A methodology for evaluating energy efficient office refurbishments as life cycle investments

Purpose – The purpose of this paper is to present a methodology to improve decision making about investments that reduce buildings' energy consumption. Design/methodology/approach – A three‐stage methodology was developed and tested to analyse an existing Australian office building's energy use, its energy rating, and its life cycle investment. In total, seven cases of sets of improvements were modelled for energy performance. Their investment value was evaluated using a life cycle‐based analysis across several investment options. Findings – A holistic approach to investment shows that the most effective sustainable refurbishments need not be the most expensive. Optimised investment can take advantage of the timing of both re‐investment in component renewal and efficiency gains from the refurbishment. Furthermore, relatively small changes in income can offset capital expenditure for refurbishments and protect against obsolescence. Originality/value – Much work on sustainable refurbishments rarely considers the investment basis, across a life cycle, of that expenditure, generally seeing them as a cost and rarely considers the optimal time for that expenditure in the asset life cycle. This paper addresses both concerns.