Why Green Building Requires Construction Companies To Digitize

Aasawari Kakade

The global green marketplace grew to $260 billion in 2013, reflecting steady client and market demand for green construction. Between 2015 and 2023, commercial building owners and managers will invest an estimated $960 billion globally in green infrastructure. Top green construction investment priorities include retrofitting old buildings, investing in energy-efficient heating, ventilation and air conditioning, and upgrading plumbing fixtures and other key technologies, reports the U.S. Green Building Council.

Green construction is rapidly becoming a competitive differentiator for construction projects. From major office buildings to multi-family developments, the market for green construction remains resilient even in the face of economic challenges. Demand for residential green construction grew from $18 billion in 2009 to $48 billion in 2013, despite the economic recession. Companies and consumers are voting with their wallets: green construction is here to stay.

Construction companies that fail to meet this market demand risk being out-performed by the competition. The digitization of the construction industry creates new opportunities for innovation and improving green methods in construction.

LEED certification and greening construction

Integrating green methods into construction is an opportunity to better use available resources while creating healthier and more energy-efficient homes and buildings. This starts with LEED certification. LEED, short for Leadership in Energy & Environmental Design, is a green building certification program that recognizes best-in-class building strategies and practices. To receive LEED certification, building projects satisfy prerequisites and earn points to achieve different levels of certification.

For example, the use of spray polyurethane foam (SPF) insulation is increasing in both new and existing homes. Using SPF can help lower heating and cooling costs thanks to a significant reduction in building-envelope air leakage, according to recent studies by the U.S. Department of Energy Building America program. The biggest energy savings are achieved when homes use SPF together with energy efficient windows and doors, HVAC systems, hot water heating, major appliances, and lighting. For example, LEED-certified buildings use 25% less energy than non LEED-certified buildings, which translates to a 19% reduction in aggregate operational costs.

Industry pushing for Green Construction Code updates, compliance documentation challenges remain

In 2014, industry representatives joined together to announce new amendments to the International Green Construction Code (IgCC). The goal is to strengthen code enforcement for energy codes, proactively assess buildings for energy performance, more effectively capture energy-saving strategies (like building orientation) in codes, and empower the International Energy Conservation Code to recognize reductions in energy use at the systems level.

Representatives from across the building industry, including code officials, building owners, manufacturers, designers, and energy efficiency advocates, have come together under the leadership of the National Institute of Building Sciences to develop a new approach to meeting energy efficiency requirements.

“A new compliance path based on targeted energy outcomes in the IgCC would represent a transformative change in the building industry that may be as significant as the advent of energy codes more than 35 years ago,” said Ralph DiNola, executive director of the New Buildings Institute. “This evolution to outcome-based performance requirements recognizes that prescriptive and modeled design approaches are often not representative of the actual energy outcomes of buildings, and that current codes fail to regulate some of the most significant energy end uses in buildings today.”

DiNola accurately sums up one of the greatest challenges facing the green construction industry: despite the best efforts of the construction industry, a single, unified approach to documentation remains a challenge. New compliance regulations will create a simplified, streamlined approach to green building, but they also pose a challenge to construction companies that may not have the resources to accurately measure energy savings reductions.

The greening of the construction industry

Sustainable, “green” construction is rapidly becoming standard practice. Between 2013 and 2015, 63% of construction companies completed new green projects, and 50% completed renovation/retrofitting work, reports McGraw-Hill’s research into world green building trends. “Going green” is not just a trend for construction companies; it is a business imperative.

Green builders face challenges putting best practices into reality. New products such as low volatile organic compound (VOC) coatings, for example, may require special installation procedures in order to perform, so contractors can’t rely on tried and true methods. They must access and use current, accurate information to ensure quality installation and compliance. The same goes for the LEED standards that are driving sustainability projects. In order to achieve and document the performance levels required in LEED facilities, contractors must remain nimble. Digital construction solutions can help.

Next steps: How digitization supports green building practices

In a digital world, new business models are emerging to disrupt traditional business processes. This includes the emergence of an open talent economy that breaks people skilled in green construction methodologies together in a borderless workplace. Contractors can scale operations rapidly by sourcing experienced talent from trade workers and management via a talent network. Digital collaboration tools and networks further support this borderless workplace, empowering effective collaboration within teams and between partners and clients. This digital approach delivers real-time status updates and eliminates lost downtime waiting from materials and equipment.

SAP’s ERP core provides near real-time information and creates the backbone required for managing projects effectively and distributing the knowledge to all the stakeholders. These digital solutions are essential to helping construction companies remain nimble and adopt green building best practices.

For more insight on this new digital age of construction, see Building a Sustainable World, How to survive and thrive in a digital construction economy.


Aasawari Kakade

About Aasawari Kakade

Aasawari Kakade has over 11 years of experience working with customers in the Construction industry. Prior to joining SAP 3 years ago, she ran global marketing for another niche construction specific ERP. While at SAP, she is responsible for leading the SAP Advisory Council for EC&O industry along with many industry specific activities focused on enabling customers with the right SAP technology to support their business strategies and innovation objectives.