With carbon pricing coming to effect on 1st of July, a report from Davis Langdon, an AECOM company, has found that construction material costs, after manufacturer compensation, will increase by 0.4 percent in the first year of the carbon pricing scheme, and total costs will rise by 0.2 percent.
The report looked into how the carbon price will impact the construction of buildings and infrastructure using Davis Langdon’s purpose built Embodied Carbon Metric (ECM) to scientifically analyse building materials for their embodied carbon content.
In an industry first, a survey of Australia’s largest material manufacturers was also conducted to find out how the carbon price will impact the manufacturing of commonly used construction materials such as cement, steel, aluminium and glass.
Post construction operational factors such as electricity costs will also be affected by the carbon price.
According to Federal Treasury forecasts, energy prices will increase by an average of 10 percent between 2013-2017, a rise contributed to in part by the carbon price.
“The Davis Langdon carbon report shows that while construction cost impacts will be relatively minimal at the construction stage, the lifecycle implications are significant and will require long term thinking to manage risks effectively,” said report author and Global Manager of Business Intelligence, Michael Skelton.
“The built environment is one of the largest users of energy in Australia, and responsible for up to 23 percent of Australia’s greenhouse gas emissions. The report shows that actions taken during construction to reduce energy use will have long term benefits over the life of the asset.”
Looking ahead the report also identified opportunities to mitigate embodied carbon and reduce operational costs from a whole of life perspective for new and existing buildings
Future proofing measures such as using materials with lower embodied carbon, passive design improvements, and high efficiency heating and cooling systems have the potential to act as a hedge against future operational cost increases, and higher asset values during the asset’s lifecycle.
“By adopting smart, energy efficient passive design principles and other measures during the construction phase, operational efficiencies can be achieved over the whole lifecycle of the asset that will provide long term benefit and reduce risk,” Mr Skelton said.
AECOM is a global provider of professional technical and management support services to a broad range of markets, including transportation, facilities, environmental, energy, water and government. With approximately 45,000 employees around the world, AECOM provides a blend of global reach, local knowledge, innovation and technical excellence in delivering solutions that create, enhance and sustain the world’s built, natural, and social environments.