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MIChlyan State
University

This is to certify that the
thesis entitled

LIFE CYCLE COST ANALYSIS OF OCCUPANT WELL-
BEING AND PRODUCTIVITY IMPACTS IN LEED® OFFICES

presented by

Amanjeet Singh

has been accepted towards fulfillment
of the requirements for the

MS. degree in Construction Management

 

 

Méevw“

- Major Professor’s Signature

(9/13/09

Date

 

MSU is an Affirmative Action/Equal Opportunity Employer

 

 

PLACE IN RETURN BOX to remove this checkout from your record.
To AVOID FINES return on or before date due.
MAY BE RECALLED with earlier due date if requested.

 

DATE DUE DATE DUE DATE DUE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5/08 Kthrolecc&PresICIRCIDateDue indd

LIFE CYCLE COST ANALYSIS OF OCCUPANT WELL-BEING
AND PRODUCTIVITY IMPACTS IN LEED® OFFICES

BY

Amanjeet Singh

A THESIS

Submitted to
Michigan State University
in the partial fulfillment of the requirements
for the degree of

MASTERS OF SCIENCE

Construction Management

2009

ABSTRACT

LIFE CYCLE COST ANALYSIS OF OCCUPANg WELL-BEING AND
PRODUCTIVITY IMPACTS IN LEED OFFICES

Bv

Amanjeet Singh

The rising concern for sustainability has provided significant impetus to the green
building movement. Its future, however, may depend on substantiation of the
widely claimed green benefits. While significant improvements in occupant well-
being/productivity in green buildings have long been hypothesized, the precise
quantification of such improvements remains fuzzy. This research analyzes
occupant well-being and productivity related costs and benefits in LEED offices
using the Life Cycle Cost Analysis (LCCA) framework and a case study based

approach.

Incremental first costs related with LEED lEQ were identified. Changes in the
occupants’ well-being and productivity were determined using occupant surveys.
Using the lEQ related incremental costs and occupant well-being and productivity
based benefits, LCCA calculations were performed. It was determined that life
cycle benefits far exceed the incremental costs, indicating economically viable
investments. This research provides some degree of validation to occupant well-
being and productivity improvement claims in green buildings and provides the

groundwork for further research and validation.

To Daarji
My Idol, My Hero

iii

ACKNOWLEDGEMENTS

This thesis is a result of extensive teamwork over the last two years as well as
significant learning throughout my academic and professional career. I am in

debt to all those who have directly or indirectly helped me in reaching this far.

Firstly, I am grateful to Dr. Matt Syal for his guidance and encouragement
throughout my Masters education. His unparalleled energy and wisdom continue
to fascinate me. I hope to continue his legacy by maintaining the same zeal

towards my professional and personal commitments in future as l have today.

Next, I am thankful to Dr. Sue Grady and Dr. Sinem Korkmaz for their timely and
valuable inputs at significant junctures during my thesis. I thank our industry and
academic partners; Mr. Gavin Gardi, Mr. Eric Doyle, Ms. Silvia Dimma, Dr. Kevin
Ford, Dr. Satish Joshi, Dr. Maya Fischoff, Ms. Chandni Bhan, as well as
individuals who participated in this study for their inputs. I would also like to
acknowledge the research funding provided by the Environmental Research
Initiative at Michigan State University and the continued support provided by the

School of Planning, Design and Construction towards my Masters education.

I am thankful to Professor Timmothy Mrozowski and Dr. Tariq Abdelhamid whose

actions have taught me lessons in humility; to Professor Vishwamitter and Ar.

Sumit Kalra for expressing the value of unfailing resolve in trying circumstances;

iv

and to Ar. Anshu Mahajan, Ar. Amit Sharma, Ar. Vivek Gupta, Ar. Rupa Gupta
and Mr. Shravan Talwar for motivating me to seriously consider Masters
education. I am thankful to Mr. Jack Mumma and Ms. Shawn Anderton for
providing me the first work opportunities in the US construction industry. The
lessons learned while working with all these people have helped me extensively

in negotiating many challenges during the course of this thesis.

My friends have always been my most treasured possession. In particular, I
thank Yash, Shilpi, and Samarth for a lot more than just the last two years. I
thank my research colleagues, Karzan, Qingwei, Varun, and Heather for their
support and inputs, Gopu, whose work I have extensively referred, and most of
all George who has almost been a second advisor throughout my Masters
education. I am grateful to all my other friends and colleagues from school
onwards’whom I haven’t been able to mention here) for shaping my personality in

invaluable ways.

Most importantly, I would like to acknowledge my family members who have
stood by me in every decision in life. Thanks to my siblings, Manan and Tanisha,
for keeping the family so alive and for taking up additional responsibilities in my

absence.

Friends, I hope that your love and support will remain with me as l shape up to

face newer challenges in life.

TABLE OF CONTENTS

LIST OF TABLES .......................................................................... ix
LIST OF FIGURES ........................................................................ xi
CHAPTER 1
1.1 Overview ...................................................................... 1
1.2 Need Statement ............................................................. 2
1.2.1 Occupant Well-being and Productivity Benefits in Green
Buildings .................................................................. 2
1.2.2 Ensuring Long-term Sustainability of the Green Building
Movement ............................................................. 3
1.3 Research Goal and Objectives ........................................ 5
1.4 Research Scope and Limitations ...................................... 7
1.5 Project Outputs/ Research Contribution .................................. 8
1.6 Chapter Summary .............................................................. 10
CHAPTER 2
LITERATURE REVIEW .................................................................. 11
2.1 Chapter Overview ........................................................... 11
2.2 Green Building and Indoor Environmental Quality (lEQ) ........ 12
2.2.1 Green building: Developments and Challenges .............. 13
2.2.2 Indoor Environmental Quality in Green Buildings ............. 14
2.3 Built Environment and Occupant Well-being! Productivity........ 16
2.3.1 IE0 and Well-being/ Productivity .................................. 17
2.3.2 Quantification of Occupant Well-being and Productivity
Benefits ................................................................... 25
2.4 Life Cycle Cost Analysis (LCCA) ...................................... 26
2.4.1 LCCA Overview ...................................................... 26
2.4.2 LCCA and Green Buildings ........................................ 29
2.5 Chapter Summary ........................................................ 33
CHAPTER 3
METHODOLOGY .......................................................................... 35
3.1 Chapter Overview ........................................................... 35
3.2 Phase 1: Literature Review ............................................. 36
3.3 Phase 2: Data Collection and Analysis .............................. 38
3.3.1 Scope of Data Collection ............................................. 38

vi

3.3.2 Case Studies .......................................................... 39
3.3.3 Phase 2a: Processes/ Items Resulting in Incremental
Costs ...................................................................... 40
3.3.4 Phase 2b: Changes in Occupant Well-being and
Productivity ............................................................... 42
3.3.4.1 Pre-move occupant survey ...................................... 45
3.3.4.2 Post-move occupant survey .................................... 47
3.3.4.3 Analysis of survey data ........................................... 48
3.4 Phase 3: Life Cycle Cost Analysis (LCCA) ......................... 49
3.5 Phase 4: Summary and Conclusions .................................. 51
3.6 Chapter Summary ........................................................ 51
CHAPTER 4
DATA COLLECTION AND ANALYSIS ............................................. 53
4.1 Chapter Overview ........................................................... 53
4.2 Processes/ Items Resulting in Incremental Costs ................. 53
4.2.1 Processes/ Items Resulting in Incremental Costs:
Approach .................................................................. 53
4.2.2 Processes/ Items Resulting in Incremental Costs:
Findings .................................................................... 56
4.3 Changes in Occupant Well-being and Productivity ................ 58
4.3.1 Occupant Well-being and Productivity: Approach .............. 58
4.3.2 Occupant Well-being and Productivity: Findings ............... 59
4.3.3 Annual Benefits from Occupant Well-being and
Productivity ............................................................... 71
4.4 Chapter Summary .......................................................... 74
CHAPTER 5
LIFE CYCLE COST ANALYSIS ....................................................... 75
5.1 Chapter Overview ........................................................... 75
5.2 Monetization of Phase 2 Outputs ....................................... 75
5.2.1 Monetization of Processes/ Items Resulting in Incremental
Costs ..................................................................... 75
5.2.2 Monetization of Occupant Well-being and Productivity
Findings ............................................................... 78
5.3 Life Cycle Cost Analysis (LCCA): Approach ........................ 81
5.3.1 LCCA Method Selection .......................................... 81
5.3.2 LCCA Variables ...................................................... 82
5.3.3 LCCA Worksheet ................................................... 83
5.3 LCCA: Findings ............................................................. 86
5.4 Uncertainties Associated with LCCA Findings .................... 88
5.5 Chapter Summary .......................................................... 92

vii

CHAPTER 6

SUMMARY AND CONCLUSIONS .................................................. 93
6.1 Overview ..................................................................... 93
6.2 Summary of Objectives Achieved ...................................... 94
6.2.1 Objective 1 ............................................................... 94
6.2.2 Objective 2 ............................................................... 96
6.2.3 Objective 3 ............................................................... 98

6.3 Observations Regarding Data Collection ............................ 100

6.4 Conclusions and lnferences .............................................. 101

6.5 Areas of Future Research ................................................ 104

APPENDICES .............................................................................. 107

Appendix A: Occupant Surveys ......................................... 108

Appendix A1: Pre-move Occupant Survey ...................... 109

Appendix A2: Post-move Occupant Survey ..................... 123

Appendix A3: Survey Response Coding Plan .................. 131

Appendix B: LEED lEQ Incremental Cost Matrices ............... 137

Appendix B1: LEED IEO Processes/ Items Causing

Incremental Costs ..................................................... 138

Appendix 32: LEED IEQ Incremental Cost Estimates ....... 150

Appendix C: Life Cycle Cost Analysis (LCCA) Worksheets ..... 173

Appendix C1: LCCA Worksheets- Base Scenario ............ 174

Appendix C2: LCCA Worksheets- Scenario 1 .................. 176

Appendix C3: LCCA Worksheets- Scenario 2 .................. 178

Appendix C4: LCCA Worksheets- Scenario 3 .................. 180

BIBLIOGRAPHY ........................................................................... 182

viii

LIST OF TABLES

Table 2.1 LEED-NC lEQ Credits and related lEQ Attributes (LEED-
NC 2007) ............................................................... 16

Table 3.1 Occupant Survey Analysis Plan .................................. 49

Table 4.1 LEED lEQ Credits attained on Case Studies (Credits
based on LEED CI 2.0) ............................................... 54

Table 4.2 Case Studies and Occupant Surveys
Overview .................................................................. 58

Table 4.3 Changes in Occupant Well-being upon Moving to LEED
Offices ..................................................................... 66

Table 4.4 Changes in Occupant Productivity upon Moving to LEED
Offices ..................................................................... 70

Table 4.5 Annual Occupant Well-being and Productivity Benefits in
LEED Offices .......................................................... 73

Table 5.1 Snapshot of LEED lEQ Cost Estimate Matrix (LEED lEQ
credit 31- CS1) ....................................................... 76

Table 5.2a Calculation of Average Hourly Wage (WA) ..................... 79

Table 5.2b Annual Economic Benefits from Occupant Well-being and

Productivity Improvements .......................................... 79
Table 5.3 Life Cycle Cost Analysis Worksheet .............................. 84
Table 5.4 Life Cycle Cost Analysis Findings ................................. 86

ix

Table A3

Table 81.1

Table 31.2

Table 82.1

Table 32.2

Table 01.1

Table 01.2

Table C2.1

Table 02.2

Table 03.1

Table 03.2

Table C4.1

Table 04.2

Survey Response Coding Plan ..................................... 132

LEED lEQ Processes/ Items Causing Incremental Costs-
Case Study 1 ............................................................ 139

LEED lEQ Processes/ Items Causing Incremental Costs-

Case Study 2 ............................................................ 145
LEED lEQ Incremental Cost Estimate- Case Study 1 ......... 151
LEED lEQ Incremental Cost Estimate- Case Study 2 ......... 163
LCCA Worksheet- Base Scenario (CS1) ......................... 175
LCCA Worksheet- Base Scenario (C82) ......................... 175
LCCA Worksheet- Scenario 1 (CS1) ............................. 177
LCCA Worksheet- Scenario 1 (082) ............................ 177
LCCA Worksheet— Scenario 2 (CS1) ............................. 179
LCCA Worksheet— Scenario 2 (082) ............................ 179
LCCA Worksheet- Scenario 3 (CS1) ............................. 181
LCCA Worksheet- Scenario 3 (082) ............................ 181

Figure 2.1

Figure 2.2

Figure 3.1

Figure 3.2

Figure 3.3

Figure 3.4

Figure 3.5

Figure 4.1

Figure 4.2

Figure 4.3

Figure 4.4

Figure 4.5

Figure 4.6

Figure 4.7

Figure 4.8

LIST OF FIGURES

Literature Review Structure .......................................

LEED lEQ-Occupant Well-being/ Productivity Structure...

Methodology Overview ............................................

Phase 1 Methodology .............................................

Phase 2a Methodology .............................................

Phase 2b Methodology .............................................

Phase 3 Methodology .............................................

Example Structure for Identification of Processes/ Items
Causing Incremental Cost (LEED IEQ credit 3.1) ..........

Demographic Information ..........................................

Workspace-related Information .................................

Occupants’ Medical History ......................................

Hours Absent due to Asthma/ Respiratory Allergies ......

Work-hours Affected by Asthma/ Respiratory Allergies...

Hours Absent due to Depression/ Stress .....................

Work-hours Affected by Depression/ Stress .................

xi

11

24

35

36

41

44

50

55

60

6O

62

63

63

64

64

Figure 4.9

Figure 4.10a

Figure 4.10b

Figure 4.11

Change in Occupant lEQ satisfaction ........................ 67

Perceived Effect of lEQ on Productivity ........................ 68

Perceived Change in Productivity due to IE0 Changes... 68

Change in Perceived Performance .............................. 71

xii

CHAPTER 1
INTRODUCTION

1.1 OVERVIEW

The concept of sustainability has been establishing a strong foothold in recent
times, with efforts ranging from reducing air emissions from our industrial
processes to lowering our energy consumption, and much more. Likewise, the
construction industry has been undergoing the transition towards the
development of a more sustainable/green built environment. Traditionally,
construction had been a major contributor in environmental degradation in terms
of material and energy consumption as well as waste and pollution generation
(Mago 2007, Kibert 2005, USDOE 2007). Existing knowledge of such negative
environmental impacts and the rising concern for sustainability provided the
perfect setting for the steady growth of the green building movement, which
gained further momentum with the development of marketable green certification
systems such as LEED® (Leadership in Energy and Environmental Design)

developed by the US Green Building council (USGBC 2008a).

LEED rating systems provide guidance for development of sustainable design
and construction strategies and award certification for utilizing such strategies,
thus deeming the buildings as green. LEED and green building supporters claim
potential benefits of utilizing such green strategies for environmental, social, and
economic gains, while uncertainties regarding such benefits often invite criticism

(Bowyer 2007, Scheuer and Keoleian 2002). Anticipations of incremental costs

and uncertainties surrounding the long-term benefits of green building may prove

to be a challenge for further growth of the sustainable/green building movement.

1.2 NEED STATEMENT

The need for this research is twofold. First, there is a need to verify claims
related with occupant well-being and productivity improvements in green
buildings, since these claims hold a significant share among the expected
benefits from green built environments. In addition, it is vital to elucidate the
economic impacts of green buildings to ensure the long-term sustainability of the

green building movement.

1.2.1 Occupant Well-being and Productivity Benefits in Green Buildings

Green buildings have been touted to provide occupant well-being and
productivity benefits (USGBC 2008b). Such claims have generated substantial
interest in building green, both for improving occupant well-being/productivity as
well as for the anticipated economic gains (Turner Construction 2005). These
claims however, seem to be based on mere hypothesis of projected green
building benefits rather than the actual gains observed during the buildings’

operational life.

Often, such well-being and productivity improvement claims are a result of far
reaching conclusions based on gross nationwide data and significant

assumptions (Fisk and Rosenfeld 1997; Kats 2003; SBW 2003). Limited

researches have attempted to validate such claims through actual case-study
observations. Such well-being and productivity savings may form a substantial
part of the potential economic benefits from green buildings, which makes it even

more significant to validate these hypotheses.

1.2.2 Ensuring Long-term Sustainability of the Green Building Movement

Building projects often imply significant economic investments. Building green
may require utilizing building materials, methods, and technologies, which are
different from those typically used for conventional projects. Several authors
have also identified the need to re-assess the overall project procurement
approach, in order to attain maximum efficiency in green building projects (Kats
2003, Lapinski et al. 2006, Mago 2007). Green buildings may, therefore, be
viewed as alternative investments, compared with conventional building projects.
While the green building industry hypothesizes the potential for improved life
cycle economic performance in these buildings (USGBC 2008b), there is a need
to provide validation to such claims by analyzing the actual performance of green

buildings.

It is also significant to understand that while green buildings may incur
incremental costs during the project procurement phase, the anticipated benefits
are spread over their much longer operational life. The incremental upfront costs
and economic uncertainties in the long-term have sometimes been criticized as

significant hurdles to the growth of the green building movement (Kats 2003).

While rise in market demand for green buildings may assist in limiting the
incremental cost, there remains a need to elucidate the long-term economic
impact of building green in order to assist informed decision making from the

investor’s perspective.

LEED office buildings provide an opportunity to assess such green building well-
being and productivity claims. This may be achieved by studying occupant well-
being and productivity changes as they move from conventional (non-LEED) to
LEED offices. This study design is based on an intervention type-prospective
cohort study approach, as discussed in epidemiological literature (Hennekens
and Buring 1987). Occupant well-being and productivity improvements have
been associated with better lEQ in LEED buildings (Pillai 2006). Hence, such
improvements may be equated against any incremental costs required to attain

LEED-lEQ credits.

From a building owner’s/investor’s perspective, improved well-being/productivity
conditions and the possible life cycle economic gains in green offices provide
sufficient motive to conduct such assessment. If these life cycle gains meet the
economic expectations from green buildings, such validation may help in
providing further impetus to green building initiatives. Overall, this research may
help in removing a significant hurdle to the growth of the green building

movement and assist the construction industry’s initiative for a sustainable future.

1.3 RESEARCH GOAL AND OBJECTIVES

The goal of this research is to demonstrate the economic benefits of green

buildings based on occupant well-being and productivity. The following objectives

and work steps have been outlined to achieve this goal:

Objective 1: Identify lEQ related processes/items responsible for incremental first

cost in LEED offices.

1.

Review literature related with Green Building and IE0 (GB-lEQ), Built
Environment and Occupant Well-being/Productivity (BE-OWP), and Life
Cycle Cost Analysis (LCCA).

Identify relationships between building IE0 and well-being/productivity.
Determine LEED-lEQ credits that may impact occupant well-being/
productivity.

Identify case studies where occupants move from conventional (non-
LEED) to LEED offices.

Review case study LEED documentation for the lEQ credits identified in
step 3, to hypothesize design/construction processes/items that may result
in incremental first costs.

Obtain feedback from constructors to finalize the hypothesized processes/
items.

Summarize lEQ related processes/items causing incremental first cost in

LEED offices.

Objective 2: Determine annual benefits from occupant well-being and productivity
improvements, resulting from the move to LEED offices.
8. Review existing occupant surveys seeking input regarding well-being and
productivity.
9. Develop and conduct pre-move occupant survey.
10. Develop and conduct post-move occupant survey.
11.Analyze responses from both surveys together to determine changes in
occupant well-being and productivity.
12.Summarize annual benefits from occupant well-being and productivity

improvements.

Objective 3: Determine life cycle economic impact of LEED-lEQ, based on inputs
from objectives 1 and 2.
13. Monetize findings from step 7 to determine incremental first cost of LEED
lEQ.
14.Monetize findings from step 12 to determine annual $ benefit from
improved occupant well-being and productivity.
15. Determine LCCA method, variables, and develop analysis worksheet.
16.Perform LCCA calculations to determine net life cycle economic impact,
based on incremental cost input from step 13 and annual $ benefits from
step 14.

17. Summarize uncertainties associated with LCCA findings.

The above outline presents key work steps conducted to attain the research

objectives. The detailed methodology discussion is presented in Chapter 3.

1.4 RESEARCH SCOPE AND LIMITATIONS

This study focuses on determining the life cycle economic impact of improved
occupant well-being and productivity, resulting from the move to LEED office
environments. The study scope and limitations are defined below.

1. The study scope is limited to evaluating the economic performance of
LEED offices based only on lEQ related incremental costs and occupant
well-being/productivity related benefits. Other variables affecting life cycle
economic performance, such as energy, operation and maintenance,
replacement and salvage of indoor equipment, employee turnover rates,
liability-related costs, etc. are not studied.

2. The economic analysis is performed from the investor’s (building owner’s)
perspective.

3. The benefit-analysis is based on 2 case study projects in Michigan. The
findings represent benefits that may be attained by comparable occupant
populations under similar conditions, while wider-scale generalization may
require further case study analysis.

4. This research utilizes self-perceived well-being and productivity data,
collected through pre-move (while occupants work in non-LEED offices)
and post-move (after occupants move to LEED offices) occupant surveys.

Both these surveys gather data based on 4-week snapshots. This study

assumes inputs attained during these snapshots as representative of
typical occupant conditions throughout the study life.

5. The recent move to a new building may have a temporary effect on the
occupants’ well-being/productivity. Hawthorne effect (Romm and Browning
1994) explains temporary changes in people’s behavior or performance as
a response to a change in the environment. Although the Hawthorne
theory has been disputed (Adair 1984; Diaper 1990; Gottfredson 1996;
Rice 1982; Wickstrom and Bendix 2000), the uncertainty in long-term
benefits presented by this theory may only be eliminated by continuing this
research over a longer timeframe.

6. This research assumes that all well-being/productivity benefits result from
improved lEQ in LEED buildings. Influence of other LEED credits and

other external influences (outside the building) are disregarded.

Several limitations identified above result from the limited timeframe and sample
size (only two case studies) for this study. Further research based on a longer
timeframe and increased number of case studies may assist in eliminating some

of these limitations.

1.5 PROJECT OUTPUTS/RESEARCH CONTRIBUTION
The following outputs would be developed from this research:
Objective 1: Identify lEQ related processes/items responsible for incremental first

cost in LEED offices.

