World Green Building Week and the campaign for net zero buildings

Aktiv-Stadthaus, a net zero residential building in Frankfurt, Germany of 11,700 m2, built in 2015.

It was World Green Building Week last week, with Green Building Councils from across the world campaigning for all buildings to be “net zero” by 2050.

Originally published on The Fifth Estate.

The week promoted the aspirations of the World Green Buildings Council's (WGBC) report earlier this year, From Thousands to Billions – Coordinated Action towards 100% Net Zero Carbon Buildings By 2050, which calls for a dramatic and ambitious transformation towards a completely zero carbon built environment.

The aim is for all new buildings to be operating at net zero carbon from 2030. The WGBC advocates that net zero carbon buildings must become standard business practice as soon as possible, to avoid the need for future major retrofits and prevent the lock-in of carbon emitting systems for decades to come.

It wants to see not just an acceleration of current renovation rates, but these renovations to be completed to a net zero carbon standard so that all buildings are net zero carbon in operation by 2050.

Image: Canada Green Building Council

The route to net zero

Ten national GBCs are already working with stakeholders in their markets to create or adopt voluntary net zero carbon building rating systems and support training. These include Australia, Brazil, Canada, Germany, India, Netherlands, South Africa, and Sweden, and UK.

Each national council is developing a program suitable for their markets, and each will respect the following principles:

1. to use carbon as the key metric
2. to promote deep energy efficiency
3. to establish a hierarchical preference for onsite renewable energy, off-site renewable energy, and then offsets
4. to transparently disclose how each building achieves a carbon balance and promote continuous improvement of the building sector

Achieving the targets would help to ensure that the worst impacts of climate change are avoided, and bring about a number of other political and economic benefits, says the WGBC. These include future-proofing investments, resilience against energy prices, education, technology development and innovation, and new jobs.

The report goes on to describe several net zero buildings in existence today, and suggests that businesses can help by committing to invest in, build or occupy only properties that will achieve net zero carbon.

NGOs have a part to play here. They can help to develop certification programs for net zero carbon buildings for businesses to adopt and support governments to create roadmaps, incentives and tracking systems.

Governments can help by committing, perhaps as part of their work to meet the goals of the Paris Agreement on climate change, to develop national and/or sub-national regulations for new and existing buildings to achieve net zero carbon standards, as well as themselves occupying only certified net zero carbon buildings before 2030.

One thing governments or NGOs could also do is to keep track of the rates of “deep energy renovation” of buildings in their country.

To achieve the 100 per cent net zero carbon by 2050 goal, this global average rate of renovation must reach three per cent a year if we start in 2017, or higher if we start later.

The current market

But that is currently a distant dream. The best estimates from building inventory studies are that there are approximately just 500 net zero energy commercial buildings and 2000 net zero energy housing units worldwide.

The Global Alliance for Buildings and Construction reports that current average renovation rates around the world are just one per cent or less of the existing building stock each year.

The European Union has the highest number of net zero buildings, due to government-sponsored retrofit programs and a history of progressive policies and market interest.

North America is estimated to have the second-largest concentration of net zero buildings. These include many smaller commercial buildings and single-family homes, especially in the western and northeast states.

Residential buildings comprise the highest number and type of net zero projects built to date, but many are single-family homes built as demonstration projects. Office blocks come second by type.

Some public-sector projects built to net zero standards in India, South Africa and the US have floor areas of over 30,000 square metres, but most buildings are under 900 square metres.

Barriers

There’s an urgent need to identify and overcome the barriers preventing more net zero carbon buildings from being built.

There’s still widespread ignorance that such buildings are possible and, even if a client may have heard of them, a perception that they are either technically difficult, risky or expensive.

This is coupled with uncertainty about which technologies should be deployed and whether energy efficiency or renewable energy should be prioritised.

As a result, client demand is still low and technical know-how rare. Most of the research and evidence has focused on net zero energy buildings – which is much harder and likely more expensive to achieve than net zero carbon buildings.

