RICS New Rules of Measurement (NRM)

What can be measured can be evaluated, improved Lord Kelvin directed in short managed

Its application for costing sustainability

Presented by Andrew Green Director of Faithful+Gould

ECOBUILD Workshop

3rd March 2011

Andy Green
Technical Subject Matter Expert: BS ISO; 2008 15686-5 life cycle costing -service life planning PAS 55 Asset Management (ISO consultation member) Author and Chair of the Technical Committee BRE; 2005 Guide to achieving whole life value In buildings PB- 156865 SMLCC for construction procurement (2008) RICS NRM 3 New rules of measurement for maintenance BS 8544;2011 Guide for life cycle costing of maintenance CIBSE Guide M Maintenance task group HVCA - Vice Chairman SFG technical standards committee Best Innovation Award Winner 1997 and 2007 ECI - Exceptional Contribution Award 2007 Presented by Sir Michael Latham

ECOBUILD Workshop

3rd March 2011

Synopsis of this workshop

Introduction to the RICS New Rules of Measurement suite Road to whole life costing of sustainability / carbon accounting Importance of sustainability and carbon reduction commitments Barriers still to be overcome Other work currently being progressed - which will need to be standardised and simplified, so the industry can cost sustainability Government and cross industry initiatives CEN T350 Constructors Product Directive The RICS Costing sustainability initiative

ECOBUILD Workshop

3rd March 2011

The RICS New Rules of Measurement (NRM) Suite

Reinvigorate measurement as a discipline Address the (sometimes) strange attitude towards measurement at varying RIBA stages An historical disconnection between the cost plans measurement and in Bills of Quantities Inconsistent approach to the cost planning A lack of transparency and understanding of both capital and operational costs A lack of rules for LCC of maintenance works A lack of rules for costing sustainability

ECOBUILD Workshop

3rd March 2011

The RICS New Rules of Measurement (NRM) Suite

Why do we need NRM?
If you want to compare/ benchmark costs (at any level) then you have got to have measured to a common standard

Recommendations
Create a suite of measurement rules for the life cycle of cost management

ECOBUILD Workshop

3rd March 2011

The RICS New Rules of Measurement (NRM) Suite

NRM 1

SFCA
NRM/BCIS NRM/BCIS Standard Standard Form of Form of Cost Cost Analysis Analysis 4th Edition 4th Edition

NRM 3

Construction Construction Order Orderof of Costs Costs Estimating Estimating Construction Construction Elemental Elemental Cost Cost Planning Planning

Maintenance Maintenance Order Orderof of Costs Costs Estimating Estimating Maintenance Maintenance Elemental Elemental Cost Cost Planning Planning& & Tendering Tendering

Capital costs Capital works Refurbishment works costs

Through life costs Maintenance costs Renewals costs Inspection costs

Works WorksProcurement Procurement

Construction costs Construction costs Capital replacement costs Capital replacement costs

Works WorksProcurement Procurement

Maintenance Works Maintenance Works Measured Term Contracting NRM 2 Measured Term Contracting

NRM 2 & 2A

ECOBUILD Workshop

3rd March 2011

The RICS New Rules of Measurement (NRM) Suite

The rules have been written to provide a standard set of measurement rules that are understandable by all those involved in the cost management of construction projects Employers Project teams Cost managers

Part 1 Construction Works

Order of cost estimating; elemental cost planning

Part 2 Works Procurement

Construction work packages procurement

Part 3 - Maintenance Works

Order of cost estimating; elemental cost planning & procurement; inc. life cycle asset replacements

Addendums to the NRM Parts 1, 2 and 3;

Operations & Environmental

Order of cost estimating: elemental cost planning & procurement of Energy, Carbon, Water and Waste.

