"The Cost of LEED" Report and Understanding the Cost of LEED Project Certification

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The Cost of LEED webinarClick to view the LEEDuser webinar on "The Cost of LEED"!What does LEED cost?

How much does LEED certification cost? Earning a LEED certification for a project involves several different types of costs, and you have to consider each separately to get an accurate picture.

Let’s envision the cost of LEED as an inverted pyramid with five levels from bottom to top. The bottom level is both the smallest (in size and cost) and the top level is potentially the biggest, but also a place where you have a lot of leeway. We’ll start at the bottom.

1. The fees

The most direct cost is also the smallest: the fees you pay to the Green Building Certification Institute (GBCI) to register and then to certify your project. These are roughly 3¢–5¢ per square foot for New Construction, depending on the size of the project and whether or not you get the USGBC member discount.

2. Cost of documentation time and effort

Next up the cost pyramid is the time and effort that someone has to put into compiling and submitting the LEED documentation and generally managing the compliance process.

This cost could be for an outside consultant hired just for that task, someone on the staff of the design firm, the contractor, or the owner. This is a big project for someone doing it for the first time, and not such a big deal for someone who has done it enough to have figured out the process and created or purchased effective tracking systems.

It helps if the team is experienced and each person doesn’t need too much coaching to provide her pieces of the documentation. It also depends how many credits you’re going after, and, to some extent, which ones. A few hundred hours to pull everything together for a big complicated project is not out of the ordinary; simple and small projects should take less time and effort.

3. Cost of extra research and design

At the third level, your baseline starts to become very relevant.

If your baseline is the cost to have a design team create a variant on their last few non-LEED projects, then designing to meet LEED standards will take some extra effort. But these added costs shouldn’t be attributed just to LEED—they are the costs of getting a better building.
To realize any high-performing building the team has to develop a range of scenarios, run simulations to determine how they will perform and prepare cost estimates to price them out. They also have to investigate alternative products and materials and explore the feasibility of new technologies. All these steps take time and effort—how much depends a lot on how experienced the team is and how aggressive the performance goals are for the project.

4. The cost of commissioning and modeling for compliance

LEED introduces a few requirements that add costs if they are not already part of the scope of the project. The most obvious of these is commissioning. At $0.50–$1.00 per square foot (or more for a complex building), commissioning may seem like a big investment, but it’s cheap compared to the cost of call-backs, fixes, and inefficiencies that are likely if you don’t do it. For this reason, many large owners, including the federal General Services Administration, require commissioning for all of their projects, so for them it is not an added cost.

Energy modeling is trickier. While energy modeling should be used to inform the design process for every building, they are most useful during early design phases. The models that have to be run for LEED documentation, on the other hand, are an added step, done late in the design process and often with different parameters. These models, or models like them, are also required by code in some places. If the models aren’t code-required then the LEED-specific model does represent an added cost that starts at $5,000–$10,000 and goes up, depending on the complexity of the project. For small projects it is possible to earn a few LEED energy points using the prescriptive path without doing such a model.

WEp1 and WEc3: Water Use Reduction cost premiumsConstruction cost premiums for LEED credits such as WEp1 Water Use Reduction are highly dependent on the savings being attempted and which strategies are chosen to get there. This table from the Cost of LEED report lays out the options.Another LEED-specific action—tied to an optional credit, EAc5 in LEED-NC—is to create a measurement and verification (M&V) plan and install monitoring devices needed to track performance. If you wouldn’t be doing this, then the monitoring equipment and writing and implementing the M&V plan require cost premiums, which are explored in the "The Cost of LEED" report. Like commissioning and energy modeling, M&V brings benefits—it’s the only way to know if your high-performance building is really performing as designed.

5. Costs of construction

Finally, we get to the top of our inverted pyramid, and what might be the biggest part of the cost picture: the hard costs of construction.

If the design team is experienced and the goals aren’t too aggressive, there may be no overall added cost because every cost premium has been offset with savings somewhere else. (For example, a smaller HVAC system resulting from a more efficient envelope.) We know this is possible because lots of projects achieve LEED certification on budgets that were set before LEED was introduced as a requirement. However, various studies have targeted a typical premium for LEED projects at 2%–15%, with the high end including a lot of on-site renewable energy generation for LEED-NC EAc2.

Managing costs of construction

To manage those costs you have to know, at least roughly, the price of a range of specific measures. It helps to know the following for example:

  • Demand-controlled ventilation adds about $1/cfm to the cost of a standard ventilation system
  • Bike racks will cost about $5 per full-time equivalentFull-time equivalent (FTE) represents a regular building occupant who spends 40 hours per week in the project building. Part-time or overtime occupants have FTE values based on their hours per week divided by 40. Multiple shifts are included or excluded depending on the intent and requirements of the credit. (FTE)
  • Showers and changing rooms will cost about $400 per FTE.

