When it comes to living or green infrastructure, funding is a commonly cited barrier to implementation.
And like clean energy and green building before it, this burgeoning industry has to prove its merit before funding is allocated. So how do we do it?
The money has to come from one of six categories: yourself, a loan, the end user (passing on the cost to your client), a partnership, a grant, or a wealthy benefactor.
Most of us do not have a wealthy benefactor, and with housing prices the way they are, we probably don’t have enough saved for a solo funding effort either. So our options are down to four – a loan, the end user, a partnership and a grant.
As scintillating as bank loans are, securing one can be a tricky affair. Now we’re down to three – the end user, a partnership and a grant.
The business case for the end user
Provided you have the data to back up your living infrastructure project, you have the potential to land a client or end user.
The benefits of living infrastructure – from health, heating, ventilation and air conditioning (HVAC) system efficiency to storm-water management, increased liveability, rental returns and improved air quality – are well known, and the business case for living infrastructure is good and growing. Here’s some stats to throw in at your next client meeting:
- Improved thermal performance and offsetting the urban heat island effect
By implementing green roofs on low-rise buildings city-wide and reducing the heat island effect, it was calculated homeowners and businesses in Toronto, Canada could save CA$21 million annually in HVAC energy costs.
- Retail customers are willing to pay more in spaces with living infrastructure
According to a survey, retail customers have indicated that they are willing to pay eight to 12 per cent more for goods and services in areas with a mature tree canopy. For a mid-size retail centre, this could generate over US$1 million of increased sales annually.
- Increased student performance
A US study looking at 101 public high schools around the country found consistent correlation between increases in student performance and exposure to the natural environment.
- Improved health outcomes
The CSIRO estimates unhealthy indoor air quality (IAQ) is costing the Australian economy about $12 billion each year in lost productivity. Living infrastructure captures the offending particulate matter, volatile organic compounds and carbon dioxide, and inputs oxygen into the space instead, improving the IAQ for building occupants.
- Contributes to Green Star IEQ points
Living infrastructure is still a new thing for most folks, but the Green Star environmental certification system for buildings is not. You can bag valuable points by implementing living infrastructure in your Green Star project – in fact, living infrastructure can deliver points in every Green Star rating tool from Design and As Built, to Interiors, Communities and Performance.
Co-benefits can land a government grant or contract
Sometimes to secure the funding for a living infrastructure project, you’re best off promoting co-benefits before the benefits topping your wish list (like improved health and well-being). Green infrastructure programs that maximise co-benefits may actually increase the pool of funding sources available.
While it may seem like an odd tact to take, it is really just appealing to familiar ‘wants’ in order to showcase the less-familiar – but ultimately greater – benefits living infrastructure provides.
Local governments can capitalise on opportunities for federal funding by designing living infrastructure projects in ways that maximise certain co-benefits. For example, designing bioswales with native plants may mean your innovative storm-water management strategy using living infrastructure could be eligible for a wildlife conservation grant from the state or federal government.
Making the most of government mandates
Australian government departments like to lead by example. By establishing mandates for government office requirements like energy efficiency, minimum daylighting, environmentally sustainable interiors and so on, government at all levels is helping move the benchmark for business-as-usual. The industry should take advantage of this and bid for government tenders to supply these benefits through living infrastructure. Use your data, sell them on familiar co-benefits and deliver on more.
Of course if you have blueprints for something new to market, you can go for an innovation grant too. All in all, it’s worth checking out the funding government can provide.
Consider a public-private partnership
A public-private partnership (P3) is a shared project between a government and one or more private sector partners. Under a P3, the private sector partner contracts to fulfil one or more traditional government functions like financing, delivery, operations and/or maintenance of public living infrastructure. This kind of arrangement is great for large scale projects – think community and precinct design where living infrastructure is integrated with other environmentally sustainable features like green building, renewable energy and shared transport solutions.
Local councils looking to have living infrastructure in their area should consider a P3 as it allows them to make major capital investments without having to dip too deep into public coffers or add stress to municipal debt by drawing in private capital.
The City of Melbourne’s Urban Forest Fund is an example of a P3 in practice. With $1.2 million in initial funding, the council aims to accelerate the greening of the Melbourne municipal area by providing financial support for privately owned or managed living infrastructure projects. The fund will match successful projects dollar for dollar.
“Approximately 75 per cent of the land within the City of Melbourne municipal area is privately owned or managed, so there is huge potential for the private realm to contribute more towards greening [the] city,” the city notes.
The City of Adelaide has a similar P3 in place. The Green City Grant Program is matching successful greening projects dollar for dollar (up to $10,000) for public-facing projects like green facades, planter boxes, and upgrades to existing verge gardens to help make the city a cooler and more attractive place.
It’s great to see local government actively recognising the community value of widespread urban greening.
Quoted in an article from the Australian Financial Review in June last year, Shahana McKenzie, CEO of the Australian Institute of Landscape Architects (AILA) called for the Australian government to recognise living infrastructure as an asset the way we do for grey infrastructure like roads, power grids and so on.
“This would enable local councils, state governments and federal governments to be able to look at and manage those assets as they would other capital assets, which would have a great impact in terms of how they can be maintained and operated,” she said.
A little government leadership goes a long way. By recognising living infrastructure as an official asset class, the government could help legitimise the sector and make funding projects a whole lot easier.