Topic: Water and Wastewater

Looking closely at your bottom line

Life cycle costing (LCC) helps local governments look beyond initial capital costs and assess infrastructure strategically over its entire life. LCC can significantly strengthen fiscal performance as well as contribute to large greenhouse gas reductions.

Barrier: first cost orientation

A major barrier to advancing premium efficiency infrastructure and renewable energy is that consumers, including many sophisticated private and public institutions, focus on the initial capital cost and simple payback. Taking this perspective, an infrastructure investment with slightly lower capital costs but high long term costs may be preferred over one with slightly higher capital costs, significantly lower long term costs, and potentially significantly lower emissions.

Looking Long Term

Rather then evaluating projects on initial cost, LCC considers the total cost of owning, operating and maintaining infrastructure over its useful life (including fuel, energy, labour, and replacement components).

LCC is particularly useful for evaluating premium efficiency infrastructure and renewable energy opportunities since their initial costs are often higher, but they tend to have lower operating and maintenance costs over the life of the project.

By overlooking the purchase of premium efficiency products because of their initially higher costs, local governments may save money in the short term but end up paying more for the project through higher energy costs and other operating costs over the life of the project.

Given the importance of fiscal performance, LCC analysis has made some of the most important contributions to advancing local government climate change programs. LCC has applications across a wide range of sectors:

• Fleets, decisive in determining new vehicle acquisitions
• Civic Buildings, relevant for premium efficiency targets for new and existing stock
• Equipment, relevant for office equipment and machinery
• Land use and transportation planning, notably as it pertains to infrastructure needs and costs
• Residential and commercial Buildings

Community Examples

• City of Dawson Creek: Life Cycle Cost Analysis Tool 1
• City of Dawson Creek: Life Cycle Cost Analysis Tool 2

The first tool provides an example of how the tool can be used to compare three vehicles that use different fuel types. The second tool is an actual analysis that the City did when deciding which vehicle to purchase.

Clear Savings

Buildings

The potential savings from investments in green buildings is 10 times the initial investment according to a US state sponsored Sustainable Building Task Force. For example, an initial upfront investment of up to $100,000 to incorporate green building features into a $5 million project would result in a savings of $1 million in today’s dollars over the life of the building. [1]
Construction accounts for only 8% of a civic building’s cost over its 30-40 year life; operation and maintenance accounts for 92%, according to a study by the City of Hamilton. [2] LCC takes operation and maintenance costs into account, revealing the true cost of the investment over its useful life.

Vehicles

After conducting a life cycle costing analysis, the Township of Langley replaced older high emissions vehicles with newer different models. The 5% reduction in fuel and repair costs more than offset the additional capital investment.

Development

In low-density, single-use developments, local governments often generate less in development fees and property tax than they spend in services like emergency and waste removal, and infrastructure costs such as roads, water mains and sewers. A Southwestern Ontario analysis found for every $1 dollar raised in development fees and property taxes $1.40 needs to be spent on servicing. This problem is more thoroughly explored under asset management. [3]

Life Cycle Analysis vs. Life Cycle Costing

LCC is complementary but not the same as life cycle analysis (LCA). LCA is used to estimate the wide range of environmental impacts or costs of a project over its entire life, literally from cradle to grave. LCA is particularly useful in selecting projects with lower greenhouse gas emissions.

[1] Kats, Greg et al. (2003). The Costs and Financial Benefits of Green Buildings: Report to the California Sustainable Buildings Task Force.

[2] City of Hamilton, Corporate Buildings & Real Estate Department. (February 20, 2001). State of the City’s Infrastructure (Council Presentation)

[3] Diamond, Jack. (May 18, 2008). “Sprawl is our ‘inconvenient truth:’ Increasing densities do not have to compromise livability,” in Globe and Mail.

A blueprint for a healthy, sustainable community

The Local Government Act authorizes the development of Official Community Plans (OCPs) in BC (Sections 471 to 478). An OCP is a local government plan that provides objectives and policies to guide decisions on planning and land use management within the area covered by the plan. OCPs are significant because, after their adoption, all bylaws and works undertaken by a Council or Board must be consistent with the plan. Every OCP will be slightly different but each will address core aspects of a community such as:

• Proposed land use and density
• Transportation, water and wastewater infrastructure
• Environmentally sensitive areas, parks and open space
• Housing needs and policies
• Public facilities, including schools, health care, etc.
• Neighbourhood character
• Social policies
• Economic development
• Targets, policies and actions for the reduction of emissions
• Development permit areas
• Building and landscape design guidelines

In a small community, an OCP will typically have more information and play a more central role in governance with policies, regulations and guidelines, including extensive detail on many issues. For a larger community, an OCP will more often be an overarching, vision and policy document that is accompanied by a wide range of policy, plans and regulatory documents that cover each issue in more detail.

