- Reducing greenhouse gas emissions from buildings and construction is vital to limiting global warming.
- Emissions dipped during the pandemic but will rebound as economies recover.
- Governments and companies around the world must step up efforts to make building and construction greener, according to a new UN report.
“Green-building” is more than just a good idea. Reducing carbon output from buildings and construction is essential if we’re going to meet the Paris Agreement goal of limiting global warming to well below 2C.
That’s the conclusion of a new United Nations-led report that shows the construction and operation of buildings accounted for 37% of global energy-related CO2 emissions in 2020. While that number was down slightly from a year earlier, most of the reduction resulted from lockdowns and economic contraction during the pandemic, not from measures to cut emissions.
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“The buildings and construction sector, as a major source of greenhouse-gas emissions, must urgently be decarbonized through a triple strategy of reducing energy demand, decarbonizing the power supply and addressing building materials’ carbon footprint,” Inger Andersen, Executive Director of the UN Environment Programme, said on launching the report.
Cut carbon faster
Progress has been made in reducing the carbon output from buildings, according to the UN. More countries are putting building energy codes in place, green building certification is rising, and investment in energy efficiency increased to more than $180 billion last year from $129 billion in 2015, when the Paris Agreement was adopted.
What is the World Economic Forum doing to support the Future of Real Estate?
While investable real estate has grown by more than 55% since 2012 (PwC), the COVID-19 crisis has underscored weaknesses in relation to human and planetary health along with drastic inequalities, leaving a stark reminder of the influence the built environment has on societies and the vulnerabilities that exist in times of crisis regarding how spaces perform.
As the real estate industry looks towards recovery, the need for transformation is clear. Portfolios must be rebalanced, and distressed assets repurposed. Technology must be fully embraced, and sustainability and wellness must be at the core of design and operation. The affordable housing crisis that already existed pre COVID-19 must be systemically approached to ensure access to adequate and affordable housing. If the Real Estate industry is to deliver transformation, it is more important than ever to ensure that policy, financing and business solutions are aligned in delivering better buildings and cities.
The World Economic Forum has brought together CEOs from the Real Estate industry to develop a Framework for the Future of Real Estate to help drive the industry’s transition to a healthier, more affordable, resilient and sustainable world.
But these efforts will not suffice and progress has been slow. Two-thirds of countries still have no mandatory building energy codes. Most of the boost in energy-efficiency investment came from only a few European countries. And there’s a “lack of ambitious decarbonization targets” in the goals many countries have set for themselves under the Paris Agreement, the report states.
Path to net zero
The time to tackle emissions from the buildings and construction sector is now. After all, energy consumption and emissions are already rebounding as economies recover from the pandemic.
Asia and Africa are expected to see building stock double over the next three decades, the UN predicts. And the use of materials globally is set to more than double by 2060, with construction materials accounting for a third of that increase.
To get on track for net-zero emissions by 2050, emissions from buildings will have to be cut in half by the end of this decade. Indirect emissions - from power generation for electricity and commercial heating - must come down by 60%, the UN reports.
So how do we get there? The UN document sets out a range of areas for immediate action.
To-do list for reducing emissions
Governments around the world need to step up their commitment to reducing carbon output from power generation. Their plans also need to target emissions from the production of building materials, which have so far largely escaped notice.
All countries need rules in place to improve the energy efficiency of buildings, covering everything from insulation to ventilation and appliances. We also need to ensure new and existing buildings that will be in use for decades to come can adapt and withstand changes in the climate and extreme weather events such as rising sea levels, heatwaves, droughts and cyclones.
All this will cost money, of course. The UN states that investment in building efficiency will need to grow at a rate of 3% a year, and public funds will need to be complemented by private investors. Green bonds, which are used to finance projects that will have a positive impact on the environment, are one tool to channel investment into the sector, along with green mortgages and other products.
That’s a lot to accomplish in a short time. But with careful planning and focused effort, the UN report is positive that the buildings and construction sector can get it done.
To aid the industry and its stakeholders in realising this ambition, the World Economic Forum has created its Framework for the Future of Real Estate, which provides an action-driven roadmap that brings together criteria such as liveability, sustainability, resilience and affordability to create a new approach to buildings and urban life.