What the latest UN climate report says about real estate

Scientists have warned that national climate policies are not enough to limit the planet’s warming to 1.5ºC, laying some of the blame on “low ambition” in building policies.

Focusing on mitigating climate change, the latest report from the UN’s Intergovernmental Panel on Climate Change offers a stark update on carbon reduction efforts and the impact of climate pledges.

An “abrupt acceleration” of carbon reduction efforts is needed to keep warming to below 2ºC, the report concluded, adding that carbon dioxide removal will be necessary to achieve net zero globally and nationally.

While the rate of global greenhouse gas emissions has slowed, they continue to grow at high absolute rates.

Similarly, although 24 countries have managed to cut their emissions in absolute terms for at least 10 years, those reductions are outweighed by “rapid” emissions growth elsewhere, particularly in developing countries.

Accounting for 21% of GHG emissions in 2019, buildings were identified as a significant source of both emissions and potential solutions.

“Our buildings and cities have yet again been singled out by climate scientists as one of the areas contributing most adversely to this stark reality,” the UK Green Building Council’s CEO Julie Hirigoyen said in the organisation’s response to the report.

“Many of the solutions already exist – as clearly noted by the IPCC – but what is missing is political ambition and financial incentives needed to make this happen at scale. Half measures will not halve our emissions, and the UK is no exception to this.”

The 3,675 page report offers a grim view of progress in climate action around the world, but it also identifies areas of progress and significant potential for improvement.

Highlights:

1. The built environment risks “locking in” carbon

Although the report commends the sector for a “significant global transition” from coal and biomass, a lack of technical capacity and effective governance risk locking in large amounts of carbon around the world. Inefficiencies are driven by both existing buildings in developed countries – due to low renovation rates – and new buildings in developing countries where building codes are either less robust or non-existent.

2. Emissions reductions are outweighed by growing demand

Developed countries are successfully cutting emissions in buildings, but in most regions those improvements have been matched by growth in floor area per capita. As a result, the report encourages what it calls “sufficiency interventions” – changes that reduce the need for more floor space – such as:

• Greater building density
• Multi-functional space
• Circular use of materials
• Shared space

3. There is huge potential for cutting carbon in buildings…

About 85% of GHG emissions could be mitigated in Europe and North America, along with 45% of emissions in developed countries in Asia Pacific by 2050.

4. … but there isn’t enough investment

Although investment in decarbonising buildings reached an estimated $193bn in 2021 (with Europe accounting for about half the total), this is nowhere near enough. Citing research from the International Energy Agency, the report suggests the total could be more than $711bn annually between 2026 and 2030.

5. Cutting emissions has widespread benefits

Climate mitigation policies could help countries achieve the UN’s Sustainable Development Goals, which range from reduced inequality to affordable clean energy and wellbeing. The report identified seven areas set to benefit from more environmentally-friendly, efficient buildings:

• Health: better air quality and alleviating energy and fuel poverty
• Environment: reduced local air pollution, sewage and other impacts such as acidification
• Resource management, including water and energy
• Wellbeing: increased productivity, more disposable income due to lower energy costs and fuel poverty alleviation
• Microeconomic effects: enhanced asset values of green buildings, fostering innovation and productivity gains
• Macroeconomic effects: impact on GDP driven by energy savings and new jobs
• Energy security: better access to modern energy resources, lower import dependency and better resilience

‘Golden opportunity’

Turning to the UK, Hirigoyen said: “Ahead of his forthcoming Energy Independence Strategy, Boris Johnson must heed the IPCC’s clear warnings that fossil fuels have no place in our future energy system, whilst energy efficiency improvements and energy demand reduction must be turbo-charged.

“With energy usage in homes alone representing 16% of total UK emissions, the upcoming energy strategy is a golden opportunity to make significant emissions reductions whilst tackling some of the most pressing issues facing the nation.

“Reducing our dependence on gas imports, ensuring bills are kept affordable, as well as achieving the prime minister’s vision of a ‘levelled up’ Britain are just three of the no-regrets benefits of prioritising domestic energy efficiency in his strategy.”