Tackling climate change through an OCP

An OCP is possibly the most important plan in a community for reducing emissions. It establishes:

• Key policy goals for a community, including climate goals and targets
• Land use patterns throughout the community that will shape how complete any neighbourhood is
• The transportation network of a community that will influence whether people walk, cycle and take transit or drive their car – and associated emissions implications
• Housing types available in each neighbourhood that will affect transportation options and quality of life
• Commercial and industrial development that is the foundation of a community’s economy and influences where jobs are located throughout a community
• The policy foundation for infrastructure planning that will determine how efficient and sustainable water, waste-water and energy systems are, based on the OCP’s land use patterns
• A key focus point for community engagement and education where climate and community issues can be linked and discussed
• Community-wide emissions reduction targets, policies and actions to help mitigate the impacts of climate change
• The network of greenways, vegetation and park spaces that influence local neighbourhood lifestyles, vegetation to reduce the heat island effect, and promote walking and cycling
• Design objectives and guidelines for buildings and landscape proposed within prescribed Development Permit Areas. These can include objectives and requirements for energy efficiency and emissions reductions.
• Development information requirements including information required regarding energy efficiency, emissions for a proposed project
• Incentives that the municipality may offer to encourage emissions reductions including policies for density bonusing
• Many other aspects of a community, including the leadership role a local government will play in its own operations around fleet management or premium efficiency building targets.

OCPs are typically updated every 5 to 10 years, but their long-term vision means they set a course for many decades.

Cross cutting actions

• Community vision is strengthened with climate action initiatives. Congestion, air pollution, community livability, community economic development and local government fiscal performance are all part of integrated framing that ensures climate action plans support other fundamental community priorities.
• Climate planning through an OCP or climate planning plus an OCP. Under the Local Government Act, local governments are required to include targets, policies and actions for the reduction of emissions in their OCPs. Many local governments undertake more extensive, energy and emission planning processes independently that would then be integrated into an OCP. Ultimately, some concerted energy and emission planning following by action is important to make significant reductions and ensure communities are protected from energy price volatility. High level climate change targets, goals and actions can be acknowledged in one section of an OCP. These targets and goals, then, should be integrated into other parts of the OCP. Some of the cross cutting opportunities include:
  • Establish climate protection and energy sustainability as fundamental considerations in meeting the community’s economic, social and environmental goals
  • Set a target to inform development of more detailed policies and actions
  • Establish a climate and energy working group to advise council or board on opportunities and build relationships with key partners in the community, utilities, neighboring communities, and senior levels of government
  • Establish some innovative financing measures to hurdle a major barrier to taking action.

Land use actions

Land use planning is at the very top of an energy planning hierarchy. Over the medium to long term, land use decisions are likely to have a cumulative impact on energy use and emissions. A climate-friendly OCP can be achieved by addressing land use patterns to ensure the following:

• Development is directed to areas of existing infrastructure to maintain compact development that supports a diversity of transportation choices from walking, cycling, transit as well as the car
• Mixed use neighbourhoods that include a wide diversity of housing, amenities, schools, open space, commercial / retail development and job opportunities. Mixed use is a primary building block for a healthy community.
• Addressing the evolution of current single use areas (such as single-detached unit subdivisions) to include a greater mix of uses in key areas
• A nodes and corridors structure focusing density in village/urban centers connected by corridors of denser development to support the most sustainable transportation options. These corridors should be easily accessible by a range of transportation options and ideally serviced by convenient and frequent transit. This structure can be set out far in advance of growth into various areas with appropriate phasing based on infrastructure.
• Densities that support convenient frequent transit service in a local transit network, where applicable. As a rule of thumb, 20 to 40 units/hectare or 50 to 80 residents and jobs combined typically supports basic (every 30 minutes) and frequent transit service (every 15 minutes or less). [1]
• Support for infill and redevelopment, including brownfield redevelopment
• Office, institutional, educational and other high employment density areas that are located only in central areas that can be easily connected by transit and active transportation networks to most residential areas (to shift commuting trips to non-auto modes)
• Industrial lands that are located to support green (and innovative district) infrastructure systems and that are easily accessed by transit where job densities are higher
• A network of green areas that link parks and greenways with agricultural or sensitive and protected natural areas, providing a network of paths, local food opportunities and recreation potential. Putting ecological targets in the OCP enables benchmarking and can contribute to a better understanding of ecological resilience.

Transportation actions

Transportation is responsible for close to 50% of emissions in many communities. An OCP will establish a policy and land use framework for a community’s transportation system – often supported with detailed transportation plans. Transportation patterns in a community are primarily an outcome of land use patterns – people travel between areas of activity – but major transportation investments can also shape land use.

