Building Energy and Cost Performance : An Analysis of Thirty Melbourne Case Studies

This study investigates the energy and cost performance of thirty recent buildings in Melbourne, Australia. Commonly, building design decisions are based on issues pertaining to construction cost, and consideration of energy performance is made only within the context of the initial project budget. Even where energy is elevated to more importance, operating energy is seen as the focus and embodied energy is nearly always ignored. For the first time, a large sample of buildings has been assembled and analyzed to improve the understanding of both energy and cost performance over their full life cycle, which formed the basis of a wider doctoral study into the inherent relationship between energy and cost. The aim of this paper is to report on typical values for embodied energy, operating energy, capital cost and operating cost per square metre for a range of building functional types investigated in this research. The conclusion is that energy and cost have quite different profiles across projects, and yet the mean GJ/m or cost/m have relatively low coefficients of variation and therefore may be useful as benchmarks of typical building performance.


INTRODUCTION
Energy has become a significant issue worldwide.Greenhouse gas emissions (GGE) and the perceived threat of climate change (caused by phenomena such as global warming and ozone depletion) is identified by Beggs (2002, p.10) as driving, "more than any other issue", change in energy consumption attitudes.Since the energy crisis of the mid-1970s attention has been directed towards strategies that lower operating energy demand (Robertson 1991), yet it has been only recently that the impact of energy embodied in building materials themselves has come under scrutiny.
Australia has the highest per capita GGE in the world (NAEEEC 1999, Department of Natural Resources and Environment 2000, ASEC 2001).Without targeted and effective action, these emissions are projected to grow by 28% from 199028% from -201028% from (NAEEEC 1999)).Bell and Fawcett (2000) indicate that GGE from the Australian construction industry are substantial and rapidly rising, particularly in the commercial sector.Buildings consume 40-50% of the energy and 16% of the water used annually worldwide (Lippiatt 1999, Hoglund 1992, Lam et al. 1992).
Buildings comprise a combination of embodied energy and operating energy.It is now realized that a focus on operating energy is insufficient to address either national or international GGE concerns (Fossdal 1995).Embodied energy is steadily increasing (AGO 1999) due to a greater use of energy-intensive materials (such as aluminium, stainless steel, coated glass and high strength concrete), larger buildings, more frequent refurbishment cycles, more machine utilization in construction processes, higher transportation energy and the introduction of new technologies such as photovoltaic cells and building management systems.Despite this trend, the routine analysis of embodied energy remains absent (Treloar, Ilozor et al. 2002).Boustead and Hancock (1979) suggest that embodied energy analysis is more comprehensive than the standard industrial paradigm as the system boundary is extended to the economy of the construction sector and other related sectors.
There are four types of embodied energy analysis described in the literature.These comprise process analysis, statistical analysis, input-output analysis and hybrid analysis.
No method is perfect.Incompleteness in typical embodied energy analysis is estimated at around 20% (Treloar 1997).
The input-output-based hybrid method, as used in this paper, is described by Crawford (2004, p.130) as "the most sophisticated complete life cycle inventory assessment method currently available for assessing environmental impacts associated with building and building-related products".
Proper energy analysis during the design process can no longer be simply overlooked.ASEC (2001, p.100) indicate that "total energy use has doubled [in Australia] over the last 25 years […] at a faster rate than GDP".The rationale behind this paper firmly lies with the perceived lack of integration of energy analysis into current practice.Capital cost still remains the primary criterion for building procurement decisions (Brown and Yanuck 1985, Langston 1991, Bull 1992), while other criteria are given less significance either due to a narrow myopic focus (Ashworth 1988) or because a suitable multi-criteria technique has not been satisfactorily identified (van Pelt et al. 1990).Energy analysis is costly, time-consuming and, when undertaken during the design phase, usually based on a large number of assumptions (Verbeek and Wibberley 1996).Even so, it is likely to produce conflicting advice to that generated from capital cost estimates (Arnold 1993).This occurs because energy analysis takes a long-term view, one that introduces multiple stakeholders and wider social concerns, rather than merely reflecting immediacy and profit-centred objectives.It has been argued over many years (e.g.Stone 1960, Kirk and Dell'Isola 1995, Flanagan and Norman 1983, Langston and Lauge-Kristensen 2002) that costs should also be accounted over a longer time span.Known as life cycle costs (LCCs), these comprise both initial (capital) and recurrent (operating) components that can be aggregated to give a more realistic picture of the total expenditure commitment (Fuller 1982).
The problem essentially is how two criteria, one measured in financial terms and the other in pure energy terms, can ever be reconciled to provide clear building design guidance.
It is not commonly understood that the lowest LCC solution will automatically be the lowest energy solution.In fact, any comparison of particular material choices will usually indicate that cost and energy ratios vary widely (Irurah and Holm 1999).Yet at the level of an entire building this differential is expected to be less -a view that is supported to some extent by the manner in which embodied energy intensities are often determined (i.e. from national input-output financial tables) and operating energy interpreted (i.e.incurred cost).
If there is an inherent relationship between energy and cost that can be exploited to enable better design solutions to be identified, then it should be possible to quantify energy directly from an LCC investigation.The outcomes will naturally be dependent on the chosen time horizon for the study but will simplify the process of embodied energy calculation (in particular) that to date has proved elusive to common practice.
The purpose of this paper is to present the energy and cost profile, both in initial and recurrent terms, for a range of building types in Melbourne, Australia.From this information, a better understanding of facilities performance can be obtained, leading to further insight into the relationship between energy and cost.The structure of this paper is to review literature on energy and cost relationships and to highlight a gap in knowledge, to outline the method adopted in this research, to analyze the results, and to make observations and draw conclusions for practice.

