The challenges and rewards of sustainable development

The following notes were originally prepared for a panel entitled “The Challenges and Rewards of Sustainable Development” at the OPPLive! Property Show at London’s ExCeL on 23rd October, 2009, chaired by Gordon Miller of www.whatgreenhome.com.

What is sustainability?

Here are some commonly used definitions:

Sustainability, in a broad sense, is the capacity to endure. In ecology, the word describes how biological systems remain diverse and productive over time. For humans it is the potential for long-term maintenance of wellbeing, which in turn depends on the wellbeing of the natural world and the responsible use of natural resources.

The best-known definition is from the World Commission on Environment and Development. This suggests that sustainability is defined as “forms of progress that meet the needs of the present without compromising the ability of future generations to meet their needs”.

Environmental sustainability refers to the environmental actions or impacts of what we do. In moving towards sustainability, we are attempting to reduce our ecological footprint or to tread more lightly on the Earth. This equates to reducing the amount of resources we use (and buy), the waste we produce and the emissions we produce.

Sustainability and property development

Buildings are responsible for about 50% of world energy use. Housing accounts for more than half of this. Energy efficiency in housing – mainly heating and cooling – is therefore a huge factor in the global energy equation.

Existing housing stock can be made more energy efficient, primarily by means of better insulation. Energy sources can also be made “greener” by substituting solar and/or wind power generation for older conventional sources.

With new housing, there is a much bigger opportunity. Energy efficiency can be designed in from the start. Basic principles – insulation, thermal mass, control of solar incidence and even use of prevailing wind currents – can be applied at the design and specification phase, leading to buildings that are not only considerably more energy efficient, but also more comfortable to live in.

New build in the Western Algarve

Starting out 10 years ago, I took on the challenge of developing a 90 acre site (now grown to 143 acres) in the Western Algarve of Portugal, surrounded on three sides by rustic land, on the border of a Natural Park, in an area of great natural beauty, where little to no development had taken place.

The Western Algarve is sometimes referred to as the Cornwall of Southern Europe, with a similar community of artists, musicians and fellow travellers, some of whom were my friends. These folks gravitated here from all over Europe largely attracted by the unique beauty of the area, so it just felt right to try to develop in a responsible manner, with due consideration for the natural environment.

I also didn’t much like what I saw being built. Quite apart from any design issues, the typical Algarve villa appeared to suffer from basic problems like summer overheating, winter cold and damp, aggressive mould and leaky roofs. The local way of building just didn’t seem fit for purpose. So I was fortunate in being able to persuade an old friend – Jes Mainwaring – to come down to Portugal and join me in the project. Jes had spent his professional life at the cutting edge of “green” architecture, as part of a team that had won “Green Building of the Year” at least twice and that had developed BREEAM (BRE Environmental Assessment Method: www.breeam.org).

Local conditions

Jes and I set out to take a fresh look at how to go about building energy-efficient houses in the Atlantic/Mediterranean climate. We looked at the local climatic and environmental conditions:

• 300 days (or 3,000 hours of sunshine) per year
• 60 cm rain per year, mostly in winter
• Hot summer days, but much cooler nights, with temperature drops of up to 20 degC
• Breezes prevailing from the NW
• Seismically active zone

Materials and systems for green design

We looked to apply the basic principles of green design and to identify suitable materials and systems.

As Europe’s biggest earthquake in recorded history had flattened much of the area 250 years previously, we decided to stick with a conventional reinforced concrete frame.

To avoid any issue with cold bridging across the concrete frame – a major cause of condensation and mould – we made up a complete external insulation envelope, comprising:

• A proprietary external insulation system (Sto: www.sto.co.uk) for the outer walls
• Timber doors and windows with high-performance double-glazing
• Timber-faced sandwich panels over laminated timber beams for ceilings
• A combined insulation and impermeabilisation system to cover roof terrace concrete slabs

The insulation envelope also protects the interior of the building from summer heat gains and winter heat losses.

What is thermal mass? It’s any dense material that can store heat or “coolth”. Once you heat it or cool it to the required temperature, it will continue to radiate heat or “coolth” for a long time, with no further energy input. A typical example of a building with lots of thermal mass is a medieval cathedral – wonderfully fresh, even at the height of summer, at zero energy cost.

The hollow baked clay bricks (“tijolos”) typically used in the Algarve didn’t qualify as thermal mass.

For examples of buildings with no thermal mass, think of most of the housing stock in the United States. To stay cool in the summer you need the air-con on all the time; ditto for the central heating in the winter. But, as well as just heating or cooling the air, much of the energy could be used to heat or cool thermal mass, if it were present.

We already had the concrete frame. We looked around for a thermally massive material to use for the inner walls, and met Constantin von Humboldt, (yes, a direct descendant of the famous Prussian naturalist http://en.wikipedia.org/wiki/Alexander_von_Humboldt), who was championing the use of sun-dried clay or adobe bricks for local construction.