For more information contact www.rics.org/nrm

ECOBUILD Workshop

3rd March 2011

The RICS NRM Part 3 for Maintenance Works

What does it contain?
Common methodology & cost data structures - linked to NRM Part 1 - (Build, Maintain & Service Life Planning) Rules of measurement - for the LCC of maintenance Standard forms of cost reporting and analysis order of estimating, elemental cost planning and tendering Prioritisation and optimisation of the total maintenance and the cyclical asset investment programmes (1 to X yrs) Risks and uncertainty typical risks & mitigation plans Sources of information what information is required: record assumptions & exclusions; reference data available Appendices core definitions (GIFA/NIA), commonly used classification (functional units) and special use definitions; information requirements and standard estimating templates.

NRM Part 3 Maintenance

ECOBUILD Workshop

3rd March 2011

Alignment to the BS ISO 15686-5 and SMLCC

NRM Part 3 Maintenance

ECOBUILD Workshop

3rd March 2011

ISO 15686-5 & SMLCC WLC COST STRUCTURE

Clarifying scope and terminology

ISO addresses the confusion over scoping whole life costs and terminology regarding the difference between whole life cost (WLC) and life cycle cost (LCC)

Note Occupancy costs included in non construction costs in BS ISO 15686-5

ECOBUILD Workshop

3rd March 2011

UK Cost Data Structure for Life Cycle Costing

Maintenance Maintenance(RICS (RICSNRM3 NRM3and andBS8544) BS8544) 2.1 2.1Routine RoutineServicing Servicing& &Maintenance: Maintenance: - -Planned tasks, including Planned tasks, includingminor minorrepairs repairs - -Reactive (first line/ unscheduled) Reactive (first line/ unscheduled) - -Proactive Proactive(tours/ (tours/monitor/ monitor/inspections) inspections) - -Redecoration Redecoration(optional (optionalinclude include2.3) 2.3) 2.2 2.2Condition Conditionand andwider widerAsset AssetReviews Reviews and Maintenance Management and Maintenance Management - -Asset Assetreviews reviews(condition (condition/ /other otherfacets) facets) - -Maintenance Maintenanceand anddata datamanagement management 2.3 2.3Life LifeCycle CycleAsset AssetInvestment Investment - -Major replacement Major replacementworks worksprogrammes programmes - -Upgrades (e.g. energy efficiency Upgrades (e.g. energy efficiencyetc) etc) 2.4 2.4Client ClientDefinable DefinableOther OtherElements: Elements: - -Refurbishment and adaptation Refurbishment and adaptationcosts costs - -Client definable costs i.e. churn, Client definable costs i.e. churn,fees, fees, capital allowances; asset depreciation etc capital allowances; asset depreciation etc

ECOBUILD Workshop

3rd March 2011

Aligned with NRM/ BCIS and to CIBSE Guide M

NRM / BCIS
Standard Form of Cost Analysis NRM Part 3 Maintenance 4th Edition In Q2 2011 (NRM aligned for construction)

ECOBUILD Workshop

3rd March 2011

CIBSE Guide Economic Service Life Planning

Description Heating Source Boiler Plant Boiler Unit Shell and tube boilers (steam and hthw) W ater tube boilers (steam and hthw) Electrode/electric boilers (steam and hthw) Shell and tube boilers (mthw/lthw) W ater tube boilers (mthw/lthw) Electrode/electric boilers (mthw/lthw) Cast iron sectional boilers (mthw/lthw) Steel boilers (mthw/lthw) Condensing boilers (mthw/lthw) Modular boilers Domestic boiler - condensing Domestic boiler - combination Domestic gas fired boilers Burner Force Draught Gas Burner Atmospheric Burner Oil burners (pressure jet) Solid Fuel Burner W ater Heater Electric W ater Heater Instantaneous W ater Heater Unvented Storage Heater HW S Cylinder (domestic type) Gas Fired W ater Heater Solar Panel / Solar Thermal Calorifier & Heat Exchangers LPHW Calorifier LPHW Calorifiers - Copper LPHW Calorifers - Mild Steel Steam calorifier Steam Calorifiers - Copper Steam Calorifers - Mild Steel Heat Exchanger Heat Exchanger - Shell and Tube Heat Exchanger - Plate Evaporator Evaporator - Shell and Tube Evaporator - Coil Direct Expansion Trace Heating Cooling Source Chiller / Refrigeration Plant Packaged Chiller Centrifugal chiller Reciprocating chiller Screw chiller Absorption chiller Blast Chiller Service Life BCIS Code HVCA SFG 20 Ref

