Net Zero Carbon

What is it?

The UK Government has committed to achieving significant cuts in greenhouse gas emissions from the economy by 2030, with the aim of achieving net zero emissions by 2050. This enormous challenge can only be tackled by Government, businesses and civil society working together to turn an ambitious aim into firm action to radically reduce emissions.

Do we need to comply?

The UK Government is one of the leading signatories to the UN Paris Agreement to keep global temperature rise below 2oC above pre industrial levels and to pursue efforts to limit the increase to 1.5oC. In June 2019 Theresa May announced an amendment to the Climate Change Act committing the country to a legally binding target of net zero carbon by 2050. This commitment makes the UK the first of the G7 countries to do so. Other countries that have legislated for zero carbon include France, Sweden, Norway and New Zealand, and increasingly countries are also taking policy positions on zero carbon.

At an organisational level, companies cannot afford to ignore the net zero carbon agenda. We have already seen the introduction of the Minimum Energy Efficiency Standard requiring a minimum standard of EPC E rating in non-domestic assets. The Department of Business, Energy and Industrial Strategy (BEIS) is currently consulting on a minimum EPC B rating by 2030. Other mechanisms are likely to be introduced to ensure real estate organisations contribute their fair share to the net zero carbon agenda.

Momentum is building from a market perspective. In September, 23 leading real estate investors and members of the Better Buildings Partnership signed a public declaration to tackle the risks of climate change through the delivery of net zero carbon by 2050.

What is involved?

Previous UK carbon policy has focused on reducing operational carbon emissions. Net zero carbon has introduced a new dimension that seeks to account for ‘whole life’ carbon which includes operational and embodied carbon (emissions from the manufacture, transport and construction of building materials together with emissions from demolition / reuse of the building).

Within the UK real estate sector the UKGBC have published a useful framework entitled Net Zero Carbon Buildings – a Framework Definition which is mirrored by the World Green Building Council who are also campaigning this issue on the global stage.

To progress with the net zero commitment you need to undertake some simple but essential steps:

STEP 1:

Establish the scope of net zero carbon within your organisation or portfolio. This should include both construction and operational carbon. Use Science Based Targets )SBT) where possible to inform your strategy and action plan.

STEP 2:

Reduce construction and refurbishment carbon. This will involve consideration of ‘whole life’ carbon embedded in the materials used and incurred during the construction process. Remember three axions ‘the devil is in the details’, ‘build tight ventilate right’ and ’embrace the power of the sun’.

STEP 3:

Reduce operational energy consumption. Prioritise ‘real time’ energy management but do not forget carbon emissions are also attributed to water consumption and waste production. Monitor and report publicly at least annually to help keep momentum.

STEP 4:

Increase your use and generation of renewable energy. Remember the energy hierarchy in the first instance but seek to install renewables onsite wherever practical to do so. Using off site generation is permissible but it is better to generate and use on site. This will bring in greener long-term resilience and create potential new revenue opportunities.

STEP 5:

Offset remaining carbon. Any residual carbon can be offset using a reputable offsetting framework. Don’t forget to consider net zero carbon at asset level as well as fund level. You may also be able to trade internally to achieve a balanced scorecard. Offsets should be publicly disclosed.

Are you ready to begin your net zero journey?

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