“Compact development can result in a 7 to 10% reduction in total transportation CO2 emissions by 2050 relative to continuing sprawl.” [2]

The transportation elements of an OCP need to establish vision, policy and investment commitments that will significantly change the amount and mode of travel from higher emission patterns to those that will support a significant reduction in emissions.

For instance, for a community growing at 1.5% per year between now and 2020, the transportation plan needs to be built around a scenario of a 50% reduction per person if the community plans to meet a 33% reduction overall by 2020 (growth ~ 17% over 11 years + 33% reduction target = 50%). Reductions can be achieved through increased fuel and vehicle efficiencies, but also through support of pedestrian, cycling and transit infrastructure as well as careful planning and development.

Transportation elements for an OCP that can support emission reductions include:

• Establishing the overall transportation network plan of highways, streets, transit corridors, bicycle routes, greenways, pedestrian paths and others to ensure all residents have reasonable access to non-automobile modes of transport for commuting, accessing school and shopping
• Clearly establishing a low-emissions modal priority of pedestrians, bicycles, transit and goods movement over the automobile for policy, design and capital investment
• Establishing policies for complete street design that support narrower streets, traffic calming design, bicycle and pedestrian support, and ecologically sound stormwater management
• Addressing parking policies to keep parking ratios as low as possible to increase housing affordability and apply gentle pressure to use alternatives to the car.

Buildings actions

Local governments, with the exception of the City of Vancouver, do not have the authority to change building code requirements. Local governments are, however, able to indirectly and significantly influence energy efficiency through a variety of conventional policies and bylaws that can be addressed at a high level through an OCP. Building elements for an OCP that can support emission reductions include:

• Build capacity through education and recognition programs for staff, developers, builders and the public, including promoting incentives offered by utilities and senior governments
• Develop partnerships with developers interested in innovation to strengthen knowledge inside and outside local government
• Establish building efficiency and emissions targets to guide the design and performance of new development projects
• Encourage heritage preservation and re-use of existing buildings where possible
• Develop incentives for energy improvements such as density bonusing, revitalization tax exemptions, building permit rebates, development cost charge adjustments, and permit fast tracking
• Develop regulations for density and form, efficiency and renewable requirements through development permit areas.

For further information see Energy Efficiency and Buildings: A Resource for Local Governments.

Infrastructure actions

An OCP can provide the framework to determine where infrastructure development will occur and how it will be implemented. As such, the OCP can address a range of infrastructure issues related to supply, demand management, phasing, policies and inter-jurisdictional agreements for energy, water, wastewater and solid waste. Sustainable infrastructure delivery should consider full life-cycle costing, environment impact and natural resource depletion.

The OCP will primarily establish high level policies and strategies and subsequent infrastructure plans will be developed for each area.

Opportunities to address low emission infrastructure opportunities in an OCP include:

• Limit the outward expansion of the settled areas of the community (compactness) to reduce need to expand infrastructure networks
• Establish energy and emissions targets for infrastructure systems against which options can be evaluated
• Adopt practical analytical and decision making tools into infrastructure planning and procurement such as life cycle analysis and integrated resource management
• Integrate local renewable, low emission energy sources and systems into existing infrastructure such as micro-hydro, waste to energy systems, biogas recovery systems, sewer heat recovery, geo-exchange and geothermal systems and the distribution of energy through district energy systems. The OCP should include policies defining levels of support for energy efficient and renewable energy infrastructure and new utilities developed by the municipality, developers, large utilities and other levels of government within the municipality.
• Develop water supply policies and practices that support efficiency targets along with other sustainable water management policies
• Develop rainwater (stormwater) management policies and practices to reduce the burden on infrastructure and enhance ecological and amenity values, including reducing impermeable areas
• Develop wastewater policies and practice, including priorities for treatment and re-use, renewable/low emission energy sources, energy recovery/generation, resource recovery, and strategies for centralized or decentralized systems and siting
• Develop solid waste policies and practices that reduce emissions including waste reduction, recycling, composting, and managing landfill gas, as well as resource recovery and environmental protection.

Local government operations actions

An OCP does not frequently address local government operations directly. However, some OCP strategies can benefit areas of local government operations indirectly and vice versa. For example:

• Building capacity through leading by example: By taking a leadership role in green buildings, fleets and infrastructure, local governments build knowledge inside city hall and out in the community that can be extended to community wide programs. This leadership also raises awareness of the potential for innovation.
• Community water conservation: Conserving water can reduce energy consumption and emissions from water and wastewater infrastructure, and reduce the size of constructed systems.
• Greening the fleet: Compact community planning, community waste reduction and backyard composting programs can reduce emissions from fleet operations.

References

1. Transit Supportive Guidelines (Ministry of Transportation of Ontario, 2012)
2. Ewing, R., K. Bartholomew, S. Winkelman, J. Walters, and D. Chen., 2008. Growing Cooler: The Evidence on Urban Development and Climate Change. Urban Land Institute, 9.