For example, a 2013 report by International Living Future Institute, New Buildings Institute and Skanska stated that the average cost premium for three net zero energy buildings in Columbia, US was between 5-12 higher.

In practice, investor and owner return on investment in a net zero building can vary greatly, depending on they building type and where it is built, taking into account energy costs, incentive programs and climate policies, such as a tax on carbon.

The need for certification schemes

The WGBC believes that only by introducing voluntary net zero certification can the necessary market transformation occur.

For example, in Australia green building certification schemes promote holistic approaches to sustainable development beyond energy performance (such as water, waste, ecology, materials), and increase global awareness.

The green building market has grown over the past 15 years, including through the introduction of rating tools. Green Star has provided a common language for the property and construction industry to use when describing best practice.

Now, 30 per cent of Australia’s CBD office space has Green Star certification, up from 23 per cent at the end of 2014 and, on average, certified buildings produce 62 per cent less greenhouse gas emissions than average Australian buildings.

The benefits to investors are that as the real estate investment market responds to the call to combat climate change, net zero carbon assets will have the lowest operating costs and be the most de-risked and, therefore, highest-quality assets.

David Thorpe is the author of Energy Management in Building and Sustainable Home Refurbishment.

European Commission must be more ambitious in its energy efficiency targets says building sector

The European Commission should set a target for retrofitting all of the continent’s existing buildings to a “Nearly Zero Energy” standard by 2050. That is the request in a letter to the Commission signed by the chief executives of 42 major building firms and six industry trade associations.

The target would be enshrined in the upcoming revision of the Energy Performance of Building Directive and the Energy Efficiency Directive, which are currently under review.

Arguing that “businesses, investors, citizens, governments, all need a clear 2050 vision to put the ambition level of the Paris Agreement into practice”, they state that doing so would provide an opportunity to create jobs and economic growth.

The letter reads: “It is clear that the Paris commitment cannot be honoured without drastically reducing energy consumption in our buildings; the EU building stock emits over one-third of our CO2 emissions, three-quarters of our buildings are inefficient, and up to four-fifths will still be in use in 2050. We need EU wide action to drive the transformation of our inefficient building stock and make it a resilient component of the energy system of the 21st century.”

It continues: “EU wide leadership and action in the construction and building sector will spur European jobs and growth (in particular for SMEs, which make up 90 per cent of the construction sector). A high level political commitment for renovation will give industry the much needed signal and certainty to unlock investments, in turn removing some of the market failures.

“Most of all, making Europe’s buildings better through a mass EU-wide renovation movement will bring invaluable benefits to the whole of society by helping deliver something that every European citizen wants and deserves: a comfortable, safe and affordable home. This is a ‘win-win’ for Europe.”

This target is in line with the aims of the World Green Building Council’s Advancing Net Zero project to make all the world’s buildings ‘net zero’ of emissions by 2050. It builds on a push to double efficiency by 2030.

Launched in June, this program involves Green Building Councils from Australia, Brazil, Canada, Germany, India, Netherlands, South Africa and Sweden who will develop clear action plans, with an aim to launch a national net zero certification.

Energy efficiency package postponed

Despite the backing of the European Parliament, the European Commission appears reluctant to back energy efficiency.

At the beginning of this week it was slammed by the Coalition on Energy Savings for its announcement that the energy efficiency package will not be launched before the end of the year.

The package will define a target for energy efficiency for 2030 and extend the main elements of the Energy Efficiency Directive beyond 2020, as well as discuss buildings’ energy performance and financing.

“This delay undermines the credibility of the European Commission to drive forward the EU with big and compelling projects like energy efficiency, which delivers benefits for people and business and which is the EU’s first action to fight climate change,” secretary general of the Coalition for Energy Savings Stefan Scheuer said.

“[European Commission] president [Jean-Claude] Juncker must not hesitate to deliver on his promise to propose a more ambitious and binding energy efficiency target for 2030.”

