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UNEP Industry and Environment April – September 2003 ◆5
Sustainable building and construction
Industry and Environment first covered
the construction industry in an issue
published in 1996 with the title “The
construction industry and the environ-
ment” (Vol. 19, No. 2). A shift in focus
over the last seven years is reflected in
the title of the current issue, “Sustain-
able building and construction.”
Sustainable building and construc-
tion (SBC) is a holistic, multidiscipli-
nary approach. This approach is increas-
ingly being advocated for buildings and
infrastructure. Another way to express
this shift is to think of SBC as repre-
senting a “sustainable built environ-
ment” encompassing the structures and
infrastructure we build, the processes
used to build them, and the many stake-
holders involved (also see the Glossary). Thus “con-
struction” per se is only part of the sustainable build-
ing process.
Estimates of the amount of time we spend in
the built environment – and on it, in vehicles –
range from 80 to 90%. Besides the resource and
pollution issues surrounding the construction sec-
tor, ensuring that the built environment is health-
ful and pleasant for humans is beginning to be
perceived as a crucial productivity issue.
If current patterns do not change, expansion of
the built environment will destroy or disturb nat-
ural habitats and wildlife on over 70% of the
Earth’s land surface by 2032,driven mainly by
increases in population, economic activity and
urbanization.
1
The world population has more than doubled
since 1950. Most of this growth has taken place in
the developing world. In the next two decades,
around 98% of world population growth will
occur in developing countries.
2
By 2007 around
half of this mushrooming population will live in
urban areas. Three-quarters of the people in devel-
oped countries already live in urban settlements.
In developing countries the share of the popula-
tion living in cities is expected to reach 40% before
the end of this decade, compared with less than
20% in 1950. Some 60% of the world’s fastest
growing larger cities (750,000-plus) are in low-
income countries.
3
In terms of farmland
alone, urbanization claims as much as
40,000 km
2
per year.
4
These demographic trends translate
into increased demand for buildings and
infrastructure. The World Bank estimates
that by 2015 more than half China’s urban
residential and commercial building stock
will have been constructed during the pre-
vious 15 years. World infrastructure needs
are estimated at US$ 2 trillion over the
next decade and a half or so (Table 1).
Developing countries are expected to ac-
count for only slightly more of this amount than
developed ones.
5
The demand for shelter is so pressing in less
developed countries that it can only be met by
“informal” housing – often self-built, usually ille-
gal, and almost always lacking basic infrastructure.
Such housing is estimated to account for 20-30%
of urban growth in the largest cities in developing
countries. About 54% of the population of Lima,
Peru, lives in informal housing.
5
Impacts of the building and
construction sector
Both the existing built environment and the
process of adding to it have numerous environ-
mental and social impacts (Table 2). While most
available statistics related to these impacts are for
developed countries, experts believe on the whole
that these impacts are worse in developing than in
developed countries. The developing world’s share
of world construction activities was 10% in 1965,
29% in 1998 and still growing.
6
Compared with other industrial products, build-
ings and infrastructure present an unusual case in
that they are long-lasting. Structures being built
today in developed countries will have an average
life of 80 years. In many countries there are build-
ings, bridges and other structures hundreds of years
old. This means the design of, say, an office build-
ing or viaduct will have long-term
repercussions on a structure’s perfor-
mance and environmental impacts. To
end up with a high-performance, low-
impact structure, it is vital to incorpo-
rate sustainability principles beginning
at a project’s earliest stages.
Of course, the impacts of buildings
and construction are not all negative.
Well planned structures built with sus-
tainable methods and materials can be
highly beneficial to both communities
and workers. The most notable social
benefit is the provision of construction
jobs, especially for low-skilled and/or
entry-level workers.
The overall economic contributions
of the construction sector are consid-
erable. Its worldwide market volume amounts to
over US$ 3 trillion and accounts for as much as
10% of world GDP, depending on how the sector
is defined. Construction is the largest industrial
sector in Europe (10-11% of GDP) and in the
United States (12%). In the developing world it
represents 2-3% of GDP. Construction also
accounts for over 50% of national capital invest-
ment in most countries. It provides around 7% of
world employment (28% of industrial employ-
ment) with a workforce of about 111 million, 74%
of which is in low-income countries. Developing
countries account for 23% of global construction
activity – in other words, the construction industry
is more labour intensive in poorer countries.
In most countries the building and construction
sector is the largest single employer. It is probably
the world’s largest industrial employer.
8
Its activi-
ties involve a very high multiplier effect: the Inter-
national Council for Research and Innovation in
Building and Construction (CIB) estimates that a
dollar spent on construction may generate up to
three dollars of economic activity in other sectors.
