Conditions in Japan are ripe for widespread adoption of sustainable building practices, a key element in a comprehensive response to environmental degradation. For this to occur, however, Japan’s government must take a leading role.
Japan’s dense population, history of intermittent isolation, and nature-based religions have created an efficient and environmentally conscientious society. The country has proven its ability to innovate and invest in experimental new technologies. Through cooperation between the public and private sectors, Japan has created standards and ratings systems for specific building projects, and many of its corporations have already bought into the green building movement.
The Japanese government has also demonstrated an interest in environmental issues. In 2002 it ratified the Kyoto Protocol, a 1997 international agreement designed to reduce greenhouse gases. While the average target reduction in greenhouse emission levels established at Kyoto was 5.2 percent (compared to 1990 levels) by 2012, Japan has committed to a 6 percent reduction.
The challenge is significant, however, because the country is already a low polluter on per capita and GDP bases. Further carbon emission reductions will likely be more onerous for Japan than for heavy polluters like the United States.
The country risks missing its Kyoto targets because the economic incentives to embrace green building simply do not exist. In order for the movement to take hold, the government must create a national green building policy that brings all existing positive forces together.
Green Building Defined Green, or sustainable, building is an approach to real estate development and redevelopment that minimizes the negative impact on both the natural and built environments through use of specific technologies and building methods. From the builders’ perspective, it requires changes in investment philosophies, design, construction material selection, and product offerings. Construction companies cannot effect the change alone, however; they must obtain customer buy-in, since green building often has a long payback horizon.
Green Building in Japan The green building movement in Japan is a bottom-up process. It has been implemented incrementally by companies, prefectures, and the national government. The adoption of the Kyoto Protocol spurred the movement, but the government’s hands-off attitude, which contrasts sharply with that of the European Union, has meant that it has gained ground slowly.
Large construction companies have taken the lead in green building in Japan. Their goals: corporate branding and a market leadership position once the movement gains force. These firms tout their green achievements to establish their environmental credentials. Anticipating legislation aimed at enabling Japan to meet its Kyoto commitments, many companies began to develop green technologies to gain a competitive advantage, and today more than 90 percent of construction projects in Japan incorporate some form of green building technology.
The structure of the construction industry in Japan supports innovation and the adoption of green building. With both architects and construction management in-house, companies are uniquely qualified to develop new products and building technologies, and have more freedom to experiment. Many dedicate significant portions of their research and development budgets to environmental issues.
While companies invest to develop new technologies, however, the most prevalent green design features used in Japan today are arguably the least innovative. Practical and cost-efficient systems such as low flush toilets and daylighting are widely used, with higher-profile green technologies such as stationary fuel cells, wind turbines, and solar cells less common.
Low financial visibility limits the adoption of some technologies. In many cases, relatively low ongoing cost savings stand in contrast to very high initial capital costs for both components and installation. In general, while there is a direct correlation between the adoption of a green technology and its impact on the return on investment (ROI), ROI and payback periods are not easily estimated. They depend heavily on assumptions and which costs are included, and are therefore subject to manipulation.
Interestingly, technologies may be inherently green, without being aimed specifically at environmental issues. Seismic isolators, for example, were designed to reduce the effect of earthquakes on buildings, but they may also be considered a green technology because they lengthen a building’s useful life.
A transformation within the construction industry is projected as economies of scale kick in and make more leading-edge technologies viable. The lack of synergies among the technologies also may make them more feasible if used collectively.
Measuring the Impact of Green For an individual project, the deciding factor in applying green technologies may well be the impact on ROI and payback period. For broader social purposes, however, a building is evaluated on its environmental impact.
Governments, industry groups, and nongovernmental organizations (NGOs) worldwide have developed standards and frameworks for evaluating this impact. Methods include BREEAM (Building Research Establishment Environmental Assessment Method) in the United Kingdom, LEED (Leadership in Energy and Environment Design) in the United States, and GB (Green Building), an international project.
Two standards exist in Japan. The Japan Sustainable Building Consortium, a government/business/academia partnership under the auspices of the Ministry of Land, Infrastructure and Transportation, developed CASBEE (Comprehensive Assessment System for Building Environmental Efficiency). CASBEE measures both the improvement in living amenities for building users within a property (a hypothetical enclosed space), and the negative environmental impacts within and outside the property. While the rating system is complex, the result is a simple, clear presentation of environmental performance.
Seeking a less complex method, builders in Tokyo established a different standard under the Tokyo Green Building Program. Here, four key areas are analyzed: rationalization of energy use, appropriate use of resources, conservation of the natural environment, and abatement of the urban heat island effect. In contrast to the tax incentives and subsidies used elsewhere in the world, the government of Tokyo has encouraged green building by convincing the banking community to offer owners and developers of compliant buildings lower interest rates.
Government’s Role: From Low Key to Assertive Japan’s government has taken a less active role in promoting green building than the country’s large construction companies. It is also much less aggressive than the European Union, which has imposed a top-down legislative agenda that mandates reductions in greenhouse gas emissions to be implemented through a cap-and-trade mechanism.
This passivity likely results from lack of political will. There are no differences between the environmental positions of the two major political parties, and little popular pressure for change. While the public supports sustainable building, it does not push for it.
The Japanese government has subsidized only the solar power industry. Even here, however, the impact has been limited. Not only are the subsidies too small to have a meaningful economic impact, but they are focused on the housing market.
Economic Feasibility the Key Green building practices will only become mainstream in Japan when the economic argument for adopting them is clear. Companies, already at the forefront of the movement, can increase the pressure for sustainable building in several ways including:
- Creation of a “green” brand with the public.
- Trading carbon credits, even if in an incipient market. This will position companies competitively once carbon trading takes off.
- The sale of carbon credits by green energy producers or carbon neutral and efficient firms, thus generating incremental revenue streams.
- Pressure by institutional investors in response to exposure to global warming risk, though this may be a weak instrument, since so many Japanese companies are closely held.
While companies can increase their green footprint and improve their bottom lines by doing so, government leadership is essential to propel Japan into the age of green building. As such several measures are recommended:
- The creation of carbon “cap and trade” schemes to create a marketplace for carbon emission buyers and sellers.
- Government tax credits and allowances to stimulate research and development of new technologies.
- Harmonized policies, regulations, enforcement and oversight to give companies a long-term planning outlook.
- Tax incentives for green real estate investment funds.
In the end, it will fall to the government to create a national green building policy to leverage and harmonize the energies of the public and private sectors.