1. A structure identifying the relationships between LEED lEQ credits and
occupant well-being/productivity.
2. Matrices identifying LEED lEQ related processes/items with potential

incremental first costs.

Objective 2: Determine annual benefits from occupant well-being and productivity
improvements, resulting from the move to LEED offices.
3. Occupant surveys addressing well-being and productivity related data
collection.
4. Summary of annual benefits from occupant well-being and productivity

improvements.

Objective 3: Determine life cycle economic impact of LEED-lEQ, based on inputs
from objectives 1 and 2
5. Matrices summarizing incremental cost estimates related with LEED lEQ
credits.
6. Table summarizing annual US$ benefits from occupant well-being and
productivity improvements.

7. Summarized Life Cycle Cost Analysis (LCCA) calculations.

Overall, this research provides a framework for future assessments of occupant

well-being and productivity benefits in green buildings.

1.6 Chapter Summary

This chapter provided an overview of the research need and presented the goal,
objectives, scope and key limitations anticipated at the start of this research. The
discussion presented in this chapter has been refined throughout the conduct of

this research.

The next chapter provides a discussion of the literature reviewed for this
research. This review assisted in finalizing the research methodology, which is
presented in Chapter 3. Chapter 4 presents the data collection and primary
analysis, while the economic analysis of these findings is presented in Chapter 5.
Chapter 6 summarizes the research conclusions and presents directions for

future research.

10

2.1 CHAPTER OVERVIEW
This Chapter presents an overview of the literature reviewed for this research.

Three categories of literature were identified for review. Figure 2.1 presents the

CHAPTER 2

LITERATURE REVIEW

structure of the literature review.

 

I

 

Literature Review

 

|
I

I

 

 

 

Life Cycle Cost Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Green Building and Built Environment and
Indoor Environmental Occupant Well-being/
Quality Productivity
Green Building: IE0 and Well-being/ LCC A Overview
Developments and Productivity
Challenges
Indoor Environmental Quantification of LCC A and Green
Quality (1130) in __ Occupant Well-being Buildings
Green Buildings and Productivity
Benefits

 

 

 

Figure 2.1: Literature Review Structure

 

The first category, Green Building and Indoor Environmental Quality, presents an
overview of green building and LEED-NC green building guidelines. Also
presented here, is a discussion of the roadblocks in the green building movement

and the need for quantification of the potential well-being and productivity

®

benefits resulting from improved indoor environments in green buildings.

11

The next category of review, Built Environment and Occupant Well-being/
Productivity, provides an overview of potential well-being/productivity effects of
the built environment. Several publications that have attempted to quantify the
affect of building Indoor Environmental Quality (lEQ) on occupant well-being and

productivity/performance are discussed in this segment.

The first two review categories lead to the overarching research hypothesis that
indoor environments in green buildings can lead to significant well-being and
productivity improvements, which may provide substantial economic benefits
during the operational life of the building. To test this hypothesis, an economic
evaluation needs to be performed that would weigh occupant well-being and
productivity-based benefits resulting from green building indoor environments,
against incremental costs involved with incorporating the related green building
strategies. This requires a review of the third literature category, Life Cycle Cost
Analysis (LCCA). An overview of LCCA is presented, followed by recent LCCA

studies in the green building domain.

2.2 GREEN BUILDING AND INDOOR ENVIRONMENTAL QUALITY (lEQ)

The construction industry has been undergoing a transition towards development
of green/sustainable built environments in recent times. Samaras (2004:
Referenced in Mago 2007) attributes this transition to construction being the
foremost contributor of detrimental impacts on the environment. At a global scale,

our construction practices consume 10% of the world’s freshwater, 25% of the

12

wood harvest, and are responsible for 40% of material and energy flows (Kibert
2005). “Further, 8-20% of the total municipal solid waste is attributable to
construction operations” (Mago 2007). While the green building movement has
grown, it has also faced criticism often arising out of economic uncertainties

(Wolff 2006, Syphers et al. 2004, Kats 2003).

2.2.1 Green Building: Developments and Challenges

The green building movement gained momentum on the premise of attaining
integrated environmental, social, and economic improvements over the buildings’
operational life spans. This growth has also lead to the development of various
green building standards/assessment systems/benchmarking tools. LEED-NC
(Leadership in Energy and Environmental Design for New Construction),
developed by US Green Building Council (USGBC 2008a) is the most widely
accepted assessment system in the US (Fowler and Rauch 2006, Syal et al.

2007)

LEED standards assess buildings on five main categories of impact; site
selection and development, indoor environmental quality, water efficiency,
energy efficiency, and materials selection. Buildings are certified as green at
various levels depending on the points achieved in these categories. The LEED
rating system utilizes a whole system approach to minimize environmental

damage while enhancing occupant well-being and productivity (USGBC 2008b).

l3

Even as the green building movement has grown and LEED has made a
significant marketplace for itself, the challenge to further enhance this movement
needs to be addressed to ascertain a sustainable future. Ever since their
inception, LEED buildings have faced some opposition owing to anticipations of
incremental first costs (Kats 2003). Besides, the precise quantification of the
widely claimed green benefits remains fuzzy. This is evident in a large number of
publications trying to elucidate the cost-benefits of green buildings (Kats 2003,
SWA 2004, Langdon 2004 and 2007, Stegall 2004, Syphers et al. 2004, SBW
2003).

While the green building movement was initiated by environmental concerns, It is
evident that in the present context the expectations from these buildings exceed
merely environmental interests. About 80% of the respondents in a public survey
expressed interest in building green for health and productivity related benefits
(Turner 2005). Other researches conclude that about 89% of building life cycle
costs (in commercial offices) are attributable to employee costs (Kats 2003),
which clearly establishes substantial economic gains by improving occupant well-
being/productivity. It seems necessary given the above discussion that the

Impact of green buildings on occupant well-being and productivity be quantified.
2.2.2 Indoor Environmental Quality (lEQ) in Green Buildings

Research suggests that people in the United States tend to spend 80-90% of

their time indoors (Singh 1996, Klepeis et al. 2001, Pillai 2006) while studies also

14

argue that “pollution levels indoors may often be higher than those outdoors”
(Hoskins 2003, USEPA 1987). This summarizes the significance of improving
building indoor environments to enhance “occupant health, comfort, morale,

productivity, and overall well-being” (Singh 1996).

lEQ improvements form one of the focus areas of green building. LEED-NC
ascribes about 20% of the total points (15/69 total) in the lEQ category. The lEQ
credits included in LEED-NC have been presented in Table 2a. These are based
on American Society of Heating, Refrigerating, and Air-Conditioning Engineers
(ASHRAE) standards and consensus-based criteria on design and construction
applications (Syal et al. 2008). Pillai (2006) identified building lEQ attributes that
affect occupant health as indoor air quality (IAQ), temperature, humidity,
ventilation, lighting, acoustics and ergonomic design/safety. These attributes

have been linked with the LEED lEQ credits in Table 2.1.

15

Table 2.1: LEED-NC IEQ Credits and related IEQ attributes

 

 

(LEED-NC 2007)
Credit No. Points Credit Descrkption IEQ Attribute
Prereq. I - Minimum IEQ Performance IAQ, Ventilation
Prereq. 2 - Environmental Tobacco (ETS) Smoke Control IAQ
Credit l I pt. Outdoor Air Delivery Monitoring IAQ
Credit 2 1 pt. Increased Ventilation IAQ, Ventilation
Credit 3 2 pts Construction IAQ Management Plan : 3.l Construction: IAQ
. , . , 3-2 Occumncy. , ,, ,
Credit 4 4 pts Low Emitting Materials: 4.1 Adhesives and Sealants: 4.2 IAQ
Paints and Coats; 4.3 Carpet Systems; 4.4 Composite
., . _. ,, Woodand.Agrifiber_Pr0d.U<=tS.--..--m-----.._,-_-_._--.,-...,...__._ . _._. ..
Credit 5 I pt. Indoor Chemical and Pollutant Source Control IAQ
Credit 6 2 pts Controllability of Systems: 6.] Lighting: 6.2 Thermal Lighting.
Comfort Temperature.
Credit 7 2 pts Thermal Comfort: 7.1 Design; 7.2 Verification Temperature,
Credit 8 2 pts Daylight and Views: 8.1 Daylight 75% of Spaces; 8.2 Lighting

Views for 90% of Spaces

 

These IEQ credits reflect the bulk of occupant well-being and productivity
concerns addressed in LEED buildings. In order to comprehend potential well-
being/productivity benefits that may be attained from improved IEQ in LEED
buildings, it is necessary to understand the general relationships between
building IEQ and occupant well-being/productivity. The next category of review,

builds on such literature.

2.3 BUILT ENVIRONMENT AND OCCUPANT WELL-BEINGIPRODUCTIVITY

Various aspects of the built environment have the potential to affect the overall
well-being of its occupants. Pillai (2006) explored potential health effects of
design and construction improvements based on various LEED-NC categories.
Holden (2007) summarized further linkages between occupant health and LEED

based design and construction strategies.

16

Several other publications have explored such relationships between various
aspects of buildings and occupant health in the past, especially those among
building IEQ and occupant health and productivity (Singh 1996, Hoskins 2003,
Fisk and Rosenfeld 1997, Fisk 2000, May 2006, IOM 2000, Seppanen et al.
2004, Wargocki et al. 2000). The next section presents an overview of such

literature.

2.3.1 IEQ and Well-beinglProductivity

Health (well-being) has a multidimensional perspective and may be defined as a
“state of complete physical, mental, and social well-being and not merely the
absence of disease or infirmity” WVHO 2007). Physical health includes
“conditions related with specific illnesses and the functioning of a person’s body
systems” (Adkins et al. 2000) while psychological health comprises of “the
attitudes and feelings one has about various life domains, including work”

(Spector 2006).

Among various physical health effects of the built environment, asthma and
respiratory allergies have been considered among the five most significant health
conditions causing sick leaves among US workforce (USA Today 2008).
Improvements in these conditions have the potential to provide significant
economic gains (Fisk 2000, Fisk and Rosenfeld 1997). Together asthma and

respiratory allergies account for 27 lost work days per year to each affected

17

employee. Allergic disorders affect more than 35 million people with upper

respiratory systems each year in the US (Syal 2008).

As per a 2005 study, about 54% of all people diagnosed with asthma (total 22.2
million were diagnosed with asthma) in the US were of working age (Moorman et
al. 2007). Literature is rich with studies that demonstrate an association between
asthma/respiratory allergy problems and workplace exposures to such allergens
(Cirla 2005, Spengler and Sexton 1983, Goe et al. 2004, Burr et al. 2008,
Henneberger et al. 2005, Schleiff et al. 2003). Fisk (2000) argues that the design
of workplaces can promote or reduce allergens and irritants, which can trigger

symptoms of allergies and asthma.

Psychological health includes issues such as anxiety, depression, and stress and
may also be described in positive ways such as feelings of confidence, energy,
and generally being in good spirits (Spector 2006). Among psychological health
effects, depression has been observed among the most significant chronic
conditions causing worker absenteeism in the United States (USA Today 2008,
Burton and Conti 1999). Studies have found depression as causing the highest
productivity loss among several health effects in work environments (Hemp 2004,
Wang et al. 2004). Existing research provides some evidence of improved
productivity/performance among workers as well as students resulting from
improved lighting, view, ventilation, and air temperature conditions (HMG 1999,

HMG 2003).

18

Pillai (2006) categorized IEQ attributes with potential health impacts through an

extensive literature review. A discussion of these IEQ attributes and their

possible effects on occupant well-being/productivity is provided below (Modified

from Pillai 2006).

1.

Indoor Air Quality: Indoor air has been defined as the air within a building
occupied for a period of at least one hour by people of varying states of
health (Pillai 2006). The 70’s energy crisis is often held responsible for
poor IAQ as it triggered development of tighter building envelopes
(Hoskins 2003). The US Department of Health (1999) attributes the rise in
indoor air pollution and associated health problems to reduced ventilation
and increased use of synthetic building materials. NIOSH (Pillai 2006)
also attributes majority of IAQ problems to inadequate ventilation (53%
cases), and indicates other causes of such problems as inside
contaminant source (15%), outside contaminant source (10%), microbial

growth (5%), and building materials (4%).

Indoor air pollutants (IAP) may be categorized as chemical and biological.
Chemical pollutants may include volatile organic compounds (VOCs),
asbestos, radon, carbon monoxide (CO), carbon dioxide (C02), nitrogen
oxides (NOx), respirable suspended particulates (RSPs), construction
chemicals, ozone, unpleasant odors, and lead. Biological pollutants may
include molds, dust mites, animals, cockroaches, endotoxins,

houseplants, pollen, and other infectious agents (IOM 2000, Pillai 2006).

19

Among chemical pollutants, IOM (2000) found evidence of relationships of
certain RSPs (for example: Environmental tobacco smoke), NOx
emissions, and formaldehyde among chemical pollutants, with asthma
exacerbations. Among biological pollutants, the report identified such
relationships with molds, dust mites, certain animals (dog, cat), birds, and
some infectious agents (Rhinovirus, Chlamydia pneumoniae, Mycoplasma

pneumoniae, Respiratory Syncytial Virus).

Literature also identifies Radon as a cancer risk (May 2006, Pillai 2006).
NOx, CO emissions and RSPs have been associated with various
respiratory allergies and sick building syndrome (888) symptoms (Pillai
2006, Holden 2007, Jaakkola et al. 1994, Skov et al. 1990). DTIR (1995:
Referenced in Pillai 2006) links ozone to eye irritations and respiratory
infections while lead is associated with slow mental development, learning
and behavioral problems, damage to nervous and reproductive systems

and high blood pressure (Pillai 2006).

Pillai (2006) argues that most of these IAQ problems can be significantly
reduced by adequate outdoor ventilation and maintaining appropriate
temperature and humidity levels. Other publications have also established
the health and/or productivity benefits of improved ventilation rates (Fisk

2000, IOM 2000, Wargocki et al. 2000, May 2006), temperature

20

(Seppanen et al 2004, Spengler and Sexton 1983), and humidity levels

(Holden 2007).

. Temperature: “Room temperature has potential impacts on prevalence of
SBS symptoms and occupant satisfaction with air quality” (Pillai 2006).
High temperatures are associated with the prevalence of sick building
syndrome while low temperatures can induce temporary deterioration in
the “dexterity of hands” (Seppanen et al. 2002). Seppanen et al. (2004)
also found a relationship between rise in temperature (above 25° C) and
productivity decrement in typical office environments. Nielsen (2002)
argues that temperature plays a crucial role in the growth of molds.
Temperature also has a role in the off-gassing from building materials

(USEPA 2005).

. Humidity: Various publications discuss significant associations between
humidity levels and concentrations of indoor air pollutants (Nielsen 2002,
Arens and Baughman 1996, Fisk and Rosenfeld 1997, IOM 2000).
Correlations between humidity levels and health effects are often found to
be building-specific (Pillai 2006). Arens and Baughman (1996) identified
the factors affecting humidity/moisture related health effects as; outdoor
climate, surface properties encountered across rooms and HVAC ducts,
water in cooling and humidification systems, intermittency of operation in

cooling systems, and other moisture sources like rain penetration, rising

21

damp, and plumbing leaks. Temperature, humidity, and air movement
often interact (Pillai 2006). In very humid conditions, the temperature
appears to be warmer than it would be in drier air (LHC 1990: Referenced

in Pillai 2006).

. Ventilation: Ventilation is used to bring outdoor air to the inside and
remove or dilute indoor air pollutants. The air supplied can be entirely
outdoor air or be mixed with re-circulated return air (Pillai 2006).
Seppanen et al. (1999) considers the relationship between ventilation
rates and occupant health as indirect. Studies show that health and
perceived air quality will usually improve with increased outside air
ventilation (Seppanen et al. 2002). NIOSI-l investigators have found a
majority of IEQ problems caused by ventilation system deficiencies and

overcrowding (NIOSH 2005).

. Lighting: Lighting is a significant factor in the indoor environment however
limited research has been conducted in the area of health effects of
lighting in the context of design and construction of buildings (Pillai 2006).
Daylight has the potential to reduce the incidence of health problems
caused by the rapid fluctuations in artificial lighting (Boyce and Hunter
2003). Studies suggest that classrooms without daylight may upset the

basic hormone pattern of children and influence their ability to concentrate

22

or cooperate or affect their performance negatively (Plympton et al. 2000,

Fisk 2000).

The amount of light we need in an indoor environment varies on the type
of surfaces, the individual's vision, and the type of task being done (Pillai
2006). Glare, flicker, lack of contrast, inadequate illumination or unsuitable
spot lighting can all lead to health problems and discomfort (Pillai 2006).
Romm and Browning (1994) found substantial productivity improvements
and reduced absenteeism rates with improved lighting conditions in eight

work environment case studies.

6. Acoustics: Noise problems indoors may be related to outdoor sources,
indoor sources or bad acoustics. Excessive exposure to noise can result
in hearing loss, which could become permanent after continued exposure
(Pillai 2006). Noise has the potential to mask important sounds and disrupt
communication. The effects can vary from a slight irritation to a serious
safety hazard involving an accident or even a fatality because of the
failure to hear the warning sounds of imminent danger (Suter 1991). Noise
that is too loud for comfort is intrusive whether it is a single, unexpected

sound or a continuous one (LHC 1990: Referenced in Pillai 2006).

This research focuses on asthma, respiratory allergies (physical health),

depression, and stress (psychological health), as well as direct productivity

23

improvements from LEED based IEQ changes. Figure 2.2 presents relationships
between LEED IEQ credits and these selected well-being/ productivity attributes,

as found in literature.

 

LEED IEQ Credits IEQ Attributes Well-beiJng/ Productivitv

 

 

I Min IAQ Performance I IAQ

 

 

}

 

............ ! I:Asthma

I Outdoor Air Delivery Monitoring I

I Increased Ventilation i Humidity ....... .................. '.i.'.'f-‘if. Respiratory

‘ Allergies

 

 

 

 

 

 

 

 

Construction IAQ Management I El:
Plan Ventilation

I Low emitting materials I .
i , Depressron

 

 

 

 

 

 

.3 . L I 2 III I I] g "‘2? ........

 

 

 

 

Indoor chemical/pollutant source f _-
control

I Con trollabili ty of systems i .
Acoustics ...... .I Stress

I Thermal comfort I

 

 

 

 

 

 

 

 

 

.. Ergonomic
I ............. 1 I1. design/ .....................
Safety .....................

 

 

I Dayfiht/ Views

 

 

 

 

* Productivity

 

 

 

Figure 2.2: LEED lEQ-Occupant Well-being/Productivity Structure

This structure helps in identifying potential LEED-IEQ credits related with
occupant well-being/productivity attributes of interest (AOI). All LEED IEQ credits
were found to have such relationships. Hence all LEED-IEQ credits were

included in the study scope.

24

2.3.2 Quantification of Occupant Well-being and Productivity Benefits

The effect of improved IEQ conditions on well-being and productivity/
performance may be felt in our daily work lives. Various studies have
investigated these relationships in distinct work environments. Burton et al.
(2001) found a 10% performance reduction among telephone customer service
workers facing allergy problems as compared to healthy workers. Hemp (2004)
reported a 9.3% average productivity loss due to respiratory allergies and asthma
related conditions. Wargocki et al. (2000) estimated a 2% productivity
improvement in typical office tasks resulting from improvements in ventilation
rates in three independent experiments, while Seppanen et al. (2004) established
a relationship of 2% decrement in work performance per °C increase in

temperature above 25° C.

Fisk (2000) estimated potential annual economic gains ranging US$7- 18 billion
from reduced respiratory diseases, asthma, and allergies; US$10-30 billion from
reduced SBS symptoms; and $20-160 billion from direct improvements in worker
performance across United States. Romm and Browning (1994) also found
significant economic benefits from improved productivity, improved work quality,
reduced defects, reduced absenteeism, and increased sales in several case

studies, resulting from IEQ improvements.

Pillai (2006) identified some potential design and construction strategies based

on LEED-NC IEQ credits that could be useful in reducing certain health problems

25

(asthma and allergies, SBS conditions). Similarly, IEQ improvement strategies
may be devised for improving other well-being/productivity conditions. While the
possibility of substantial economic gains upon implementing such healthy
building strategies is evident, these may require an incremental investment (SBW
2003, SWA 2004), which is often a significant consideration when making
building decisions. In order to assist investors in making better informed
decisions, it is necessary to elucidate the long-term economic impacts of
incorporating these strategies (Kats 2003). This warrants the need for conducting

a life cycle cost analysis.

2.4 LIFE CYCLE COST ANALYSIS (LCCA)
This category presents an overview of life cycle cost analysis and its applicability
to the current research. Also discussed here are recent LCCA related

publications in the green building domain.

2.4.1 LCCA Overview
Life cycle cost analysis has been defined as an “economic assessment of
competing alternatives, considering all significant costs over the economic life of
each alternative” (Kirk and Dell’lsola 2008). It enables an investor to make
decisions based on costs and benefits throughout the economic life of an
investment. In the building industry this economic life may include:

1. Initial costs for design and construction of buildings.

2. Costs incurred during the operational life of the building.

26

3. End of life or demolition costs.

Historically, building decisions have been based in initial investments. Bull (1993)
suggests that the realization of building operational costs having significant
budget impacts in 1930’s helped in transforming this economic decision making
process towards a more long-term approach. In the present context, with
employee costs being 90% of building life-cycle costs (Kats 2003), any savings
among such employee costs could result in substantial life cycle gains. Such

savings must be included in present day economic assessments of buildings.

Various sources provide information regarding several economic analysis
methods in the building industry (Wolff 2006, Bull 1993, Dell'lsola and Kirk 1981,
Ruegg and Marshall 1990). Among these, simple payback, net present value,
and internal rate of return have been consistently discussed in building
economics literature. These are summarized below.

1. Simple payback enables a user to calculate the expected time period for
availing the investment returns. This method does not account for time
related variations (discounting, inflation) in costs. This is often viewed as a
significant limitation (Norris 2001, Woodward 1997). Although simple
payback is commonly used as a coarse filter to eliminate unrealistic
options, it is not recommended for detailed economic analysis to support

decision making (Bull 1993).

2.

Net present value (NPV) permits discounting the total investment
throughout the building life to its present value. Such overall investment
results may then be compared among competing alternatives and the
least overall cost option may be selected. NPV accounts for time related
changes in the value of money by utilizing the concepts of discounting and
inflation. It is primarily useable when comparing alternatives, and not to

assess the investment value for a single scheme (Bull 1993).

