The Price of Going Green

Payback From Earth-Friendly Products
Takes Years; Can a House Be Too Eco?

By JUNE FLETCHER
February 29, 2008; Page W8

Most homeowners like the idea of going green -- until they get the bill.

With home sales slumping and consumers rethinking their remodeling budgets, building contractors and suppliers are dangling green upgrades. They hope that energy-efficient systems and products made from sustainably harvested materials will hook consumers concerned about global warming, pollution and natural resources.

Yet with a few exceptions, green materials and construction cost extra, making them a hard sell. Enermodal Engineering, a Canada-based consulting firm, estimates the premium at 5% to 10%, depending on how extensively a builder uses recycled materials and water- and energy-efficient products. When Specpan, an Indianapolis research firm, surveyed builders recently for Building Products magazine, the greatest number estimated a 10% to 19% cost increase when going green.

There are signs, though, that the industry's sales pitch is resonating. In the American Institute of Architects' fourth-quarter survey of 500 architects, 61% said their clients are interested in "renewable" flooring materials like cork and bamboo, up from 53% a year earlier; 47% said clients wanted high-end appliances, down from 65%.

Being earth-conscious isn't always easy. Anna and David Porter decided three years ago to trade in their 4,000-square-foot Seattle home for a smaller, greener abode. They paid about $300,000 for an old house on a beachfront lot in Stanwood, Wash., and budgeted $450,000 to renovate it into a green showplace, with kitchen countertops made of recycled glass and concrete, a geothermal heat pump, a tankless hot-water heater, a solar electric system and cabinetry and flooring made from sustainably harvested wood.

Contractor estimates ranged from $700,000 to $800,000 and still didn't include everything the couple wanted. In the end, they tore down the house, salvaged or gave away most of it and spent $1.2 million, not including the original purchase, to build a custom-designed, 2,700-square-foot replacement. It was "the right thing to do," says Ms. Porter, a nonprofit project manager. Even though many of the upgrades will help keep energy costs down, she adds, "I don't expect we'll get back all the money that we paid in our lifetimes."

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In fact, earning back the green premium can take years, not counting rebates and incentives that may be available from government agencies. Enermodal calculates a payback period of more than 10 years for the most extreme green measures, including super-efficient furnaces and water-thrifty faucets. Systems integrator Solar Depot estimates a solar hot-water system will pay for itself in eight to 10 years, depending on the climate, site and home size; a solar radiant floor-heating system will take five to six years. But considering the average U.S. homeowner lives in a house only seven years before moving, many will need more than the hope of lower utility bills to inspire a green remodeling. (And some green products, such as bamboo floors, don't save any money.)

LIGHTBULB PAYBACK

Yet there are some items with relatively short paybacks. EnergyStar.gov, an Environmental Protection Agency Web site, estimates a 3.5-year payback period for the $200 premium on an Energy Star-rated electric clothes washer costing $500 and a 3.1-year payback for the $30 premium on an Energy Star side-by-side refrigerator costing $1,100. Compact fluorescent light bulbs -- which go for about five times the price of incandescent bulbs -- pay back their extra cost in about four months.

Mark Silberman, a retired wine-store owner, plans to tear down a four-bedroom split level in Norwalk, Conn., he bought seven years ago for $500,000 and spend about that amount again to rebuild. He has just begun making his way through the dizzying array of green options -- earthen roofs, gray-water irrigation systems, geothermal heating, recycled shingles. Since all these things could add 20% to his final cost, he figures he'll probably just pick those that make the house less drafty and expensive to heat. "If something helps save the earth's resources, that's an extra bonus," he says.

Cost has been a stumbling block to the green building movement ever since interest in solar homes, sod-topped buildings and dome houses took root in the 1960s. Ratings standards such as Energy Star and the U.S. Green Building Council's LEED (Leadership in Energy and Environmental Design) point system help people evaluate costs and benefits.

GROCERY-BAG DECKS

John Kurowski, a Denver builder who began building "green" homes in 1974, says there is more to consider than just the bottom line. For example, one of the most cost-effective remodeling steps is to caulk and insulate thoroughly. Yet making a building too tight can hurt indoor air quality. "You have to look at the entire system," he says. And some green products can have other downsides. Deck-material makers Trex and TimberTech were early producers of composites blending plastic with reclaimed lumberyard sawdust to create a semisynthetic "lumber" that wouldn't splinter or rot. But with time, the embedded wood tended to stain, scratch and attract mold.

The companies say they have largely conquered the mold with chemical additives. But they also have launched "virgin" polyvinyl chloride decking that they say is more scratch- and stain-resistant. Tom Lent, policy director of an environmental group, the Healthy Building Network, calls pure PVC decks a "disaster environmentally." Anthony Cavanna, chief financial officer of Trex, says 99% of its products are still made using recycled plastic grocery bags. Carey Walley, a TimberTech spokeswoman, says a pure PVC deck, with a 25-year warranty, is "more sustainable" than pressure-treated wood, which may need replacing after 10 years.

The greenest home, though, may be the one you live in now, given the cost in dollars and pollution of ripping out old materials and producing and shipping new ones, the National Trust for Historic Preservation noted in a recent issue of the magazine Preservation. New York architect Andrew Kotchen reminds clients they can save energy and fossil fuels simply by building smaller mansions. "Bigger isn't better," he says.

Write to June Fletcher at june.fletcher@wsj.com