Estimate Costs to Implement Greenhouse Gas Mitigation Strategies for Employee Commuting
For greenhouse gas (GHG) mitigation, once a Federal agency identifies the employee commute alternatives and supporting strategies that will most effectively reduce trips to the worksite, costs of encouraging adoption of those methods can be estimated.
The annual costs of commute trip reduction programs can vary greatly by worksite. This section outlines types of costs that might be incurred by an agency as well as savings and other benefits of commute trip reduction to an agency, its employees, and the communities surrounding its major worksites. It includes:
Employer Costs and Benefits
Estimates of costs and savings specific to an agency and worksite should be used when possible however the guidance in Table 1 below may be suitable for high level planning purposes if site-specific costs are not available. Some of the key questions to consider that will affect overall budget include:
Will the agency charge for parking? This can help recoup costs.
Can the agency reduce the need for parking, thus reducing parking costs?
Will subsidies or financial incentives be provided?
Is there a need to construct new facilities, such as showers for bicyclists and walkers?
What is the agency's level of readiness to accommodate higher levels of teleworking?
Can the agency leverage existing regional transit services, such as ride-matching and guaranteed ride home, or is there a need to coordinate those internally?
How much staff time will be required to administer the program at the worksite level? For more information, see the Employee Transportation Coordinator Handbook from the Washington Department of Transportation.
Will adoption rates of alternatives work arrangements be significant enough that the agency can reduce total floor space via hoteling, hot desk, or desk sharing solutions?
Telework costs in particular will vary significantly depending on agency and worksite readiness to support teleworking. In order to estimate the cost of scaling up teleworking infrastructure to support 25% to 50% of the workforce, the agency should determine whether they have the necessary home office infrastructure (e.g. PC/software support, peripheral support), service components (e.g. data and voice communications, help desk support), and enterprise components (e.g. secure network access, collaboration resources) in place. For more information, see the Telework Cost Study by the General Services Administration.
The agency's Telework Coordinator can help determine the agencies readiness level to increase telework use at targeted worksites and across the agency, as teleworking may be the most viable option for workers in rural locations.
Table 1. Types and Ranges of Initial Cost Requirements and Annual Operating Costs/Savings for Commute Reduction Strategies
|Telework technology support||Vary widely based on agency readiness and level of support provided to user. A GSA 2006 study showed an annualized total cost per user ranging from $310 to $5,420. See GSA Cost Per Person Model to develop customized estimates costs and savings from teleworking.|
|Telework employee training||Initial cost:
Operating costs: $0
|Telework centers||Cost per square foot to lease telework centers varies widely by location. In DC area, agencies have paid GSA $72 per day per employee using a telework space.|
|Facilities and infrastructure improvements||Initial costs:
Operating costs: General building maintenance costs
|Floor space reduction and reconfiguration (e.g. hoteling, hot desking, desk sharing)||Savings will vary based on real estate value, extent of space saved and scale of space redesign.
Operating costs: $0
|Worksite-level ETC||Initial costs: $0
Operating costs: Approximately 25% time of coordinator at major worksites, if position not already established
|General promotional activities and outreach||Initial cost: $0
Operating costs: Cost of print materials. Labor included in ETC cost
|Direct subsidies and travel allowances||Initial costs: $0
Operating costs: Vary. Agency may subsidize all or pay a proportion of transit pass or vanpool expenses. Under Federal tax code, employees can receive up to $105/month in tax-free transportation benefit for vanpools and transit.
|Rewards and other incentives||Initial costs: $0
Operating costs: Can vary but minimal required for periodic rewards (e.g. $100 gift certificate for a monthly raffle)
|Guaranteed ride home||Initial costs: $0
Operating costs: $1.69 average cost per registered commute (source: 2007 Federal Transit Administration study)
|Parking management||Initial costs: Minimal cost to identify preferential parking areas
Operating costs: $0
|On-site services||Initial costs: May vary depending on type of service, but may be no cost to the agency
Operating costs: Typically none
|Commuter information resources||Initial costs: $100-200 for commute information board.
Operating costs: $0
|Shuttle bus service||Initial costs: May be cost for route planning activities
Operating costs: $75 per vehicle hour for contracted shuttle service
Commute Trip Reduction Savings to the Employer?
Savings to the employer from commute trip reduction programs are primarily associated with parking. However, if enough workers adopt alternative work arrangements the agency may also be able to reduce total facility floor space allocated for office space.