Internal rate of return (IRR) considers all benefits during the investment
life as earnings and permits calculation of these as interest earned. This
interest rate can then be compared with the expected returns for
alternative investments to determine the economic feasibility of the
investment. Like NPV, IRR is also a discounted cash flow technique,

which implies that it accounts for time value of money.

Other commonly used LCCA methods are based on minor modifications of the

above methodologies.

4.

The annualized value method uses the NPV result and amortizes it over
the study period. This is useful in comparing product alternatives with

differing lifetimes or when addressing non-recurring costs.

5. Discounted payback allows incorporating time related cost variations in
the simple payback methodology. This method utilizes annualized inputs

for assessment of the time period expected for investment returns.

6. Benefit-cost ratio (B/C ratio) allows separate calculation of life cycle costs
and benefits while incorporating the discount rate, and inflation rate. A net
ratio of benefits/costs greater than 1 reveals a favorable investment and
that less than 1 reveals a potential loss. This method also includes
discounting future costs to their present value and may be considered as
part of the NPV umbrella. The same method is often called cost-benefit

ratio in literature.

Recent green building literature is rich with benefit-cost evaluations. While most
of these studies discuss potential economic gains from improved occupant health
and productivity, they either refrain from quantifying such gains (Stegall 2004,
SWA 2004) or base the calculations on gross nationwide data and assumptions
(Kats 2003, SBW 2003). The following section summarizes some of these

pubficafions.

2.4.2 LCCA and Green Buildings
Kats (2003) compared economic data for 33 LEED projects with hypothetical
non-LEED buildings. This study used an NPV analysis with a 5% discount rate

and 2% inflation. The authors argue that these are representative of rates used

29

by public sector entities and in line with common inflation projections. The
research team gathered actual cost data for the LEED projects and generated
incremental cost reports based on extensive discussions and interviews with
building industry professionals. An average 2% incremental investment for LEED

buildings was established.

Data on utility savings and waste reduction was obtained from USGBC
databases and economic impacts were calculated using typical utility costs and
landfill diversion impacts for the State of California. However, no case study
specific data was gathered for estimating well-being and productivity impacts of
these buildings. These well-being/productivity benefits were assumed, based on
existing literature (Fisk and Rosenfeld1997). The authors argued that such
benefits were conservatively estimated; however, in context of their overall
findings these form about 70% of the total estimated benefits from LEED

buildings.

In a study at Carnegie Mellon, Stegall (2004) conducted the economic
assessment of a new LEED-Silver residence hall facility considering the
incremental investment, and the annual energy cost savings. This study also
established a 2% incremental cost for the LEED building. Once again, the author
collected actual cost data for the new facility and conducted interviews with the
university project managers and architects to compare costs with similarly built

conventional buildings. The annual energy costs were determined to be about

30

22% lesser than a similar facility based on the university’s typical design and
construction approach. The author did not conduct an overall life cycle cost
analysis to determine the net economic implications. In addition, the
quantification of improved well-being and/or productivity gains is missing, even

though the author discussed the potential for such benefits in the conclusions.

A study conducted for the Seattle office of Sustainability and Environment (SBW
2003) quantified benefit-cost ratios of incorporating LEED in two state buildings.
The study assumed a 25-year life cycle, two discount rate scenarios of 2% and
6% and an inflation rate of 2.8%. The authors identified three separate benefit-
cost ratios based on varying benefit considerations:

1. Primary benefit-cost: These include direct observable financial impacts
such as additional costs for bike racks, benefits due to reduced energy
consumption etc.

2. Primary and secondary benefit-cost: These include less observable
impacts such as productivity gains.

3. All benefit-cost: These include citywide effects, such as utility incentives

that may pay for conservation measures.

This study found a 1.2% incremental cost for LEED buildings and established
benefit-cost ratios of 0.78-1.11, 1.49-2.16, 1.19-1.72 for the respective case
scenarios. Once again”, the study establishes significant gains based on

improved occupant well-being and productivity but these numbers are based on

31

statewide data regarding general productivity-health relationships, existing
nationwide research, and the authors’ assumptions instead of live case study
analysis. None of the studies summarized above considered a case study-based

approach for well-being/productivity analysis.

Rocky Mountain Institute (Romm and Browning 1994) found energy savings, and
quantified the productivity gains from 8 separate work-environment case studies
with lighting upgrades. They however, did not link such gains to improved health
conditions. A recent University of Pittsburgh study (Ries et al. 2006) determined
a benefit-cost ratio of 1.7 from a live case study where occupants from a
manufacturing facility moved to a new LEED building. Among the two
components of manufacturing plant workers and office employees, the study
accounted for absenteeism for all workers, while productivity gains were
calculated only for manufacturing workers based on increased production data.
The authors restrained from quantifying any health/productivity effects for the

associated office employees.

Several other initiatives have focused on establishing only the initial cost effects
of LEED buildings, rather than the complete life cycle cost analysis. The GSA
LEED cost study (SWA 2004) was commissioned to determine incremental costs
for incorporating LEED in existing GSA building standards. The study established
average cost premiums ranging from 0-8.5% for incorporating LEED for various

building scenarios.

32

Langdon (2004) established a 0-3% incremental investment for LEED buildings
based on a comparative analysis of 45 LEED and another 93 similar non-LEED
facilities. Upon a second review (Langdon 2007) the same team determined no
significant cost premiums for LEED facilities. They compared cost data from 83
LEED and 138 non-LEED academic, laboratory, library, community centers, and
ambulatory care facilities. The authors attributed this variation to the changing
markets, and project teams incorporating sustainability concerns in their initial
budgets. They also discuss that building costs and incremental investments are
very specific to the projects and generalizing them may not be appropriate. This
further strengthens the need for conducting case study based life cycle cost

analysis rather than utilizing macro-level data.

2.5 CHAPTER SUMMARY

This Chapter presented an overview of the existing literature under three
categories, Green Building and IEQ, Built Environment and Occupant Well-
being/Productivity, and Life Cycle Cost Analysis. Literature presents strong
evidence of relationships between indoor environments and occupant well-
being/productivity. Although several authors hypothesize substantial economic
benefits from improvements in occupant well-being and productivity in LEED
offices, resulting from better IEQ (Fisk and Rosenfeld 1997, Kats 2003, SBW
2003), literature presents limited case study-based evidence of such
improvements. However, outside the scope of LEED-related literature, studies

have demonstrated such improvements in occupant well-being and productivity

9.)
b)

resulting from IEQ improvements (Burton et al. 2001, Hemp 2004, Romm and

Browning 1994, Seppanen et al. 2004, Wargocki et al. 2000).

Occupant well-being and productivity improvements in LEED buildings have
often been considered intangible/ difficult to measure, especially in office settings
(Kats 2003, Ries et al. 2006, SBW 2003). The possibility of large economic
benefits related with such improvements warrants a need for better quantification

of such improvements.

34

CHAPTER 3
METHODOLOGY

3.1 CHAPTER OVERVIEW

This Chapter presents a discussion of the research methodology. After
identifying the research objectives and scope, a four-phase approach was
followed. These phases include literature review, data collection and analysis, life
cycle cost analysis, and interpretation. Figure 3.1 presents an overview of this

methodology.

 

 

 

Data collectionI and analysis

 

2a: Identification of processes/ items 2b: Identification of changes in
resulting in incremental costs occupant well-being and productivity

 

 

 

"Heal. ...........................................................................................................................

    

Life cycle cost analysis

...I’.IIII§S.3. .................................................... . ...........................................................................

 

 

Summary and
Conclusions

 

Phase 4
Figure 3.1: Methodology Overview

Phase 1 included a review of relevant literature. This review, presented in
Chapter 2, assisted in summarizing existing research in this area. Phase 2
included collection and primary analysis of the research data. This was sub-

divided in phase 2a that dealt with identification of processes/items resulting in

35

Incremental costs, and phase 2b that addressed changes in occupant well-being
and productivity. The work done in this phase is presented in Chapter 4. Phase
3 included economic analysis of the phase 2 outputs from an LCCA perspective
to determine the net benefit-cost ratio for the investment (i.e. constructing the

®

building based on LEED IEQ credits). The work performed in Phase 3 is

presented in Chapter 5. Finally, the overall research conclusions forming phase 4
are presented in Chapter 6. The methodology used for each phase is elaborated

in the following sections.

3.2 PHASE 1: LITERATURE REVIEW
The literature review conducted to develop the necessary background for this
research provided input for several steps in the following phases. Figure 3.2

presents the phase 1 methodology.

 

 

uuuuuuuu

Review Literature (CM) ’1’ To Phase \\
l \\ 2b I
I I I ~

GB-IEQ BE-OWP LCCIA ,

i, . I

Summarize relationships between
LEED IEQ credits and occupant well-

 

 

 

 

 

 

 

 

 

 

 

 

  
     

being/ productivity “~ - - - i3- - - X!
lEQ-WeII-being/ , I To Phase
Productivity ~ 23
Structure ‘ --------

 

OOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO

Legend ‘/‘I (, “,

Process Output Input from7 t6 airother phase

 

 

 

 

 

 

 

Figure 3.2: Phase 1 Methodology

36

Based on the research objectives, three categories of literature were identified for
review. These include Green Building and Indoor Environmental Quality (GB-
IEQ), Built Environment and Occupant Well-being/Productivity (BE-OWP), and
Life Cycle Cost Analysis (LCCA). The GB-IEQ literature was reviewed to
develop an understanding of current green building trends and challenges with a
focus on IEQ aspects of LEED buildings. The BE-OWP review focused on linking
building IEQ aspects with selected occupant well-being and productivity
attributes. Among several physical/psychological health conditions, four were
selected for assessment in this research. These four attributes of interest (AOI)
are:
1. Physical well-being attributes
a. Asthma
b. Respiratory allergies
2. Psychological well-being attributes
a. Depression

b. Stress

In addition, the direct effects of IEQ on productivity were also studied. Next,
relationships between LEED IEQ credits and these AOI and productivity were
summarized in the IEQ- Well-being/Productivity structure, presented as Figure
2.2 in Chapter 2. This structure identifies relationships between LEED IEQ
credits and occupant well-being and productivity. This input is useful for the

identification of processes/items causing incremental cost in phase 2a.

37

LCCA literature was reviewed to develop an overall understanding of the subject,
to select an analysis method for this research, and to identify the economic
analysis variables and data requirements. This background assisted with
planning the phase 3 LCCA as well as phase 2 data collection. The literature
review is presented in Chapter 2. The literature reviewed in phase 1 helped

extensively in refining the research objectives and methodology.

3.3 PHASE 2: DATA COLLECTION AND ANALYSIS

Phase 2 includes the data collection and analysis conducted to provide input for
LCCA in phase 3. The research data was collected from two case studies. The
following sections provide insight into the scope of data collection and the case

studies used in this research.

3.3.1 Scope of Data Collection
The data required for this initiative included two major components:
1. Data for identifying processes/items causing incremental cost among
LEED-IEQ credits.
2. Data for evaluating changes in occupant well-being/productivity, as a
result of moving to an office with LEED-IEQ.
This data was collected from selected case-study projects. Identification of
processes/items causing incremental cost was conducted under phase 2a and

evaluation of changes in occupant well-being was conducted under phase 2b.

38

3.3.2 Case Studies

Two case-study offices were identified where occupants were either planning to
move or had recently moved from conventional offices to new LEED facilities.
The other selection criteria were, ease of accessibility and the organizations’
willingness to participate in the research initiative. To maintain confidentiality,
these have been referred to as Case Studies one and two (CS1, CSZ)

throughout this publication.

CSI was a 60 (approximately) employee organization in Michigan. The company
had recently moved to a new office that was awarded LEED Platinum ratings
under both the CS 2.0 (LEED— Core and Shell) and CI 2.0 (LEED- Commercial
Interiors) rating systems. CSZ was a 200 (approximately) employee
organization, also in Michigan. Most occupants were slated to move to a newly
constructed office building expecting a LEED Silver rating under the N021
(LEED- New Construction) rating system. The study sample included all
employees from CS1 and about 90% employees from CS2 (The other employees

from 082 organization were expected to continue operations in the old building).

Contact persons were identified within both case study organizations and among
the constructors involved with these projects. Initial meetings were held with each
of the contact persons to establish partnerships, provide an overview of the
project objectives, and discuss their potential roles in the study. Since this

research required communication with a large population, a separate e-mail

39

account was set up with access restricted to the research team. All
communication related with this project was channeled through this e-mail

account

The selected case studies provide variety in terms of population size as well as
the level of LEED rating (Platinum vs. Silver) and the certification system (Cl/CS
vs. NC). This allowed assessment in varying circumstances thus providing depth
to the analysis. After finalizing case studies and developing the communication
channels, data collection and primary analysis were performed under the two

parallel paths presented as phase 2a and 2b.

3.3.3 Phase 2a: Processes/Items Resulting in Incremental Costs

Literature presents evidence of the existence of incremental costs for LEED
buildings. However, the values of incremental costs identified in literature vary
considerably and such findings are often loaded with uncertainties. These
uncertainties arise from approaches comparing LEED buildings to either
hypothetical non-LEED buildings (Kats 2003, Stegall 2004) or to existing
buildings that may not always be comparable (Langdon 2004, Ries et al. 2006,
SWA 2004). In addition, these studies typically focus on evaluating overall
incremental cost for LEED buildings, while the focus of the current research is to
assess only building lEQ-related cost (and benefit) impacts. These concerns
directed the research team to develop an alternative approach for assessment of

the incremental cost for LEED-IEQ credits incurred on the case study projects.

40

The lEQ-Well-being/Productivity structure presented as Figure 2.2 identifies all
LEED IEQ credits as possibly affecting occupant well-beinglproductivity. These
credits were analyzed to identify processes/items resulting in incremental costs.
LEED credits are awarded upon a review of project documentation, which
provides input regarding how the requirements for each credit were achieved. A
review of such documentation provides information regarding design and
construction strategies used to attain the credits, thus offering an insight into
processes/items influencing the first cost for the project. Figure 3.3 presents the

methodology used for this phase.

 

uuuuuuuuuuuu

,I’ From Phase I: ‘\

 

 

 

 

 

 

 

 

1: IEQ- Health Z) Select Case _‘,”-I~;.I;h-a;;“,
Structure Studies '\ 2b ,I‘
Review LEED Hypothesize processes/ items that may
documentatlon for IEQ result in incremental cost
credits that affect occupant

 

 

 

 

 

well—being AOI

 

 

 

 

Finalize processes/ items that
result in incremental cost

 

 

 

Constructors’ input

 

 

 

 

 

_______ FISummary Matrix of
X, To ‘~\ LEED IEQ related Objective 1
‘\ phase 3 I,‘—‘ processes/ items causing ______ achieved
\‘ ------- ’ incremental cost
\___//—

OOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO

 

 

 

 

 

 

 

 

 

 

 

Process Output Input from7 t5 another phase External input Milestone

 

Figure 3.3: Phase 2a Methodology

41

The researchers reviewed LEED IEQ documentation from the case studies to
hypothesize processesfitems that may be different from conventional (non-LEED)
building projects. This documentation included LEED templates and submittals
furnished by the case study design/construction teams for USGBC review. Next,
feedback was obtained from the constructors to finalize such processes/items,
which had not been used for their non-LEED projects. The constructors were
asked to reject the hypothesized items as causing incremental cost if these
formed part of the local building codes, or if these had become market standards
or were being used for most projects over the past 5-6 years. This feedback was

obtained through personal discussions, and e—mail communication.

The processes/items finalized above, represent design and construction work
undertaken primarily to attain LEED certification. Costs associated with such
work are specific to LEED buildings and considered incremental investments
over conventional projects. This approach incorporates a review of the same
information that is assessed by LEED reviewers for award of LEED credits. It
eliminates the uncertainties resulting from comparing non-LEED buildings or
those caused by using hypothetical scenarios. Estimation of incremental costs for

the processes/ items identified above was undertaken under phase 3.
3.3.4 Phase 2b: Changes in Occupant Well-being and Productivity

Data collection for changes in occupant well-being falls within the scope of

Epidemiological research. Epidemiology is defined as “the study of the

42

distribution and determinants of disease frequency in human populations”
(Hennekens and Buring 1987). The current research explores the effect of
building indoor environment on disease frequency. This research fits an

intervention type-prospective cohort study design within epidemiology.

Prospective cohort studies are used to determine changes in the people’s health
conditions by following them fonrvard in time. In this research, the case study
occupants were followed from their old (conventional) office through their move
to the new LEED office, the move being viewed as an intervention. Typically,
subjects in a cohort study are classified based on the presence or absence of
exposure to some particular factor. In this research, that factor is the move to the
new LEED office. However, only occupants moving to the LEED building were
studied, while it was assumed that health conditions remain unaffected for
occupants continuing work in the old office. Future initiatives may consider
releasing this assumption by selecting case studies where comparable fractions
of the sample population may be expected to continue operations in the old

(non-LEED) office.

Pre-move (while occupants worked in non-LEED offices) and post-move (after
occupants started working in LEED offices) occupant surveys were used to
collect data regarding occupant well-being and productivity. Phase 2b includes

development, administration, and analysis of these surveys to determine the

43

annual benefits from changes in occupant well-being/productivity. Figure 3.4

presents the methodology used in this phase.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

{I TO Phase ‘\ Select Case Studies Review surveys enquiring about
\ 23 ”, occupant well-being, performance, and
t ....... satisfaction
Conduct pre- prfimovc J ,"Frb-ni thee; ‘\
move survey ,4 occupant survey —<\ I: Lit. P

 

 

\

 

‘\ .. _R_C_V-I§\_V. - I”

Conduct post- \ Post-move Constructors’
‘ input for

move survey 4 occupant survey

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

refinement

—‘I IRB Review I

Analyze survey data to determine changes . V
in occupant well-being and productivity DeveIOp survey analysrs plan

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7
Finalize annual benefits from changes in
occupant well-being and productivity

 

 

 

 

 

Summary of annual
benefits from improved
occupant well-being and
productivity

 
 
    
 

  
   

 

. Objectivez
._ achieved

\ ,-

 

OOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO

 

 

 

 

 

 

 

 

 

 

Process Output Input fi‘om? t5 another phase External input Milestone

 

Figure 3.4: Phase 2b Methodology

3.3.4.1 Pre-move Occupant Survey

The primary objective of conducting the occupant surveys was to determine
changes in occupant well-being/productivity upon moving from conventional to
LEED offices. To attain this, data was collected under three key categories:

1. General occupant information: The general occupant information category
included questions regarding demographic information and the occupants’
workspace. Questions in this segment were based on building post-
occupancy evaluation literature (CBE 2004, Fard 2006, Lee 2007,

Prakash 2005, Ries et al. 2006).

2. Occupant well-being: Occupant well-being questions focused on the
occupants’ health background and their recent health conditions. Recent
health conditions were studied over 4-weeks, similar to previous studies.
Occupant well-being attributes and questions were defined using input
from the BE-OWP and medical literature (Kessler et al. 2003, Kessler et

al. 2004).

3. Work environment satisfaction: Work environment satisfaction questions
focused on getting occupant feedback regarding their satisfaction with the
office IEQ, and their perception of the effect of IEQ on their productivity.
Questions in this category were based on building post-occupancy
evaluation literature (CBE 2004, Fard 2006, Lee 2007, Prakash 2005,
Ries et al. 2006).

45

Data from categories 2 and 3 provided the key input needed to evaluate
occupant well-being/productivity-related changes in the work environment. In
addition to these, data was collected under two other categories on an
exploratory basis:

4. Productivity and performance: The productivity and performance category
included questions seeking occupant perception regarding their
performance, as a 4-week snapshot. This provided additional information
regarding variation in perceived performance resulting from the move.
These questions were based on the surveys reviewed in the earlier two

categories.

5. Other effects of work environment: Questions in this category focused on
getting occupant input regarding their general behavior/attitude, as well as
environmental initiative, and their knowledge of green (LEED) buildings.
This provided exploratory input regarding spill over effects of changes in
the work environment on the occupants’ attitude/lifestyle. These questions
were based on social sciences literature (Dunlap et al. 2000, Stem et al.
1999). This data was collected as part of a larger research initiative (Syal

et al. 2008) and has not been analyzed in this thesis.

For quality assurance of the survey data, questions seeking the respondents’

confidence levels were built in with key survey questions. Eventually, occupant

well-being responses with <50% confidence were eliminated from the analysis.

46

The draft pre-move survey was circulated to attain subject specific input, among
associated researchers from Built Environment, Epidemiology. Industrial
Psychology, and Behavioral Sciences. Feedback was also attained from the case

study constructors and the university’s Institutional Review Board (IRB).

The final version of this survey was then developed using an online survey tool
(Survey Monkey 2008). The pre-move survey links were forwarded to the study
population through e-mail with a 3 week response window and followed up with
several participation reminders. The pre-move survey has been provided as

Appendix A1 .

The survey data was downloaded in MS Excel spreadsheets and coded per the
analysis methodology discussed in section 3.3.4.3. A preliminary analysis was
conducted to provide feedback for development of the post-move survey. This
preliminary analysis suggested a drop in the respondents’ interest as number of
questions increased. Also through this preliminary analysis, the need to conduct

separate surveys for the two case studies to facilitate the analysis was realized.

3.3.4.2 Post-move Occupant Survey

The post-move survey was condensed and developed as separate versions for
each case study. Since the demographic and health background information was
already attained, such questions were easily eliminated from the general

occupant information and occupant well-being categories. Based on discussions

47

with the research team, selected questions were eliminated from the other three
categories as well. The post-move survey was administered in the same manner
as the pre-move survey with a 2-week response window. The post-move survey

has been provided as Appendix A2.

3.3.4.3 Analysis of Survey Data

Each response was accompanied by a unique ID and the respondent’s full name.
Based on name, pre-move and post-move IDs were correlated and names were
removed from the analysis sheet to protect the respondents’ privacy. Next, a
coding plan was implemented to represent all responses as numerical values.
Typically, single digit numerical values were used to code responses; however,
responses such as age that already contained numerical values were not coded
while those with a numerical range were coded as the range average (for
example, range 1-5 was coded as 3). The complete survey coding plan is

presented as Appendix A3.