Employment
Potential for growth in the sector’s labour force
remains considerable in both developing and
developed countries. In China the construction
workforce tripled between 1980 and 1993, while
its share in total employment rose from
2.3% to 5%.
9
In Europe reducing GHG
emissions from buildings by 20% would
lead to the creation of 300,000 permanent
jobs in this sector over a 10-year period
(taking into account renovation, retro-
fitting and maintenance), according to
CICA estimates.
One important characteristic of the
construction industry is the dominant
role of small and medium-sized enter-
prises (those employing fewer than 250
people, using the EU definition). Some
Sustainable building and construction:
facts and figures
Note: Building sector data represent building operations only; energy
use in manufacture and transport of building materials, etc., excluded.
European
Union (1999)
United States
(2000)
Japan
(1999)
0 20 40 60 80 100
Figure 1
Final energy consumption by sectors
Source: European Commission, US Department of Energy, Japanese Resource and Energy Agency,
in Environmentally Sustainable Buildings: Challenges and Policies, OECD, 2003.
%
Building Transport Industry, etc.
Table 1
Infrastructure availability and needs
Type of % of total Unpaved Population without GDP per
country by world roads (%) sanitation (% of capita
income level population urban population) (US$)
high non-OECD 0.5 15.6 1.1 16,664
high OECD 14.9 18.7 2.4 27,305
upper middle 8.2 44.8 7.5 4,670
lower middle 35.5 52.8 9.5 1,195
low 40.9 71.0 25.4 408
Source: World Bank
6◆UNEP Industry and Environment April – September 2003
Sustainable building and construction
90% of construction workers worldwide are
employed by micro firms consisting of fewer than
10 people.
10
SMEs are also heavily involved in
making building materials, especially in develop-
ing countries, as well as in associated fields such as
architecture and engineering. The EU construc-
tion sector includes around 2.5 million construc-
tion SMEs representing over 90% of all EU
construction enterprises, 16% of all manufactur-
ing, construction and service enterprises, and
80% of construction turnover. Roughly 25% of
EU construction workers are self-employed, while
about 50% work for micro firms.
In general, the construction industry is over-
whelmingly male. However, in South Asia up to
30% of construction workers are women, who
perform the least skilled, worst paid jobs.
11
Jobs
in construction are often unregistered and haz-
ardous. In the UK, for example, 600 workers die
annually from asbestos-related ailments; 40% suf-
fer muscular-skeletal problems and 30% have der-
matitis from working with cement. Construction
accidents kill at least 55,000 workers a year world-
wide, mostly in developing countries.
Job security is a concern, especially in view of
the use of casual labour and the growing trend to
subcontract. Some 19% of construction workers
in the EU are on temporary contracts at any given
time (see the article by Alex Wharton and David
Payne in this issue). Trade union density, i.e. the
percentage of workers who are union members
and are not self-employed, is less than 1% in con-
struction in some countries (see the article by Jill
Wells). All in all, construction has a poor image. It
is seen as providing mainly low-status, low-paid
and often hazardous employment.
12
Environmental effects
Among the direct environmental consequences of
construction, the most significant is its consump-
tion of energy and other resources. Construction
is believed to consume around half of all the
resources humans take from nature (including
25% of the wood harvest, according to a United
States Department of Energy estimate). Construc-
tion material dominates overall material flows in
most countries. Mining and quarrying of materials
used in construction generate large amounts of
pollution and waste and account for considerable
land use. In the case of some metals widely used in
construction, such as copper and zinc, shortages
are possible by the middle of this century.
In OECD countries, the building and con-
struction sector as broadly defined (including pro-
duction and transport of building materials)
consumes 25-40% of all energy used (as much as
50% in some countries) The International Ener-
gy Agency estimates that, on average, one-third of
energy end-use in the developed world goes for
heating, cooling, lighting, appliances and general
services in non-industrial (i.e. residential, com-
mercial and public) buildings.
These estimates do not take into account the
“embodied energy” that can be calculated for
building products and (with difficulty) for build-
ings themselves (not all definitions of embodied
energy count material transport). This concept,
which dates to the 1970s, is essential to the life-
cycle approach discussed below. It attempts to cal-
culate how much energy is used in producing a
particular item. Transformation of many of the
raw materials consumed in construction has par-
ticularly high energy demands.
Since the amount of sustainably produced ener-
gy used in buildings and construction (as in most
other areas) is relatively small, the bulk of energy
use in this sector entails emissions of greenhouse
gases. Most notably, cement production is a major
source of GHG emissions, both through burning
of fossil fuels and breakdown of raw materials. Vir-
tually all the cement industry’s output is used in
the construction sector, especially for concrete.
