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Sustainable Design & Risk
Introduction
The interest along with requirements for sustainable projects has increased dramatically and a trend that will most likely continue. With sustainable projects comes increased risk and liability exposures for design professionals. Many sustainable concepts incorporate new and innovative products, energy saving systems, recycled materials and construction methods with subjective outcomes. For buildings, certification programs promote improved health and well-being of occupants and students. Since there is no proven track record for many of these concepts, it presents unique challenges along with associated risks for the architects, engineering and environmental (A/E/E) community.
LEED Buildings Not Meeting Expectations
Two recent reports on LEED Buildings provide data that buildings are not performing at the levels expected. One report by Rob Watson, editor of GreenBuildings.Com and well know for developing the USGBC’s Leadership in Energy and Environmental Design rating system (LEED). Watson’s report includes data, identifies market trends, water efficiency and energy use for LEED projects. The data indicate discouraging results with “Some LEED buildings are not performing as expected given their design and technology elements.” states Watson.
Another report released in October, 2009 by USGBC Chicago evaluated efficiencies of LEED certified buildings in Illinois. Findings show LEED buildings were performing only 5 percent better than non-LEED buildings throughout the region. Platinum and Gold LEED structures were found to be no more efficient than Silver or basic LEED certified buildings that routinely have significant increases in design and constructions costs.
Managing Expectations
What does this mean for A/E/E's? Most likely unhappy clients and increased risk if performance and energy savings were identified or implied on projects. Many clients are expecting to recoup increased costs for design and construction of LEED buildings through improved performance and energy savings.
To manage sustainable design risk, it’s critical to have a up-front, in-depth, well documented discussion with clients regarding their expectations. Topics include the actual costs that may be incurred, the energy benefits that will be endeavored, risks vs. rewards using new or untested products and technologies as well as the operation and maintenance responsibilities upon completion. Discuss how far does the client want to go in pursuing sustainable design? Is LEED or another energy program certification an objective of the project? Answering such questions and understanding the client’s objectives and expectations will lessen the design professional’s exposure to risks and litigation.
Green Expertise
Based on their knowledge and expertise, design professionals are in a unique situation to play a leading role in the green movement. However, recent surveys of design professionals have shown that a large percentage of architects, engineers, and contractors have limited expertise and technical understanding of the green building methodologies needed to properly design and oversee the construction of green buildings. Design firms eager to jump into the green marketplace, but relatively inexperienced, may run into trouble if they underestimate the costs and expertise needed for sustainable projects. Business as usual is not the approach needed when it comes to sustainable projects.
Key Challenges & Questions
1. Are client expectations consistent with the A/E/E’s qualifications and capabilities?
2. What is the experience of the design team, contractor, and client on green projects?
3. How are the goals and project expectations defined; how will decisions be made, and how will they be documented?
4. Who is responsible for identifying and investigating new products and systems and to what degree?
5. What are the expectations of the end-users of the project?
6. How is the owner/operator going to be trained on the operations and maintenance responsibilities of the building systems?
Cost of Going Green
Green building design and construction promote energy and other environmental savings over a building’s life cycle. These are calculated savings where an Owner’s original investment may be paid back over time. Owners anticipated cost savings relate to the building’s life cycle, and saving may be minimal in the near future when compared to the increased capital required for green building design and construction.
The National Renewable Energy Laboratory (NREL) in Golden, Colorado a unit of the U.S. Department of Energy (DOE) is midway through construction of a $64 million project that lays claim to the title of being the "Greenest building in America". Architects and engineers have spent hundreds of hours calculating the energy use of every aspect of the building, from the elevator to the exit signs. They have tweaked the design with the aim of getting the 218,000-square-foot building to perform at net zero—meaning it will not draw energy from the power grid. All these techniques cost a premium. A run-of-the-mill office tower in Denver runs at $140 per square foot to design and build. The NREL building costs will be twice that at $280 a square foot unfurnished, according to Haselden Construction.
New Material & Technology
Green and sustainable project incorporate innovative construction technologies and materials. The design professional should inform the owner of the potential risks entailed in specifying them. It is up to the design professional to become knowledgeable about new products and not accept based solely on manufacturer product data sheets and sales literature. Manufacturers may perform minimal analysis and limited testing of new products and systems. The first projects to use them will be the beta tests.
Every new material or application should be carefully evaluated for the project and tested to determine its capabilities for intended use. The owner and design professional should agree on the depth and length of analysis of products and locate projects where they have been used in order to validate performance. When reliable performance criteria is not available, hiring independent testing laboratories is a consideration, though adds cost to the project. All discussions and decisions about using new materials and technologies need to be thoroughly documented for the project file.
Contract Provisions
A good contract is always the best line of defense when it comes to managing and mitigating risk. The contract is an excellent method for defining your scope of services- what will be offered, when, how much it will cost, and on what schedule. Contracts are excellent method for managing and establishing client expectations. Contracts for green projects should address the following:
1. Which new and innovative products and technology may be used. The owner must understand that sustainable project objectives in many cases are speculative. At this point, many products and systems do not have a proven history of successful application.
2. Customary standard of care shall be applied to achieve project objectives. It is vital that no warranty or guarantees are expressed or implied on project performance or achieving LEED or other any energy or environmental certification level.
3. The level of investigation, analysis and selection process of new material and technologies should be spelled out and the risks vs. rewards in their selection.
4. The client must agree to measure the potential risks related to incorporating the innovation product and/or system and accept those risks.
5. The design professional must limit exposure to consequential damages.
6. Upon completion, the Owner is responsible for inspection, operation and maintenance duties.
Conclusion
A/E/E professionals are uniquely qualified to take a leading role in green and sustainable design project. Taking on these projects should not be taken lightly and without evaluating associated risks. There is a great deal of subjectivity in green projects and caution is needed when selecting clients, managing expectations, specifying new products and technologies, determining appropriate project team capabilities, and drawing up contracts provisions. All critical elements required for a successful sustainable project.
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artRisk LLC