An analysis plan was developed to identify the statistical analysis requirements
for the research. This was finalized in consultation with a statistical consultant.
Descriptive statistical methods including histograms and box plots were used for
the basic analysis in all categories. Further analysis of occupant well-being and
productivity data was performed using hypothesis testing (paired t-tests) in order
to provide statistically relevant inputs for the economic analysis. The analysis

plan has been summarized in Table 3.1.

48

Table 3.1: Occupant Survey Analysis Plan
(Pr: Pre-move data, Po: Post-move data)

 

Survey

Category

Sub-cate ories

Objective of data
collection

Analysis Method

References for
Survey Development

 

General
occupant
information

Demographic
information

To define the study
sample.

 

Workspace
definition

Histograms (Pr)

 

Histograms (Pr, Po)

CBE 2004, Fard 2006,
Lee 2007, Prakash
2005, Ries et al. 2006

 

Occupant well-
being

Health background

To define the study
sample.

Histograms (Pr)

 

Health snapshot

To determine

Box plots (Pr vs. Po)

BE-OH literature
review, Kessler et al.
2003 and 2004.

 

 

 

changes in Paired t-tests (Pr vs. Po)
occupant well-
beinL
Work Satisfaction with To identify Box plots (Po-Pr) CBE 2004, Fard 2006,
environment various IEQ changes in Lee 2007, Prakash
satisfaction attributes satisfaction 2005, Ries et al. 2006
Effect of IEQ on To determme Box plots (Pr vs. Po)

productivity

changes in
productivity

Paired t-tests (Pr vs. Po)

 

 

 

 

 

Productivity and Performance To explore direct Box plots (Po-Pr) Kessler et al. 2003 and
performance snapshot effects of the 2004, Ries et al. 2006

Initiative at work move on changes

snapshot In performance
Other effects of General behavior/ To explore spill- Box plots (Po-Pr) Dunlap et al. 2000,
work attitude over effects of Stem et al. 1999
environment Environmental the move on

leadership environmental

Knowledge of green leadershipi

buildings general attitude

 

 

 

 

 

Further discussion and findings from the phase 2b occupant survey analysis as

well as the phase 2a incremental cost assessment have been provided in the

next chapter.

3.4 PHASE 3: LIFE CYCLE COST ANALYSIS (LCCA)

Phase 3 includes monetization of phase 2 findings and an economic analysis

using the LCCA approach. Figure 3.5 presents the phase 3 methodology.

49

 

 

 

Case study input

 

 

-------------
’ \

,’ Processes/ .

 

 

 

 

 

 

 

 

 

 

-------------

,’ Annual well- ‘~‘

 

 

 

 

 

 

 

 

/ items causing ‘\ I ,I' being and ‘x
g incremental I>——> Monetize items Monetize +——r.’ Productivity ‘,
\ cost, from identified as annual well- benefits from
\‘._ P035}? 2&1 _ _ ’1’ causing being and \ phase 2b "
------ incremental productivity “ ' ' ' ' ' ' ' ‘ ' ' ' ’

Estimates of cost benefits Summary of annual
incremental cost of economic benefits from
LEED IEQ well-being/ productivity
improvements
\/ \‘/—
Conduct LCCA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   

 

 

 

 

LCCA Model Scenarios
Worksheet
Populate 89kg! :CfCA ‘
variables me 0 or V . .
analysis and LCCA findings 03:::;::3
A ' """ \///,
Case study ’x'Frdm Phase-“x I,” - TIC->- -“\‘
input l LCCA Lit. ;. ~ \ Phase 4 , .
\\\ - -Bgyifyv. - -”’ -------
...-.. :j
Process Output Input from7 t6 another phase External input Milestone

 

Figure 3.5: Phase 3 Methodology

The processes/items causing incremental cost, finalized in phase 2a, were

monetized using input from the case study constructors and additional estimates

from of-the-shelf cost manuals (Means 2007). The annual benefits attained

50

through improved occupant well-being and productivity were monetized using

employee wage information from case studies and typical industry wages.

LCCA-related literature review helped in determining the economic analysis
methods for this research. Benefit-cost analysis methodology was selected as
the primary analysis method, because of its wide application in existing green
building studies. The three key variables identified from literature are study life,
discount rate, and inflation rate. These were populated based on the literature
review and with input from the case study decision makers. Next, an MS Excel
worksheet was developed for conducting the LCCA calculations. Finally, LCCA
calculations were performed using the monetized phase 2 outputs and analysis
variables discussed above. Further discussion and findings from phase 3 are

presented in Chapter 5.

3.5 PHASE 4: SUMMARY AND CONCLUSIONS

This phase includes presentation of overall research outputs and conclusions
and identification of potential areas for future research. This discussion is as
significant as the research findings because it provides a better understanding of

the findings and may also assist in further development of this critical field.
3.6 CHAPTER SUMMARY

This chapter provided a discussion of the methodology adopted for this research.

This overall methodology discussion and the supporting models form a key

51

output of this research. These can provide guidance to future initiatives for
exploring the impact of other LEED (or other similar green building rating
systems) credits on occupant well-being, and application of economic analysis
for quantifying benefits from changes in peoples’ well-being/productivity. The

next two chapters elaborate on research data collection and analysis.

52

CHAPTER 4

DATA COLLECTION AND ANALYSIS

4.1 CHAPTER OVERVIEW

This Chapter presents a discussion of the data collection and analysis
undertaken for this research. As discussed in the methodology, this data
collection and analysis work forms phase 2 of the research and provides input for
phase 3. Identification of processes/items causing incremental cost, conducted
under phase 23, is discussed in the next section. This is followed by phase 2b

work addressing changes in occupant well-being and productivity resulting from

®

the move to LEED offices. Work related to monetization of the phase 2 findings

forms part of phase 3 and is discussed in the next chapter.

4.2 PROCESSES/ITEMS RESULTING IN INCREMENTAL COSTS

Existing studies typically focus on evaluating overall incremental cost for LEED
buildings, while the focus of the current research is to assess only building IEQ-
related cost (and benefit) impacts. This research utilizes constructor-feedback for
hypothesis validation to identify design and construction processesfttems
resulting in incremental costs in LEED buildings. An overview of this approach

and key findings from the incremental cost assessment are discussed below.

4.2.1 Processes/Items Resulting in Incremental Costs: Approach
The IEQ credits attained on the case studies were analyzed for identification of
processes/items resulting in incremental costs. Table 4.1 summarizes the IEQ

credits attained on both case study projects.

53

Table 4.1: LEED IEQ Credits attained on Case Studies (Credits based on LEED-C110)
(Y: Credit attained; Y“: Similar credit attained; N: Not attained; NA: Credit not available for the LEED

rating system pursued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—— ——
Prereq. 1 Minimum lEQ Performance Y Y
Prereq. 2 Environmental Tobacco (ETS) Smoke Control Y Y
Credit 1 Outdoor Air Delivery Monitoring _. a--- WY W... Y .1;
Credit 2 Increased Ventilation Y W ” ,. Y *7“
Credit 3.1 Construction IAQ Management Plan : during construction Y Y
Credit 3.2 Construction IAQ Management Plan : before occupancy ”NW W Y“
Credit 4.] Low Emitting Materials:vAdhesives and Sealants ~ ”-an W Y—
Credit 4.2 Low Emitting Materials: Paints and Coatings Y Y
Credit 4.3 Low Emitting Materials: Carpet Systems Y Y
Credit 4.4 Low Emitting Materials: Composite Wood and Agrifiber Products Y N
Credit 4.5 Low Emitting Materials: Systems Furniture and seating , i _ “wa.“ NA
Credit 5 Indoor Chemical and Pollutant Source Control - Y Y" m
Credit 6.1 Controllability of Systems: Lighting — H """ _ iw'Ym-WWFYT“
Credit 6.2 Controllability of Systems: Temperature and Ventilation N B .. YW Y“
Credit 7'] Thermal Comfort: Compliance .. ..-.. "Y “(NW ..
Credit 7.2 Thermal Comfort: Monitoring Y m _N
Credit 8.] Daylight and Views: Daylight 75% of Spaces * mm ~ Y Y
Credit 8.2 Daylight and Views: Daylight 90% of Spaces ..-_-.__.._-,-m-..__-_. .- Y WfiN—A—w
Credit 8.3 Daylight and Views: Views for 90% of Seated Spaces Y N

 

It is evident that although the two case studies attempt different levels of LEED

certification, both have tried to attain most of the IEQ credits. CSl attained 18/19

CI 2.0 prerequisites and credits and 082 attained 13/17 NC2.1 prerequisites and

credits. The following steps summarize approach undertaken for identification of

incremental cost processes/items:

1. Review of LEED requirements and documentation for the IEQ credits.

99’!”

Development of hypothesis for potential cost impact items.
Hypothesis testing through constructors’ feedback.

Finalization of processesfitems resulting in incremental cost.

Figure 4.1 demonstrates this incremental first cost items identification approach

using the example of LEED-IEQ credit 3.1 for 081.

 

LEED Rgguirements for IE9 Credit 3.1 (LEED-NC 2007)

 

 

Develop and implement IAQ management plan during construction: Meet SMACNA IAQ guidelines for
construction phase. Protect stored on-site and installed absorptive materials from moisture damage. Use
MERV 8 filters for any AHU's used during construction and replace filters prior to occupancy.

 

 

LEED Documentation

 

LEED template

 

 

 

 

Construction IAQ
management plan

 

 

 

 

Construction photos

 

approach

 

identifying SM ACN A ~ 1 -._.-

 

 

Filter schedule and
literature

 

 

 

Hypothesis- Potential
Incremental Cost Items

 

Plastic covering for all
HVAC material.

 

 

 

J Plastic barriers and negative

pressure equipment

 

 

 

'1 Wet misting equipment

 

 

 

‘ “fi MERV 8 filters- used during

construction

 

 

 

i Additional storage costs

 

 

 

 

 

 

'iDaily cleaning costs

 

Engineering-IAQ management
' plan development and
documentation cost

 

 

 

Constructor’s Feedback

Part of supplier’s standard
operating procedures (SOP);
hence, no additional cost.

Not used much on project; hence,
no additional cost.

Not used on project

Additional cost needs to be
assessed.

Part of constructor’s SOP; hence,
no additional cost

Part of constructor’s SOP for
safety reasons; hence, no
additional cost

IAQ management plan is
standardized; hence, no additional
cost. Account for 4 hrs of
documentation time @ $54/hr

 

Figure 4.1:

Example Structure for Identification of Processes/ Items Causing Incremental Cost

(LEED IEQ credit 3.1)

55

Documentation for E0 3.1 included an IAQ management plan, construction
photos, and HVAC filter schedule and literature. Based on a review of LEED
requirements and this documentation, several potential items that may result in
incremental cost were hypothesized. The relationships between LEED
documentation and these hypothesized items have been depicted by arrows in

Figure 4.1.

After the constructors’ feedback, it was established that most of these items had
been part of standard practices for recent construction projects. However, LEED
documentation caused additional effort that was not necessarily representative of
typical industry practices. Also, MERV 8 filters used during construction present a
cost that may not be typically accrued on non-LEED construction projects.
Similarly, incremental cost items were identified among all LEED-IEQ credits.

The findings from this process are discussed below.

4.2.2 Processes/Items Resulting in Incremental Costs: Findings
The analysis from both case studies suggests that very few LEED-IEQ credits
result in incremental hard costs. This is either a result of the local building codes
having similar base requirements or such green practices having become part of
standard industry practices. Some significant processes/items identified as
causing incremental costs include:

1. MERV13 filters installed for building operation— CS1 and 082 (LEED-Cl

2.0 credit E05; LEED-NC 2.1 credit EQ3.1).

56

2. MERV8 filters used during the construction process for CS1 (LEED-CI 2.0
credit E03.1). Alternatively, temporary heating provided during the
construction process for 082.

3. Installation of a permanent outdoor air delivery monitoring system - CS1
(LEED-Cl 2.0 credit E01). The C82 constructor considered the 002
monitoring equipment (LEED-NC 2.1 credit E01) as part of their standard
construction practice.

4. High-performance glazing used for enhancing energy performance and
maximizing daylight and views (LEED-NC 2.1 credit E08.1).

5. Indoor air quality testing before occupancy- CSZ (LEED-NC 2.1 credit
E032)

6. Commissioning of IEO systems- CS1 only. The C82 constructor

considered this as part of their standard construction practice.

In addition to the above, LEED-related coordination/documentation for all credits
were also identified as accruing additional soft cost for both case studies.
Monetization of such LEED-IEO costs is presented in the next chapter. The
following section presents a discussion of the changes in occupant well-being
and productivity, resulting from the move to LEED offices, that may be

attributable to IEO credits.

57

4.3 CHANGES IN OCCUPANT WELL-BEING AND PRODUCTIVITY

Literature presents a need to quantify occupant well-being and productivity-
based benefits in LEED offices. The current research utilizes a case study based
approach using self-reported well-being and productivity metrics (occupant
surveys). An overview of this approach and key findings from the related

analysis are presented below.

4.3.1 Occupant Well-being and Productivity: Approach

Table 4.2 presents an overview of the case studies and occupant surveys.

Table 4.2: Case Studies and Occupant Surveys Overview

 

 

 

 

 

 

 

 

 

 

CS] CSZ
Buildingfipe, location Office building, Michigan Office building; MMan
Total population (N) 56 207
LEED rating Awarded LEED Platinum- C12.0 Registered for LEED Silver-
and C820 NC2.1
Timing of the move Occupants moved to LEED Occupants moved to LEED
building around the start of building during the research
research
Pre-move survey: timing and Survey conducted 34 months Survey conducted [-2 months
response rate (n) after the move. n= 33 (59%) before the move. n= I42 (69%)
Post-move survey: timing and Survey conducted 3-months after Survey conducted 1-2 months
respgnse rate (n) the Ere-move. n= 32 (57%) after the move. n= I I3 (55%)

Occupant responses from pre-move (Pr) and post-move (Po) surveys were
downloaded to MS Excel spreadsheets. These Pr and Po responses were
correlated, coded, and copied to a unified analysis spreadsheet. Next, the data
analysis was performed using MS Excel and Minitab 15 (Minitab 2008) software.
Among the respondents (n), few provided information related with their well-being
conditions (Pr 42% and P0 36% overall for CS1 and CSZ). Due to such limited

response, both case studies were analyzed collectively.

58

Basic analysis was performed using descriptive statistical methods such as
histograms and box plots (Devore 2004), while hypothesis testing using paired t-
tests (Devore 2004) was used for further analysis of occupant well-being and
productivity-related data. While the basic analysis presents an overview of the
occupant responses, hypothesis testing provides statistically significant inputs for
the economic evaluation. The key findings from the occupant survey analysis are

discussed below.

4.3.2 Occupant Well-being and Productivity: Findings
1. Occupant demographic information was collected during the pre-move
survey while workspace-related information was collected during both
surveys, as part of the general occupant information category. The
objective of collecting such data was to provide a descriptive overview of
the study population. Occupant responses in this category are
summarized using histograms. Figure 4.2 presents an overview of the
demographic information while workspace-related information is

summarized in Figure 4.3.

59

 

 

100% 1
90% l
80% -
70% 4
60% ‘
50% -
40% .
30% -
20% -
10% -

0% .

.4? ‘ (u g

.' .l

. .. u a
- -

“,-u 5 r .

item. in. — ..
R.

I".

 

 

-~ . , .
~.-.. ,. '2.- _..:..v ~-‘ 1
. v'..l‘.u ‘ .< .V“» ‘

l-"ltlll-llll-ll ll

 

 

 

 

 

 

 

 

 

 

III-II...-
Iiiillllllli.

 

l..---..‘...---.. -- 1:"

 

 

 

 

 

 

I leale; 2:<20yrs; 3:White/Caucasian;
4:Hispanic; 5:Single; 6:High school;
7:Managerial

E leemale; 2:20-29yrs; 3'African
American; 4:Non-H'spanic; SzMarried;
6:Some college; 7:Supervisory

a IzNone; 230-39yrs; 31American
Indian/Ahskan Native; 4:None;
SDivorced/Separated; 6:Associates
Degree; 7:Support Staff

lzNone; 2:40-49yrs; 3'Asian/Pacific
Islander; 4'None; 5:Widowed; 6:Bachelor
Degree; 7Dther

I:None; 2>49yrs; 3.0ther; 4:None;
SOther; 6flraduate Degree; 7None

 

 

 

‘ v. ‘1
n a u

i- ‘a
n

y.

,.
.1: ..._:

 

v.
a

o
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4.5-2";

3‘ 3",

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,.

¢
34'
,-

 

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z
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II. I. ll-

 

..u,,-. .c‘

 

 

 

I l.-
I ll-

 

 

 

 

 

 

 

. lindividual room; 2:Floorl;

3:N; 4.0-5fl
lzlndividual cubicle;

2:Floor2; 3:8; 4:6-10fl
f2; 9 l:Slnred room; 2:Floor3;
l“ 3-13; 4:1 1-1511

' ‘ l:Sl'nred open space;

2:Floor4; 3: W; 4: 16-20fi

“Q: l.Other; 2: FloorS; 3:N-E;

4>20fl

B l'None; 2:Floor6; 3:N-W;
None

{(9 5‘ E lzNone; 2:0ther; 3:S-E;

G 4:None
4‘s)
(9 CI lzNone; 2:None; 3:S-W;
4:None
Ill lNone; 2:None; 3:Don't
know; 4:None

 

Figure 4.3: Workspace-related Information

 

 

Figure 4.2 shows that about 70% of the respondents were female; the
respondents were fairly divided between age groups 20-29,30-39yrs with
slightly fewer respondents divided among age groups 40-49 and >49yrs.
More than 85% of the respondents identified themselves as
White/Caucasian and more than 90% as Non-Hispanic. About 65% of the
respondents were married, and the education category had fairly divided
responses with more than 90% of the population having been through
some level of college education. More than 55% of the respondents
identified themselves as support staff while approximately 40% identified

as holding supervisory or managerial positions.

Figure 4.3 shows that about 70% of the occupants work from individual
rooms or cubicles both pre-move and post-move, while a greater
percentage of occupants work from the upper floors (above floor 1) in
LEED offices than previously (approximately 60% occupants pre-move
worked from floor 1). Responses were fairly distributed for workspace
direction both pre-move and post-move with >70% of the respondents
working from the four cardinal directions. Interestingly, fewer occupants
work from within a 5feet distance from external windows in LEED buildings
(about 30%) than those in conventional buildings (about 48%), although a
fairly similar percentage of occupants work from within 15feet of external

windows both pre and post-move.

61

2. The occupant well-being survey category gathered information regarding
the occupants’ physical (Asthma and Respiratory Allergies) and
psychological (Depression and Stress) conditions. Figure 4.4 shows that
about 15% of the respondents had a medical history of asthma and a
similar number have faced depression symptoms in the past, while nearly
30% respondents have been affected by various respiratory symptoms
and about 35% have a history of stress-related conditions. This data was

collected during the pre-move survey.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

100%
El Occupants
8 A _
on without
60% _ Medical
History
40% ——
20%
I Occupants
0% ‘ with Medical
Asthim Respiratory Depression Stress History

Allergies

 

 

Figure 4.4: Occupants’ Medical History (n=l75)

The pre-move and post-move surveys provided data regarding occupant
absenteeism and work-hours affected by the above health conditions over
four-week snapshots. Due to a limited number of data points, the effects
from asthma and respiratory allergies were clubbed together and similarly
those from depression and stress were also clubbed. Health snapshot

responses were accompanied by questions seeking respondents'

62

confidence levels. All responses with <50% confidence were disregarded
from the analysis. The box plots presented in Figures 4.5-4.8 summarize

the health snapshot responses.

 

 

Hours alsent (per month)

 

 

 

 

 

 

20 -
Q
15 d
Q
10 -
a in a
5 " s
l 12 l 0 49
0« 33 ' 6 '
Pre-move(n=49) Pos t-move(n=34)

 

 

Figure 4.5: Hours Absent due to Asthma/Respiratory allergies
(*z Outlier; +: Mean-values shown; x: Median)

 

 

Work-hours affected (per month)

 

*Q‘kQQ
80- ~

 

 

 

 

 

 

 

 

 

 

 

 

 

60 .1
40 4 l
n
20 ‘ $ 16.28 I
0 g . Q 6.32
Pre-move(n=46) Pos t-mo've(n=33)

 

 

Figure 4.6: Work-hours Affected by Asthma/Respiratory Allergies
(*: Outlier; +: Mean-values shown; x: Median)

63

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

12.5 . ” *
’5‘
g 10.0«
E
I-
g 7.5 « ”
E
3 5.0-1
a
E
g 2.5 " ' $ *

.9
0.0 $0 3 @047
Pre-move(n=45) Post-move(n=34)
Figure 4.7: Hours Absent due to Depression/Stress
(‘z Outlier; +: Mean-values shown; x: Median)
g 80 *
E
O
E
h
a 604 3
‘6
8
0 40*
E ”Ea. ”TS-T
S ‘2
O 204 r171.- -_ 5 f
f .2. “1.; ":6"_ 5 20.2] w 14 O6
.5 ,. G 3:“ ‘ .
° ’1 4. 1 -.
B 0-1 “ ---
Pre-move(n=48) Post-move(n=34)

 

Figure 4.8: Work-hours Affected by Depression/Stress
(*z Outlier; +2 Mean-values shown; x: Median)

For asthma/respiratory allergies, Figure 4.5 indicates a minor reduction in
the mean value for hours absent (1.12 to 0.49), while a more substantial
reduction in the mean value for the affected work-hours (16.28 to 6.32) is
presented in Figure 4.6. For depression/stress-related conditions, Figure

4.7 shows a minor reduction in the mean value for hours absent (0.93 to

 

 

0.47), while a more substantial reduction in the mean value for the
affected work-hours (20.21 to 14.06) is presented in Figure 4.8. These
findings are based on all responses collected through pre-move and post-
move surveys. Even though the above findings indicate reductions in
average absenteeism and affected work-hours, such findings can only
provide limited confidence for the economic analysis as they do not
necessarily imply improvements in health conditions for the same

respondents.

In order to address such uncertainty, further analysis using hypothesis
testing was performed. Pre-move and post-move responses were paired
and analyzed using lower-tailed, paired t-tests to determine statistically
significant (Cl: 95%) values of reduction in absenteeism and affected
work-hours for the same respondents, resulting from improved health
conditions in LEED offices. Lower-tailed tests provide fairly conservative
estimates, and pairing results in better estimation of changes, as a mean
of differences for the same occupants instead of a difference of means for
the entire population. However, pairing of the data results in a limited data
set for the analysis since all unpaired responses (where occupants

responded only one out of the two surveys) have to be discarded.