Twice as much concrete is used worldwide than the
total of all other building materials put together.
Based on current trends, CO
2
emissions from
the cement industry will quadruple by 2050.
13
Estimates of the industry’s contribution of global
anthropogenic CO
2
emissions range from 5% to
over 7%. The built environment overall is the
largest source of GHGs in Europe (in the US, on
the other hand, the largest source is transport).
The built environment accounts for some 40% of
world GHG emissions.
14
Land use implications of construction are many
and varied. Much of the deforestation in develop-
ing countries is due to clearing for local building
and harvesting of timber for export. Compaction
of land by buildings and infrastructure is often
irreversible. Land use policies related to land’s per-
ceived value for construction frequently result in
social inequities, especially where it is in competi-
tion with energy biomass production, commercial
food crops and other uses.
In terms of reducing transport energy use and
demand for land, higher density building is
preferable to lower density. However, human liv-
ing conditions can suffer unless density is com-
pensated for by design. Where land is particularly
scarce, the option chosen is increasingly not to
build but to renovate. Renovation and mainte-
nance account for one-third of construction activ-
ity in Europe (up to 50% in some countries). This
share is growing.
Pollution related to buildings and construction
is not always obvious. In addition to immediate
emissions of air and water pollutants, dust and
noise during construction, pollutant concentra-
tions within buildings (stemming from finishes,
paints, backing materials and other components)
can be over twice as high – in some cases as much
as 100 times as high – as concentrations outside.
Cement production releases not only CO
2
but
also NO
x
. Raw material processing and product
manufacturing are estimated to be responsible for
20% of dioxin and furan emissions.
The impacts of buildings and construction on
water resources are not always straightforwardly
quantifiable. They range from discharges to fresh-
water and coastal waters during mining and raw
material processing, to siltation of watercourses
from desforestation, on-site spillage during con-
struction and run-off from surface sealing, to
freshwater consumption and wastewater genera-
tion during building use.
Regarding construction and demolition waste,
some OECD countries achieve a reuse and recy-
cling rate of over 80%, though it should be noted
that much of the material is used in a low-value-
added form, e.g. in road foundations. Overall, this
sector accounts for 30-50% of total waste generat-
Figure 2
Projected energy consumption applying model Danish regulation in EU countries
(climate corrected; KWh/m3/year)
Source: European Commission, in Environmentally Sustainable Buildings: Challenges and Policies, OECD, 2003.
KWh/m3/a
B DK DEU EL E F IRL I L NL A P FIN S UK
35
30
25
20
15
10
5
0
KWh/m3/a
35
30
25
20
15
10
5
0
Consumption if Danish
regulation applied Consumption according
to member states regulation
Table 2
Main environmental and social impacts
of buildings and construction
◆raw material extraction and consumption; related
resource depletion
◆land use change, including clearing of existing flora
◆noise pollution
◆energy use and associated emissions of
greenhouse gases
a
◆other indoor and outdoor emissions
◆aesthetic degradation
◆water use and wastewater generation
◆increased transport needs (depending on siting)
◆various effects of transport of building materials,
locally and globally
◆waste generation
◆opportunities for corruption
◆disruption of communities, including through
inappropriate design and materials
◆health risks on worksites and for building occupants
a. Particularly the “Kyoto gases”: CO
2
, CH
4
, N
2
O, HFCs,
PFCs and SF
6
Sustainable building and construction
ed in higher-income countries. That includes
waste from renovations, which buildings generally
undergo roughly every 20 years in a typical design
life of 50 to 100 years.
The controversial question of corruption in the
construction sector is both a social issue and an
environmental one. In 2000 the anti-corruption
NGO, Transparency International, ranked the
construction industry as the most willing to pay
bribes to government officials in emerging mar-
ket economies (the arms industry was No. 2).
Bribed officials may turn a blind eye to illegal dis-
charges of pollution and waste. Moreover, where
corruption involves substandard buildings or
building products it can lead to high death tolls in
building collapses and natural disasters.
Moving towards solutions
Those in the building and construction sector
who are working to make it more sustainable rec-
ommend a variety of immediate steps that can be
taken to address the environmental impacts of
buildings and construction. These include:
◆reducing material wastage in construction,
including through economic incentives such as
higher landfill fees (which also promote the fol-
lowing item);
◆increasing use of recycled waste as building
materials, not only reuse of construction and
demolition waste but also incorporation of other
types of waste in building products – as a recent
study funded by the California Integrated Waste
Management Board confirms, recycled-content
building materials generally perform as well as the
equivalent standard products;
◆improving energy efficiency in buildings (e.g.
see Figure 2);
◆making wiser use of water in buildings and on
construction sites;
◆increasing structures’ service life, including
through built-in flexibility of use.