These figures, and many more, come from “The Cost of LEED”—a new report from BuildingGreen.

The Cost of LEED report

Going credit-by-credit through LEED for New Construction v2009 (LEED-NC), “The Cost of LEED” itemizes all the common approaches to achieving the performance that the credit requires and offers the view of an experienced cost estimator on the cost implications of adopting those technologies or design solutions.

“The Cost of LEED” can’t tell you what it might cost to locate your project near mass-transit for SSc4.1: Alternative Transportation—that’s too location and project specific for even a rough guess. But it can suggest a figure to put into your budget for any one of hundreds of specific technologies, and it identifies the other credits that might also benefit from that measure (so you can consider the appropriate synergistic benefits).

“The Cost of LEED” is available for purchase as a PDF through the LEEDuser website for $49.

Getting It Done

"The Cost of LEED Report" webinar recording

The video below is a recording of the April 13, 2010 webinar, "The Cost of LEED: A Credit-by-Credit Look at the Cost of LEED-NC v2009." See more about the webinar below.

“The Cost of LEED” is available for purchase as a PDF through the LEEDuser website for $49.

More about the Cost of LEED webinar

Do LEED-certified buildings cost more? Studies have indicated overall cost premiums for some LEED projects, but until now there hasn't been an objective study breaking it down, credit by credit, and strategy by strategy.

This webinar explores "The Cost of LEED" report from BuildingGreen, with research by Tsoi/Kobus and Associates Architects, AHA Consulting Engineers, and Vermeulens Cost Consultants.

Credit-by-credit cost premiums

This webinar discusses the background and methodology of the report, and discuss key findings.

  • What are the assumptions and cost basis information?
  • What are the key findings? (Including no-cost and low-cost credits.)
  • Which credits have major cost synergies?

Credit cost explanations

The webinar also gives detailed explanations of cost estimates and premiums on the following credits, exploring alternate scenarios and key components for each one:

  • WEp1 and WEc3: Water Use Reduction
  • EAp2 and EAc1: Optimize Energy Performance
  • IEQp1 and IEQc2: Ventilation Effectiveness

The report goes beyond providing cost premiums for each credit. It gives detailed tables of common strategies or components that are used to earn a credit, paired with percentage and dollar cost premiums for those strategies, over conventional options.

About "The Cost of LEED"

"The Cost of LEED: A Report on Cost Expectations to Meet LEED-NC 2009" is a 47-page report from BuildingGreen, LLC. Cost premiums (if any) are explored for each credit, with alternate scenarios. You can purchase the report as a download through LEEDuser and also go back to the main tab of this page to learn more about it and discuss what it means.

About the presenters

Jim Newman, LEED AP – BuildingGreen, LLC
Jim is the Director of Business Development at BuildingGreen, LLC and was instrumental in pulling together the consortium that made this groundbreaking report possible.

Stephen Oppenheimer, AIA, LEED AP – TK&A
Steve is an Associate and Project Manager with Tsoi/Kobus & Associates (TK&A). He has more than 25 years of experience that includes academic, health-care, R&D, and commercial projects.

Inga Leonova, LEED AP – TK&A
Inga’s experience covers 18 years of design, planning and project management on various institutional and commercial projects, including campus master planning, health care, K-12, higher education and life sciences. Inga is also with TK&A.

James Vermeulen, PQS, LEED AP – Vermeulens Cost Consultants
James is the Co-CEO of Vermeulens Cost Consultants. As a respected cost consultant, Professional Quantity Surveyor (PQS), and a LEED Accredited Professional he has provided cost estimating and program analyses for a wide range of projects since 1983.

Craig Chiarelli, LEED AP – Vermeulens Cost Consultants
Craig is currently a Senior Project Manager with full responsibility for an estimation team consisting of a cost engineer, a junior quantity surveyor, and a digitizing technician.

Robert G. Andrews, Jr., PE, CEA, LEED AP – AHA Consulting Engineers
Bob works as a green system advocate and project team resource in sustainable mechanical system and plumbing design.

Technical Guides

The Cost of LEED: A Report on Cost Expectations to Meet LEED 2009 for New Construction and Major Renovations

A 47-page report from BuildingGreen, LLC published in April 2010. Cost premiums (if any) are explored for each credit, with alternate scenarios. $49 download.