This problem was addressed by including blank responses as a “0” value

for occupants who had participated in both surveys and had provided input

65

for well-being questions in at least one survey. This was possible since the

well-being questions directed occupants to leave the fields blank if they

had not faced such heath conditions during the snapshot period. Table 4.3

presents the findings from the occupant well-being paired t tests.

Table 4.3: Changes in Occupant Well-being upon Moving to LEED Offices
(d-value: mean difference of Pr-Po response; AB: Absenteeism; WH: Affected work-hours; W/MH:
Occupants with medical history; W/O MH: Occupants without medical history; PR: Reduced productivity)

 

Lower tailed paired t-test

 

     
 
   

  

d-value
CI (95%)

1. Asthma and Respiratory Allergies

Interpretation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AB All 0.115 -0.26 #17 No significant finding
W/MH 0.047 0.034 25 95% sure that value of mean (AB difference) is at least
0.034 hours/month for occupants with MH of Asthma/
Respiratory Allergies
WH All 0.048 0.07 46 95% sure that value of mean (WH difference) is at
least 0.07 hours/month for all occupants
W/MH 0.02 2.35 27 98% sure that value of mean (WH difference) is at
least 2.35 hours/month for occupants with MH
2. Depression and Stress
AB All 0.058 -0. l 8 46 No significant finding
W/MH 0.102 -0.24 29 No significant finding
WH All 0.047 0.17 51 95% sure that value of mean (WH difference) is at
least 0.17 hours/month for all occupants
W/MH 0.02 2.86 34 98% sure that value of mean (WH difference) is at
least 2.86 hours/month for occupants with MH of
Depression/ Stress
3. Overall effect of health
AB All 0.239 b0.44 109 No significant finding
PR All 0.005 0.565 107 99% sure that value of mean (Productivity difference)
is at least 0.565 % for all occupants
_ __ _

 

 

 

The t-tests indicate statistically significant values for mean reduction in

work-hours affected by both sets of health conditions and a minor

reduction in the absenteeism caused by asthma/respiratory allergies.

66

Overall, an improvement (0.565%) in the occupants’ perceived productivity

resulting from all health conditions was also found.

In the next survey category, work environment satisfaction, occupants
were asked to rate their satisfaction level with their work environment IEQ
attributes both pre-move and post-move (5-point scale, 5 being completely
satisfied). IEQ attributes included temperature (TE), humidity (HU), air flow
(AF), air quality (A0), lighting (Ll), daylight (DL), glare (GL), outside views
(OV), noise level (NL), office furniture (OF), office computer (OC), and
visual privacy (VP). Responses were paired and the difference (d) in
satisfaction levels (Post-Pre) was determined. Figure 4.9 presents an
overview of changes in occupant IEQ satisfaction using such difference

values.

 

 

Change in occupant satisfaction (Po-Pr)

,._.**H_i _, _‘A . r.
3- - ~ - VI"! it»
9r?
-— V
M l‘, R
c O c
.2--1 - QM mu «in
..3d «Q Q.
Q
T I I I l T I l

 

     

 

 

 

 

 

I l l
TE HU AF AQ Ll DL GL OV NL OF OC VP

 

 

Figure 4.9: Change in Occupant IEQ satisfaction (n=68)
(*: Outlier; +: Mean-values shown; x: Median)

67

While mean occupant satisfaction with all lEQ attributes seems to have
improved in LEED buildings, the most substantial improvement is seen in
occupant satisfaction with the indoor air quality (A0: mean d=1.2), daylight

(DL: mean d=1.5), and outside views (OV: mean d=1.6).

Occupants were also asked to provide input regarding the effect of their
workspace IEQ on their perceived productivity both pre-move and post-
move. These responses are summarized in Figure 4.10a. Figure 4.10b
presents box plots based on paired responses from the same respondents

who provided Pr and Po inputs for IEQ satisfaction earlier (Figure 4.9).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20 20
15- -- A 154
25
ix“ 3
g 10« s 104
s 1'?
‘g 5-1 2 18 g 5 '1
E, ' 8 O 3.59
y—H 0
go 0., -0.80 2 “g 0 2
s P
2 -2 %
° -54 ,g -5.
3 a
"5 .2
E 'l0‘1 * & -l0‘
5 5
.fl
.1 S -1 U '15 "
-20 g j -20
Pre-move(n-128) Post-move(n-=l4l) d (Po-Pr)
Figure 4.10a: Perceived Effect of IEQ on Figure 4.10b: Perceived Change in
Productivity Productivity due to IEQ Changes (n=68)
(*z Outlier; +: Mean; x: Median) (*z Outlier; +: Mean; x: Median)

68

Figure 4.10a reflects that on average the LEED office IEQ has a positive
effect on the occupants’ perceived productivity. The mean value for effect
of office lEQ on average productivity has changed from -0.8% to +22%,
i.e. approximately a 3% improvement; the median value also changed

from -2% to +2 %.

Figure 4.10b presents an even higher mean improvement value (3.6%) for
change in the perceived productivity. This is based on responses from the
same population that indicated improved satisfaction levels with LEED
office IEQ in Figure 4.9. This indicates the possibility of a correlation
between improvements in perceived productivity and improvements in IEQ
satisfaction. While scatter plots of perceived IEQ changes vs. changes in
satisfaction with IEQ attributes do not reflect linear relationships, future
researchers may explore such relationships based on other statistical

models.

Similar to the occupant well-being analysis, lower-tailed, paired t-tests
were conducted to determine statistically significant (Cl: 95%) values of
improvement in perceived productivity for the same respondents, resulting
from improved IEQ in LEED offices. Also, in order to explore the effect of
well-being conditions on the occupants' perceived productivity, such t-

tests were performed using data from occupants with medical history of

69

the well-being attributes of interest (AOI), as well as for those without such
conditions. Table 4.4 presents the findings from these paired t-tests.
Table 4.4: Changes in Occupant Productivity upon Moving to LEED Offices

(d-value: mean difference of Po-Pr response; W/MH: Occupants with medical history; W/O MH:
Occupants without medical history; PR: Productivity)

 

Lower tailed paired t-test

p-value d-value n Interpretation
CI 95%
—

1. Overall effect of IEQ on Productivity

 

 

 

 

 

 

 

PR All 0.000 2.599 86 Almost certain that value of mean (Productivity
difference) is at least 2.6% for all occupants
PR W/Ml-I 0.000 2.875 52 Almost certain that value of mean (Productivity

difl'erence) is at least 2.875% for occupants with MH
of at least one well-beingAOl.

PR W/o MH 0.006 1.01 34 99% sure that the value of mean (Productivity
difference) is at least 1.01% for occupants without MH

of all of the well-bemg AOI _

 

 

 

 

 

 

 

 

 

 

These t-tests indicate statistically significant values for mean improvement
in occupant productivity (2.6%) resulting from the move to LEED offices
for all occupants. For occupants with medical history of at least one well-
being AOI this mean improvement was found to be slightly higher (2.9%)
while a lower improvement value (1.01%) was determined for occupants

without medical history of all of the well-being A01.

4. In the next survey category, productivity and performance, occupants
were asked to rate their performance over a 4 week snapshot during both
the pre-move and post-move surveys (5 point scale, 5 being most
preferable). Performance was defined by four attributes including quantity

of work (Work-Qty), quality of work (Work-QltY). customer service provided

70

 

to internal clients (CS-Int), and customer service provided to external
clients (CS-Ext). The difference (d) in performance attributes (Po-Pr) was
determined. Figure 4.11 presents an overview of changes in such

performance attributes.

 

 

       

Change in performance (Po-Pr)
O h—
I l

 

 

 

-2-1 as an emu u
-3-4 , -- a -- 5 , a - a it-
Work-Qty Work-Qlty CS-lnt CS-E‘xt

 

 

Figure 4.11: Change in Perceived Performance (n=105)
(‘z Outlier; +: Mean-values shown; x: Median)

Figure 4.11 reflects mild improvements in the mean values for all
performance attributes resulting from the move to LEED offices, however
these changes are not as substantial as those seen for IEQ satisfaction

questions.

4.3.3 Annual Benefits from Occupant Well-being and Productivity

The primary goal of the occupant survey analysis was to provide annual benefit

input for phase 3. The researchers hypothesized, that the move to LEED offices

71

would improve productivity and reduce absenteeism among occupants. While
reduction in absenteeism is expected to result from improved occupant well-
being alone, the productivity improvement may include benefits resulting from

changes in well-being or directly from improved IEQ (Fisk and Rosenfeld 1997).

Within the scope of this research, improvements in occupant productivity
resulting from improved well-being form a sub-set of overall improvements in
occupant productivity resulting from better IEQ. Hence, using a 2.6% change in
productivity from better IEQ (Table 4.4) along with a 0.57% productivity
improvement from improved well-being (Table 4.3) would lead to double-counting
of the productivity benefits. Therefore, the overall productivity improvement from
IEQ was discounted to 2.03% (2.6%-0.57%) and used along with other benefits
determined from the well-being AOl earlier. This productivity improvement was
finally converted to additional work-hours offered by occupants toward their

respective organizations.

The reduction in the absenteeism value was directly used to calculate annual
work-hours gained per employee due to the respective health conditions.
However, conversion of affected work-hours (WH) included an additional step.
Occupant well-being questions also collected data for perceived productivity loss
during these affected work hours for the respective health conditions. Such
productivity data was clubbed from both surveys and analyzed using lower-tailed

one-sample t-tests (Devore 2004). The mean productivity loss during work-hours

72

affected by asthma/respiratory allergies was found to be at least 4.75% and for
depressionlstress'as 5.90%. These mean productivity loss values were used for
calculation of the lost work-hours per employee. Table 4.5 summarizes the final
benefit outputs from the survey analysis, useable for the phase 3 LCCA.

Table 4.5: Annual Occupant Well-being and Productivity Benefits in LEED Offices
(d-value: mean difference of Po-Pr response; AB: Absenteeism; WH: Affected work-hours; PR:

Productivity; W/MH: Occupants with medical history; W/O MH: Occupants without medical history)

 

Source of im rovement Additional calculations Resultant benefit/ ear

 

1. Reduction in Asthma/ Respiratory Allergies

 

 

 

 

AB is reduced by None Additional 0.41 work-hours
0.034hrs/month for W/MH for each occupant W/MH
WH is reduced by @4.75%productivity loss, 2.35 WH (d) Additional 1.34 work-hours
2.35hrs/month for W/MH laccounts for aiain of 0.1 thrs/month for each occupant W/MH

 

2. Reduction in Demession/Stress
WH is reduced by @5.90%productivity loss, 2.86 WH (d) Additional 2.02 work-hours
2.86hrs/month for W/MH accounts for a gain of 0. 1 7hrs/month for each occupant W/MH

 

 

 

3. Improvement in productivity
PR d value=2.599% for all Discount 0.565% improvement resulting Additional 38.98 work-hours
occupants from well-being; PR=2.03% for each occupant

 

For each month averaging 160 work-
ours a 2.03% improvement equals 3.25
additional work-hours

 

 

 

   

Improvements in asthma/respiratory allergy conditions seem to provide 1.75

(0.41-+1.34) additional work hours/year to each employee with a medical history
of such conditions. Similarly, occupants with a medical history of depression/
stress seem to gain 2.02 additional work hours/year due to reductions in such
conditions. Perceived improvements in productivity seem far more substantial. All
occupants seem to gain approximately 39 additional work hours/year from direct

productivity improvements (unrelated to well-being conditions).

73

The above findings provide the benefits input for LCCA. These findings have

been monetized in the next chapter.

4.4 CHAPTER SUMMARY

This chapter provided a detailed discussion of the phase 2 analysis approach
and presented the findings from the analyzed data. It seems likely that the case
study organizations may attain substantial benefits through improvements in
occupant well-being and productivity in LEED offices. However, economic
justification of the incremental investment for incorporating LEED-based IEQ
strategies remains to be undertaken. Phase 3 provides such economic
justification through a life cycle cost analysis approach, as presented in the next

chapter.

74

CHAPTER 5

LIFE CYCLE COST ANALYSIS

5.1 CHAPTER OVERVIEW

This Chapter presents a discussion of the life cycle cost analysis (LCCA) work
undertaken as research phase 3. This phase includes monetization of phase 2
outputs and conduct of the LCCA. The following section elaborates the approach
and findings from monetization of phase 2 outputs. The LCCA approach
including method selection, variables, and calculation worksheet has been
outlined next. This is followed by a discussion of LCCA findings and the

uncertainties associated with these findings.

5.2 MONETIZATION OF PHASE 2 OUTPUTS

The previous chapter elaborated on phase 2 work. Phase 2a concluded with
identification of processes/items resulting in incremental costs, and phase 2b
ended with a summary of additional work hours (benefits) available to case study
occupants through improved well-being and productivity each year. These phase

2 outputs have been monetized in this section to provide input data for LCCA.

5.2.1 Monetization of Processes/Items Resulting in Incremental Costs

Processes/Items including labor, material, equipment etc. were categorized as
hard costs. These were monetized using inputs from case study constructors
and estimation using of-the-shelf cost references (Means 2007). Others items

requiring engineeringldocumentation etc. were categorized as soft costs. These

75

were monetized using the constructors’ estimates of time invested in such
documentation and hourly cost estimates. Cost estimates were added to the

matrices developed in phase 2a. Table 5.1 presents a snapshot of the final

LEED-IEQ cost estimate matrix developed for CS1.

 

    
   

.
' . 1,)
11.1 h ..._.1

. ‘ ,1‘ ll
ll‘lm‘lkllll‘p
1112511111”

11'?“ 3 .:'
‘ll'll .‘ .
111'
111111 .

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lm

"III
I
I

ll
ll

1
. 1

11’

ll
1‘11;

.11.

u.‘

.011
l

-. 111:1

template, covering supplier's
Construction for all Standard
IAQ HVAC Operating
management material. Procedure
plan, (SOP)

" .111 .

ill
1 1

ma.
tiling

ll"

 

1111 '
11

2.

1

ii

.11,

Construction Plastic Disagree Not used on $0.0 $0.0
photos barriers and project
identifying negative
SMACNA pressure
approach. equipment,
Filter Wet
schedule and misting.
literature. MERV 8 Agree- $0.0 $0.0 MERV8 filter cost
filters used MERV 8 not assessed- these
during filters (are assumed to be
construe. used during
operations for
other buildings.
MERV13 filters
cost for operations
in the case study
assessed under
EQS

 

1‘ ‘

 

 

.s(' '
.l Itn

”I?“ h! ‘3
l
l

1 111m 1 1
m1

I‘llfi
(a
1‘1.

"111

7'“-
‘Sul‘l‘lfi "l‘l 1‘
‘ 1: “5:9

.‘llh ll

 

l
l‘jlli" “J71 . ll

-. ‘ll

,.
‘U

l
'11 lull’

Additional Disagree Part of $0.0 $0.0
storage constructor’s
costs. SOP

2.,

(l
u!

.1 ,’

 

J
‘1

Daily Disagree Part of $0.0 $0.0
cleaning constructor's
costs. SOP for
safety reasons

Engineer.- Doc. Standardized $0.0 $216.04hrs

IAQ only IAQ documentation
managem. management time @554/hr
plan plan used , (constructor's
develop. hence no input)

and substantial
document. engineering
cost work

239'

11*“ ll
ill

.1th ’1 P 11
Develop and implement IAQ management plan during construction: Meet SMACNA IAQ guidelines for

construction phase. Protect stored on-site and installed absorptive materials from moisture damage. Use MERV 8

11 fr‘
1.?
all

' 'sl

in; *
1
i

1

‘1'1

I. . .‘1 1 ll.

l \l '- ,' I- ‘11‘ l

_1
up'

' 1. 1
9‘ y

l
.111

 

.‘ 1| . “
111,111
I
11

11111113 "3"‘3‘1‘1111
1171.10 11.11
1 111'
filters for any AHU's used during construction and replace filters prior to occupancy.

‘11

 

 

Ill
1111:

1 11;
1:1 1
‘ ~11

., in
.11

l' 4‘

 

 

 

 

 

 

 

Note: Cost inputs from constructors were assumed to represent 2008 values, as discussed in Section 5.5.

76

These matrices follow a similar layout to the first cost assessment structure
presented in Figure 4.1 in the previous chapter. In these matrices, the
information reviewed for each IEQ credit is linked with hypothesized incremental
cost items, the related feedback obtained from constructors, and the incremental
cost estimates. Complete cost estimate matrices are provided in Appendix B.
Some key findings from the LEED IEQ cost estimate matrices are discussed

next.

CS1 incurred an incremental cost of approximately $40,000 for LEED-IEQ
including $33,500 (85%) in hard costs and the rest as soft costs. This amounts to
$2.34ISF for the 16,900 gross square feet (GSF) space. The total incremental
cost for C82 was determined to be approximately $454,591, including $417,491
(92%) in hard costs and the rest as soft costs. This amounts to $2.6/SF for the
174,750 GSF space. The above findings amount to about 2.1% (CS1) and 2.4%
(C82) of average costs for construction of office buildings in Michigan (Means

2007).

Kats (2003) had earlier found incremental costs for overall LEED credits (for a
mixed sample including 33 LEED buildings rated at different LEED levels,
certified to platinum) as approximately $4.00/SF amounting to 2% incremental
investment. Stegall (2004) also established a 2% incremental investment for a
LEED-Silver facility, while SBW (2003) found a 1.2% increment for 2 LEED
buildings. SWA (2004) found an overall incremental cost of $11.00/SF for LEED-

Gold rated office buildings amounting to an 8.5% increment. Langdon (2004 and

77

2007) reported a reduction in LEED-related incremental costs from 0-3% in 2004

to almost negligible increments in 2007.

Although the above studies vary in their findings of incremental cost amounts,
they generally indicate increments ranging from 1-3% of project costs for all
LEED credits. Our findings suggest that a substantial portion of such first cost

increments may be attributable to lEQ-related credits.

5.2.2 Monetization of Occupant Well-being and Productivity Findings
The annual resultant benefits (additional work hours) from improved occupant
well being and productivity improvements presented in Table 4.4 were monetized

using employee wage inputs from case studies and typical industry wages.

The occupant demographic information gathered during the pre—move survey
provided the respondent job category breakup among managerial/supervisory
and support staff categories. Typical employee income ranges for these
categories were obtained from case studies and industry averages. Average
hourly wages (WA) considering all occupants were computed for each case
study. These were used to determine the dollar value of phase 2b benefits.

These calculations have been summarized in Tables 5.2a and 5.2b.

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Table 5.2a: Calculation of Average Hourly Wage (WA)

 

 

 

 

 

__ ‘
Support Staff Category Managerial Staff Category
Av. Annual % Av. Annual % Overall Average

Income Population Income Population Hourly Wage (W A)
(CS input) (Pr Survey) (CS input) (Pr Survey) {(Av Category
Income x %

 

 

 

 

 

 

 

Population)/2080 hrs

C81 $35,500 22% $72,500 78% $30.94

C82 $41,655 69% $108,500 31% $29.99
__ _ —

 

 

Table 5.2b: Annual Economic Benefits from Occupant Well-being and Productivity
- Improvements
(WA: Average hourly wage; AWH: Additional work hours; $0: Dollar benefit per occupant; W/MH:
Occupants with medical history; n': Number of occupants extrapolated from Pre-move respondent sample
using total CS population; Pr: Pre-move survey)

 

 

 

 

 

 

 

I AWI-l C81 C82
_ - —
Avera e hourl wa e- WA (from Table 5.2a) $30.94 $29.99

AWH fi‘om reduced Asthma/Allergies per year (from Table 4.4) 1.75

$ Benefit/occupant- $0 (WA x AWH) $54.15 $52.48

Applicable occupants-n' (extrapolated from W/MH in Pr

Survey) 20 69 _
Monetized benefit/year (n' x $0) $1,103 $3,596

 

AWH fi'om reduced Depression/Stress per year (from Table 4.4) 2.02

 

 

 

 

 

 

 

 

 

 

 

$ Benefit/occupant- $0 (WA x AWH) $62.50 $60.58

Applicable occupants-n' (extrapolated from W/MH in Pr

Survey) 15 85
Monetized benefit/year (n' x $0) $955 $5,122

AWl-l from improved Productivity per year (from Table 4.4) 38.98

$ Benefit/occupant- $0 (WA x AWH) _ $1,206.13 $1,168.9‘7W

Applicable occupants- n' (Total CS Population) 56 207 ..
Monetized benefit/year (n' x $0) $67,543 $241,976

1r
Total $ benefit/ year from improved occupant well-being and
productivig _ 569:601 8250:6944

 

79

Table 5.2a presents the calculation of average hourly wage (WA) using percent
of respondents among each category and typical annual income for such
categories. Using these WA values the additional work hours (AWH) found in

phase 2b were monetized for each occupant ($0) in Table 5.2b.

Next, the number of applicable occupants (n’) was calculated by extrapolating the
percent of relevant respondent population from the pre-move survey to account
for the total sample population. For example, only 33 among 56 CS1 occupants
responded to the pre-move survey. Among these about 36% responded as
having a medical history of Asthma/Allergies. Hence an n’ of 20 (36% of 56)
occupants was determined. Finally, the total annual $ benefit was calculated

using the annual benefit per occupant ($0) and number of applicable occupants

(n’).

For CS1, the total annual benefit was computed to be $69,601 and for C82 it was
determined as $250,694. The larger benefit value in 082 is primarily attributable
to a much larger occupant population. About 97% of the total benefits for both
case studies are attributable to direct occupant productivity improvements and
the rest result from: improved occupant well-being. These benefit values, along
with the incremental first costs determined in the previous section, provide the
data input for LCCA. The next sections elaborate on the LCCA approach and

findings and present the associated uncertainties.

80

5.3 LIFE CYCLE COST ANALYSIS: APPROACH

The literature presented LCCA applications for studying the economic viability of
several green building investments. While these studies have limited focus on
evaluating occupant well-being/productivity related impacts, they certainly
provide overall directions for approaching LCCA, selecting the analysis method,
and help in identifying data requirements and key analysis variables. The
following discussion provides further insight into this overall LCCA approach and

highlights some key analysis decisions.

