Towards a green economy 1 Introduction

1.1 The aim of this chapter This chapter makes a case – focusing on economic arguments – for greening the building sector. It also provides guidance on policies and instruments that can bring about this transformation. The broader goal is to enable public- and private-sector actors to seize environmental and economic opportunities, such as the efficient use of energy, water and other resources, to improve health, boost productivity and create jobs that reflect decent work and reduce poverty.

1.2 Scope and definition

This chapter encompasses both new construction and the retrofitting of existing buildings, with the focus on urban areas, which are expanding and now home to more than half the world’s population. The chapter covers an environmental and socio-economic agenda, with special consideration given to climate, health and employment. The analysis of resource use focuses mainly on energy, given its importance to the building sector and the relative abundance of data at the global scale. While efficiency in the use of water and land as well as recycling and waste is considered, covering a comprehensive environmental agenda of all life-cycle impacts is beyond the scope of this analysis.

According to the International Energy Agency (Laustsen 2008), green buildings are characterised by increased energy efficiency, reduced water and material consumption, and improved health and environment. The International Organization for Standardization’s definition of sustainable buildings combines a minimum

adverse environmental impact with economic and social aspects across various geographic scales. In this chapter, the concept of green buildings is similarly broad, including not only the environmental dimensions, but also economic dimensions (such as energy savings, the cost of greening, payback periods, productivity and job creation) and social dimensions (such as indoor pollution and health).

1.3 Structure of the chapter

This chapter has three main parts. Firstly, it introduces the sector and highlights key

challenges and

opportunities it faces today. Developmental, energy and environmental challenges are highlighted. The section notes trends in population growth and urbanisation, drivers for growth in the industry, and its resource use and environmental impact. Secondly, the next section sets out the case for investment in green buildings. This starts with a description of investment needs, cost benefit analysis and efficiencies to be gained. An overview of benefits covers energy and water, waste and materials, productivity and health, as well as job creation. Special consideration is given to the policy target of reducing GHG emissions from the building sector, based on 450 parts per million (ppm) as climate bench mark used by the International Energy Agency (IEA) in its climate change mitigation scenarios. Modelling by the Millennium Institute provides a green investment scenario for the sector, quantifying the implications of going beyond business-as-usual (BAU). Thirdly, the chapter gives an overview of policy instruments and tools that can be used by Government or regulatory institutions at different levels to advance green building.

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