We considered some other solutions, including concrete blocks, but none of them worked out any cheaper than the sun-dried adobe bricks. Von Humboldt had a small production facility going, which we agreed to move into an adjoining field, so that the bricks could be formed, dried and stored on site ready for use, with no further transportation cost. It turned out that you could use the same material in finer, granulated form for mortar and plaster. And there was a further bonus. Adobe is a natural, micro-porous material that also helps to regulate humidity by absorbing moisture when humidity is high, and releasing it when it is low.

Heating and cooling

The next challenge was to find suitable heating and cooling systems.

For cooling, we had the idea of bringing in air through underground tubes, where it would lose heat to the sub-soil. As of 2002, it was estimated that domestic air conditioning in Southern Europe was already responsible for a massive 90 million tonnes of carbon emissions, and increasing prosperity was boosting the use of air-con and growing carbon emissions. We worked with John Doggart of London-based energy consultants Faber Maunsell to look at ground cooling as a low-energy alternative to air conditioning. John identified some European project partners and we were able to obtain some highly-prized EU funding. We called the project Coolhouse.

With engineering help of the team in London, and Professor Mat Santamouris of the University of Athens who had developed the empirical formula, we developed a simple design that would use a big fan to suck air through 16 cm. diameter PVC tubes buried a couple of meters underground. The fan would blow the air into a sub-floor void or plenum, and up into the house through horizontal vents at skirting level. The system was predicted to result in an average 30C reduction in internal temperature, but with a higher peak reduction.

For heating, we settled on an ultra-efficient condensing gas boiler with a hot water cylinder, and a radiant skirting heating system in which heated water flows behind aluminium skirting sections at ground level. Like conventional radiators, this system had the benefit of being able to deliver radiant heat quickly, but the plan was not only to deliver radiant heat to the room but also use it to heat the thermal mass of the adobe walls. As the radiant skirting distributes heat evenly along the wall, it does this better than conventional radiators. Once the thermal mass reaches the right temperature, the heat source can be switched off, and the thermal mass will continue to give out its store of heat for hours if not days. The other benefit of radiant skirting is that it does not take up wall space.

The architecture also took account of solar incidence. We used solar-control glass, measured overhangs and shutters to protect south and west facing glass surfaces from the high summer sun, while allowing the lower winter sun through, to help warm the house.

A more technical summary by Jes Mainwaring entitled “Coolhouse: Cooling Without Carbon” can be found elsewhere on this blog.

With a building specification that would be completely new to Portuguese builders, we had to produce very detailed construction drawings, to ensure that all the kinks were ironed out ahead of time. Nonetheless there were a few teething issues, and the first 6 houses took a bit longer than expected to build, but the buildings and the Coolhouse systems are still happily in use 6 years later, with no maintenance problems.

The Coolhouse project called for strict monitoring, as the objective was to provide some benchmarks for other building professionals to use in deploying similar systems. The final report can be found at: http://www.softech-team.it/Coolweb/CoolHouse-Monitoring-PT.pdf.

The results were even better than expected. As a result of the combination of measures that we had taken, internal temperatures remained basically constant day and night over a 2-month summer period, at around 26oC, while external temperatures varied from lows of 18oC to regular highs of 38oC. We had succeeded in completely stabilizing the internal temperature at a relatively comfortable level.

While the average cooling effect was 3 to 5oC, the peak cooling effect was up to 12oC. And all this using only a fan that drew a maximum of 170 watts for 8 -10 hours a day, the equivalent of a 60 watt light bulb. The engineers calculated a 94% energy saving over a conventional ducted air conditioning system achieving the same result. Thanks to the adobe, the internal humidity levels also stayed within a narrow and healthy band as well.

We have since built a further 76 houses to a similar specification, with only a few minor refinements to protect the adobe from wet weather and from internal damage.

The costs

So far, to my knowledge, AlmaVerde remains one of the only leisure developments in the world to have taken a serious stab at energy-efficient construction.

It is sometimes said that “energy-efficient construction” only requires a marginal (3 – 5%) increase in build costs, one that is amply repaid by the resulting energy savings. This clearly depends on the starting point for comparison and the definition of energy-efficiency. In countries where building codes are more advanced, this can be the case, but in Portugal it is simply unrealistic.

What I can say is that, compared with a “good quality” Portuguese build, such as you will find in other resorts up and down the Algarve, our construction specification adds about 22% to the overall turnkey cost of a villa with pool and landscaping.

This is not strictly comparing like-for-like. A better comparison would be with a villa equipped with a ducted air-conditioning system. The difference then reduces to about 15%, or about €235 per m2 of construction. Bear in mind that new-build in Portugal attracts IVA (value added tax) at 20%, so without this, it would be more like €195 per m2. An even better comparison would also take de-humidification into account, but I don’t have costs for this to hand.