The Cost of Green Revisited

This paper from Davis Langdon is a sequel to an earlier paper entitled "Cost of Green: A Comprehensive Cost Database and Budget Methodology." This update looks at the cost of green by examining a larger sampling of buildings and looking at additional building types.


GSA LEED Cost Study

This report from GSA is a review of the hard and soft cost implications of achieving LEED certification.


Green Building Costs and Financial Benefits

This oft-cited report from Greg Kats of Capital E is a comprehensive cost-benefit analysis of green buildings.

Publications

Greening Our Built World

This book by Greg Kats is a reference tool for cost-conscious designers interested in exploring the advantages of green buildings.

10 Comments

George Abou Adal Apr 16 2010

Cost of LEED report - Internationl projects

Hi,
Does the report also covers cost issues for undertaking LEED certifications outside the US? Such as in the Middle-East?
Thanks.

Post a Reply

Nadav Malin replied President, BuildingGreen, LLC Apr 16 2010

Good question, George! The report focuses on construction costs for the high-performance measures that would be used to achieve each credit, based on the specific experiences of a team of designers and cost estimators in the Northeastern United States. The particular cost premiums that it provides would probably not be directly applicable to projects outside the U.S., but the list of suggested measures and the methodology for getting at the cost implications of each credit would likely still be quite useful.

So, if you have access to your own cost information for some of these measures that you can integrate into the information in this report, I think it would be quite useful. If you don't, it might still be interesting, but less valuable.

Richard Walker replied Apr 22 2010

This report should NOT be called the cost of LEED. It is clearly NC. When dealing with an existing building the costs and benefits are totally based on the facility that you're working in. When are we going to stop generalizing?

Michael Heacock replied Architect, LEED AP, Michael Heacock Architects + LEED Consultants Apr 22 2010

Finally! I'm really pleased with the presentation and report. Thank you for sharing your research and providing this useful tool, which will greatly enhance decision making for Owners and Project Teams. I am very happy to see both hard cost data and soft cost estimates discussed openly. Now we just need this information for EBOMEBOM is an acronym for Existing Buildings: Operations & Maintenance, one of the LEED 2009 rating sytems. and LEED-H.

Tristan Roberts replied Editor – LEEDuser, BuildingGreen, LLC Apr 22 2010

Michael, I'm glad you like the report. We worked hard on it and we're glad it's going to be useful to you.

Richard, a number of people have asked if this report is relevant to LEED-EBOMEBOM is an acronym for Existing Buildings: Operations & Maintenance, one of the LEED 2009 rating sytems., and my answer has been that while there may be some pieces that are relevant, it's not addressed directly. As you point out there are a lot of unique challenges with EBOM buildings.

We tried to make that clear in the title of the report, "The Cost of LEED: A Credit-by-Credit Look at the Cost of LEED-NC v2009."

Jonathan Weiss replied May 06 2010

This looks like a good report - like many earlier "cost of LEED" studies, it will be incumbent on us in the practice community to use the information well - e.g apply it and scale it as appropriate to our own projects. The lengthy list of assumptions at the beginning of the report (p. 3) are really important to the accurate use of the data. I look forward to delving into it!

Thanks, BuildingGreen team for developing this.

hao zhang replied May 23 2010

This report looks very interesting.indeed it's a report focus on leed NC projects,i hope more accurate information can be shared for the previous leed projects,inclusive of acutal operation performance.BTW,do you have some figures about leed proects in China or asia?thanks l lot!;)

Nadav Malin replied President, BuildingGreen, LLC May 24 2010

If other LEED users have cost information on their projects--what, if any, premiums they've paid to accomplish the performance required to earn certain credits, perhaps they'll post those here.

We hope to add information soon about how projects are achieving LEED certification in China--though it may take a bit longer before we can offer any cost information. Do you have any experiences to share?

David Wardell replied President & CEO, Leed International, LLC Jul 10 2010

George, if you have any questions concerning LEED costs and compliancy in the Middle East, please visit our website at http://www.leedintl.net. Fillout our "contact us" webpage and a representative will contact and assist you with any questions or information. Leed International has offices in Riyad, KSA.

M Bordeaux replied Graduate Architect, LEED AP Jul 13 2010

Thank you for the work in putting this report together! Just a small note for something that seems beneficial to see in an addendum--particularly for discussion with building owners--is the return on investment for each credit (daylight building vs. non-daylight), in terms of the cost savings in utility bills, etc. over a certain time period. While I realize there are many variables in this, it would be helpful to have a range to reference within the report.

Copyright 2010 – BuildingGreen, LLC