BACKGROUND
Energy and cost are similar in a number of ways.1987).This complex interdependence involving tangible and intangible goods and services suggests that price signals alone must be inherently incomplete.

METHOD
The selected research method is sampling via case studies.Case study is an ideal methodology when a holistic in-depth investigation is needed (Feagin et al. 1991).It has been used in varied investigations, particularly in sociological studies but increasingly in construction.The procedures are robust, and when followed the approach is as well developed and tested as any in the scientific field.Whether the study is experimental or quasi-experimental, the data collection and analysis methods are known to hide some details.Case studies, on the other hand, are designed to bring out the details from the viewpoint of the participants by using multiple sources of data (Tellis 1997).
The data for the research are drawn from actual case studies obtained courtesy of the Melbourne office of Davis Langdon Australia, a large national quantity surveying practice.Case studies are located across Greater Melbourne and are specifically intended to reflect a broad range of functional purpose.
Capital cost data and floor areas are obtained direct from the elemental cost plans prepared by Davis Langdon Australia.Embodied energy intensities are estimated from the composite items of work listed in these documents using the input-output-based hybrid method developed by Dr Graham Treloar (Treloar 1998, Crawford 2004).
Operating cost is estimated from reasonable cycles for future maintenance and replacement work using LIFECOST™ software.Operating energy is based on data obtained from the Property Council of Australia for Melbourne office buildings, adjusted to allow for extended opening hours for other functional uses.All costs are adjusted and expressed in fourth quarter 2006 dollars using published building price indices (BPI) also supplied by Davis Langdon Australia.
Thirty recent Melbourne projects are used as case studies.These projects represent diverse functions including provision of office workspace, health facilities, residential accommodation, teaching and laboratory space, retail, hotel accommodation and a number of specialist uses.Projects comprise both new construction (73.3%) and redevelopment (26.7%).So-called residential projects, comprising apartment buildings and aged care facilities, account for 23.3% of the case studies, and the remainder are constructed for various other commercial uses.One-third of the case studies are hospitals.Projects range from 1997 to 2004, and vary in floor area from 249 m 2 to 18,821 m 2 gross floor area (GFA) and number of storeys from one to sixteen floors (although most buildings are lowrise).
The mean floor area is 3,749 m 2 (coefficient of variation of 110.75%).
They comprise a wide range of materials and standards, some are air-conditioned and some not, some have fire sprinkler systems, some have loose furniture and special equipment, and some have substantial external works.This mix decreases the likelihood that projects exhibit similarities in energy and cost performance.Economies of scale also play a part in larger projects, which tend to have lower unit costs than identical designs of smaller size.The mix is therefore effectively random, enabling a range of statistical techniques to be applied to the sample.Capital costs are converted to fourth quarter 2006 prices using a BPI provided by Davis Langdon Australia.Otherwise no adjustment to capital costs is undertaken and all unit rates are taken as correct and reflective of the project given applicable market conditions at the time.The BPI for fourth quarter 2006 is 175.0 (later indices were not used as they were still forecasts at the time of analysis).
Operating costs, on the other hand, are estimated using LIFECOST™ software provided by Computerelation Australia Pty Limited.Maintenance and replacement cycles are determined using personal experience together with a number of useful references (e.g.Dell'Isola and Kirk 1995), and priced by original unit rates with a suitable allowance for removal and disposal costs where applicable.All costs are adjusted to fourth quarter 2006 as before described.
Embodied energy, including both initial and recurrent embodied energy, is determined using a sophisticated spreadsheet model.The model is an input-output-based hybrid method that embraces both process analysis data (where it is available) supplemented with the input-output data from published government statistics (1996)(1997)  Note that the good practice guidelines were used in preference to the new building design target (PCA 2001) for the purposes of this study.The latter is a 28.5% reduction from the former, yet in the short-term this is unlikely to be achieved for the general run of projects except those that are specifically designed as energy efficient.
Buildings constructed before 2001 were assumed to also follow good practice, and some have undergone minor upgrade to lift their performance.
For all operating costs and operating energy, including recurrent embodied energy, a onehundred-year time horizon has been assumed.

