Changes to the 2016 GRESB Survey- Part One

The GRESB 2016 Real Estate survey was released on 1st April and with it came the detailed (231 page) reference guide. GRESB has always been transparent about the categorisation and scoring of their indicators, which is useful if you have the time and inclination to go through those 231 pages. In this first blog of two, I have set out my thoughts on the more notable changes.

Increased focus on performance

GRESB’s goal is to “provide investors with the ESG information they need to make more informed investment decisions“. You can’t knock this goal, but there are questions as to how GRESB portfolio level assessments can provide investors  with sufficient information at the asset level. That said, GRESB scores clearly indicate how sustainability has been incorporated into participant business strategies.

GRESB results can be analysed and broken down in a number of ways.  However, fundamentally GRESB assesses sustainability across two broad levels (or dimensions as GRESB calls them):

  1. Management and Policy – a measure of the intent of your ESG programme
  2. Implementation and Measurement – a measure of the impact and performance the intent is delivering.

The GRESB quadrant is shown in the Figure 1 below.

GRESB graph

Figure 1: GRESB Quadrant Scoring Model and Global Average Scores 2011 – 2015

Participants scoring more than 50% in both dimensions are placed within the Green Star quadrant. Lower than 50% in both dimensions places you within the Green Starter quadrant. A strong Management and Policy score but weak Implementation and Measurement score results in a Green Talk score (i.e. you have good intent but it is not backed up by performance). Conversely, a strong Implementation and Measurement score but weak Management and Policy score results in a Green Walk score (i.e. you have good performance but seemingly no co-ordinated management structure behind it).

In general, participants score better in Management and Policy (2015 global average 63%) compared to Implementation and Measurement (2015 global average 52%). This is to be expected – it is relatively easy to develop plans and policies, the biggest challenge lies in achieving the results.

The global average result in 2015 for all participates was Green Star (the best rating).  To put it another way, more than half of participants achieved this GRESB rating. This has led to criticism of the GRESB scoring mechanism, as it was seen as too easy to achieve a Green Star, without performance being sufficiently scrutinised. In the 2016 survey, the overall weighting for Implementation and Management (or performance) has increased by 2 percentage points from 70% to 72%. The goal posts have shifted.

The increased focus on performance may well be significant, particularly noting the 2015 global average Implementation and Measurement score was 52% in 2015. The 2% weighted increase for Implementation and Measurement could see a large group of borderline participants shift from the Green Star quadrant to the Green Talk quadrant,

Participants should expect a greater scoring emphasis on Implementation and Measurement to continue in the future. Current participants will need to maintain forward thinking ESG strategies that deliver results to keep pace. New participants may find themselves significantly behind the curve on first submission (fortunately a grace period provides anonymity in the first year’s submission). Wherever you are in your sustainability journey, it is clear that neither complacency nor inactivity is an option.

In the second part of this blog, I will highlight the key changes to the Real Estate assessment and also introduce new GRESB assessments and modules.

Regardless of the changes introduced by GRESB, our message to achieving an impact driven Environmental, Social and Governance strategy remains the same:

  1. Plan your strategy based on current and future risks and opportunities.
  2. Prioritise delivery according to the value proposition.
  3. Measure and report the ongoing impact.
  4. Review new risks and opportunities and repeat from step 1.


To read Part 2 of this blog, click here.

GRESB Premier PartnerAs a GRESB Real Estate Premier Partner, we are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

Budget 2016: Changes to the UK Government Energy Efficiency Strategy

Significant changes to the Government’s energy efficiency strategy were announced in today’s budget (16 March 2016).  Key points are summarised below:

  • The Carbon Reduction Commitment (CRC) energy efficiency scheme will be scrapped at the end of the 2018-19 compliance year (the end of Phase 2). Obligated businesses will be required to surrender allowances for the final time in October 2019.
  • Lost revenue will be recovered through an increase in the Climate Change Levy (CCL).  This will come into effect from 1 April 2019.  This is designed to cover the cost of CRC abolition (although 2019 appears to be a bumper year for the Government – with increased CCL rates and a final CRC payment).
  • CCL rates and CRC allowance prices will increase in line with RPI annually until 2018-19.
  • The CCL discount for sectors with Climate Change Agreements will be increased to cover increases in CCL main rates.
  • The Government will retain existing eligibility criteria for Climate Change Agreement schemes until at least 2023.
  • The main rates of CCL for different fuel types will be rebalanced to reflect recent data on the fuel mix used in electricity generation. In the longer term, the Government intends to rebalance rates to deliver greater energy efficiency savings and reach a 1:1 ratio of gas and electricity rates by 2025.
  • Finally, the Government will consult later in 2016 on creation of a simplified energy and carbon reporting framework planned for introduction by April 2019.