5.3.1 LCCA Method Selection
Chapter 2 provided an overview of some commonly used LCCA methods. These
include:

1. Simple payback.

2. Net present value.

3. Internal rate of return.

4. Annualized value.

5. Discounted payback.

6. Benefit-cost analysis.

Several existing green building-related LCCA studies have used benefit-cost
analysis as the LCCA method of choice (Kats 2003, Ries et al. 2006, Romm and
Browning 1994, SBW 2003). This method addresses the time-related variations

in costs by incorporating concepts such as discounting and inflation. It provides a

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simple indicator of favorability of the economic investment (favorable investments
are those where benefit-cost ratio is greater than 1) based on the selected

variables.

For the current research, benefit/cost analysis has been used as the primary cost
analysis method in order to allow comparisons of the research findings with
existing green building LCCA literature. In addition, payback period (simple
payback) and the rate of return (internal rate of return) will be calculated to

provide additional decision support metrics for the investors.

5.3.2 LCCA Variables
Three LCCA variables were identified through literature. These include:

1. Study period (SP): This is the duration for which the study is conducted.
Costs and benefits accrued within this period are used as inputs for the
analysis. The United States General Services Administration (GSA)
recommends limiting the SP for LCCA calculations to a maximum of 25
years (GSA 2003). Dell’lsola and Kirk (1981) as well as Gardi (2003)
recommend using an SP of 25-40 years. Kats (2003) used 20 years; SBW
(2003) used 25 years, while Ries et al. (2006) used an assumed 50 year
building life as the study period. For the current research, the researchers

finalized a 25 year study period for the base scenario.

82

2. Inflation rate (IR): This is the rate at which costs are expected to escalate
over the study period. United States inflation data (lnflationdata 2008)
since 1997 suggests an average annual inflation rate ~2.74°/o, while this
number is ~3.33% for the last 5 years. Kats (2003) used 2%, SBW (2003)
used 2.8%, while Gardi (2006) used 2-6°/o inflation rates for various
analysis components. For the current research, a 3% inflation rate was

finalized for the base scenario.

3. Discount rate (DR): This rate represents a reduction in the value of money
over the study life. Gardi (2003) recommends using “cost of borrowing
money” as an indicator to select the appropriate discount rate. Dell’lsola
and Kirk (1981) recommend using either the “minimum acceptable rate of
return” for the investor or the “current borrowing rate of interest” to
determine the discount rate. In a recent green building-related LCCA
application, Gardi (2006) used a 7.75% discount rate. Other researchers
have used discount rates of 5% (Kats 2003), 7% (Ries et al. 2006), as well
as 2% and 6% (SBW 2003). For the current research, a 6% discount rate

was finalized for the base scenario.

5.3.3 LCCA Worksheet
After identifying the LCCA method and the base scenario variables, an MS Excel
worksheet was developed to assist in performing the LCCA calculations. This

worksheet is presented as Table 5.3.

83

Table 5.3: Life Cycle Cost Analysis Worksheet

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—— _
LCCA Inputs LCCA Variables
Incremental Cost- Co (Appendix B2)l $0.00 Study Period- SP (Yrs) 1 0
Annual Benefit- Be (Table 5.2b) g""W500?"'fHfiEEiBBWREtWEJW'ifi0/o) W0f0%”'
l _ Discount Raiéi'fiiilé/J __ . .. .. , . .._ N...” 00% ..
LCCA Mid-Points . Source . Value
Present Worth Factor (PW) (Determined from Present Worth 1
; “blessingfigéxerialzlssl-.....__.._.1.--_-4..__..._..___--._9.;99_.
Present worth of Annuity Factor (PWA) ._ (Co/Be) l (100
Present Value of Life Cycle Benefits (PVB) 1 (Be x pwp) $0
LCCA Outputs 1 Source Value
Benefit-Cost Ratio (B/C) ,5 PVB/Co 0
Payback Period (PB)- in years l Co/Be ; ()0
Rate of Return (RR) WWWWDetermined using PWA tables ‘ W
using PWA 0.00%

 

The worksheet comprises of four sections. These are:
1. LCCA Inputs: This includes the Incremental Cost (Co) and Annual Benefit
(Be) inputs for LCCA. For the current research, the incremental first cost
for LEED-IEQ provides a one-time cost input, while the occupant well-

being and productivity improvements provide annually recurring benefits.

2. LCCA Variables: This includes the Study Period (SP), Inflation Rate (IR),

and Discount Rate (DR), as previously discussed.

3. LCCA Mid-Points: A Present Worth (PW) factor is determined from
published PW tables (Dell’lsola and Kirk 1981) using the LCCA variables.
This PW is used to compute the Present Value of Life Cycle Benefits

(PVB). Since incremental costs are incurred only once at the start of the

study period, PV for these is not computed. The Present Worth of Annuity
(PWA) is also calculated from the LCCA inputs. PWA is used to determine

the Rate of Return (RR).

4. LCCA outputs: This includes the final computation step and presents the
findings from the analysis. Benefit-Cost ratio (BIC) is computed using Co
and PVB. A Benefit/Cost greater than 1 represents an economically viable

investment.

The Payback Period (PB) and Rate of Return (RR) provide additional
decision support metrics for the investor. PB is calculated using Co and
Be. An acceptable payback period is specific to the investor’s

expectations.

RR is determined using PWA value, published PWA tables (Dell’lsola and
Kirk 1981) and adjusting for inflation. Instead of assuming a discount rate
to extrapolate costs and benefits over the study period, this method
assists in determining the expected returns on investment for the given
study period. An RR greater than the investors typical returns, represents

an economically viable investment.

The above discussion outlines the overall cost analysis approach and presents

some key assumptions/decisions for this research. This discussion may assist

85

readers in developing a better understanding of the economic analysis and

minimize any ambiguity in the research findings.

5.4 LCCA: FINDINGS
Based on the approach highlighted in the previous section, LCCA calculations
were performed for the base scenario. In addition, three alternative scenarios
were modeled by adjusting the analysis variables based on the literature review
and case study feedback. The four scenarios include the following variables:

1. Base Scenario: SP=25years, IR=3%, DR=6°/o

2. Scenario 1(lncrease in inflation): SP=25years, IR=6%, DR=6%.

3. Scenario 2 (Higher discount rate): SP=25years, IR=3%, DR=8°/o.

4. Scenario 3 (Shorter study period): SP=15years, IR=3%, DR=6%.

LCCA findings from all scenarios have been summarized in table 5.2 below.
LCCA worksheets for all scenarios have been presented in Appendix C.

Table 5.4: Life Cycle Cost Analysis Findings

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Scenario Case Study Benefit/Cost Ratio Payback Period (yrs) Rate of Return (%)
Base Scenario (SP= 25yrs ; IR=3%; DR=6%)

cs 1 30.9 1 0.6 yrs 1 167%
Scenario 1 (SP= 25yrs ; IR=6%; DR=6%) W

CS 1 WWWWW W 44."0'WW=BaWsWeSce"nWa}W13= 926656613516 '

CS 2 L 138 """"锧5§é”§'ee‘n"ana"'""" WQWBWaWsWe"See—1197157777
Scenario 2 (SP= 25yrs ; IR=3%; DR=8%) ‘

CS 1 .. .-..._. _ -252 .. .. .. - _ ..._ "“rgggg S'eenaifi’ ., ._ - ,. .2 “fig;g5;fi5fig“"“

Cs 2 " 79 ' W W W=W 656623533" W é “engages W
Scenario 3 (SP= ISyrs ; IR=3%; DR=6%) ' W

CS 1 21.1 W = Base Scenario j = Base Scenario

CS 2 6.6 = Base Scenario = Base Scenario

 

 

86

For the base scenario, life cycle benefits exceed the incremental costs
approximately by factors of 31 and 10 for CS1 and 082 respectively. The
benefits seem to payback for the incremental costs within about 7 months of
occupancy for CS1 and in less than 2 years for C82. The rates of return on
LEED-IEQ investment are in the order of 167%Iyear for CS1 and 50%lyear for

CSZ. These findings imply a high feasibility of the economic investment.

Other LCCA scenarios were modeled to gain a preliminary insight into the
sensitivity of research findings to changes in LCCA variables. Future researchers
may use Monte Carlo Simulation (Huijbregts et al. 2003) to model the economic
risk associated with these findings by using a wider spectrum of LCCA variables.
It may be noted that PB and RR calculations are based on first year costs and

benefits only and remain unaffected by changes in LCCA variables.

Scenario 1 addresses an increase in inflation. The 6% inflation rate used in this
scenario is higher than the largest monthly inflation (5.6%) reported over the last
10 years (lnflationdata 2008). For this scenario, the BIC increases to about 44
and 14 for 081 and C82 respectively, increasing the economic feasibility of the
investment. Scenario 2 models a higher discount rate (8%) representing higher
expectations of returns on the investment. This causes the BIO to reduce to 25
for 081 and 8 for CS2 Scenario 3 models a shorter study period (15 years). This
reduces the BIC ratio to 21 and 7 for CS1 and 082 respectively. Each of these

scenarios, still represent a highly beneficial economic investment.

87

Among previous green building related LCCA studies, Kats (2003) found an
average BIC ratio in the range of 15-16, SBW (2003) found BIC ranging
approximately 1 to 2, and Ries et al. (2006) determined a BIC of 1.7. Romm and
Browning (1994) determined a 1 year payback for improved workplace lighting
conditions. While all these studies indicate higher benefits than costs, they vary
in the scale of their findings primarily due to the scope of the benefits evaluated.
The current research focuses on benefits resulting from occupant well-being and

productivity that have sometimes been conservatively quantified in these studies.

5.5 UNCERTAINTIES ASSOCIATED WITH LCCA FINDINGS
The above findings indicate substantial economic incentive in investing in LEED-
IEQ, received through improved occupant well-being and productivity. While the
above findings are based on a research methodology developed upon extensive
labor and rigorous review, several uncertainties exist. Highlighting these
uncertainties is significant to assist the readers in gauging the validity and
associated risk of these findings as well as for further development of this critical
research area. Some key uncertainties have been discussed below:
1. Cost input uncertainties
a Often, building decisions are not solely driven by LEED
requirements; in such cases attributing incremental costs to LEED
becomes challenging. For example both case studies used under
floor air distribution (UFAD) systems instead of conventional

overhead HVAC systems. While this assisted these projects in

88

achieving certain LEED credits, the constructors’ input suggested
that this decision was driven by other concerns (for example,
architectural). Such costs were not accounted for in this research

b Certain cost items accounted for under LEED-IEQ credits, also
assist attaining other LEED credits. For example, substantial
incremental costs were estimated for high-performance glazing for
C82, while incorporating this glazing also resulted in achieving
credit EA1. Since other LEED categories were not studied in this
research, all such costs were attributed to LEED-IEQ

0 Costs estimated using Means (2007) were extrapolated to 2008
Michigan-specific estimates while cost inputs received from the
constructors were assumed to represent 2008 estimates, as these
inputs were received in 2008.

d Hypothesis development for identifying incremental cost items was
based on a review of LEED documentation. Certain cost items not
evident in such documentation may have been missed

In addition, the constructors’ bias to justify LEED investments or loss of
information due to miscommunication may also have affected the
incremental cost assessment. However, these uncertainties form part of
most researches that involve external feedback and are assumed to have

limited significance.

89

2. Benefit input uncertainties

a Occupant productivity benefits provide the majority of the total life
cycle benefits in this research. However, such productivity is based
on self-reported perceptive responses. While such perception-
based surveys have been extensively used in post-occupancy
evaluation literature, their validity may need to be explored through
further research

b Benefits attained by the survey respondents (n) were assumed to
be representative for the entire organizations’ population (N)

c Benefits were determined from two 4-week snapshots; it can not be
claimed that these snapshots would have comprehensively
captured the annual effects of occupant well-being and productivity
conditions

d The recent move to a new building may have a temporary effect on
the occupants’ well-being/productivity. Hawthorne effect (Romm
and Browning 1994) explains temporary changes in people’s
behavior or performance as a response to a change in the
environment. Although the Hawthorne theory has been disputed
(Adair 1984; Diaper 1990; Gottfredson 1996; Rice 1982; Wickstrom
and Bendix 2000) , the uncertainty in long-term benefits presented
by this theory may only be eliminated by continuing this research

over a longer timeframe

90

e Decisions made during data coding and analysis may result in
some uncertainties. Some of these decisions include; using
occupant well-being responses with >50% confidence, coding blank
responses as 0 in limited cases, cropping upper scale values, and
using mid-scale values for coding ranges. Also, lower-tailed t-test
benefit values were used for the economic evaluation; average
benefits may be higher

In addition, influences of other LEED credits as well as those unrelated to
the building on occupant well-being and productivity were not explored.
Such external influences may be explored in further research to fully
understand the relationship of building IE0 and occupant well-being/

productivity.

3. Other uncertainties

a Changing the LCCA variables can affect the final results. While
multiple scenarios were modeled during LCCA to limit this
uncertainty, it is not completely eliminated

b Occupant well-being conditions other than those studied in this
research may also affect the LCCA findings. Sick Building
Syndrome (888) has been previously discussed as another key
occupant well-being condition impacted by building IEQ (Pillai
2006). While data for some 888 symptoms was collected during

occupant surveys, it has not been assessed in this thesis

91

Overall, improvements in occupant well-being/productivity may also
provide several trickle-down benefits. These may include reduced liability
from improved well-being, reduction in company-wide medical insurance
premiums, increased client database resulting from improved
marketability, benefits from reduced employee turnover rates etc. Such
effects have not been accounted for in this research, while these may add

significantly to the overall economic benefits.

5.6 CHAPTER SUMMARY

This Chapter provided a discussion of phase 3 approach and the related findings.
In this chapter, the phase 2 outputs were monetized to provide incremental cost
and annual economic benefit inputs for LCCA, and the LCCA approach and
calculations were presented. Completion of phase 3 also marks the completion of

the final research objective.

Within the research limitations, the findings indicate that the case study
organizations are on track to attain significant economic benefits. This may
provide some economic validity to LEED-IEQ investments. However, several
uncertainties remain to be addressed before such investments may be
comprehensively justified. These uncertainties provide opportunities for further

research.

92

CHAPTER 6
SUMMARY AND CONCLUSIONS

6.1 OVERVIEW

This research analyzed occupant well-being and productivity related costs and

benefits in LEED®

offices, using the LCCA framework and a case study based
approach. In this research, LEED IEQ related design and construction
processes/items resulting in incremental first costs were identified, and their
incremental costs were estimated. Occupants from the selected case studies
were followed through their move from conventional to LEED offices. Changes in
their well-being and productivity were assessed using data from occupant
surveys, and these findings were monetized. Finally, a benefit-cost analysis was
performed setting LEED IEQ related incremental costs against occupant well-

being and productivity benefits. It was determined that life cycle benefits far

exceed the incremental costs, indicating an economically viable investment.

The research need, goal, objectives and key work steps, scope and overall
limitations were presented in Chapter 1. Chapter 2 presented a summary of the
literature. Chapter 3 outlined the 4-phase research methodology. Data collection
and primary analysis was presented in Chapter 4, and LCCA work was

summarized in Chapter 5.

This chapter summarizes the overall research outputs and conclusions. This
discussion forms phase 4 and marks the completion of this initiative. The next

section summarizes the work performed for each objective and presents the

93

related outputs. This is followed by a discussion of the research conclusions and

inferences. Finally, potential areas of future research are presented.

6.2 SUMMARY OF OBJECTIVES ACHEIVED
The goal of this research was to demonstrate the economic benefits of green
buildings based on occupant well-being and productivity. This section

summarizes the work performed to achieve the research objectives.

6.2.1 Objective 1: Identify IEQ related processes/items responsible for
incremental first cost in LEED offices
The work performed to attain Objective 1 is divided among research Phases 1
and 2a. This is presented in Chapters 2 and 4. Following is a discussion of the
work performed under the key work steps.
1. Review literature related with Green Building and IEQ (GB-IEQ), Built
Environment and Occupant Well-being/Productivity (BE-OWP), and Life
Cycle Cost Analysis (LCCA).
Literature related with the above categories was reviewed under phase
1 and summarized in Chapter 2. GB-IEQ literature provided an
overview of green building, LEED-NC guidelines, and the need for
quantification of the well-being and productivity benefits. BE-OWP
literature provided an overview of potential well-being/productivity
effects of the built environment and assisted in identification of

physical/psychological health attributes for assessment. LCCA

94

literature assisted in developing an approach for the economic analysis

and provided insight into existing LEED-related LCCA studies.

2. Identify relationships between IE0 and well-being/productivity
The GB-IEQ and BE-OWP literature provided such overview. This

discussion is included in Chapter 2.

3. Determine LEED-IEQ credits that may impact occupant well-being/
productivity.

Potential relationships between LEED IEQ credits and selected

occupant well-being and productivity attributes were identified based

on the literature review. These are presented in Figure 2.2, LEED IEQ-

Occupant Well-beinglProductivity Structure, in Chapter 2. All IEQ

credits were found to have such relationships.

4. Identify case studies where occupants move from conventional (non-
LEED) to LEED offices.
The research team identified two case studies in Michigan where
occupants were slated to move or had recently moved from
conventional offices to LEED facilities. Overview of the selected case

studies is provided in Chapter 3.

95

5. Review case study LEED documentation for the IEQ credits identified in
step 3 to hypothesize design and construction processes/items that may
result in incremental first costs.

Access to case study LEED online documentation was obtained with
assistance from the constructors involved with these projects. This
documentation was reviewed, and potential items/processes causing

incremental cost were hypothesized.

6. Obtain feedback from constructors to finalize the hypothesized processes/
items.

Input was obtained from constructors through personal discussions/e-

mail communication. Hypothesized items identified as Standard

Operating Procedures (SOPs) or part of local building code

requirements etc. were rejected for incremental cost estimation.

7. Summarize IEQ related processes/items causing incremental first cost in
LEED offices.

The work done in steps 5 and 6 was summarized in matrices

presented in Appendix B1. This step marks the completion of the first

research objective as well as phase 23.

6.2.2 Objective 2: Determine annual benefits from occupant well-being and

productivity improvements resulting from the move to LEED offices

96

The work performed to attain Objective 2 forms research Phase 2b. This is

presented in Chapter 4. Following is a discussion of the work performed under
the key work steps.

8. Review existing occupant surveys seeking input regarding well-being and
productivity.

Surveys from building post occupancy evaluation literature, medical

(public health) literature, and social sciences literature were studied to

identify useful questions and analysis methods.

9. Develop and conduct pre-move occupant survey.
The pre-move occupant survey was developed with demographic, well-
being, productivity/performance, and few exploratory questions. The
survey was conducted online. Discussion regarding development and
conduct of the pre-move survey is provided in Chapter 3, and the

complete survey is provided as Appendix A1.

1 0. Develop and conduct post-move occupant survey.
A preliminary analysis of responses from the pre-move survey was
conducted and the required adjustments were made to the post-move
survey. The survey was conducted online. The complete survey is

provided as Appendix A2.

97

11.Analyze responses from both surveys together to determine changes in
occupant well-being and productivity.

A survey analysis plan was developed. This is presented as Table 3.1

in Chapter 3. Next, responses were coded based on a survey coding

plan, presented as Appendix A3. Finally, the responses were analyzed

using MS Excel and Minitab 15 software. Detailed discussion of the

survey analysis is provided in Chapter 4.

12.8ummarize annual benefits from occupant well-being and productivity
improvements.
Annual benefits from improved occupant well-being and productivity
(additional work hours available to occupants), as determined from the
survey analysis, are presented in Table 4.5 in Chapter 4. This step
marks the completion of the second research objective as well as

phase 2b.

6.2.3 Objective 3: Determine life cycle economic impact of LEED-IEQ, based
on inputs from objectives 1 and 2
The work performed to attain Objective 3 forms research Phase 3. This is
presented in Chapter 5. Following is a discussion of the work performed under
the key work steps.

13.Monetize findings from step 7 to determine incremental first cost of LEED

IEQ.

98

LEED IEQ related processes/items identified as having incremental
first cost were monetized using input from constructors and additional
estimating efforts. Estimates of overall incremental cost of LEED IEQ

were developed. These are presented in Appendix B2.

14.Monetize findings from step 12 to determine annual $ benefit from
improved occupant well-being and productivity.
The additional work hours determined in step 12 were monetized using
employee wage inputs from case studies and typical industry wages.
These calculations and outputs are presented in Tables 5.2a and b in

Chapter 5.

15. Determine LCCA method, variables, and develop analysis worksheet.
The LCCA method (benefit-cost analysis) and variables were identified
using input from the literature review (step 1) and with inputs from case
studies. Four scenarios were developed by adjusting the variables. An
MS Excel based worksheet was developed to perform the required

calculations. This worksheet is presented as Table 5.3 in Chapter 5.
16.Perform LCCA calculations to determine net life cycle economic impact,

based on incremental cost input from step 13 and annual $ benefits from

step 14.

99

LCCA calculations were performed using inputs from steps 13 and 14
and based on the approach and worksheet finalized in step 15. The
findings are summarized in Table 5.4 in Chapter 5 and all LCCA

worksheets are provided in Appendix C.

17. Summarize uncertainties associated with LCCA findings.
A structured discussion of the uncertainties associated with the LCCA
findings is provided as Section 5.5 in Chapter 5. This step marks the

completion of the final research objective as well as phase 3.

The final research phase includes presentation of overall research outputs and
conclusions and identification of potential areas for future research. This is

provided in the current chapter.

6.3 OBSERVATIONS REGARDING DATA COLLECTION
Detailed. analysis of the pre-move and post-move occupant surveys presents
some directions to improve their effectiveness. These are summarized below:

1. Include‘O’ values for well-being questions: Occupants were asked to leave
certain questions blank if they had not faced the related health problems
during the snapshot period. It is uncertain whether such blank responses
can be viewed as a ‘0’ or if the occupants chose to not respond to these
questions. Allowing a ‘0’ response to these questions, in future surveys,

will assist in eliminating this uncertainty.

100

2. Gather demographic, medical background information: Demographic and
medical background information was gathered only during the pre-move
survey. Hence, such data is missing for occupants who did not participate
during the pre-move. Since improvements in well-being conditions vary
significantly based on the occupants’ medical history, such data needs to
be gathered in future surveys.

3. Club asthma and respiratory allergies, and depression and stress: While
well-being data was gathered separately for all occupant conditions,
asthma and respiratory allergy-related responses were analyzed together
and similarly depression and stress-related responses were analyzed
together. Such data may be collected together as well, for ease of
analysis.

