The race to Net Zero: How the industry can maintain momentum
Vidal Bharath, Chief Commercial Officer at Bramble Energy, says much of the ability of the UK to successfully meet its 2050 net zero target will hinge on the success of the construction sector’s decarbonisation strategy.
The building industry is responsible1 for around 11.4 million metric tonnes of carbon dioxide emissions every year, with the built environment more widely estimated2 to account for a quarter of the UK’s entire carbon footprint (42% if you include surface transport and vehicle emissions).
It is therefore no secret that the complex and multi-faceted construction sector has a significant role to play in minimising emissions and building towards net zero.
New techniques, technologies and processes, including innovative ways of tracking data, developing greener technologies, and greater collaboration with partners up and down the construction value chain, offer a route towards hitting those all-important sustainable milestones.
Creating economic and societal growth
It is worth noting that this is not just about cutting emissions in order to limit the impact of climate change. Indeed, as the construction industry continues to chip away at these targets, another advantageous by-product emerges in the form of potentially monumental economic and societal growth for countries, cities and companies.
The building sector has the potential to be the force that keeps the net zero agenda pushing ahead, at the same time spurring on the UK economy and enhancing the development and integration of greener technologies and processes into the wider economy and society.
For consumers, especially those living in net zero carbon homes, several key benefits can be drawn from this progress, including reduced emissions and increased resilience to climate change, reduced utility bills, and improvements to comfort and wellbeing. Meanwhile, similar advantages can be obtained by businesses regarding their workplaces and employees.
From a financial perspective, capital markets are shifting toward ESG. This means businesses that are bold stand to benefit from a greater supply of cheaper capital to drive their sustainability investments.
According to McKinsey3, this could be a major driver of demand for ESG friendly buildings, as well as heightened awareness among consumers about the emissions generated by their homes and places of work, and other lifestyle choices such as eating and travel habits. Furthermore, in the UK, social value has become a particular priority for construction companies to remain competitive in the investment landscape – government contracts worth more than £5 million, for example, can only be awarded to firms with a formalised social value policy in place.
Accelerating progress
As a result, sustainability (both environmental and social) is moving up the priority ladder of construction leaders, whose decisions and strategies will ultimately determine the success of the sector’s efforts to decarbonise.
The Covid pandemic, it seems, has served as something of an accelerant in this process. According to a study4 carried out last year, more than half (53%) of building sector executives cited sustainability when asked which trends have accelerated due to the covid crisis. Furthermore, one in ten said they had already started to increase their investments in sustainable strategies since the pandemic took hold in 2020.
Such emission-reducing activities span the entire building lifecycle. These typically include reducing the carbon intensity of building materials in the procurement process, implementing smart technologies and measures to reduce energy consumption in the building use phase, and designing and using more recyclable materials and closed material flows in refurbishment and demolition.
Crucially, these activities should not be limited to projects involving new buildings. While new structures are, as to be expected, more energy efficient, the fact remains5 that 80% of the buildings which will stand in 2050 are already built. This makes it essential that decarbonisation programmes focus equally if not more strongly on enhancing the UK’s existing building stock.
The government knows this. In its 2021 budget, a £1.8 billion fund to turn brownfield sites into housing was announced. This is a move which reflects public opinion – according to the Environmental Industries Commission, 70% of the public prefer development on brownfield land as opposed to building on greenfield sites. And there is plenty to go around. In 2020, there were 20,750 brownfield sites listed on brownfield registers across over 330 local planning authorities in England alone.
The uptick in sustainable investments that we’ve seen since the pandemic is certainly cause for optimism, and such progress will need to accelerate further if the UK’s 2050 net zero target is to be met.
Indeed, if the construction industry is making positive steps to achieving these targets, then it can continue to gain game-changing advantages in the form of tech proficiency, use of data, collaboration with innovators and the creation of a culture that embraces agility and an appetite to take calculated risks. Realisation and awareness of these wider benefits should help to drive further progress.
Taking the initiative
The sector also needs to maintain momentum and continue to hold itself to account.
There are some companies that are already making leaps in their attempts to achieve net zero. However, it will require a collective effort if the dial is to be truly shifted, meaning every stakeholder across the ecosystem needs to play their part.
Firms need to take the initiative as opposed to waiting for others to lead the way. After all, 2050 is only 27 years away, and given the size of the task at hand, this is not a long period of time.
Efforts need to accelerate, and even the smallest of steps can help to gather a greater pace.
Many companies will be wondering what that first initiative might look like. A good place to start would be to become aware of the financial and educational support on offer to businesses – both those operating in the construction landscape and firms seeking to decarbonise their built assets.
According to our research6, more than 80% of companies in the construction space believe the government can be clearer in how it expects the sector to hit carbon targets and ensure net zero ambitions are actually attainable.
Specifically, a key challenge identified was obtaining full transparency on the types of public funding available. For instance, 81% of players in the construction sector are yet to take advantage of any government-backed funding for hydrogen schemes, with more than half the industry not aware that such financial incentives even exist.
There are many other schemes that companies can turn to in order to get off the mark.
Nearly £5 billion of government funding is available7 to help UK businesses become greener, while there is also a range of localised support8 that firms can take advantage of. In addition, the Clean Growth Fund9 is a body that invests in early-stage UK enterprises that are seeking investment in their low-carbon initiatives.
Private sector financiers are also getting involved. Major high street banks, including the likes of HSBC, Barclays and Lloyds, are offering business loans for green projects.
Meanwhile, housing associations are also stepping up their ESG and sustainability efforts.
One in particular that stands out is GreenSquareAccord, which provides homes to around 54,000 people across England. The organisation is in part a relative newcomer to the scene, forming in April 2021 from the merger of Accord Housing Association in the West Midlands and GreenSquare Group from the South West.
It is breathing some sustainable impetus into the housing sector and is clearly serious about net zero. In August this year, for example, the group announced it was nearing completion on a ground-breaking project in Redditch to build the first plastic free homes in not just the UK, but also Europe. The €1.6 million project received €967,000 funding from the EU’s Interreg North West Europe funding partnership, allowing GreenSquareAccord to research the reduction and removal of plastic in a real world large scale project. It sets a promising precent for sustainable home building in the future.
The more, the merrier
Responsible for vast swathes of one of the most significant components of the country’s building stock, housing associations will continue to have a vital collective role to play on the road to net zero.
It is time for all stakeholders across the building sector to take the initiative. The direction of travel is already positive, with sustainability firmly ingrained into an increasing number of construction leaders’ agendas. The more firms that get their own net zero plans off the ground, the quicker the sector will decarbonise and unlock the various benefits that come with embracing green ideas.
Sources
- https://www.ukgbc.org/climate-change-2
- https://tinyurl.com/nxey2p7n
- https://tinyurl.com/nxey2p7n
- https://www.ukgbc.org/climate-change-2
- https://eic-uk.co.uk/news/blog/seizing-the-brownfield-opportunity-in-london
- https://tinyurl.com/58xy3rpp
- www.gov.uk/guidance/find-funding-to-help-your-business-become-greener
- https://zerocarbonbusiness.uk/find-support-and-funding
