What the UK’s net zero review says about real estate
Calling net zero “the economic opportunity of the 21st century”, the UK’s independent national review of decarbonisation has urged the country to act quickly to maximise investment, opportunities and jobs amid global competition.
Citing initiatives in other parts of the world, including the USA’s allocation of $369bn towards clean technology investment, the Mission Zero Review argued that there is an international race to tackle climate change.
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While the UK has made progress that has “exceeded expectations” around net zero, the report found that businesses still lack policy clarity, experience delays in the planning system and face “infrastructure bottlenecks” that are hampering the potential of decarbonisation.
“Work is needed to secure the benefits and minimise costs,” it said. In particular, the report recommended:
- Supporting businesses with incentives that will help them decarbonise, alongside information and advice on how to plan ahead
- Backing local action, including through planning reform and by supporting a “trailblazer net zero city” that will work towards reaching net zero by 2030
- Delivering energy efficient homes through legislation, such as standards that will new homes from having gas boilers from 2025
- Investing in infrastructure that will allow the UK to adapt to new green energy sources such as hydrogen.
In total, Chris Skidmore, chair of the Net Zero Review, made 129 recommendations in the 340-page report.
Recommendations that could affect real estate
- Minimum energy efficiency rating legislation by 2025 that would require at least EPC B for all commercial buildings by 2030
- Government-driven sustainable material supply chains, alongside new public procurement standards by 2027
- A drive towards public sector decarbonisation with trials to ensure alignment with targets in the Heat and Buildings and Net Zero Strategies
- An update to the Green Finance Strategy to set out a “clear, robust and ambitious” approach to disclosure and standards around green financing
- A public procurement plan for low-carbon construction by the end of 2023
- Regulations to drive the installation of at least 600,000 heat pumps per year by 2028, rising to 1.9m by 2033
- Bringing forward the Future Homes Standard to 2025 to ensure that standards apply to all developments. This should include a consultation on mandatary solar on new homes
- Retrofit hubs, supported by the government, to offer installers training and advice and to connect households with professionals
- Regulations around and updates to EPCs to ensure they are updated regularly and reflect more detailed information about the heating technology in a building – and its financial and social effects
- Government support for homes to install solar panels
- Clear guidance on when gas boilers will be phased out
- Regulations to require all homes sold by 2033 to have an EPC rating of C or above
‘Era of opportunity’
Julie Hirigoyen, CEO of the UK Green Building Council, said that the report “rightly recognises” the “enormous” economic opportunity in reaching net zero, adding: “We welcome the range of recommendations in the review to support the decarbonisation of our homes, buildings, communities and cities.
“Many of our members would even support going further in several areas, including introducing a net zero test for the planning system, requiring solar power on new homes, and an end date for new fossil fuel boilers in homes by 2028.
“We urge the government to decisively take forward the recommendations so that the UK can accelerate progress toward net zero and embrace this era of opportunity at a time when our economy needs it most acutely.”
Business and Energy Secretary Grant Shapps said: “With a wealth of talent and expertise, and a track record to be proud of, the UK is well placed to ensure that tackling climate change also brings new jobs and investment for businesses and communities.
“I am grateful to Chris Skidmore – the man who signed our climate commitments into law – for his detailed report today, which offers a range of ideas and innovations for us to consider as we work to grasp the opportunities from green growth.”