According to Visual Capitalist, 69% of retail investors were interested in ESG (investing which prioritizes environmental, social, and governance factors) in 2020, a huge increase from 19% in 2015. As the focus on the environment has grown and changed public sentiments, many businesses have adopted environmental sustainability targets. Some are working on their eco-friendly image; others are trying to achieve carbon neutrality. However, most of the participants in the green movement are still interested in making a profit. And it looks like a balance of nature conservation and profit-making is achievable.
In global experience, a green elevator is no longer just a trendy buzzword, but an environmentally friendly alternative to the conventional vertical transportation system — a modernized version of an elevator.
Typically, it uses an energy efficient pulley system and a regenerative drive, which directs the generated energy back into the electrical network, where it can be used to power other systems inside the building. Green elevators are also equipped with a smart control system that adjusts lighting depending on the operation of the hoisting mechanism. Ventilation is switched off automatically on standby, which also reduces energy consumption.
Management companies can lower energy drain even more by installing energy-efficient ceilings with LED lights. One LED light has the capacity below 14 W while fluorescent lamps spend 30–70 W.
A typical elevator emits 2 tons of carbon dioxide every year. Our calculations show that installing a green elevator can curb emissions by 1 ton per year, or reduce the environmental damage by half. Therefore, eco-friendly elevators can significantly improve the quality of life in a city because buildings are responsible for almost 40% of the CO2 emissions in the world.
Advantages do not stop here as green elevators can also change the market value of a building itself. By having eco-friendly equipment, the building owner becomes eligible for international sustainability certificates LEED and BREEAM. The certificates confirm that a building uses eco-friendly materials and renewable energy to save resources. In Russia, a property that complies with international environmental standards can be sold or rented out for at least 10% more.
This factor is even more important in foreign countries. Selling or renting out a green facility is much easier, to say nothing about its market value that can be 30% higher than the standard price. Tenants also seek out eco-friendly spaces. According to the International Finance Corporation, green facilities find occupants 23% faster than non-complying office buildings.
The LEED and BREEAM certificates can be as important for some international companies as the rent amount and location. For example, Deutsche Bank is only interested in LEED-certified offices.
Therefore, equipping a residential or a commercial property with eco-friendly elevators reduces emissions and increases the building’s market value. Companies that opt to buy or lease green buildings are willing to pay 10% above the market rate and more. An eco-friendly elevator also pays off much faster thanks to lower expenses.
Green technology and its advantages make the market an attractive investment. According to Allied Market Research, between 2019 and 2026, the global green technology and sustainable development market will grow more than five times, from $8.8 to $48.4 bln, its annual growth rate exceeding 24%. Green construction will eventually become the largest segment of this market. Complying with environmental standards will, obviously, lead to extra construction costs but subsequent low operation expenses should provide a quick payoff.
The energy-efficient elevator market in Russia is developing slowly but it has great potential in terms of green technology implementation and, therefore, higher quality of life. Consumers’ insufficient awareness of existing green technologies and their positive impact still creates obstacles for the development of this sector. The demand for eco-friendly materials and energy-saving solutions from Russian customers is currently only occasional — unlike in other countries.
By Kenneth Lindgren, Managing Director, KONE Russia