, Heating, Ventilating
and Air Conditioning (HVAC), electrical system, water heating and pumping systems. To
develop ECBC, BEE collaborated with a diverse group of domestic and international technical
experts.
Nonprofit organizations like The Indian Green Building Council (IGBC), The Energy and
Resources Institute (TERI) are actively promoting green buildings in India. Promotion for a
whole-building approach to sustainability by addressing performance in the following five areas:
In addition, LEED India has adopted several benchmarks for building performance. The rating
levels “Platinum,” “Gold,” “Silver,” and “Certified” indicate the extent to which a building
excels the requirements of the national codes.
Over last few years, IT and ITES has been the primary contributor in the acceptance and
development of ‘go green’ philosophy. A case in point is Turbo Energy Limited’s (TEL) R&D
and Administration block in Paiyanur, Chennai, which has been certified by LEED as the
greenest building in India and 2nd greenest in the world. Other prominent green projects would
include ITC Green Centre (Gurgaon), IGP Office Complex (Bengaluru), Kalpataru Square
(Mumbai) and CII-Godrej Green Business Centre (Hyderabad), though the concept is yet to
catch on a wider basis. Also a key supportive role is shown by India’s biggest bank SBI. It is
offering concessions on constructing green developments (lower upfront margin up to 5-10%,
and reduction in interest rate by 0.25%) that could start similar trend across industry.
ECONOMIC ADVANTAGES
There are some clear economic advantages to sustainable building. Since clients generally pay
for the energy and water we use, it would follow that reducing that consumption would lessen
the financial burden of building operations.
In the case of passive heating and cooling systems, this also means a reduction in maintenance
costs. And by improving the comfort for our buildings' occupants, we can reduce costly
employee turnover. The economic benefits of sustainable design can be realized in the short
term, long term, and in the added value projects.
The good news for this criticism is that recent growth in the green market is becoming a much
more competitive market and therefore, it could possibly reduce the additional buildings cost to a
significant level in the near future. In fact, it is already evolving and the competition is driving
the prices down. It won’t be too long before the local home building super store will have a
green building section where these products are readily available at a competitive price.
But one of the greatest disadvantages of Green Building happens to be its main focus, the
environment. It may look odd statement because of the numerous benefits provided by green
buildings for environment.
For example, in recent years American’s homes have become more and more energy efficient
which has added to the problem of Indoor Air Quality. Client’s homes have become so sealed
that they are affected by indoor pollution. Eventhough Green Buildings address the issue of
indoor air quality, focuses mainly on the overall impact the building and building process has on
the environment and does not have the health of the occupants as its priority. So, at times, this
focus can be at the expense of indoor air quality and ultimately it leads to health problems.
A green builder may choose to replace all the light bulbs with energy efficient florescent lights
which are known to emit more radiation. Research studies are showing that this radiation can
potentially cause health problems.
IMPLEMENTATION
First and foremost requirement is the implementation of ECBC. Till now, ECBC is currently
voluntary, but in the future, either the central or state governments should decide to adopt it as a
mandatory standard. No states have adopted it yet. BEE is working closely with national and
state-level government agencies to promote ECBC. Once ECBC becomes mandatory at either
the central or state level, one can assume that the implementation and enforcement approach will
be similar to that employed for other mandatory building codes.
A more mobility is needed from administration side so that long term goal of India as an energy
efficient, developed economic giant can be traced on realistic grounds even if in short term we
have to pay for it.
AWARENESS FOR GLOBAL MARKETING NEEDS
Signs of improvement in the energy intensity figures were only observed with the opening up of
the economy during the last one and half decades. Increased competition both at home and
abroad, has compelled the business leaders to look into alternative options to save energy cost. In
this new century, when most of the industries were gearing up to boost exports, they realized that
the cost of energy was robbing off their competitive edge in the international market.
In India, the cost of power has escalated three fold in the last ten years. This probably can
explain better why the green buildings which are estimated to reduce energy cost by 40% are
likely to be the fighting front in the global markets.
CONCLUSION
Green building is an emerging concept in the rapid growing Infrastructure Industry. It is a
solution to the climate change and Global warming which is mainly caused by worldwide carbon
emission. All the developed and developing countries are very serious towards their carbon
emission. Major carbon is released from transports and also from construction industry. Green
building is a sustainable building which reducing 40% of energy used in convention building and
also providing health space the occupants. So this concept is attracted by many countries and
already implemented in many developed countries in early 2000. But in India, this concept is still
in early acceptance stage, due to various implementation issues which is described in this paper.
Indian government needs to take major steps to ensure this concept should be accepted nationally
by all state governments. It needs to form a Council and committee to implement this concept to
reduce the carbon footprints of India to reduce the impact of climate change and Global
Warming.
With strong leadership, clear vision and the right mix of policies and practices, India can make
green building standard practice for all new and existing buildings. Today, there is a strong
momentum supporting green building. We must capitalize on that momentum.
BIBLOGRAPHY
Journals Referred
1. “State environmental policies: Analyzing green building mandates”, Peter J May,
Review of Policy Research, Vol.24, issue: 1, 2007.
2. “Portland’s green building cluster economic trends and impacts”, Jennifer H Allen,
Economic Development Quarterly, 2008, vol.19 (12), p.22-29.
3. “A comparison of occupant comfort and satisfaction between a green building and a
conventional building”, Warren L Paul and Peter A Taylor, Building and
Environment, vol.43, issue: 11, 2008.
4. “Occupant satisfaction with Indoor environmental quality in green building
concept”, S Abbaszadeh, L zagreus, D Lehrer and C Huizenga, Proceedings of
health buildings, vol.3, issue: 1, 2006.
5. “Adapting aspects of Green Buildings (GB) Tool 2005 - Searching for suitability in
Taiwan”, K Chang, C Chiang and P Chou, Building and Environment, vol.42, issue:
1, 2007.