Financial Sustainability as a Metric for Infrastructure Projects

Various sustainability rating systems have been developed to provide an objective framework for assessing infrastructure projects. Examples include civil engineering environmental quality assessment and award scheme (CEEQUAL), Greenroads, Envision, infrastructure voluntary evaluation sustainability tool (INVEST), and infrastructure sustainability (IS). These rating systems aim to help the construction industry identify and quantify sustainable approaches that are beneficial to infrastructure projects. Most of these infrastructure rating systems have their origins in the rating systems developed for evaluating commercial buildings, such as building research establishment environmental assessment methodology (BREEAM), leadership in energy and environmental design (LEED), green globes, and Energy Star, which poses a few challenges when these types of tools are applied to broader infrastructure projects. Of most significance is the lack of a financial sustainability metric within the tools. This is understandable: buildings generally have a well-defined and relatively short service life for revenue generation, clear redevelopment options to perpetuate the real property value, and few long-term liabilities or legacy issues (e.g., pollution potential). However, other infrastructure projects have much longer service lives and are even expected to remain viable over an indefinite post-service period long after revenue generation has ended. This paper presents a review of sustainability metrics used by various infrastructure rating systems and compare their advantages and disadvantages. Thereafter, the paper discusses the need to engage and encourage decision makers to invest in more sustainable approaches for developing large infrastructure projects with very long term service and post-service lives by including a financial metric to existing rating systems. Finally the paper discusses a few financing options which could help the construction industry transition to more sustainable design approaches while simultaneously protecting their return on investment.