Last month, I told you about the Drake Landing Solar Community, which the Prime Minister of Canada dubbed the greenest community in Canada. It’s an impressive project and the fact that the 52-unit community sold out before construction was complete points us to an important question. What are the mortgage costs of a green home?
The answer is, the increase in the up-front costs (which affect the monthly payment) minus the amortized savings in the homeowners’ energy costs.
The formula may sound complex but its bottom line involves just two computations, both percentages. The rule of thumb within the green building industry is that a green home costs 10% more to build if the green attributes are included in the project from the outset. Hence, the mortgage costs of a green home will be about 10% higher when all is said and done. However, the average green home consumes well in excess of 10% less energy than its conventional counterpart.
So, then, why don’t we see green homes become the industry standard? Well, alas, projects such as the Drake Landing Solar Community are the exception rather than the rule because developers are in business more to turn a profit than worry about the long-term happiness and sustainability of their customers. Drake Landing changed that through close collaboration with multiple parties.
There are many ancillary benefits to doing so (and further savings in energy efficiency top the list). You see, because of the tight integration of geothermal heating and solar water heating, the Drake Landing Solar Community uses just the tiniest quantities of fossil fuels in the winter and it is located in Central Canada! Imagine the savings! The average homeowner in this neighborhood uses at least 80% less natural gas.
So, we have mortgage costs of a green home which run about 10% more and energy savings of about 80%. With prices for fossil fuels on a steady climb, one need not possess an advanced degree in mathematics to grasp the fact that green homes are beneficial.
Fomenting the Triple Bottom Line
Corbett Kroehler
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