Decarbonising any industry requires a strong collective effort and the right policy incentives to ensure that all industry players, big and small, are motivated to act. The Minimum Energy Efficiency Standards (MEES) regulations specifying a minimum Energy Performance Certificate (EPC) rating have certainly created the right imperative to act, but the property sector needs more than just a design-based metric if it is to reach net zero.
The UK property sector accounts for 125 million tonnes of greenhouse gases per year, or around 25% of the country’s emissions, split between embodied and operational carbon.
The IPCC estimates that over a building’s lifetime, embodied carbon accounts for 11% of carbon emissions, and operational carbon for the remaining 89%. As such, with the looming 2030 target to halve global emissions, our efforts should be prioritised towards eliminating operational emissions of our existing building stock.
As a design rating focused on regulated energy use within buildings, the EPC regime has provided a blueprint for sustainable refurbishments, resulting in investment being made towards LED deployment, façade enhancements and electrification of heat. But despite the positive actions that EPCs incentivise, they are not sufficient alone. As a design rating, an EPC does not capture the operational energy performance of a building. In practice, high design specification often doesn’t translate into high operational performance.
In fact, EPCs have been shown to have little correlation with the actual energy performance of a building, particularly for larger buildings such as offices or shops. This means a building can receive a high EPC rating but still consume more energy than stipulated, resulting in a ‘performance gap’.
Instead of relying solely on the EPC rating system, regulations should incentivise monitoring of real-time energy usage and the implementation of schemes that reduce energy usage within a building while in operation.
“Instead of relying solely on the EPC rating system, regulations should incentivise monitoring of real-time energy usage and the implementation of schemes that reduce energy usage within a building while in operation.”
The good news is that greater visibility of whole-building energy and carbon performance is already a priority for the industry. Further, at a time when energy costs are skyrocketing, greater visibility of building energy consumption will help businesses better manage operating costs and budgets.
If the sector is to tackle its operational carbon challenge, our policy framework needs to be reshaped to adopt performance-based, not just design-based, metrics. The findings of a recent British Property Federation report were particularly vocal on this, and we agree with its calls for the government to publish the results of its consultation on introducing a new performance-based energy rating determined by operational energy use.
Make no mistake, the EPC rating system in place is a necessary part of the transition to net zero. It took more than a decade for the sector to fully embrace the EPC, inform design decisions and upskill the value chain to deliver on the required upgrades.
Any new performance-based policy framework may take a similar time to become embedded, but this is not a reason to delay adoption. The introduction of a performance-based energy rating and the commitment to bring all buildings up to EPC ‘B’ standard by 2030 are not mutually exclusive – they would reinforce each other.
Sonal Jain is head of sustainability at Workspace Group
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