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Estimate Costs to Implement Greenhouse Gas Mitigation Strategies for Business Travel

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Step 4

Once business travel reduction strategies have been identified, a Federal agency may evaluate the cost of implementing those measures and any potential savings from avoided travel.

The annual costs associated with reducing business travel may vary greatly by agency, program, and site depending on the current level of video conferencing and desktop collaboration solutions that are available between the organization's major travel destinations. This will be largely driven by whether the agency has to install or upgrade equipment or just make them more accessible and familiar to users. Strategies focused on policy and behavior change are less costly to implement than IT solutions, but are typically not enough to effectively reduce the need for travel.

The savings from avoided trips can be significant, and may very well outweigh the costs of any IT solutions in a short time. However, an agency's ability to repurpose travel funds for infrastructure and other travel demand management activities may be limited by budgetary policy. This should be considered when determining whether to account for savings from avoided travel.

Using the number of potential trips avoided from Step 3. Evaluate Greenhouse Gas Reduction Strategies for Business Travel, the agency can easily estimate financial savings:

Number of trips avoided * Average cost per trip = Total savings

Average costs specific to the agency, program or worksite should be used when possible; however the estimates in Table 1 below may be suitable for high-level planning purposes if specific costs are not available.

Finally, there are other factors that are not quantified in Table 1 below but can have important financial savings implications and other benefits. Video and desktop systems can support everyday work even when not a direct substitute for travel. For example, access to desktop collaboration tools may improve working productivity when there is frequent coordination with workers across various worksites. In addition to the benefits of video and desktop systems as every day collaboration tools, reduced travel can improve work/life balance for frequent travelers which may provide productivity and job satisfaction benefits.

Table 1 Types and Ranges of Initial Cost Requirements and Annual Operating Costs and Savings for Business Travel Reduction Strategies
Business Travel Strategy Key Cost Elements Key Savings Elements Initial Investment Annual Costs Annual Savings Assumptions
Web conferencing and webinars Software license cost
Maintenance including help desk support
Training in use of tools
Airfare, hotel, car rental, other expense savings from avoided travel
Labor savings from avoided travel time
$0 Variable; $500 on average Avg trip cost of ~$3000 X Number of trips avoided annually Annual single license fee for basic web conferencing software.
Average U.S. per diem = $285
Average U.S. airfare = $500 for airfare
Average trip length = 3 days
(source: Global Business Travel Association)
Average labor hours avoided = 12 hours (50% of time spent traveling)
Labor cost = $75/hr
Desktop collaboration tools with video Software license cost
Maintenance including help desk support
Training in use of tools
Airfare, hotel, car rental, other expense savings from avoided travel
Labor savings from avoided travel time
Highly variable Highly variable Avg trip cost of ~$3000 X Number of trips avoided annually See average trip cost savings assumptions above.
Videoconferencing and telepresence rooms: New rooms deployed onsite Videoconference suite set-up
Maintenance including technical support
Training in use
Airfare, hotel, car rental, other expense savings from avoided travel
Labor savings from avoided travel time
$5000-$50,000 (conventional) up to 300,000 (telepresence) $25,000-$50,000 Avg trip cost of ~$3000 X Number of trips avoided annually Wide range of start-up costs for video conferencing based on quality. High-end telepresence suites can average $300,000. Annual costs vary by use.
See average trip cost savings assumptions above.
Videoconferencing and telepresence centers: Rent nearby GSA or private centers as needed Videoconference suite set-up time
Training in use
Usage fee
Airfare, hotel, car rental, other expense savings from avoided travel
Labor savings from avoided travel time
  Varies based on use Avg trip cost of ~$3000 X Number of trips avoided annually Annual costs vary by use. GSA telepresence fee is $400 per hour per location.
See average trip cost savings assumptions above.
Double delivery: incorporate multiple objectives into a single trip Travel cost savings from avoided trips Avoided trips $0 $0 Avg trip cost of ~$3000 X Number of trips avoided annually See average trip cost savings assumptions above.
Ride-share with colleagues for ground travel No additional costs Fuel savings $0 $0 Miles saved* IRS mileage reimbursement rate  
Select centrally located destinations for conferences or large meetings Meeting costs if central location has higher per diem; potential difference in airfare Meeting costs if central location has lower per diem; potential difference in airfare $0 Varies Varies  

Table 2 below summarizes the types costs for supporting strategies for business travel reduction. Financial savings from these actions are indirect in that they may support but don't directly contribute to reductions in travel. Costs will be based largely on labor time to develop and deploy the strategies.

Table 2. Key Cost Elements of Supporting Strategies That Can Enable Business Travel Reduction
Business Travel Strategy Key Cost Elements
Create a cross organizational management team Management time to set and track goals
Create a travel reduction awareness and training campaign for employees Labor time to develop and deploy
Establish travel decision-making guidance Labor time to adapt existing decision-making resources
Incorporate sustainability into procurement and travel supplier selection process Labor time to establish criteria, modify contracts

To illustrate, Agency ABC estimates its cost of implementing four high-end videoconferencing rooms, desktop collaboration and video tools, some policy modifications, and a broad awareness campaign will require a $1.3 million investment and cost $300,000 per year, but will save up to $112 million per year in travel expenses by the time trip reduction targets are met in 2020.

Table 3. Estimated Travel Reduction Savings for Agency ABC
Strategy Reach Investment Annual costs (savings)
High-end video conferencing at 4 sites 4 sites $1,200,000 $200,000
Desktop collaboration w/ video 20% of employees in Programs A & B $100,000 $50,000
Awareness campaign Agency-wide $0 $50,000
Policy and decision-support changes Agency-wide $10,000 $0
Trip reduction savings (in FY2020) Agency-wide   ($111,825,000)

Next Step

After estimating the cost of implementation, the next step in GHG mitigation planning for business travel is to prioritize GHG mitigation strategies.

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