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Occupier and Capital Projects Thinks

Building to net zero: is the built environment sector waking up to its embodied carbon problem?

In May the long-awaited Environmental Audit Committee (EAC) report (Building to net zero: costing carbon in construction) was launched, which emphasised the importance of reducing emissions in the built environment if the UK is to meet net zero. The report succinctly highlights the problem that the UK currently faces:

"The UK built environment is responsible for approximately 25% of total UK greenhouse gas emissions. The UK has a legally binding target to reach net zero by 2050 and at COP26 the Government committed to achieving 68% reductions in carbon emissions by 2030. This is only eight years away. There is little government guidance as to how these targets are to be met by the built environment industry.1"

The report sets out some of the challenges and opportunities for the government to address the issue, including accounting methods, construction materials and procurement. But do these responses go far enough?

Given the EAC’s findings, but lack of regulation, why should organisations change now?

To date, government policy has focused entirely on operational emissions, namely, how to make buildings more energy-efficient2 . The embodied carbon (emissions primarily associated with materials and construction, and typically 40-70% of whole life carbon3 for a building), is not currently required to be assessed or controlled. As a result, little progress has been made in reducing these emissions within the built environment. ‘Put simply, if the UK [Government] continues to drag its feet on embodied carbon, it will not meet net zero or its carbon budgets.’ 4

Figure 1: Indicative building life cycle construction timeline

If a new building were to be commissioned today (Figure 1), it would need to go significantly beyond current regulation to be aligned with government net zero commitments. It is estimated that 80 per cent of buildings currently standing will still be in use in 2050: if the UK is to meet its net zero goals, the majority of these will require retrofitting to become energy efficient.5 Therefore, it is expected that the government will introduce regulation, which will impose significant costs to organisations who haven’t responded to net zero commitments.

What should organisations do until regulation keeps pace with ambition?

As public and private sector organisations grapple with fully understanding the scope of their emissions and responding to the challenges outlined above, there are some “quick wins” that organisations could focus on to accelerate their journey to net zero and ensure they are prepared for future regulation changes:

New build vs. refurbishment – is construction always the answer?

The greatest emissions saving starts with ‘build nothing’6 by challenging briefs and asking whether construction is the answer. If the answer is yes, then ‘build less’ through refurbishment or reassessing space usage should then be explored. Only if more space is really required should ‘build clever’ be adopted, using industry-leading design criteria and specifications (which go beyond government legislation).

Data-led Decarbonisation

Much better data is required in the built environment sector to empower better decision making. Understanding (operational and embodied) carbon emissions across real asset portfolios is key to their efficient management and decarbonisation. In the public sector, a good start has been made through the Net Zero Systems Tool as part of HMT’s shared outcomes fund, but greater cross-government collaboration is needed to make this a success.

Capital programmes to support energy transition

A faster transition to greener energy sources is required to significantly affect scope 1 and 2 emissions, with offsetting for those that cannot be avoided. Ensuring that operational emissions are significantly reduced in the construction process will also be important to meet net zero.

Driving sustainability through strategic asset management

Managing ageing asset portfolios in the UK has long been an economic problem, but a greater emphasis on the full lifecycle of asset management can provide significant additional emissions savings to aid the transition to net zero. This is predominately due to better decision making across lifecycle delivery.

Responsible procurement in real asset operations

Scope 3 emissions have historically been harder to reduce as often reach outside an organisation’s reporting mechanisms, but not beyond its influence. Moving emissions down the supply chain is a zero-sum game and worth acknowledging when the UK sets net zero objectives. Tackling Scope 3 emissions now would futureproof organisations from regulation change.

The EAC report has highlighted the challenges that lay ahead in achieving net zero and set out some proposals for government to consider. Whilst these regulations are likely to be implemented over the period of a few years, it is important for organisations to respond now in developing their plans for achieving net zero. Not only because it's the right thing to do, but if they don't, government regulation may impose significant costs to any existing built assets that do not deliver.