Maintainable Assets
20 25 25 20 25 25 25 20 20 15 15 10 10

Build Code Service Life Expectancy

15 20 15 15 12 8 12 30 12 25 5E 5E 5E 5E 5E 5E 5E 5E 5E 5E 5E 5E 5E 5E 5E 5E 5E 5D 5D 5D 5D 5D 5D 05-19; 05-19; 05-19; 05-14; 05-14; 05-21; 05-14; 05-14; 05-04; 05-11 05-23; 05-29; 05-28; 05-20 05-20 05-20 05-23 05-23 05-22 05-23 05-23 05;10;05-12; 05-13

PPM Tasks
05-30

05-(10-12); 07-03 05-(03-04); 07;01 05-13; 07-(04-07) 05-(25-27) 32-15 32-14 32-09; 32-13 32-15 32-13 53-01

25 20 25 20 25 15 20 20 20

5D 5D 5E 5E 5E 5E 5F 5F 5D, 5E, 5F

32-(05-07) 32-(05-07) 32-(05-07) 32-(05-07) 32-(05-07) 29-(06-07) 19-01 19-01 40-03

Including Task Times & Skilling

20 20 25 25 20

5F 5F 5F 5F

09-02; 09-02; 09-02; 03-04;

12-03 12-01 12-02 09-05

ECOBUILD Workshop

3rd March 2011

RIBA Work Stages

Life Cycle Applications of NRM RIBA Plan of Works

Preparation A Appraisal Build, Maintain & Replace Order of Cost Estimates 1 1

RICS Cost Estimating, Elemental Cost Planning and Tender Document Preparation Stages

OGC Gateways (Applicable to Projects)

Business Justification

Design Brief

Build, Maintain & Replace Order of Cost Estimates 2 2 Delivery Strategy

OGC Gateways

Concept

Build, Maintain & Replace Elemental Cost Plan 1 3A

Design

Design Brief and Concept Approval

Design Development

Build, Maintain & Replace Elemental Cost Plan 2

Technical Design Build, Maintain & Replace Elemental/Tender Cost Plan 3 3B Detailed Design Approval

F Pre-Construction

Production Information

Tender Documentation

Work Package Tender Costs (Quantified) PPM Task Schedules (Quantified) LCR Work Schedules

Tender Action

Post Tender Costs Elemental Cost Plans - 4 3C Investment Decision

Construction

Mobilisation

Construction to Practical Completion

As Built Applicable maintainable asset tasking & service life plans 4 Readiness for Service

Use

Post Practical Completion

Servicing & Maintenance Plans; and /or LCR works programmes

ECOBUILD Workshop

Operational Review and Benefits Realisation

3rd March 2011

BS 8544 Guide for LCC of Maintenance

BS 8544;2011 Guide for Life Cycle Costing of Maintenance - during the In use
phases of buildings & constructed assets

Business Outcomes focused, for LCC of maintenance during the in use phases Integrated process for: agile life cycle planning, budgeting and delivery of maintenance and life time asset investment, sustainably! Practice guidance on how to: 1 Set Functional Maintenance Standards 2 Understand the impact of funding and not funding maintenance (FCI risk profiling) 3 Prioritise and optimise actual spend .v. business needs/wants, risks & budgets 4 Inform wider decision making (i.e. estate rationalisation; sustainability agenda etc)

ECOBUILD Workshop

3rd March 2011

Road to WLC costing of sustainability & carbon

Importance of sustainability and whole life carbon accounting
Achieving the Climate Change Act targets is driving the need for carbon reduction. Properties are the largest source of CO2 around 47% so improving energy efficiency and reducing carbon emissions is a priority for the built environmental sector. As more and more CO2 is driven out of operational energy use, the embodied carbon built into a new or refurbished properties will take a much greater significance.