Energy Data
Table 1 summarizes the case studies for total life cycle energy, initial embodied energy, recurrent embodied energy per annum, and other operating energy per annum.All data are expressed in primary energy terms per m 2 GFA, and simple statistical means and coefficients of variation are calculated.
Total operating energy is defined as including recurrent embodied energy; the latter comprising expected maintenance/repair and eventual replacement.This is therefore comparable with total operating cost other than cleaning (predominantly labour).Initial embodied energy relates directly to capital cost -and takes into account direct energy and direct cost for the construction process respectively.
From Table 1 it can be seen that the range of energy values for each project is quite consistent.This is surprising given the diversity of building types.In particular, the coefficient of variation for initial embodied energy per m 2 is just 14.61%.The variation is a little higher for recurrent embodied energy and other operating energy, but still shows remarkable consistency.
All operating energy is related directly to the hours that the building is in use, with hospitals, hotels and residential accommodation all at the higher end of the range.Higher or lower estimates of operating energy intensity can be readily interpreted.
Total energy increases from a mean across all case studies of 21.76 GJ/m 2 at construction to 209.79 GJ/m 2 over a one-hundred-year time horizon.
Of the annual increase recurrent embodied energy accounts for about 15% while the remainder (85%) is attributable to electricity and gas usage and dominates the life cycle.The coefficient of variation for total energy rises from 14.61% initially to 25.77% after one hundred years on the entire dataset.
The distribution of embodied energy between initial and recurrent is significantly different.For example, Preliminaries and Substructure elemental groups combined have 17% of total initial embodied energy but zero recurrent embodied energy.Nevertheless, Superstructure and Special Provisions are the largest categories in both cases (about half).Figures 1 and 2 illustrate the distribution and are based on the mean GJ/m 2 of embodied energy over a onehundred-year time horizon across all case studies.Other operating energy is excluded as it is allocated to Services only and will completely dominate the chart.
Building elemental groups (i.e.Preliminaries, Substructure, Superstructure, Finishes, Fittings and Services) account for 77% of initial embodied energy and 67% of recurrent embodied energy.Special Provisions also includes other indirect energy (incompleteness) that fills the gap between the total pathways and modified (quantified) pathways.Site Works and External Services do not have an influential impact on embodied energy distribution.The first observation from this data is that, on every project, energy expenditure is less than recurrent expenditure.This is in contrast to Table 1 that shows, again for every project, operating energy is more than recurrent embodied energy.The reason for this disparity lies with the subsidized price of energy in Australia and particularly the structure of pricing based on delivered rather than primary energy.
As expected, the mean capital cost/m 2 varies with project type (e.g.residential accommodation averages $2,332.52 and hospitals average $2,961.12),but are also affected by the extent of refurbishment involved (new projects are usually more expensive than redevelopment projects).While the coefficients of variation are not excessive, they are higher than the energy figures presented earlier in Table 1 in all three cases.
Total life cycle cost (life-cost), defined here as the sum of capital cost and operating cost, increases from $2,540.49/m 2 initially to $16,456.61/m 2 after one hundred years, multiplying the initial cost by nearly six-and-a-half times.The coefficient of variation rises only slightly from 25.41% to 26.26% over the same period.The cost of energy is just 20.63% of the total annual operating cost on average.
Figure 5 elaborates further on the distribution of operating cost over the full one-hundred-year time horizon across all projects.The pattern is remarkably even.
The highest category is "other" costs, which includes essential staffing for general maintenance, gardening and security.The category with the highest variation by project is cleaning (CV=76.87%),followed by maintenance/repair (CV=45.40%),other costs (CV=38.60%),energy (CV=30.79%)and replacement (CV=27.40%),but these figures are significantly affected by several projects (notably Building 18) with generally very low operating costs.In the case of occupier-owned residential accommodation, routine cleaning is undertaken by the owners for no extra cost.
Operating cost is dominated by Preliminaries (46%), as seen in Figure 7.This element includes items such as municipal rates, insurances, essential staffing (maintenance, gardening, and security), garbage collection, maintenance equipment, and contract cleaning.Building elements dominate at 90% of the total.The cost of energy, in a similar way to the data presented in Figure 2, is excluded.If it had been added under the Services elemental group, both Preliminaries and Services would have each represented 36% of the total operating cost.Operating energy, on the other hand, is 85% of the total, mainly due to impact of primary energy and no price subsidization.
The distribution of capital cost across the thirty case studies yields few surprises.Figure 6 shows capital costs by elemental group.Superstructure and Services are the two largest groups (both equalling 29%) while Preliminaries and Finishes account for 10% and 11% respectively.
The building elements (Preliminaries through Services) account for 89% of the total capital cost.What is interesting about the distributions is that they have different patterns.This difference is not only between capital and operating cost, but also between initial embodied energy and capital cost, and between recurrent embodied energy and operating cost.This would suggest that it is unlikely that energy and cost would have any strong relationships, and may explain to some extent why a relationship, should it exist, is not well understood.
Figure 8 provides further insight into the distribution of cost within the major elemental groups.External Alterations and Renovations are not included for clarity, even though some minor costs occur.The comments made earlier in relation to embodied energy apply equally well here.The main difference in fact between Figures 3 and 8 is the decrease in the proportion of Special Provisions and the increase in the proportion of Services in cost terms.