The European Parliament has repeatedly called for a binding 40 per cent energy reduction target by 2030 in line with the already identified cost-effective potential for implementing energy saving measures. The target is currently set at a reduction of 20 per cent in energy use by 2020.

Energy efficiency mortgage scheme

Further backing the increasing desire for making European buildings more energy efficient, a new financing initiative, that would potentially offer better borrowing rates on mortgages for homebuyers purchasing more energy-efficient homes or carrying out energy-saving retrofits within properties, was presented by energy and building sector professionals from across Europe last week.

The European Energy Efficiency Mortgage was launched at the World Green Building Council’s “Build Upon” summit in Madrid by the European Mortgage Federation, which consists of the European Covered Bond Council with partners.

• See EU residents set to get cheaper home loans for energy efficient houses

The scheme effectively creates a “pan-European mortgage financing system” in order to make energy efficiency measures more accessible and affordable for home-buyers.

For banks and investors, the mortgage could allow for loans that represent a lower risk on the balance sheet and could therefore qualify for a better capital treatment.

It could also ensure that banks are able to recognise “energy-efficient” assets in their risk-profiling, which would begin to help the market price-in the added value of energy-efficient real estate.

The project is the first time a group of major banks and mortgage lenders have sat down with businesses and organisations from the building and energy industries to address the concept of energy efficient mortgages.

Creating a private bank financing mechanism to encourage the energy efficient improvement of households would be a key means of helping the EU to meet its energy saving targets.

Alongside the EMF-ECBC, the project partners are the Ca’Foscari University of Venice, RICS, European Regional Network of Green Building Councils, E.ON, and SAFE Goethe University Frankfurt.

Over the coming months, they will begin a mapping exercise in relation to existing or past financing initiatives, energy efficiency indicators and valuation practices, with a view to identifying best practices with which to move the project forward. It will explore the link between energy efficiency and borrower’s reduced probability of default and the increase in value of energy efficient properties.

The experts will meet again in Brussels in February 2017, followed by a public event at which the next stage will be decided.

Europeans can also generate half their energy at home

Continuing the news from Europe on energy and buildings, it also emerged last week that half of EU citizens – including local communities, schools and hospitals – could be producing their own renewable electricity by 2050.

A study by Dutch consultancy firm CE Delft that evaluated the potential of decentralised power generation across the continent found that 264 million people in Europe could be producing their own renewable electricity by 2050 and meet 45 per cent of the EU’s energy demand, provided the right regulatory framework is put in place.

Sweden looks like leading the way, with an estimated 79 per cent of the population being able to produce their own energy in 2050.

Germany and other EU countries like the Netherlands already champion energy production by households, which can sell surplus electricity back to the grid at a guaranteed price.

“But in Spain, there is a ‘sun tax’ which makes it very expensive to install solar panels on your roofs or have energy storage at home. And there is only a handful of cooperatives,” said Sebastian Mang, climate change and energy officer at Greenpeace EU, which is among the organisations behind the study. “Yet across Germany, you see solar panels on the roofs and hundreds of energy cooperatives flourishing.”

The organisations are calling for the European Commission to enshrine so-called “energy citizens” at the centre of the EU’s Energy Union initiative.

David Thorpe is the author of:

• Best Practices and Case Studies for Industrial Energy Efficiency Improvement (with Oung, K. and Fawkes, S. UNEP, 2016)
• A London Conversation: Business Briefing on Green Bonds (The Fifth Estate, 2015)
• The One Planet Life (Introduction: Jane Davidson. Routledge, 2015)
• Earthscan Expert Guide to Energy Management in Buildings (Earthscan, 2013)
• Earthscan Expert Guide to Energy Management in Industry (Earthscan, 2013)
• Earthscan Expert Guide to Solar Technology (Earthscan, 2011)
• Earthscan Expert Guide to Sustainable Home Refurbishment