Barriers still to be overcome:

1. 2. 3. 4. 5. 6. Currently embodied carbon accounting is in its infancy! Major problem of complexity and confusing language + uncoordinated research initiatives Industry structure and cultural divides procured on lowest capital cost not best whole life value! No standard methodology for costing sustainability - hence results are not comparable Need for clear leadership to drive cross industry efficiency and reform of its working practices Need for UK plc business case, based on a transition plan and incentivisation to make it happen!

ECOBUILD Workshop

3rd March 2011

(Excluding Disposal)

ECOBUILD Workshop

3rd March 2011

Costing Sustainability is Complex

Climate Change Act 2008: 34% reduction by 2020 80% reduction by 2050

Part L - improvement in building regulations Code for Sustainable Homes mandatory (RSLs) BREEAM mandatory (Government) Zero carbon building targets Homes by 2016 Schools by 2016 Non domestic by 2019

EPCs / DECs now mandatory (October 2008) On site renewables targets: PPS1 10%; PPS 22 Carbon Reduction Commitment (April 2010) Creation of a climate change department (DECC) Site Waste Management Plans mandatory (Landfill Tax) Local Authorities: Local area agreements (N185 & N186) Strategy for Sustainable Construction Sustainability Commitments (Cross industry champions)

ECOBUILD Workshop

3rd March 2011

CO2e whole life carbon accounting (simplified case study)

CO 22 CO CO 22 CO

Embodied carbon: Operational carbon: CO2e emissions during operation CO2e emissions during manufacturing of building materials and on-site construction
ECOBUILD Workshop

3rd March 2011

Stage 0 - Baseline building

4 storey, square, concrete frame, 40% glazing, air conditioned, 8400m2
TOTAL CARBON = 742t (tonnes per annum) Operational carbon = 416t

Embodied carbon = 327t

CONSTRUCTION COST

ENERGY COST 0%

LIFECYCLE R COST 0%

1,734 / m2

Workshop 19 / ECOBUILD m2 / yr

23 / m2 / yr 3rd March 2011

0%

Stage 1 Building Form, Orientation and Ventilation

TOTAL CARBON = 656t (tonnes per annum) Operational carbon = 328t
Simple model Skin Rotated One side tapered Both sides tapered

Base case

-6.9%

+7.2%

+/-4%

-8%

Embodied carbon = 329t

CONSTRUCTION COST

1,701 / m2

2%

ENERGY COST

Workshop 17 / ECOBUILD m2 / yr

15%

LIFECYCLE R COST

10 / m2 / yr 3rd March 2011

58%

Stage 2 Solar shading and envelope improvements

Reduce glazing to 25% of faade + incorporate shading
Reduce glazing to 25% of faade High performance glass Introduce shading Temperature relaxation 2oc Improve air tightness U Values by 20% Increase insulation Thermal mass Embodied carbon = 331t TOTAL CARBON = 616t (tonnes per annum) Operational carbon = 286t

CONSTRUCTION COST

1,703 / m2

2%

ENERGY COST

Workshop 16 / ECOBUILD m2 / yr

19%

LIFECYCLE R COST

10 / m2 / yr 3rd March 2011

58%

Stage 3 Systems Optimization, Controls + Efficient Lighting

High efficiency LED fittings: Presence detection Time and daylight linking
TOTAL CARBON = 592t (tonnes per annum) Operational carbon = 260t

Presence detectors

Time switches

Twilight switches

Embodied carbon = 332t

CONSTRUCTION COST

ENERGY COST 0%

1,730 / m2

Workshop 14 / ECOBUILD m2 / yr

28%

LIFECYCLE R COST

10 / m2 / yr 3rd March 2011

58%

Stage 4 Biofuel Boiler + PV Panels

Closing the gap Renewable Technologies
Offset carbon emissions through the use of renewable technologies
TOTAL CARBON = 535t (tonnes per annum) Operational carbon = 202t