Parking savings: For agencies that subsidize parking, direct savings may be realized from parking pricing strategies that agency reduce the value of the subsidy. A reduction in parking demand does not always create near term savings however there are generally opportunity costs to maintain such spaces in the long run. For example, reducing parking demand may enable the worksite to avoid adding parking to accommodate growth, to lease space to other users, or use that space for other purposes (e.g. buildings, converted to green space). (see VTPI study)
Office space savings: With high adoption levels and well-managed scheduling for employees using alternative work arrangements, the agency may be able to reduce floor space through alternative office arrangements such as hoteling, hot desking, and desk sharing. (See GSA Alternative Work Space Solutions). Case studies from industry have shown these financial savings can be significant. Achieving these will require the cooperation of many stakeholders including senior managers, IT, human resources, facilities & operations, and employees.
To estimate implementation costs to the worksite, it is recommended that the agency bundle the activities required to achieve the projected commute trip reductions and cost them as a program of activities (e.g. telework program, carpool program). This enables both total costs and GHG reduction impacts to be linked to a specific commute trip reduction program, and the cost effectiveness of those programs to be compared in Step 5., Prioritize Greenhouse Gas Reduction Strategies for Employee Commuting. For overarching strategies that support multiple commute reduction efforts, such as a guaranteed ride home program and worksite-level employee transportation coordinator support, the worksite may roughly apportion those costs across the commute methods that benefit from them.
For example, at Agency ABC's worksite, B2, it was determined that telework, compressed work week, carpool, bus, vanpool, bicycle and walk are all important commute alternatives to encourage at some level. The estimated cost of establishing two of those programs are summarized below based on the key elements required for success. The program to increase the number of teleworkers by 1,000 is estimated to cost $350,000 initially, primarily to equip teleworkers to work from home. Annual costs are offset to some extent by the reduced need for leased space as that agency creates a hoteling arrangement for frequent teleworkers. The annual cost/savings estimate does not account for potential savings from increased productivity and reduced absenteeism as are often cited in telework case studies.
In another example, the program to increase the number of carpoolers by 200 employees has a direct investment of just $2,000 and an annual cost of $16,788 per year, including savings from being able to give back 50 parking spaces to the building owner.
Table 2. Cost of Select Commute Reduction Program Elements at Worksite B2
|Commute Alternative||Key Program Elements||Investment||Annual Cost (Savings)||Assumptions|
|Telework||IT||$250,000||$200,000||250 of 1000 new teleworkers require new hardware @ $1000; annual license for voice/data access for all @ $200/person|
|Training||$100,000||$0||All require one-time training @ $100/hr. Leverage existing GSA training resources.|
|Space support||$0||$(92,000)||Twenty 230-SF office spaces will be reduced through office sharing @$20/SF.|
|General admin and outreach||$0||$39,000||25% time of worksite telework coordinator @ $75k/yr|
|Carpool||Guaranteed ride home||$0||$338||Average cost per registered participant of $1.69 x 200 participants|
|Ride-matching support||$2,000||$8,500||Employer ride-match website development cost. 10% of ETCs time @$75k/yr for support.|
|Rewards/incentives||$0||$2,400||$200/month of gift certificates|
|General admin and outreach||$0||$11,250||1 month of coordinator's time + materials|
|Parking supply reduction||$0||$(12,500)||$500/year x 50 spaces reduced|
|Parking price subsidy||$0||$12,000||$10/month discount x 100 cars|
Employee Benefits and Costs
Agency efforts to reduce employee travel to their worksites can benefit employees in a number of ways. These should be communicated to employees as part of awareness campaigns at the worksite.
Increased travel and work options – Having alternative commute methods and work schedules available is considered a valuable benefit for many employees.
Reduced travel costs – Commuters reducing SOV trips can save on gas and general wear and tear on personal vehicles. Each mile avoided in a SOV vehicle due to use of telework or an alternative commute option can represent an average cost savings of $0.585 per mile travelled (source: AAA). Furthermore, the employee may benefit by the amount of any direct financial subsidies for biking, walking, or ridesharing.
Increased personal time – Carpool, vanpool and transit passengers can read, work, or socialize with other travelers.
Health benefits – Bicyclists and walkers get the benefit of exercise during their commute. Transit riders can benefit from reduced stress associated with driving in heavy traffic.
Reduced commute time – Commute times may be shorter in locations with traffic congestions and high occupancy vehicle lanes.
Employees may also incur additional costs as a result of the programs put in place at the worksite, including parking costs, if parking fees are increased. Depending on the worksite, some alternative commutes could result in longer travel time for the employee as well.
Community Costs and Benefits
The community can also benefit from agency efforts to reduce commuting in single occupancy vehicles. Benefits can include:
- Roadway maintenance and traffic service cost savings
- Congestion reduction
- Reduced parking facility requirements
- Emissions reduction
- Increased revenue resulting and operational efficiency of transit from increased participation in public transit.
- Step 1
Assess Agency Size Changes
- Step 2
Evaluate Emissions Profile
- Step 3
Evaluate Reduction Strategies
- Step 4
Estimate Implementation Costs
- Step 5
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