The extra cost breaks down into several main areas:

– One third (33%) is the additional cost of the external insulation system, with its 6 cm of extruded polystyrene and its pre-coloured, washable, flexible thin coat render system, versus 3 cm of cavity insulation and an external painted sand and cement render with no cold bridging protection;

– One quarter (25%) is in the roof structure with its 8 cm of sandwich panel insulation, plus the externally applied insulation and impermeabilisation combo over flat roof terrace slabs;

– 22% is in the Coolhouse comfort cooling system, including the extra excavation, tubes, equipment, and the additional foundations necessary to support the beam and block concrete floor;

– 10% is in the additional adobe material to provide thermal mass and humidity regulation;

– 10% is in the superior radiant skirting central heating system (assuming the lower cost Thermaskirt system now available from Martin Wadsworth, the guy who faced off with Duncan Bannatyne in Dragon’s Den: see www.thermaskirt.com); under-floor heating would take this a bit higher.

Was it worth it?

It has certainly not been possible to pass on all of these costs through higher pricing. Most buyers have been primarily interested in location and price. Specification typically only becomes as issue when comparing two properties in a similar location and price band.

British buyers in particular are simply not accustomed to thinking about specification, particularly when buying a new property. Buyers of new built properties in the UK are protected both by a fairly robust building code, and by a 10-year NHBC guarantee.

Buying in Southern Europe is a bit different. The building codes are not as strong. The local building industry is not as sophisticated or as developed. And, as we know from the many well-publicised horror stories, buyers, dazzled by the sunshine, often bring their wallets but leave their common sense at home.

So why spend extra money building to a higher energy-efficient standard, if it can’t even be recouped? Let’s see how much money we’re talking about.

We build all of our villas to the same eco-friendly specification, 82 of the 100 built on the site to date. With an average villa size of say 170 m2, this means that we have spent an additional 3.2 million euros to achieve a superior level of thermal stability and energy efficiency versus the “good quality” Portuguese build. This equates to about half a million euros per year over the marketing life of the project to date.

I have always been able to rationalize at least some of this as the cost of achieving a unique market position. As a pioneer in delivering eco-friendly homes commercially in quantity, we have been able to get a lot of press exposure and to win lots of awards. This all has a definite value, although it is difficult to quantify.

How much more would we have had to spend to achieve this level of visibility without the eco approach? No doubt an additional half a million euros a year over 7 years would have gone a long way.

How commercially successful would we have been without the eco approach? With the additional marketing spend, we could have generated more leads, hired more sales people and closed more business.

Without the need to be so meticulous in planning and producing detailed construction drawings, we could have made faster progress, and may even have completed the project before the current slow-down hit.

Indeed, there are some additional hidden costs here, both in terms of architecture and project management, and in terms of opportunity cost, that I have not tried to factor in.

But would we have been able to achieve the same prices? Possibly not. The higher spec and unique qualities of the AlmaVerde construction have definitely helped us to achieve higher prices than might otherwise have been possible, as well as capturing sales that would otherwise have gone elsewhere.

The choice of professionals

It is worth mentioning the large number of our owners who happen to be in property and construction related businesses:

– 5 Chartered surveyors of which 2 are also property lawyers
– 3 Architects
– 10 Builders and contractors
– 8 other developers or agents

These are the people who actually “get it”. They have the background to be able to understand and appreciate what we are doing. They are keen to avoid the pitfalls of poor or inadequate construction, and to take advantage, not only of lower energy costs, but lower maintenance costs as well.

Let’s look at the cost issue in another way:

The additional construction cost of the eco-specification is about 8% of the 40 million in sales achieved.

Some of this has been effectively spent on market positioning and some recouped through higher pricing. 50/50? I don’t know. But this is missing a big point. John Wanamaker, founder of a famous US department store, famously said that half of an advertising budget is wasted – the trouble is you don’t know which half.

However, when you’re spending, not on ephemeral marketing impressions, but on improving quality, the money is never actually wasted. It is going to build client satisfaction over the long-term, ultimately leading to recommendations, referrals and repeat business.

If we were starting today to establish an eco-friendly niche, we would no doubt meet more competition from other developers who are at least trumpeting their eco-credentials, even if their measures are only the most superficial.

Public awareness has come a long way since we started out 10 years ago, but, for most people, “living the dream” means relaxing by your own private pool with a gin and tonic, ice, and a slice
from your own lemon tree. It does not mean enjoying the radiant “coolth” from a well-insulated slab of suitably heat-purged thermal mass.

So, for most people paying lip service might be enough. As always the truly well-informed are in the minority.

We are who we are and we do what we do. At AlmaVerde, we intend to remain at the forefront of energy efficient design. Our next step will be to use solar energy to create a store of heat, which can then be used to bring warmed air into the house when it is needed, much as Coolhouse brings in cooled air. Our particular holy grail is still to deliver zero-carbon villas on a commercial basis.