DISCUSSION
When the data are further explored, significantly more variation is found.Not all elements are present in all case studies, and this contributes to higher coefficients of variation in most cases.Furthermore, the lowest recurrent embodied energy is 0.03 GJ/m 2 /year for a car parking station, and the highest is 0.47 GJ/m 2 /year for a hotel.The mean in this instance is 0.28 GJ/m 2 /year with a coefficient of variation of 28.75%.Recurrent embodied energy can be compared to other operating energy involved in powering buildings, which ranged from 0.80 GJ/m 2 /year for a primary school to 2.32 GJ/m 2 /year for a hotel.The mean of operating energy calculates at 1.60 GJ/m 2 /year with a coefficient of variation of 31.00%.
All figures are expressed in primary energy terms.The difference between new and redeveloped projects is not significant when considering recurrent energy.
Embodied energy is normally distributed across all elements and elemental groups in a project.Across the case studies it is shown that the most significant elements for initial embodied energy are (in decreasing order) Special Provisions, Roof, Substructure, External Walls, Upper Floors and Preliminaries; the first includes an allowance for incompleteness while the last includes an allowance for direct energy in construction.
Recurrent embodied energy is concentrated in Special Provisions, Fitments and Special Equipment.The largest elemental group for initial embodied energy is Superstructure (35%) by a factor of two over the next largest.
These results provide useful benchmarking data for other Melbourne buildings, and indicate the significance of embodied energy compared to operating energy.Total embodied energy over one hundred years is estimated at 49.53 GJ/m 2 of GFA, while operating energy (primarily electricity and gas demand) is estimated at 160.26 GJ/m 2 of GFA.In other words, embodied energy is estimated at 23.61% of total energy needs.Over a typical building economic life of thirty years, the proportion of embodied energy rises to 38.49%, or an increase of about 63%.
Cost modelling is a well understood technique and commonly used in practice to predict building costs at various stages during the design process.The technique spans from simple algorithms through to complex models based on abbreviated measured work items.The cost/m 2 of GFA is frequently used to judge the completeness of an estimate by comparison with time-adjusted unit rates for historical projects of similar type.It is acknowledged that unit cost varies according to building type, as well as factors like location and access, market conditions, complexity and others.
The lowest capital cost (expressed in final quarter 2006 dollars) is $1,082.40/m 2 for a new car parking station, and the highest is $3,507.53/m 2 for a hospital redevelopment.The mean for capital cost is $2,540.49/m 2 with a coefficient of variation of 25.41%.Furthermore, the lowest recurrent cost (excluding the cost of energy) is $38.43/m 2 /year again for a new car parking station, and the highest is $184.38/m 2 /year for a new hospital.The mean in this instance is $110.46/m 2 /year with a coefficient of variation of 29.82%.Recurrent cost can be compared to other operating cost involved in powering buildings, which ranged from $11.03/m 2 /year for a primary school to $44.73/m 2 /year for a hospital.The mean calculates at $28.71/m 2 /year with a coefficient of variation of 39.31%.The cost of energy is very much linked to the hours of building usage, so hospitals, hotels and residences are generally bigger energy consumers.The contribution of electricity and gas is clearly more significant in energy terms than cost terms due particularly to its conversion from delivered to primary energy.