4. Condense surveys further: A large amount of exploratory data gathered
during occupant surveys was not analyzed in this thesis. Either such
exploratory questions can be eliminated from future surveys or analysis

methods should be determined to analyze such data.

6.4 CONCLUSIONS AND INFERENCES

The literature review led to the overarching research hypothesis that indoor
environments in green buildings can lead to significant well-being and
productivity improvements, which may provide substantial economic gains during
the operational life of the building. Within the research limitations, our findings
provide some validation to this overall hypothesis. Other conclusions are

provided below:

101

1. Incremental costs in LEED buildings: Our findings indicate that LEED
buildings still incur some incremental costs. While some of the hard
costs may reduce with increased market penetration, documentation-
related soft costs may continue to exist.

2. Occupant well-being and productivity benefits in LEED buildings: Our
findings indicate improvements in the physical and psychological well—
being conditions as well as the occupant productivity after moving to
LEED offices. These findings represent well-being/productivity gains as
observed by the case study occupants.

3. Benefit/Cost of improved IEQ: From the long-term economic
perspective, benefits attained from improved occupant well-being and
productivity significantly outweigh the incremental costs associated

with IE0 improvements.

Few other inferences may be drawn, based on the research findings. These are
presented below:

1. Benefits from occupant well-being/productivity may exceed overall
incremental cost for all LEED credits: Literature indicates overall
incremental costs for LEED buildings ranging from 0-8.5% (Kats 2003,
Stega12004, SBW 2003, SWA 2004, Langdon 2004 and 2007). For typical
office buildings in Michigan, the maximum 8.5% increment would amount
to approximately $9.30 of the typical construction cost per square feet

(square feet cost estimated from Means 2007).

102

If occupant well-being and productivity benefits determined in this
research are attained by other offices in Michigan, this would translate to a
BIC ratio ranging from 3 to 8 (using the base scenario PVB). Hence,
benefits from occupant well-being and productivity alone may outweigh
the overall incremental costs from LEED buildings, from the LCCA
perspective.

. Large state-wide gains possible from improved occupant well-being: In a
state-wide survey (Cook 2006), Michigan residents between 18 and 64
years old reported approximately 2.2 days/month of activity limitations on
average caused by poor physical or mental (psychological) health
conditions. These included day to day activities such as “self-care, work,

or recreation."

Our findings indicate 4.75% to 5.9% of average productivity loss during
hours affected by certain health conditions (Asthma, Respiratory allergies,
Depression, and Stress). Extrapolating the research findings for Michigan,
using a low end 4.75% productivity loss, and assuming that a third of the
2.2 days represent work hours, the findings indicate approximately 0.84

lost work hours/employee/month.

Another survey (Census 2005) identifies about 5.03 million people among

the labor force in Michigan earning approximately $25,000/year (About

$13/hr) on average. Using 0.84 lost work hours, this amounts to about

103

50.7 million lost work hours/year or roughly $660 million/year of possible
losses across Michigan, incurred solely due to lost work hours from poor
health conditions. A 0.565% productivity improvement, as found through
survey analysis (Table 4.3: productivity improvement from improved well-
being in LEED offices) would translate to savings of roughly $6.5
million/year throughout Michigan. These substantial benefits may be
attained by improving the IEQ of our buildings.

The above conclusions and inferences indicate substantial economic value for

improving building IEQ by investing in green (LEED) buildings, both from the

individual investors’ as well as the policymakers’ perspective.

6.5 AREAS OF FUTURE RESEARCH

While the research findings indicate significant benefits of investing in LEED
buildings, some uncertainties need to be addressed for further progress of this
research area. These uncertainties provide challenges as well as opportunities
for further research. Some key research directions are presented below:

1. Long-term follow up on occupants’ well-being and productivity changes
over the study life, especially by selecting case studies where comparable
occupant populations continue to stay in conventional buildings: Further
research may focus on prospective cohort study designs with case and
control group populations (Hennekens and Buring 1987) to compare
changes in occupant well-being/productivity conditions for occupants who

move to LEED buildings with those who continue to stay in conventional

104

buildings. Also, a longer research period with multiple pre-move and post-
move surveys would assist in increasing confidence in the research

findings.

. Economic risk assessment based on LCCA uncertainties: Further

research may use Monte Carlo simulation (Huijbregts et al. 2003) to model
the wide range of LCCA uncertainties and determine the economic risk
associated with the investment. If a low risk is determined, it may provide
additional confidence in the economic investment.

. Explore comprehensive benefit/cost of LEED including all credits as well
as all costs and benefits throughout the study life: This research
developed a methodology for assessment of LEED costs and benefits
related with IE0 credits and occupant well-being/productivity. This
methodology may be expanded further to address life cycle costs and
benefits from all LEED credits.

. Development of a comprehensive sustainability decision-making
framework using environmental, social, and economic impacts: This
research focused on assisting decision-making for LEED IEQ related
investments using an economic framework. However, the focus of
sustainability includes environmental, social, and economic concerns.
There is a need to develop a comprehensive sustainability decision-
making framework to assist investors/policymakers in making better-

infonned sustainable investment decisions.

105

5. Explore spill-over effects of the move to LEED buildings on occupants’ life
style and behavior: The exploratory data gathered as part of the surveys
was focused on spill-over effects on the occupants’ life style and behavior
from changes in the work environment or their well-being. Such spill-over
effects have been discussed in literature (Bianchi et al. 2005, Lambert
1990, Wharton and Erickson 1993, Greenhaus and Bentell 1985, Major
and Germano 2006). However, not much research seems to have focused
on such effects in the context of green building environments. These

impacts remain to be explored.

This research is among some initial efforts directed towards providing economic
validation to occupant well-being and productivity gains in green (LEED)
buildings through a case study-based approach. Within the research limitations/
uncertainties, the findings impart some degree of substantiation to such well-
being/productivity improvement claims. l-lowever, expecting this initial effort to

comprehensively validate such benefits would be unreasonable.

Continuing research exploring life cycle economic impact of occupant well-being
and productivity benefits in LEED buildings may provide additional confidence to
these research findings. The researchers hope that this initiative would assist in
providing the groundwork for such future efforts and assist long-term

sustainability of the green building movement.

106

APPENDICES

107

APPENDIX A

OCCUPANT SURVEYS

A1: Pre-move Occupant Survey
A2: Post-move Occupant Survey

A3: Survey Response Coding Plan

108

Appendix A1
Pre-move Occupant Survey1

I . . . . .
Content reformatted to meet them publrcation requrrements.

109

Survey Consent Form

We, in Construction Management and related disciplines at Michigan State University. are
conducting research on the impact of improved indoor environments from LEED/ Green office
buildings on occupants. This project is funded by the Environmental Research Initiative at MSU
and is submitted for further funding to the National Science Foundation. You are being asked to
participate in this project as an occupant having recently moved/ planning to move to a LEED
("Leadership in Energy and Environmental Design” rating system) office.

The main theme of this research is to evaluate changes in occupant well being, performance, and
behavior after moving into LEED/ Green office environment. Occupant surveys will be conducted
every 3-6 months over the next 3 years, to understand the occupants’ perception of the effects of
this new office environment on themselves, and employee records will be studied for attendance
and performance. Each survey will take 20-30 minutes to complete. You may also be contacted for
further participation in focus groups (every 3-6 months over the next 3 years) to elaborate and
discuss your opinions and recommendations. All information collected through these surveys and
focus groups would be kept confidential in the Principal Investigator’s office and would be
accessible only to the research team involved with this project and would be used to achieve the
study objectives as well as for written or oral reports and published papers. Your name will be kept
confidential in all public references to this research and your confidentiality will be protected to the
maximum extent allowable by law (unless the interviewee agrees for us to use his/her name and/or
professional affiliation in the study). There are no known risks associated with participation in the
study. As a possible benefit of your participation, you could gain a better understanding of your
work environment and this work may help advance the sustainable building movement
in soc1ety.

Your assistance is voluntary i.e., you may choose not to participate at all, or refuse to participate in
certain procedures or answer certain questions or discontinue your participation at any time without
consequence. One copy of this document will be kept together with our research records at
Michigan State University for 3 years after the project completion. As a participant you may request
a copy for your records. If at any time, you would like to discuss questions regarding this research,
you may do so by contacting Dr. Matt Syal, Construction Management, Michigan State University
at (517)-432-2951. Also. If you have any questions or concerns about your role and rights as a
research participant, or would like to register a complaint about this study, you may contact,
anonymously if you wish, the Director of MSU’s Human Research Protection Program, Dr. Peter
Vasilenko, at 517-355-2180, Fax 517-432-4503, or e-mail irb@msu.edu or regular mail at 202 Olds
Hall, MSU, East Lansing, MI 48824.

* I. I voluntarily agree to participate in this study and give permission to access my records.

No

Yes, Please print your full name

 

*2. I volunteer the name of my professional affiliation to be used for publishing the study results.

No

Yes, Please print your full name

 

110

 

Section 1: General Information

I. What is your Gender?
Male

Female

2. What is your Age in years?

1:!

3. What is your Race?

White/Caucasian
Black/African American

Other (please specify)

American Indian/Alaskan Native

Asian/Pacific Islander (Asian American)

 

l

4. What is your Ethnicity?

Hispanic

5. What is your Marital status?
Single
Married

Other (please specify)

Non-Hispanic

Divorced/ Separated

Widowed

 

l

6. What is your highest level of education?

High School

Some College

Other (please specify)

Associate Degree , Graduate Degree

Bachelor Degree

 

l

111

7. What is your job category?

Managerial/ Executive Support staff , Supervisory/ Technical

Other (please specify)
[ 1

8. What is your job title?
I l

 

9. What kind of work space do you currently have?

Individual room ’ Individual cubicle Shared room/ cubicle

Shared open space

Other (Please Specify)
l l

 

10. How many people do you share your work space with?

1:1

11. How large is your workspace? (Sq ft estimate)

E

12. How satisfied are you with your work space size?

 

To no extent To some To a moderate To a large To a very
extent extent extent large extent
Rate your
satisfaction level 0 O O O O

 

 

 

 

 

 

 

112

 

13. Which floor in your building is your work space located?
First Floor Second Floor . Third Floor

Fourth Floor . Fifth Floor , Sixth Floor

Other (Please Specify)
[ 7

 

14. What direction in your building is your workspace located? (Pick single or multiple options as
applicable)

North South East West Don't know

15. How far is your work space from the nearest window?
O-Sft 11-15ft ‘ >20ft

6-10ft l6-20ft

16. How many hours each week do you typically spend at your workspace?

1:1

17. How many total hours each week do you spend in your office building?

1:]

18. How long have you worked at your present workspace?

Years [:1
Months [:1

19. How long have you worked in this building?

Years 1::
Months |:l

113

Section 2: Occupant Well-being

I. Do you currently smoke?
Yes No

2. How many cigarettes do you typically smoke each week?
1-5 15-20
6-10 >20
1 HS

3. How long have you been smoking?

Years :
Months I:

4. Listed below are some common health problems. Please answer the following questions.

 

Do you have a medical Are you currently on
history ofthis problem? medication for this problem?

Asthma

Respiratory allergies

Sore throat/ Cough/ Common cold
Breathing difficulty
Hypertension

Cardiovascular diseases
lrritation- eyes/ nose/ throat/ skin
Headache/ Fatigue/ Dizziness
Visual discomfort/ Eye strain
General discomfort

Anxiety

Depression

Stress

Lack of confidence

Lack of motivation

Low energy level

Other lung diseases (Please specify below)

L l

 

1

Q;

III
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l- W El

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lfillfilfl

@

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go

@A

5. Please answer the following questions if you have experienced these health problems in the last 4
weeks.

'Note: lfyou did not experience some ofthese health problems in the last 4 weeks, please leave those rows
blank.‘

How many days How many While at work, During these
did you face this hours were you how many hours affected hours
health problem absent from did you face this while at work,
during the last 4 work due to this health problem how did your

weeks? health problem during the last 4 productivity
during the last 4 weeks? change?
weeks?

 

 

Asthma auUravation

Vb

1121 1L lEll
ll lEll ll llill
If Hill 11 1E1

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Respiratory allergies

 

Sore throat/ Cough/ Common cold

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seem

 

Breathing difficulty

a]

 

Hypertension

 

Cardiovascular diseases

 

lrritation- eyes/ nose/ throat/ skin

lfil

 

Headache/ Fatigue/ Dizziness

fig

Visual discomfort/ Eye strain

 

 

General discomfort

 

ll

 

 

 

 

Anxiety 11 11211 "7 llfl
Depression l—E] [—El 11 “ill 11W lEll
Sress i—rel 1—151 1 1191 11 1&1

 

 

Lack of confidence

ll Jlfll IV llill
IL JEl 11 Hill

11 lEll 11 Hill
1121 11 11211

I
j

 

Lack of motivation

 

Q

Low energy level

n
* ,1
fillfiltfil

Other lung diseases (Please specify
below)

 

‘Jl
1:1
1:1

6. How much confidence do you have in your answers in the above question?
9l-IOO% 81-90%71-80% 61-70% 51-60% 41-50% 31-40% 21-30% 11-20% I-10% 0%

O O O O O O O O O OO

 

 

 

 

.3
0'1

1

 

7. How was your overall productivity affected during the last 4 weeks due to all health problems
selected in question 1 above?

0% No effect on productivity 7-8% Less productive 15—|6% Less productive

1-2% Less productive 9-10% Less productive 17-18% Less productive

3-4% Less productive 1 1-12% Less productive . 19-20% Less productive

5-6% Less productive 13-14% Less productive ’ OvirSJ/l productivity was reduced by
,>_ ,0

8. In the last 4 weeks, how many hours were you absent from work because of all health problems
selected in question 5 above?

0 31-40 71-80
l-IO 41-50 >80

1 1-20 . 51-60

21-30 61-70

9. If you selected 'Asthma' or 'Respiratory allergies' in question 5 above, do you think that the
indoor environment of your office triggers your symptoms?

Yes No Don't Know

l0. What aspects of your office indoor environment trigger your respiratory symptoms? (Pick all
that apply)

, Furniture Ceilings Air quality
Carpet/ Floors Temperature . Don't know
Paint/ Walls Humidity

Others (please specify)

11. How much confidence do you have in your answers in the above question?
91-100% 81-90%71-80% 61-70% 51-60% 41-50% 31-40% 21-30% “-20% 1-10% 0%

 

O O O O O O O O O OO

 

 

116

Section 3: Work Environment Satisfaction

1. Listed below are some aspects of your office indoor environment. Please rate your current
satisfaction level, their importance to your satisfaction, and your personal control over these.

How satisfied are How important is Do you have control
you? this to your overall over this?
satisfaction?

A

Temperature

 

Outside views

111
11

Noise levels

IE]
Q

I IS ,L s__
I—E
Air flow speed l-E]
I_""""’1EI I—EJ
Daylight _|-@ [—fi—u—E
Glare

IEI

Office furniture ergonomics

I
I
1

Office computer

1:1
a
E

Visual privacy

1
l
1

Other- Specify below

I I

1:]
I51
131

 

2. Do you think that the indoor environment of your office affects your performance?

Yes No "Don't Know

3. How does the indoor environment of your current workspace affect your typical performance/
productivity?

 

-10% or +10% or
worse: 0%; No better:
RCdUCCd -8°/o -6% 449/0 {29/0 affect on +20/o +41% +69%: +80%) Improved
productivity productivity productivity
0 O O O O O O O O O O

 

 

 

4. How much confidence do you have in your answers in the above question?

9I-IOO% 8|-90°/o7I-80°/o 61-70°/o 5l-60% 41-50% 31-40% 2l-30°/o ”-20% 1-10% 0%

 

O O O O O O O O O OO

 

 

 

1

._L

7

Section 4: Productivity and Performance

1. Rate your personal performance based on the following attributes for the last 4 weeks.

Performed Performed Performed Performed Performed
at a much at a at a level at a at a much
lower somewhat that meets somewhat higher
level than lower the higher level than
the level than standards level than the
standards the set for my the standards
set for my standards job standards set for my
job set for my set for my job
job job
Quantity of work produced 0 O O O 0
Quality of work produced 0 O O O 0
Customer service provided (to those 0 O O O 0
within my organization)
Customer service provided (to those 0 O O O 0

outside my organization)

2. To what extent in the last 4 weeks have you done the following?

To a
moderate
extent

O

To a large To a very
extent

To some
extent

To no
extent large

extent

0

Implemented strategies that have improved ways to 0
do yourjob

O
0

Created better processes and routines in your
department

0

Came up with new ideas to improve the work
processes in your area

Done things to help others do their job better

Helped others in ways so that people feel this is a
good place to work

Helped others who had work related problems

Taken fewer off task breaks while at work
Tended to complain about work to colleagues
Tended to make a mountain out of molehills
Tended to complain about work to colleagues

Obeyed company rules and regulations throughout
the day

000000000

000000000 0
000000000 0
000000000 0
000000000 0

118

Section 5: Other affects of work environment

1. How satisfied are you with your life in general?
Strongly Mildly Unsure Mildly Strongly

disagree disagree agree agree
In most ways my life is close to my ideal O O O O O
The conditions of my life are excellent 0 O O O O
I am satisfied with my life 0 O O O Q
So far, I have gotten the important things I want 0 O O O Q
If I could live my life over. I would change 0 O O O 0

almost nothing

2. Given an opportunity how likely are you to make a special effort to do the following?

To no To some To a To a large To a very

extent extent moderate extent large
extent extent
Consider buying Energy Star appliances at home 0 O O O 0

Consider buying water saving fixtures at home

Consider buying LEED/ Green home for your next
house
Buy products made from recycled materials

Buy household chemicals such as cleaning
solutions that are environmentally friendly

Buy organic fruits and vegetables

0000
000000
00000
000000
00000

Avoid buying products from a company that you 0
know may be harming the environment

3. Please answer the following about your current commuting habits

Never SometimesAveragely Mostly Always

Do you currently carpool to get to work? O O O O Q
Do you currently use public transport to get to O O O O 0
work?
Do ou currently bike/ walk to work?

y O o o o Q
Do you currently drive a low-emitting and fuel- 0 O O O O

efficient vehicle to get to work?

119

4. Rate the following statements

To no To some To a To a large To a very

extent extent moderate extent large
extent extent
1 would be willing to pay higher taxes in order to O O O O 0

protect the environment

I would be willing to accept cuts in my standard of

living to protect the environment 0 O O O O
1 would be willing to pay higher prices in order to O O O O 0

protect the environment

In the last twelve months, have you read any
newsletters, magazines or other publications 0 O O O 0
written by environmental groups?

In the last twelve months, have you signed a
petition in support of protecting the environment? 0

In the last twelve months, have you given money to

an environmental group? O O O O O

In the last twelve months, have you written a letter

or called your member of Congress or another 0 O O O 0
government official to support strong

environmental protection?

In the last twelve months, have you read any
newsletters, magazines or other publications O O O O 0
written by environmental groups?

In the last twelve months, have you boycotted or

avoided buying the products of a company because

you felt that company was harming the O O O O 0
environment?

In the last twelve months, have you voted for a

candidate in an election at least in part because he 0 O O O O
or she was in favor of strong environmental

protection?

5. Are you a member ofany group whose main aim is to preserve or protect the environment?

Yes No

120

6. Do you agree or disagree to the following?

Strongly Mildly Unsure Mildly Strongly

disagree disagree agree agree
We are approaching the limit ofthe number of
people the earth can support 0 O O O O
Humans have the right to modify the natural 0 O O O 0

environment to suit their needs

When humans interfere with nature it often
produces disastrous consequences

0
O
O
O
O

Human ingenuity will insure that we do not make
the earth unlivable

00
OO
00
00
OO

Humans are severely abusing the environment

The earth has plenty of natural resources if wejust

learn how to develop them O O O O 0
Plants and animals have as much right as humans
to exist 0 O O O O

The balance of nature is strong enough to cope
with the impacts of modem industrial nations

0
O
O
O
0

Despite our special abilities humans are still
subject to the laws of nature

0
O
O
O
O

The so called “ecological crisis" facing humankind
has been greatly exaggerated

The earth is like a spaceship with very limited
room and resources

Humans were meant to rule over the rest ofnature

0000
0000
0000
0000
0000

The balance of nature is very delicate and easily
upset

Humans will eventually leam enough about how
nature works to be able to control it

O
O
O
O
Q

If things continue on their present course, we will
soon experience a major ecological catastrophe

O
O
O
O
O

121

7. Have you received any information/ education from your company about LEED/ green building?

Yes No

8. Please provide a short description of what information has your company shared about LEED/
green building.

 

 

 

 

Thanks for your participation in this pre-move survey. We would forward further surveys for your
new LEED building in the near future.

Sustainable Built Environment Research Team (SBER)
Michigan State University

122

Appendix A2
Post-move Occupant Survey1

I . . . .
Content reformatted to meet thesrs publication requrrements.

123

Survey Consent Form

Continuing with our endavor to explore the impact of LEED office environment on occupant health
and performance, the Sustainable Built Environement Researchers urge you to participate in this
post-move occupant survey. You are being approached to take part in this survey as an occupant
having recently moved to a LEED ("Leadership in Energy and Environmental Design" rating
system) office.

The main theme of this research is to evaluate changes in occupant well being, performance, and
behavior after moving into LEED/ Green office environment. Occupant surveys may be conducted
every 3-6 months over the next 3 years, to understand the occupants’ perception of the effects of
this new office environment on themselves, and employee records will be studied for attendance
and performance. Each survey will take 20-30 minutes to complete. You may also be contacted for
further participation in focus groups (every 3-6 months over the next 3 years) to elaborate and
discuss your opinions and recommendations. All information collected through these surveys and
focus groups would be kept confidential in the Principal lnvestigator’s office and would be
accessible only to the research team involved with this project and would be used to achieve the
study objectives as well as for written or oral reports and published papers. Your name will be kept
confidential in all public references to this research and your confidentiality will be protected to the
maximum extent allowable by law (unless the interviewee agrees for us to use his/her name and/or
professional affiliation in the study). There are no known risks associated with participation in the
study. As a possible benefit of your participation, you could gain a better understanding of your
work environment and this work may help advance the sustainable building movement in society.