Please contact Paul Sutcliffe at EVORA for more information (

Pre-Budget: Rethinking the Energy Efficiency Taxation Landscape

With the energy efficiency taxation review just around the corner, it is expected that the CRC Energy Efficiency Scheme will be scrapped or at least changed significantly.  Below, we make three key predictions:

What are the key predictions for the upcoming budget review?

  1. A simpler energy efficiency taxation landscape: A single new tax based on the climate change levy and a single reporting framework
  2. Scrapping of the CRC Scheme
  3. Further developments based on ESOS supported by an incentivisation scheme to drive the implementation of improvement measures.

Moving away from the older policy environment, the translation of theory to practice will present new opportunities to utilise ESOS to spur the uptake of energy efficiency measures. Following on from our reflections on ESOS, it makes sense for businesses to develop strategies to address energy regulations in a coordinated fashion and to reap the benefits of a combined approach. A good example of this is having a combined approach to ESOS and MEES, where meeting minimum energy efficiency requirement aligns with the broader achievement of reducing energy costs in the building.

Please stay in tune for the budget announcement on the 16th of March 2016 and our post-budget review.


Reforming the business energy efficiency tax landscape



Reflecting on ESOS: The Next Steps

Going forward, what are the prospects for ESOS? EVORA highlights the next steps for the scheme.

A Coordinated compliance and improvement approach?

EVORA recommend that clients should consider the establishment of a collective approach to address all regulatory risks and opportunities. It makes sense for example, for real estate businesses to develop a strategy addressing both ESOS and the Minimum Energy Efficiency Standards (MEES).

ESOS: a burden or an opportunity for businesses?

On the whole, we believe that businesses have found the compliance process more challenging than regulators anticipated. ESOS is new and businesses will certainly feel that they had a short period of time in which to prepare. Nevertheless, EVORA is already seeing evidence that assessment results are being incorporated into energy action plans. Overtime, ESOS has the ability to deliver the energy savings the UK industry needs. However, ESOS needs to form part of a structured and stable energy policy framework.

ESOS and ISO 50001

In the latest round of ESOS, only 0.9% of businesses chose ISO 50001 as a route to compliance. EVORA believes that, over time, an energy management system approach will help deliver the best results. However, the ISO 50001 approach is also the most time and resource intensive. Nevertheless we believe that, ISO 50001 will grow in popularity over time. The low level of initial uptake will have been restricted by the long time it takes to gain certification and the lack of available certification assessors.

For more information, Paul Sutcliffe will be speaking at the UK Green Building Council (UK-GBC) ESOS Showcase Event in London on the 15th of March. The link to the event can be found on the website:

Stay in tune for further updates on the energy efficiency taxation review budget to be announced soon!

Reflecting on ESOS: The EVORA Experience

Over the last six months, EVORA has supported a broad range of clients to meet ESOS requirements. Through our support programmes we have engaged with 27 companies from Real Estate to a Big Six energy provider.

Energy spend assessed equated to £55m and saving opportunities of £2.8m (5.2%)  where identified (this equated to 27,000 MWh per annum).





ESOS routes to compliance

It was also interesting to explore the ESOS routes to compliance. From an analysis of all ESOS participants and responses to the notification questions (excluding personal data) across the UK and a selection of industry sectors, 65% of the notifications were made during or after December 2015.

The breakdown by compliance routes was as follows:

  • ISO 50001 – 0.9%
  • DECs – 5.3%
  • Green Deal – 0.2%
  • Audits -90%
  • De Minimus – 3.6%

Audits formed the main route to compliance; although ISO 50001 could become a popular option in the future.