Longer-term approaches to reducing impacts
include:
◆rethinking policies affecting the sector, includ-
ing financial ones, and strengthening standards;
◆promoting corporate environmental and social
responsibility in the sector, with industry-specific
reporting mechanisms;
◆building public and enterprise awareness and
knowledge sharing;
◆upgrading skills and worksite health and safety;
◆innovating in regard to materials, technologies
and methods, with site-appropriateness in mind
and focusing on integrated, holistic research;
◆improving data collection and indicator devel-
opment.
Measures being taken to make buildings and con-
struction more sustainable rely increasingly on life-
cycle approaches. Life-cycle thinking in the con-
struction sector takes account of every stage – from a
structure’s conception to the end of its service life,
and from raw material extraction to a building’s
demolition or dismantling. It also takes account of
all actors, from land-use planners and property devel-
opers through building owners and users to salvage
firms and landfill operators (Table 3).
While Table 3 shows a linear, “cradle-to-grave”
life cycle, the material loop can be closed to a great
extent through repeated building renovation and
material salvage and reuse. A variety of measures
and mechanisms exist to promote such moves
towards “dematerialization” and other practices
that make building and construction more sus-
tainable (Table 4).
Clients and financing
Because designers, architects and contractors can-
not always influence design decisions, sustainabil-
ity criteria need to be integrated into procurement,
contracts, tenders and commissioning. However,
clients are not always aware of the environmental,
Model of a business case for SBC
Below are the assumptions used in comparing a
standard building project to a green (“high per-
formance”) project by Seattle City Light, the
electric company of Seattle, Washington, in the
United States. It should be noted that the case
would not necessarily hold in every type of cli-
mate, economic system, etc.
◆Each building is mixed use, with 20,000
square feet of retail space and 80,000 square feet
of office space.
◆Standard building construction cost, exclud-
ing land, is US$ 100.36/square foot.
◆The green building optimizes daylighting to
reduce electric lighting requirements. This also
reduces heating, ventilation and air condition-
ing requirements. Increased cost for daylighting
and controls will be offset by reduced HVAC
costs.
◆A raised floor for air distribution will be used in
the green building at an added core and shell cost
of US$ 2.00 per square foot.
◆Individual office workstation control of venti-
lation, heat and lighting will be provided at a cost
of US$ 1500 per workstation, increasing tenant
improvement costs from US$ 10.00 to US$
14.40 per square foot.
◆The resulting construction cost for the green
building, excluding land, is US$ 112.58/square
foot. (The utility adds that case studies exist
showing no increase in construction cost.)
Among the results of choosing the green
building:
◆Rents are 14% higher than in the standard
building.
◆Operation and maintenance (O&M) and
energy costs are about 30% lower.
◆Vacancy and credit losses are down 25%.
In addition, net operating income (NOI) is
27.6% higher (nearly US$ 400,000 a year),
while the loan amount reflects the increased con-
struction cost so that net cash flow (NOI minus
loan payments) increases by somewhat less than
$300,000; still, this is 63.75% more than in the
standard project. The increase in NOI raises pro-
ject value by just over US$ 4 million, or 27.7%.
The rent can be increased because of advan-
tages such as high-benefit lighting techniques,
access to natural daylight, superior indoor air
quality, the need for lower liability insurance,
and fewer worker compensation cases.
Seattle City Light suggests that, depending on
project details, the comparative market value
may be as much as twice as high, energy costs up
to 90% less, O&M costs down as much as 73%,
and the overall payback period less than a year.
Seattle City Light case studies
(office buildings in US)
Case study 1
◆50% energy savings
◆absenteeism dropped 40%
◆productivity increased 5%, reducing payback
time to under one year (a 100% return on
investment)
Case study 2
◆40% reduction in energy
◆early estimate of 16% productivity increase
with 4-6% increase attributed to individual
workstation environmental control
◆thermal condition complaints reduced from
40 per day to two per week
.
Glossary
No single definition of sustainable construc-
tionor sustainable buildings is accepted world-
wide. The European Union defines the former
as the use and/or promotion of a) environ-
mentally friendly materials, b) energy efficien-
cy in buildings, and c) management of
construction and demolition waste.
