Extended building life cycle cost assessment with the inclusion of monetary evaluation of climate risk and opportunities

The buildings and construction sector account for a significant part of the total energy use and related greenhouse gas emissions. However, climate change mitigation often becomes secondary or completely disregarded in building design assessment as the primary concern of building owners are economic tenability. Therefore, this study introduces an Extended Life Cycle Cost Assessment that include monetary evaluation of climate risk and opportunities in terms of Social Cost of Carbon (SCC). SCC could function as a tax to promote climate change mitigation within e.g. the construction industry. The purpose is to provide a more holistic assessment approach that is easy to relate to if economic tenability is of primary concern in decision making, which can be used to assess building design. Return on invested greenhouse gas emissions is used as an additional or standalone indicator for climate change mitigation. The introduced approach is exemplified by a case study where renovation and new construction are compared with keeping buildings in its original design. The case study show that with or without a flat greenhouse gas tax, renovation is the most climate and cost efficient alternative.