Figure 7 :
Figure 7: Operating Cost Distribution by Elemental Group

Figure 9 :
Figure 9: Distribution of Operating Cost by Project

Table 1
lists the case studies used in this research by building type.Case studies are identified by a numerical code, as the name and location of projects needs to be kept confidential (this is a non-negotiable agreement made between the researchers and Davis Langdon Australia).

m 2 ) (GJ/m 2 /yr)
financial year), extracted and compiled at Deakin University by Dr Graham Treloar and Dr Robert Crawford.

Table 1 :
Case Study: Base Information & Energy Summary (per m 2 Gross Floor Area)

Table 3 :
Table3lists the mean initial embodied energy in GJ/m 2 for each element, and the mean recurrent embodied energy in GJ/m 2 over the full hundredyear time horizon, while Table4lists mean capital and operating costs in cost/m 2 .Most coefficients of variation are high, and where the number of projects involved is also low little confidence should be taken in the mean.Statistical Summary for Embodied Energy by Element(Langston 2006)There is little similarity between Table3and Table4, with the exception of the coefficients of variation, which are close between energy and cost data for the majority of elements.No reason for this, other than coincidence, is apparent.Note that under Water Supply for operating cost every project is included, as the cost of water usage is allocated to this element.
, etc.), Electric Light and Power (given that electricity costs are included here), Floor Finishes, Special Provisions, Transportation Systems and Water Supply.The largest elemental group for capital cost is equally shared between Superstructure and Services at 29% each.Operating costs are divided between cleaning (14.16%), energy (20.85%), maintenance/repair (16.63%), replacement (20.76%) and other costs (27.61%) and are measured over a onehundred-year time horizon.