EVORA predicts an increase in the take-up of ISO 50001, although significant time investment is required. This reflects the opportunities that energy management system frameworks present for target-setting and monitoring for continual improvement in the long-term.

How about transport?

This is often neglected since traditionally businesses have focused on health & safety when considering travel. Many opportunities exist including training, installation of tracking-systems, promotion of alternatives to travel including video conferencing and introduction of site-specific green travel plans. Focusing on transport could present new ways to achieve significant energy and cost reductions.

Please check out our Reflecting on ESOS: The Next Steps article for more on our reflections on ESOS and the next steps going forward.

For more information, Paul Sutcliffe will be speaking at the UK Green Building Council (UK-GBC) ESOS Showcase Event in London on the 15th of March. The link to the event can be found on the website:

Stay tuned for further updates on the energy efficiency taxation review budget on the 16th of March.



70% of organisations on the road to ESOS compliance

Latest figures from the Environment Agency show 6000 organisations have complied with the Energy Savings Opportunity Scheme.

In the two days before 29 January deadline, the agency received a further 1,015 notifications of compliance. This last-minute action reflected earlier fears of a slow start to compliance by organisations covered by the scheme.

More information via The Environmentalist

DECC launches Energy Innovation Consultation

A new consultation published by the Department of Energy and Climate Change invites the energy sector to contribute thoughts and ideas to encourage innovation across the sector.

The consultation is open until 11th February and asks the following three questions:

  • How can legislation and enforcement frameworks help support new technologies and business models to encourage growth?
  • How is new technology likely to shape the energy sector?
  • How can regulators better utilise new technologies to generate energy savings and reduce burdens on business?

The final Innovation Plan will be published in spring 2016.

More information via Business Green.

How Energy Efficiency Cuts Costs for a 2°C Future

A new report (from a consortium of groups led by Fraunhaufer ISI) — “How Energy Efficiency Cuts Costs for a 2° C Future” — analyses how energy efficiency policies and programs in Brazil, China, Europe, India, Mexico, and the U.S. can reduce the cost of economy-wide de-carbonisation by up to $250 billion per year for these regions, with no net cost to society through 2030.

About 40% of global greenhouse gas (GHG) emissions originate from energy use in industry, transport, and buildings, and another 25% from power generation (IPCC 2014). A highly efficient use of energy is thus fundamental to limit GHG emissions. Yet, energy efficiency receives much less attention than the de-carbonisation of the energy supply.

The report explains how energy efficiency can be a low-cost pathway to keeping global warming to the critical 2 degrees Celsius mark. They stress it’s benefits compared to a highly expensive energy intensive pathway that focuses primarily on de-carbonising energy supply with more limited energy efficiency policies to help achieve a 2° C future.

Read related articles via Greenbiz and ClimateWorks

FiT cuts: The Impact on the Solar Industry

The Department of Energy and Climate Change (DECC) is proposing to cut the feed-in tariff rates for solar PV installations by as much as 87%. Construction News looks into what this means for the Solar Industry.

Article can be viewed via Construction News here.

Regulatory Energy Regime under Review

Last week, the UK Government announced plans to review the business energy tax landscape to consider approaches to simplify and improve the effectiveness of the regime.

This message was circulated to all CRC, Energy Savings Opportunity Scheme and Climate Change Agreement participants (who have been further advised to continue to participate in the various schemes until further notice).

This news is in part welcome but also worrying.  Current energy legislation is confused and uncoordinated – this must be addressed.

By way of example, last year, the Government issued consultation on plans to (amongst other options) scrap use of Display Energy Certificates.  At the same time the ESOS scheme was in process of being rolled out.  One of the core compliance approaches referenced in ESOS is … use of Display Energy Certificates!

The structure of regulatory requirements surrounding energy is confusing and a revised coordinated, and structured approach designed to help business understand energy and carbon emissions, whilst appropriately incentivising improvement, would be welcome from me.

However, over-simplification will ultimately make UK business less competitive. Furthermore, if the Government take a similar approach to that taken for Zero Carbon homes plans last week (i.e. scrapping everything) then we should be very worried indeed.

The Government has committed to launching a formal consultation in the autumn and I strongly encourage participation.