The built environment is the second-largest source of carbon emissions in the UK after surface transport, and as such, it is of paramount importance that we take action to decarbonise buildings to meet net zero targets. However, UK Green Building Council figures show that 80% of the buildings that will exist in 2050 have already been built. So why is so much of the built environment sector’s work to decarbonise buildings concentrating on building ever more new stock?
The challenge may seem daunting, especially as, despite many stakeholders’ hopes to the contrary, it is unlikely electrification by itself will create a path to net zero anywhere near quickly enough. But with environmental and regulatory challenges on the horizon – both affecting the market interest of tenants – it is important property owners and managers act now to decarbonise their property portfolios.
Fortunately, what may have once seemed an impenetrable challenge can be unlocked with technology, and with it, landlords and property managers can identify the most efficient and cost-effective ways to decarbonise their existing building stock.
To some, electrification was seen as a shortcut to decarbonisation. After all, the energy sector is rapidly increasing its capability to generate renewable energy, with a recent International Energy Agency report revealing that global additions to renewable power capacity are expected to jump by one third in 2023 alone. At least in theory, by electrifying existing building stock, the property industry can decarbonise at a stroke – replacing carbon-intensive gas-powered systems with alternatives running on green electricity.
The reality is unlikely to be so simple. A recent Regen report shows that the UK electrical grid will need more investment than it has received since the 1960s to meet net zero targets. That is without even addressing current capacity issues: the grid is already operating on the edge of its capacity and electrifying all current gas-fired operations in UK buildings would increase electricity demands by a factor of four.
Electrification may not be the answer then, but the economic and environmental pressures on the sector mean that an answer urgently needs to be found. Regulations, including the recent Minimum Energy Efficiency Standards (MEES), risk landlords and property managers who fail to take action on decarbonising their existing building stock being left with stranded assets, unable to rent or sell their properties without significant investment in decarbonisation.
Property owners can also expect to face increased levels of scrutiny and reputational damage for poor environmental performance. Particularly as the climate crisis remains front of mind for so many in the UK. The latest survey conducted by the Office for National Statistics reveals that climate change is the second-biggest concern facing adults in Great Britain, and that three out of four adults have made lifestyle changes to help tackle climate change. With investors, tenants and occupiers increasingly expecting properties to meet climate and social requirements, this could create a problem for property managers and owners with underperforming buildings.
Possibly the most challenging aspect of decarbonising existing building stock is that there is no single approach that will suit every property. But this challenge can be tackled using innovative digital building tools, parametric and comparative modelling, cloud technology, bespoke analysis and data visualisation.
Parametric tools generate thousands of different scenarios for improving energy efficiency in a building or across entire portfolios, allowing property owners or managers to identify the most efficient and cost-effective strategies to decarbonise, mapped against their specific goals and budget.
This approach can be particularly beneficial for property owners with a wide range of buildings within their estates to eke out the maximum carbon return for the budget available. Universities, for example, may need to make decisions that factor in both complex research laboratories and halls of residence. Data tools will enable them to make informed decisions about where they can make the biggest difference across their entire estate rather than having to rely on ‘gut feel’.
Going forward, these digital tools can also be used for continuing analysis. Such analysis will be vital as new regulations and technologies emerge, changing the roadmap to net zero. But by embracing the use of data tools, property owners can pivot to meet these emerging challenges or opportunities.
To create a built environment that is both environmentally and economically sustainable and that meets net zero targets, action to decarbonise existing buildings will be essential. In fact, it is arguably the most important step the industry can take towards achieving net zero targets. Thanks to the emergence of parametric data tools, efficient, cost-effective action on decarbonisation has been brought within reach. Now is the time for the industry to grasp the opportunity these tools present.
Martin Bissell is director and head of northern MEP at Ramboll