How to Save With Green Renovation
This two-part series looks at the green renovation trend. This article explains why you should consider going green with your next renovation. The second article will tell you how to do it.
Firms ranging from the Boston Red Sox to Wal-Mart (WMT) have been trumpeting their intentions to adopt environmentally sound business practices such as increasing recycling and buying alternative energy.
Going green gets them great publicity -- and saves them money in the long run.
Homeowners also can benefit from going green, saving money even as they do their bit to save the planet. Those cost savings help explain why 39% of all home-renovation projects are green.The percentage is even higher among certain types of projects, including replacement windows (47%) and heating, ventilation and air-cooling systems (44%). As a result, the green building industry grew from $7 billion in 2005 to nearly $12 billion last year. Here are reasons for making your next renovation project environmentally friendly:
A Chance to Save MoneyMany homeowners who undertake green home-improvement projects aim to improve energy efficiency -- a no-brainer in these days of high energy prices. Others are looking to improve indoor air quality by ditching products like formaldehyde-treated wood and standard paints, which can release toxic vapors. Still others hope to preserve natural resources by selecting products whose creation doesn't harm the environment, such as flooring made of bamboo rather than wood from clear-cut forests. Green renovation projects cost a bit more than traditional remodeling jobs, but the green premium has declined sharply in recent years thanks to the increasing availability of expertise and materials. A 2003 study prepared for California's state government indicated that green commercial projects in the state cost, on average, just 2% more than their nongreen equivalents. The kicker? The report found that the 2% upfront investment in green design resulted in a 20% savings in operational costs over the lifetime of the building, primarily through increased energy efficiency. Potentially greater savings are possible for residential projects, where improvements in energy efficiency can help consumers cut their annual energy costs in half. What's more, green homes may command higher resale values -- as much as a 6% premium -- than comparable standard homes. But given the young nature of the industry, data are still somewhat limited.
Government IncentivesOwners of commercial buildings already have incentives beyond the long-term cost savings to go green. By incorporating green-design elements like water conservation and eco-friendly site management, they may be eligible for reduced insurance premiums as well as lower interest rates on building loans, along with some significant tax incentives. Similar incentives may slowly find their way into the residential market as more homeowners do green building projects. For example, Massachusetts offers a 15% tax credit for alternative energy production. Check the Green Home Guide to find out if similar government incentives are available in your area. Coming in Part Two: How to make your next renovation project green.
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