Green Pays Its Way--Performance-Based Fees

Green Pays Its Way--Performance-Based Fees

Giving building and design professionals a financial incentive to create high-efficiency schools proves to be a winning strategy for both the firms that design and build schools and the students who learn in them. By Cameron M. Burns and Huston Eubank, AIA



"Phenomenal!” exclaimed Rocky Mountain Institute’s CEO Amory Lovins when architect Heinz Rudolf told him about the newly-opened North Clackamas High School’s likely future energy savings.

Lovins had good reason to be excited. Computer and physical modeling of the school indicate that it is one of the “greenest” schools in the nation. The total energy savings are expected to be 44 percent better than the Oregon Energy Building Code requires (and much better than the American Society of Heating Refrigeration and Air Conditioning Engineers, Inc. energy code recommendations). The school will save roughly $75,000 to $80,000 annually on its energy bills, and the total capital cost was a mere $118.70 per square foot. And now that it’s open, the structure itself is drawing rave reviews.

“This is an incredible building for students and staff,” said Principal Dean Winder. “The natural light and ventilation brighten everyone’s day. The students have more bounce in their step and smiles on their faces. The parents and community are very proud of what they have done for this generation and generations to come.”

Promise of Profits

The North Clackamas High School is unique not only because it is one of the greenest schools in the nation, but also because of the use of performance based fees (PBF). In fact, the school was one of four projects chosen by RMI to demonstrate the use of PBFs. As the name implies, PBFs link a portion of the compensation of project architects and engineers to the savings derived from high efficiency designs. The greater the savings in electricity, natural gas, liquid fuels and other resources, the more these professionals earn.

The North Clackamas High School project began in the mid-1990s and involved numerous entities, including RMI, BOORA Architects, CBG Engineers, Eley Associates, ENSAR Group, the Northwest Energy Efficiency Alliance, Portland General Electric, the Energy Foundation and, of course, the school district. North Clackamas educators had heard about the effects of natural lighting and ventilation on student and teacher performance, and investigated.

“The district was not interested in green design for it’s own sake,” said Bill Dierdorff, Business Manager with the North Clackamas School District. “The district was interested in an excellent educational environment that would be cost-effective over the 75 to 100 year life of the facility. Green was not a goal, it was a solution!”

With funding from the Energy Foundation, RMI worked closely with Eley Associates to create set of PBF guidelines. PBFs aren’t rocket science, but using them requires considerable foresight and planning.

“The value of starting early cannot be overemphasized,” wrote Charles Eley of Eley Associates in the primer on Energy Performance Contracting for New Buildings. “Retrofits and late design changes are usually limited to HVAC equipment selection, lighting equipment changes and possibly glass type. These measures save energy, but they have a relatively low rate of return. The most cost-effective measures happen early on, and affect characteristics like building orientation, window size and placement, shading, space planning. Many of these measures cost nearly nothing—sometimes they even cost less than the base case—but each has the potential of saving a lot of energy.”

Green by Design

The 265,355-square-foot school opened April 3, 2002, after spring break, so that North Clackamas seniors will be able to enjoy the school before they graduate. Organized into building “bars” along an east-west axis for optimum natural lighting and ventilation, the school employs natural and recycled content materials—such as natural linoleum, ceramic and quarry tile, brick, recycled rubber flooring, recycled upholstery and recycled acoustical tiles—that follow principles of environmental sensitivity, simplicity and efficiency. Divided into four academic houses, the building provides small-scale learning environments with emphasis on flexibility, integration of instruction, technology as well as spaces for social interaction and community use.

“Because of a tight budget (roughly $29 million), building orientation, massing, bay-depth and microclimate had to be considered from the beginning,” said architect Rudolf, a principle of BOORA Architects of Portland. “The emphasis on high performance glass and skin permitted a reduction of the mechanical system.”

A DOE-2 computer energy model anticipates savings over typical designs of 275,000 kilowatt hours in lighting, 315,000 kilowatt hours in fans and pumps, 150,000 kilowatt hours in cooling and roughly 27,000 therms (2.7 billion Btus) in heating. An indigenous landscaping design that includes preserving and enhancing an existing six-acre wetlands area complements the building. The wetlands will be used to retain and purify stormwater runoff.

To test their design ideas about lighting and natural ventilation, the architects and students built two full-scale classroom mockups. The first of these was at the Seattle City Light’s Lighting Design Laboratory, where they were able to hone critical aspects of their daylighting and electric lighting design. The second was built by the students on the site of the new school and used to test natural ventilation components of the heating and cooling design.

Staying the Course

Performance-based fees can get lost in the complexities of building and development project processes, especially when there are many change orders. In this project, however, the PBFs survived and even helped steer the process. The money saved through energy efficiency will be split between the designers and the school fifty-fifty for the first two years, with the school’s share going into the general fund to offset the increasing cost of energy, according to Physical Plant Director David Church.

“The PBFs were important simply because they allowed us to spend the extra time and effort required to create a first-class school,” said Rudolf. “The extra compensation allows us to do extra research, evaluations and testing so that we can develop cost-effective systems, especially passive systems. What is equally important is the fact that once a contract for the extra compensation is in place, it serves as tool to commit everyone to accomplish specific goals, as opposed to slightly increasing the professional fees without the specific expectations.” In an aside, Heinz chuckled about how the run-up in energy prices last summer might have a very positive effect on the performance- based fees, and how this has highlighted the importance of energy savings for this project.

The school has been a hit locally as well as regionally. Several other school districts are working on high schools that will use similar technology, including the Salem-Keizer School District and the City of Oregon School District.

“I was surprised at how a building can be so functional and yet beautiful at the same time,” says Church. “My impression in talking with both students and members of the community is that they are very pleased with the school. The School Board is pleased as they know this facility was a great bargain and will continue to save operating costs due to its low energy consumption. The press was very positive and did several stories on the school and its ‘green’ aspects.”

Green or sustainable buildings like the North Clackamas High School aren’t just getting noticed in Oregon. Across the country and around the globe they are becoming the norm, not the exception. Recently, Australian architect Glenn Murcutt won the Pritzker Prize for his beautiful and sustainable designs. In his New York Times article about the award, architecture critic Herbert Muschamp—by no means a champion of green design—noted, “Mr. Murcutt’s selection by the Pritzker jury can be seen as an acknowledgement that sustainability now overrides aesthetic criteria in the urbanizing world.”

While we agree, the new North Clackamas High School project demonstrates very elegantly, as do Mr. Murcutt’s buildings, that sustainability and aesthetics can be quite complementary.

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Cameron M. Burns is an author and editor, and Huston Eubank, AIA, is an architect and consultant. They work at Rocky Mountain Institute, 1739 Snowmass Creek Road, Snowmass, Colorado 81654-9199, TEL: (970) 927-3851, FAX: (970) 927-3420, e-mail: [email protected], [email protected].