MCGM mulls tax relief for Mumbai's Green buildings

In a bid to encourage eco-friendly construction in Mumbai, the city's civic authorities are actively considering a proposal to offer a 20 percent discount on property tax to certified green buildings in Mumbai.

According to informed sources, top officials of the Municipal Corporation of Greater Mumbai (MCGM) are in talks with the Indian Green Building Council (IGBC), the country's leading green ratings agency to discuss the modalities of the proposal that will offer the property tax discount to both developers and residents of such projects with the objective of spurring demand for such environment-friendly, energy-saving projects in the city.

Confirming the move a senior official of the IGBC revealed that while the exact quantum of the discount to be offered to developers and residents of green buildings was still being worked upon, the civic body (MCGM) was serious about implementing the proposal in view of its likely impact in promoting eco-friendly construction in the city.

While this would be the first concrete step taken by the city's civic body in this direction, other cities and states like Noida, Chandigarh and West Bengal have already taken a lead in encouraging the construction of such projects by offering developers various incentives including an additional space index of approx 5-10 percent, a move which has paid rich dividends by way of increasing the number of Green projects in these areas.
 
What is a Green Building?
A Green building refers to both a sustainable structure and the use of processes that are environmentally-responsible and resource efficient throughout the building's life-cycle from design to demolition. In other words, green building design involves finding the balance between building a home and the sustainable environment.

By definition, a green building uses less water, optimizes on energy efficiency, conserves natural resources, generates less waste and provides healthier spaces for its occupants, in comparison to a conventional building.

As per data available with the Indian Green Building Council, India's green footprint has grown from approx 20,000 sq ft in 2003 to over 3 billion sq ft of registered and certified projects this year spread across various tier I, II and III towns and cities of the country.

A list that includes: the Mumbai Metropolitan Region (MMR), the Delhi National Capital Region (NCR), Bangalore, Chennai, Hyderabad, Pune, Kolkata, Bhubaneshwar, Vadodara, Thiruvananthapuram, Kochi, Vishakhapatnam, Aurangabad, Nagpur, Nashik and Dehradun among other cities.

Of this, Mumbai's share is a whopping 20 per cent, or 600 million square feet of green projects, sans any significant incentives or exemptions from the government. The Mumbai Metropolitan Region has emerged as the top green destination with close to 100 Green buildings, followed by Chennai (70-odd buildings) and Pune (approx 60 green buildings). The industry expects the next decade to witness further green and sustainable development especially across Tier I and II cities in India.

India also features among the Top Three countries in a list of the top 10 counties in the world by the US Green Building Council (USGBC) for LEED outside of the US. The Leadership in Energy and Environmental Design (LEED) certification, an globally recognized standard for measuring a building's carbon footprint, is now an accepted and acknowledged practice in India.

The Green building concept has been gaining prominence in India with an increasing number of initiatives, primarily by the Indian Green Building Council (IGBC)—a division of the Confederation of Indian Industry (CII) - striving to impart knowledge offering advisory services to the industry on environmental aspects and practices for green buildings, energy efficiency, water management, renewable energy, green business incubation and climate change activities. 

The Way Forward:
Although it is easier for new and under construction buildings to adopt green technology, existing establishments can also employ several initiatives to improve their environmental performance.

According to industry experts, Green office spaces which are 20-30 per cent more efficient in the use of water and energy than conventional offices, account for approx 200mn square feet in the country today, with the 10 major cities accounting for a major chunk of green realty.

A typical 100,000 sq ft green office building is likely to save the occupier nearly INR 30-40 lakh p.a in energy savings alone, while savings in the water bill could be close to half this amount. Not surprisingly, rentals commanded by offices in certified green project are approx 2-3 percent higher than conventional commercial space, as per a survey conducted across seven major cities.