Embodied carbon = 333t

CONSTRUCTION COST

ENERGY COST 3%

1,793 / m2

Workshop 11 / ECOBUILD m2 / yr

43%

LIFECYCLE R COST

13 / m2 / yr 3rd March 2011

42%

Stage 5 Embodied Carbon Reduction

20% Recycled Content + Use of Prefabricated Materials Recycled Content Partial replacement of cement with fly ash Use of Bubble-Deck flooring system
TOTAL CARBON = 488t (tonnes per annum) Operational carbon = 202t

Embodied carbon = 287t

CONSTRUCTION COST

ENERGY COST 3%

1,793 / m2

Workshop 11 / ECOBUILD m2 / yr

43%

LIFECYCLE R COST

13 / m2 / yr 3rd March 2011

42%

Construction, Life Cycle and Energy Costs (Informative)

ECOBUILD Workshop

3rd March 2011

Construction, Life Cycle and Energy Savings (Informative)

Summary of Resultant Savings (over 25-year period)

Project Solution Baseline Total Cost Stage 5 Total Cost Total Savings Total Savings (%)

Financial () 26,223,343 21,137,483 5,085,859 19%

Carbon (tonnes) 18,560t 12,209t 6,351t 34%

ECOBUILD Workshop

3rd March 2011

Other work currently being progressed

CEN T350 Constructors Products Directive PAS 2050 Product standards for assessing greenhouse gas emissions The Green Property Alliance Metrics for carbon, energy, water and waste TSB Projects Tools for Influencing Low Carbon Design / Decision Making Carbon databases and industry tools ICE data and SBEM models etc RICSs Costing sustainability initiative NRM addendums for Operations and Environmental Governance support/ steer to the response to the industry call Cross industry collaboration (3 working forums)

ECOBUILD Workshop

3rd March 2011

Carbon Critical Costing (80/20) - by Functional Types

ECOBUILD Workshop

3rd March 2011

Green Property Alliance (GPA) has addressed

the need for greater consistency and clarity in the way in which the sustainability performance and the wider property portfolio is measured and reported upon. Industry wide sustainability ground rules:

1 Determined a common methodology and metrics for Energy, Carbon, Water & Waste 2 Mechanisms for classifying building types and norms of operation 3 Practical methods of assigning responsibilities for measuring and reporting resource used in rented buildings 4 Practical methods of normalising resource use

ECOBUILD Workshop

3rd March 2011

The RICS New Rules of Measurement (NRM) Suite

The rules have been written to provide a standard set of measurement rules that are understandable by all those involved in the cost management of construction projects Employers Project teams Cost managers

Part 1 Construction Works

Order of cost estimating; elemental cost planning

Part 2 Works Procurement

Construction work packages procurement

Part 3 - Maintenance Works

Order of cost estimating; elemental cost planning & procurement; inc. life cycle asset replacements

Addendums to the NRM Parts 1, 2 and 3;

Operations & Environmental

Order of cost estimating: elemental cost planning & procurement of Energy, Carbon, Water and Waste.

For more information contact www.rics.org/nrm

ECOBUILD Workshop

3rd March 2011

Embedding O&E Metrics within the NRM Standards

EMBODIED OPERATIONAL
Order of Cost Estimating Construction Elemental Cost Planning Procurement

Part 1 NRM Addendum

Replacement

Pt 2 NRM Add Pt 2 NRM Add

Part 1 NRM Addendum

Operation
Performance of buildings Wider portfolio measures

Green Property Alliance Metrics

Including classification of building types and norms of operation

Maintenance

Part 3 NRM Addendum +Ops/Environmental

Environmental
Occupancy (property) Disposal / End of life

Green Property Alliance Metrics

Including use of the IPD environment code; Global reporting indicators

ECOBUILD Workshop

3rd March 2011

RICS New Rules of Measurement (NRM)

Road to costing sustainability and whole life carbon accounting

Why this is very importance? (3Rs) Regulation; Reputation & Responsibility

For more information contact www.rics.org/nrm

ECOBUILD Workshop

3rd March 2011