Your assistance is voluntary i.e., you may choose not to participate at all, or refuse to participate in
certain procedures or answer certain questions or discontinue your participation at any time without
consequence. One copy of this document will be kept together with our research records at
Michigan State University for 3 years after the project completion. As a participant you may
request a copy for your records. If at any time, you would like to discuss questions regarding this
research, you may do so by contacting Dr. Matt Syal, Construction Management, Michigan State
University at (517)-432-2951. Also, If you have any questions or concerns about your role and
rights as a research participant, or would like to register a complaint about this study, you may
contact, anonymously ifyou wish, the Director of MSU’s Human Research Protection Program, Dr.
Peter Vasilenko, at 517-355-2180, Fax 517-432-4503, or e-mail irb@msu.edu or regular mail at
202 Olds Hall, MSU, East Lansing, MI 48824.

*1. l voluntarily agree to participate in this study and give permission to access my records.

No

Yes, Please print your full name

 

124

 

Section 1: General Information

'I. What kind of work space do you currently have?

Individual room Individual cubicle Shared room/ cubicle

Shared open space

Other (Please Specify)
[ I

2. How large is your workspace? (Sq ft estimate)

1::

3. How satisfied are you with your work space size?

 

To no extent To some To a moderate To a large To a very
extent extent extent large extent
Rate your
satisfaction level 0 O O O O

 

 

 

 

 

 

 

 

4. How many people do you share your work space with?

E:

5. Which floor in your building is your work space located?
First Floor Second Floor _ Third Floor

Fourth Floor , Fifth Floor Sixth Floor

Other (Please Specify)
I

I4. What direction in your building is your workspace located? (Pick single or multiple options as
applicable)

North South East West Don't know

15. How far is your work space from the nearest window?
O-Sft “ ll-l 5ft ‘ >20ft

6-lOft l6-20ft

125

18. How long have you worked at your present workspace?

Years 1::
Months [:1
19. How long have you worked in this building?
Years :3
Months 1:]

Section 2: Occupant Well-being

1. Please answer the following questions if you have experienced these health problems in the last 4
weeks. 'Note: lfyou did not experience some ofthese health problems in the last 4 weeks, please leave

those rows blank.’
How many days

How many

While at work,

During these

did you face this hours were you how many hours affected hours
absent from did you face this while at work.
during the last 4 work due to this health problem how did your

health problem

weeks?

during the last 4

Asthma aggravation
Respiratory allergies
Sore throat/ Cough/ Common cold

Breathing difficulty

Hypertension

l
@1

Cardiovascular diseases

ll
ll

lrritation- eyes/ nose/ throat/ skin

Headache/ Fatigue/ Dizziness

E,

Visual discomfort/ Eye strain
General discomfort
Anxiety

Depression

Stress

Lack of confidence

I

Lack of motivation

Low energy level

E;
II
EIEI

Other lung diseases (Please specify
below)

In:
E

 

—
n—

.3
0')

2

i
I
El

11111I
@EQEEE

I

weeks?

health problem during the last4 productivity

change?

 

IEI

II

IEI

 

IEI

II

IEI

 

IEI

IEI

 

IEI

IE]

 

IEI

IEI

 

IEI

IEI

 

IEI

IEI

 

IEI
IEI

IEI
E

 

IEI

IEI

 

IEI

JEI

 

IE1
IE1

IV
II

IE1
IE1

 

IEI

II

IEI

 

IEI

IEI

 

JEI
IEI

I
II

IE
WEI

2. How much confidence do you have in your answers in the above question?
91-100% 81-90%71-80% 61-70% 51-60% 41-50% 31-40% 21-30% “-20% 1-10% 0%

O O O O O O O O O OO

 

 

 

3. How was your overall productivity affected during the last 4 weeks due to all health problems
selected in question 1 above?

0% No effect on productivity 7-8% Less productive 15.-16% Less productive

l-2% Less productive 9-10% Less productive 17-18% Less productive

3-4% Less productive I 1- 12% Less productive 19-20% Less productive

5-6% Less productive 13-1491’6 Less productive Overall productivity was reduced by
>_0%

4. Over the last 4 weeks, how many hours were you absent from work because of all health problems
selected in question 1 above?

0 31-40 71—80
l-IO 41-50 >80
ll-20 51-60

21-30 61-70

5. If you have 'Asthma' or 'Respiratory allergies,’ what aspects of your office indoor environment
trigger your respiratory symptoms? (Pick all that apply)

Furniture Ceilings Air quality
Carpet/ Floors Temperature Don't know
Paint/ Walls Humidity

Others (please specify)

L I

 

6. How much confidence do you have in your answers in the above question?

9I-IOO% 81-90%7l-80°/o 61-70°/o 5|-60°/o 41-50°/o 3l-40°/o 2|-30% ll-20% l-10°/o 0%

O O O O O O O O O OO

 

 

 

 

127

 

Section 3: Work Environment Satisfaction

1. Listed below are some aspects of your office indoor environment. Please rate your current
satisfaction level, their importance to your satisfaction, and your personal control over these.

How satisfied are How important is Do you have control
you? this to your overall over this?
satisfaction?

Temperature [—IE]
Humidity [-E]
Air flow speed
Air quality [jg

Lighting

ll
1:le

 

_@

 

 

I!
III!

 

Daylight

Glare l—lgl 7,_

Outside views 1_lfl 1__E

Noise levels I—lfl I

i1
I

 

Office furniture ergonomics [ii]

Office computer

I
E
E

 

l
@

Visual privacy

f 131
Other- Specify below jig] l—El
I 1

1:1

 

2. How does the indoor environment of your current workspace affect your typical performance/
productivity?

 

-10% or +10% or
worse: 0%: No better:
Reduced -8% -6% -4% -2% affect on +29% +4% +6% +8% Improved
productivity productivity productivity
0 O O O O O O O O O O

 

 

 

128

Section 4: Productivity and Performance

l. Rate your personal performance based on the following attributes for the last 4 weeks.

Performed Performed Performed Performed Performed
at a much at a at a level at a at a much
lower somewhat that meets somewhat higher
level than lower the higher level than
the level than standards level than the
standards the set for my the standards
set for my standards job standards set for my
job set for my set for my job
job job
Quantity of work produced 0 O O O 0
Quality of work produced 0 O O O 0
Customer service provided (to those 0 O O O 0
within my organization)
Customer service provided (to those 0 O Q O 0

outside my organization)

Section 5: Other affects of work environment

1. Given an opportunity how likely are you to make a special effort to do the following?

To no To some To a To a large To a very
extent extent moderate extent large
extent extent
Consider buying Energy Star appliances at home 0 O O O 0
Consider buying water saving fixtures at home 0 0
Consider buying LEED/ Green home for your next
house 0 O O O 0
Buy products made from recycled materials 0 O O O 0
Buy household chemicals such as cleaning
solutions that are environmentally friendly 0 O O O 0
Buy organic fruits and vegetables 0 O O O 0
Avoid buying products from a company that you O O O O 0

know may be harming the environment

129

2. Please answer the following about your current commuting habits

Never SometimesAveragely Mostly Always

Do you currently carpool to get to work? 0 Q O O Q
Do you currently use public transport to get to O O O O 0
work?
Do you currently bike/ walk to work?

O O O O Q
Do you currently drive a low-emitting and fuel- 0 O O O O

efficient vehicle to get to work?

-‘ :1: m

3. Have you received any information/ education from your company about LEED/ green building?

Yes No

 

8. Please provide a short description of what information has your company shared about LEED/
green building.

 

 

 

 

Thanks for your participation in this post-move occupant survey. We may conduct further surveys,
as needed in the near future.

Sustainable Built Environment Research Team (SBER)

Michigan State University
sbercm@msu.edu

130

Appendix A3

Survey Response Coding Plan2

7
Data not analyzed in this thesis was typically not coded. Hence. the coding plan does not represent such
data.

131

 

Table A3: Survey Response Coding Plan

 

Short question title

Survey
(Pr/ Po)

Response

Code

 

Section I: General Information

 

Gender

Pr

Male

 

Female

Ix)—

 

Race

Pr Wh

ite/Caucasian

 

Black/African American

 

American Indian/Alaskan Native

Lute—-

 

Asian/Pacific Islander (Asian
American)

.1}.

 

Other

 

Ethnicity

Pr

Hispanic

 

Non-Hispanic

lQ—UI

 

Marital status

Pr

Single

 

Married

 

Divorced/ Separated

 

Widowed

 

Other

 

Education

Pr High school

 

Some college

 

Associates Degree

 

Bachelor Degree

 

Graduate Degree

 

Other

 

Job Category

Pr Managerial/ Executive

 

Supervisory/ Technical

 

SMOI'I staff

 

Other

 

Work space type

Pr. Po

Individual room

 

Indi

vidual cubicle

lU—fiWlQ—QWLleQ—MLDJIJ—

 

Share

d room/ cubicle

 

Sharedgopen space

 

Other

 

Work space size satisfaction

Pr, Po

To no extent

 

To

some extent

 

To a moderate extent

 

To

a large extent

 

To a very large extent

 

Work space level

 

Pr. Po

First Floor

 

Second Floor

 

Third Floor

 

F

ourth Floor

 

Fifth Floor

 

Sixth Floor

 

 

 

Other

 

\lOM-fileJ—MLDJlJ—Mkb)

 

132

 

Table A3: Survey Response Coding Plan (continued from previous page)

 

Short question title

Survey
(Pr/ Po)

Response

Code

 

Work space direction

Pr, Po

North

 

South

 

East

 

West

Lia-1k)—

 

NE

 

NW

 

SE

 

SW

 

Don’t know

 

Distance from window

Pr, Po

O-Sft

 

 

6-lOft

OODJOOONQUI

 

 

ll-let

 

 

l6-20ft

 

 

>20ft

lg...—
meow

 

Section 2: Occupant Well-being

 

Smoke

Pr

No

 

Yes

 

C igarettes/ week

Pr

l-5

 

6-10

00 DJ I‘d —

 

ll-15

 

16-20

 

>20

rQ——
moot.)

 

Have medical history

Pr

Yes

 

No

IQ—

 

Medical history- on medication

Pr

Prescribed

 

Over the counter

 

None

LaJlJ—

 

Health snapshot- days affected

Pr, Po

1-7

‘—

'Ui

 

34

b)
LII

 

5-6

 

7-8

 

9-10

PS5”
l.IIIJILII

 

ll-|2

ll.5

 

l3-l4

13.5

 

15-l6

15.5

 

l7-l8

17.5

 

l9-20

U

 

>20

 

Health snapshot- hours absent

 

Pr, Po

0

 

l-5

 

6-lO

 

ll-lS

 

l6-20

 

21-25

 

26-30

 

31-35

 

36-40

 

 

 

>40

 

Ahab.2totQ——°°wo8>o

bJOObJMDJWb)

 

133

 

Table A3: Survey Response Coding Plan (continued from previous page)

 

Short question title Survey Response Code
(Pr/ Po)

 

 

Health snapshot- work hours affected Pr, Po 0
1-5

 

00ch

6-10

 

ll-15

 

16-20

 

21-25

 

26-30

 

31-35

 

36-40

 

41-45

 

LLbeJlJlQ—-—

46-50

 

lquwamemebJ

'JI

51-55

 

56-60

 

61-65

 

00"):

66-70

 

\I

71-75

 

76-80

 

DJWDJOODJOO

OO\I

>80

 

Health snapshot- productivity reduction Pr. Po 0%

 

l-5%

 

OOUJO

6-10%

 

ll-15%

 

l6-20%

 

2 l -25°/o

 

26-30%

 

3 l -3 5%

La) 1;) [J h) —- —-

 

36-400/0

 

3..

4 l -45%

 

46-5 0%

 

bJOCbJOObJOObJOObJ

>500/o

 

'Ji

Confidence level (Same codes used for Pr, Po 91-100%

 

all confidence related questions) 81-90%

 

IJI

71-80%

 

(JI

61-70%

 

wasu'ooounh.
JI

LII

5 l -60%

 

4|-50%

 

3 l-40%

 

IJUJJZ.
£1thth

21-30%

 

'JI

l [-20%

 

Ur

l-lOo/o

 

O

0%

 

 

 

 

 

 

134

Table A3: Survey Response Coding Plan (continued from previous page)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short question title Survey Response Code
(Pr/ Po)
Overall productivity reduction Pr, Po 0% 0
[-2% 1.5
3-40/0 3.5
5-6% 5.5
7-8% 7.5
9-10% 9.5
I l-l2% I 1.5
13-14% 13.5
15-16% 15.5
17-18% 17.5
19-20% 19.5
>20% 20
Overall absence Pr, Po 0 0
1-10 5.5
1 1-20 15.5
21-30 25.5
31-40 35.5
41-50 45.5
51-60 55.5
61-70 65.5
71-80 75.5
>80 80
Does IEQ affect respiratory symptoms? Pr Yes I
No 2
Don’t Know 3
lEQ aspects that affect respiratory Pr. Po Furniture 1
symptoms Carpet/ Floors 2
Paint/ Walls 3
Ceilings 4
Temperature 5
Humidity 6
Air wlity 7
Others 9
Don’t know 8
Section 3: Work Environment Satisfaction
IEQ aspects- satisfaction Pr, Po Not satisfied 1
Below average satisfaction 2
Average satisfaction 3
Above average satisfaction 4
Completely satisfied 5
IEQ aspects- significance Pr, Po Not significant 1
Below average significance 2
Average significance 3
Above average significance 4
Completely significant 5

 

135

 

Table A3: Survey Response Coding Plan (continued from previous page)

 

Short question title

Survey
(Pr/ Po)

Response

Code

 

IEQ aspects- control

Pr, Po

Full Control

 

Partial Control

 

None

 

Does IEQ affect perfonnance?

Pr

Yes

 

No

 

Don’t Know

 

Work space IEQ- productivity effect

 

Pr. Po

- I 0% or worse productivity reduction

O

 

-8%

 

-6%

 

-4%

 

-2%

 

0% no effect on productivity

 

+2%

 

+4%

 

+6%

 

+8%

wontuolbhééo—ww—wm—

 

 

+10% or better productivity
improvement

 

O

 

Section 4: Prod uctivit

and Performance

 

Performance snapshot questions

Pr, Po

Much lower performance

 

Somewhat lower performance

 

Performance per standards

 

Somewhat higher performance

 

Much higher performance

MACJIQ—

 

Section 5: Other affects

of work environment

 

Purchasing intent

Pr, Po

To no extent

 

To some extent

 

To a moderate extent

 

To a large extent

AbJIQ—

 

To a very large extent

 

Commuting habits

 

 

Pr, Po

Never

 

Sometimes

 

Averagely

 

Mostly

.LLDJI‘J—‘UI

 

 

Always

 

'Ji

 

136

 

APPENDIX B

LEED IEQ Incremental Cost Matrices

B1: LEED IEQ Processes/ Items Causing Incremental Costs

32: LEED IEQ Incremental Cost Estimates

137

Appendix B1

LEED IEQ Processes! Items Causing Incremental Costs

138

 

 

 

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500 .HGOESUOU

 

        

 

 

 

             

 

       

 

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172

APPENDIX C

Life Cycle Cost Analysis (LCCA) Worksheets

C1: LCCA Worksheets- Base Scenario
CZ: LCCA Worksheets- Scenario 1
CB: LCCA Worksheets- Scenario 2
C3: LCCA Worksheets- Scenario 3

173

 

 

 

Appendix C1

LCCA Worksheets- Base Scenario

174

 

Table Cl.l: LCCA Worksheet- Base Scenario (CSl)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LCCA Inputs LCCA Variables
Incremental Cost- Co (Appendix 32) $39,537.20 Study Period- SP (Yrs) 25
Annual Benefit- Be (Table 5.2b) $69,601.00 Inflation Rate- IR (%) 3.0%
Discount Rate— DR (%) 6.0%
LCCA Mid-Points Source Value
Present Worth Factor (PW) (Determined fi'om Present Worth
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Present worth of Annuity Factor (PWA) (Co/Be) ‘ 0' 57
Present Value of Life Cycle Benefits (PVB) ' (Be x PWF) 4 $1,223,586
LCCA Outputs 7 Source Value
Benefit-Cost Ratio (B/C) PVB/Co E 30.9
Payback Period (PB)- in years E Co/Be I 0.6

 

Rate of Return (RR) Determined using PWA tables '
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Table C1.2: LCCA Worksheet- Base Scenario (C82)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LCCA Inputs - LCCA Variables
Incremental Cost- Co (Appendix 92) $454,591.00 Study Period- SP (Yrs) E 25
Annual Benefit- Be (Table 5.2b) $250,694.00 Inflation Rate- lR (%) m”“""""3“.'0‘*%"‘
Discount Rate- DR (%) E 6.0%
LCCA Mid-Points Source Value
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Present worth of Annuity Factor (PWA) (Co/Be) 2 L81
Present Value of Life Cycle Benefits (PVB) @e x pWF) $4,407,201
LCCA Outputs Source Y Value
Benefit-Cost Ratio (B/C) PVB/Co’ E 911”
Payback Period (PB)- in years Co/Be 1.3
Rate of Return (RR) .... Determined using PWA tables-WEN
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#

175

 

Appendix CZ

LCCA Worksheets— Scenario 1

176

 

 

Table C2.l: LCCA Worksheet- Scenario 1 (CSI)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—
LCCA Inputs LCCA Variables
Incremental Cost- Co (Appendix B2) $39,537.20 Study Period- SP (Yrs) 25
Annual Benefit- Be (Table 5.2b) $69,601.00 Inflation Rate- IR (%) 6.0%
Discount Rate- DR (%) E 6.0%
LCCA Mid-Points Source Value
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Present worth of Annuity Factor (PWA) (Co/Be) E 0. 57
Present Value of Life Cycle Benefits (PVB) (Be x pwp) E $1 740 02 5
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Benefit-Cost Ratio (B/C) PVB/Co E 44.0
Payback Period (PB)- in years . Co/Be I I“ 0.6
Rate of Return (RR) 2 H E Determined using PWA tables" E” , E
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Table C2.2: LCCA Worksheet- Scenario 1 (C82)

 

 

LCCA Inputs

LCCA Variables

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Incremental Cost- Co (Appendix B2) $454,591.00 Study Period- SP (Yrs) 25
Annual Benefit- Be (Table 5.2b) $250,694.00 Inflation Rate- IR (%) 6.0%
Discount Rate- DR (%) 6.0%
LCCA Mid-Points Source Value
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LCCA Outputs E Source . Value
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— - -

 

177

 

Appendix C3

LCCA Worksheets- Scenario 2

178

 

 

Table C3.l: LCCA Worksheet- Scenario 2 (CSI)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

_ I _
LCCA Inputs LCCA Variables
Incremental Cost- Co (Appendix 32) $39,537.20 Study Period- SP (Yrs) 25
Annual Benefit- Be (Table 5.2b) $69,601.00 Inflation Rate- IR (%) 3.0%
Discount Rate- DR (%) 8.0%
LCCA Mid-Points .. Source j Value
Present Worth Factor (PW) (Determined from Present Worth E
.- . .ta.blss._9.si0g NLUCCAHXariablcsi . _. _. _ ....151130 __
Present worth of Annuity Factor (PWA) (Co/Be) 1 0.57
Present Value of Life Cycle Benefits (PVB) ' E E E E M (Be x pWF) 599.1434
LCCA Outputs E Source Value
Benefit-Cost Ratio (B/C) PVB/Co 25.2
Payback Period (PB)- in years Co/Be 0.6
Rate of Return (RR) Determined using PWA tables ‘
using PWA I 67.0%
_ _
Table C3.2: LCCA Worksheet- Scenario 2 (C82)
LCCA Inputs LCCA Variables
Incremental Cost- Co (Appendix BZ) $454,591.00 Study Period- SP (Yrs) g 25
Annual Benefit- Be (Table 5.2b) $250,694.00 Inflation Rate- IR (%) E 3.0%
Discount Rate- DR (%) ' ‘ ’ f ' 8.0%
LCCA Mid-Points Source Value
Present Worth Factor (PW) (Determined from Present Worth
T tables using LCCA variables) _ 14.30%
Present worth of Annuity Factor (PWA) (Co/Be) 1.31
Present Value of Life Cycle Benefits (PVB) A E (Be x pwp) $3,585,426
LCCA Outputs - Source Value
Benefit-Cost Ratio (B/C) E PVB/Co j 7.9
Payback Period (PB)- in years I E Co/Be _ 1.8

Rate of Return (RR)

_ - .. DétemrfledfisrngPWAtables E ..
E using PWA E
J, _

 

r

50%

179

 

 

Appendix C4

180

Table C4.1: LCCA Worksheet- Scenario 3 (CSI)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- _ i ‘r j
LCCA Inputs LCCA Variables
Incremental Cost- Co (Appendix B2) $39,537.20 Study Period- SP (Yrs) 15
Annual Benefit- Be (Table 5.2b) $69,601.00 Inflation Rate- IR (%) 3.0%
Discount Rate- DR (%) 6.0%
LCCA Mid-Points Source Value
Present Worth Factor (PW) E (Determined from Present Worth
tables using LCCA variables) E _ 12.01 _____
Present worth of Annuity Factor (PWA) (Co/Be) 0. 57
Present Value of Life Cycle Benefits (PVB) E V (Be x pwp) U E I $836,186
LCCA Outputs . Source . Value
Benefit-Cost Ratio (B/C) PVB/Co E 2] ,1
Payback Period (PB)- in years i _ Co/Be .- E ...--. 206
Rate of Return (RR) ... WE Determined using PWA tables E I
. E usmg PWA ' E 167.0%
_ —
Table 01.2: LCCA Worksheet- Scenario 3 (C82)
LCCA Inputs V LCCA Variables
Incremental Cost- Co (Appendix B2) $454,591.00 Study Period- SP (Yrs) 15
Annual Benefit- Be (Table 5.2b) $250,694.00 Inflation Rate- IR (%) 3.0%
Discount Rate- DR (%) 6.0%
LCCA Mid-Points Source Value
Present Worth Factor (PW) (Determined fi'om Present Worth
---; tables using LCCA variables) 12.0!”
Present worth of Annuity Factor (PWA) (Co/Be) 1.81
Present Value of Life Cycle Benefits (PVB) E I (Be x pWF) , E 1 $3,011,333
LCCA Outputs Source Value
Benefit-Cost Ratio (B/C) PVB/Co E 66
Payback Period (PB)- in years Co/Be H 1.8 .
Rate of Return (RR) E _. Determined using PWA table‘s—- E I E M i M
using PWA E 50%

 

“

181

 

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