The EU definition of constructionis “on-site
production, assembly and disassembly of resi-
dential buildings, non-residential buildings
and infrastructure by specialist builders.” The
Confederation of International Contractors’
Associations (CICA) defines the construction
industry as contractors and the construction
sectoras all construction-related activities/pro-
fessions, including architects, engineers, mate-
rial producers and facility managers.
Design-buildor design and build is a system
of contracting in which the same company per-
forms both architectural/engineering and con-
struction functions.
Embodied energy is an estimate of the ener-
gy needed to make a material or structure avail-
able to users. It may include transport of
materials. Many practitioners argue that high-
er embodied energy in materials can be justi-
fied if it contributes to lower operating energy.
Facility management is the activity involv-
ing “coordination of the physical workplace
with the people and work of the organization.”
It integrates principles of business administra-
tion, architecture and the behavioral and engi-
neering sciences. (International Facility
Management Association and US Bureau of
Labor Statistics)
UNEP Industry and Environment April – September 2003 ◆7
8◆UNEP Industry and Environment April – September 2003
Sustainable building and construction
social and economic benefits of sustainable build-
ings and construction.
Generally, investment in the built environment
has long come primarily from:
◆governments and international financing institu-
tions for infrastructure (e.g. roads, water supply,
telecommunications, power supply, sanitation) and
public institutions such as schools and hospitals;
◆private financing for residential buildings
(except some social housing), commercial proper-
ty and related infrastructure.
Increasingly, private financing is playing a role
in the first category.
Many forms of public-private partnerships
oblige bidders to take operation and maintenance
(O&M) costs into account as well as capital costs.
One of the oldest such partnership models is
“build, own, operate, transfer” (BOOT), in which
the contractor must consider operating costs, or
even whole-life costs, from the project’s earliest
stages. Today, however, contracts are generally
awarded not on the basis of the shortest period
before government ownership, as in the BOOT
model, but on the smallest government stake
required to make a project economically feasible.
Another type of public-private partnership is
the public finance initiative, in which the govern-
ment makes no capital investment at all (other
than fees to have tender documents drawn up, and
possibly investment in the land required). Instead
it undertakes, in essence, to rent a finished, fully
equipped built facility (e.g. school, hospital,
prison) operated by a concessionaire.
Thus far, investment in “green” buildings has
come largely from the public sector, with sustain-
able housing supported partly by government
funding of demonstration projects (multi-family)
and partly by well off individuals (single-family).
For all types of clients, education and awareness
raising are critical in promoting a trend towards
SBC. Corporate image enhancement can be a key
motivation in the commissioning of green com-
mercial and industrial buildings.
Notes
1. UNEP/Earthscan (2002) Global Environmental
Outlook 3. London.
2. WRI/UNEP/WBCSD (2002) Tomorrow’s
Markets: Global Trends and Their Implications for
Business. Paris.
3. Ibid.
4. Sundquist, B. (2002) The Earth’s Carrying
Capacity – Some Literature Reviews (www.all-
tel.net/~bsundquist1).
5. CICA (Confederation of International Con-
tractors’ Associations) (2002) Industry as a Part-
ner for Sustainable Development: Construction.
UNEP, Paris.
6. UNEP/CIB/CSIRCIDB (2002) Agenda 21 for
Sustainable Construction in Developing Countries.
Pretoria.
7. CICA, op. cit.
8. Ibid.
9. International Labour Office (2001) The Con-
struction Industry in the 21st Century: Its Image,
Employment Prospects and Skill Requirements.
Geneva.
10. Ibid.
11. Ibid.
12. Ibid.
13. A Concrete Foundation. In: Tomorrow, 12:6,
December 2002.
12. CICA, op. cit.
13. OECD (2003) Environmentally Sustainable
Buildings: Challenges and Policies. Paris.
14. UNEP/CIB/CSIRCIDB, op. cit.◆
Table 4
Policies, measures and tools that promote SBC
Stage of Siting/design Construction/ Use Demolition/
building process refurbishmen deconstruction
Policies and Codes and standards Full-cost material pricing Full-cost pricing Disposal regulations
policy measures Zoning ordinances Regulations (e.g. Taxes Recycling legislation
Land-use planning energy efficiency) Codes and standards Taxes (e.g. landfill)
Eco-design criteria Labour laws and standards Take-back regulations Monitoring and
Procurement policies On-site EMS
c
Disclosure requirements reporting
Monitoring and Awareness programmes
reporting EMS
Tools Life-cycle assessment
a
EPDs
d
Labels/certification
f
WLC
b
accounting ISO 14000
e
Energy audits
Sustainability indicators Supply chain management