Strategies for Minimizing Greenhouse Gas Emissions from the Built Environment
The built world sector, contributing over a third (37%) of the global greenhouse gas emissions, is under the spotlight as urgent action is required to meet climate targets. In the UK, heating generates 18% of the total greenhouse gas emissions, making it a critical area for focus.
To address this issue, making energy-efficient housing more accessible and affordable, particularly for low-income communities, is crucial. However, three quarters of buildings in the EU are classed as energy inefficient, and this number is expected to rise to as much as 90% by 2050. Long-term changes, transcending political parties, are needed to accelerate the decarbonisation of the built world and maximise the value of public and private investment.
Leaning on technology for retrofitting buildings and expanding access to renewable energy is essential for significant societal gains. Industrial heat pumps and electrical heating solutions are being proposed for lower temperature industrial energy consumption, addressing the significant carbon emissions contributed by industrial heat generation.
The National Audit Office's report on decarbonising home heating highlights the most pressing priorities for decarbonizing the built environment. These include:
- Accelerating the replacement of fossil fuel heating systems with low-carbon alternatives, such as heat pumps, backed by capital grant schemes like the Boiler Upgrade Scheme (BUS) to support upfront costs and increase adoption.
- Ensuring robust compliance and audit processes to safeguard public funds dedicated to decarbonisation efforts, maintaining scheme integrity and helping vulnerable consumers access these technologies.
- Improving the energy efficiency of homes, particularly upgrading social housing to at least EPC band C or above, to reduce overall heating demand as a key step in decarbonisation.
- Facilitating market transformation towards affordable, easy-to-install, and retrofit-ready low-carbon heating solutions, especially heat pumps, despite changes in federal incentives, ensuring sustained adoption trends.
- Integrating heating electrification with flexible, decarbonised energy systems to manage increased electricity demand from heating and enable smarter energy use through smart meters and market reforms.
Investing in decarbonising the built world can have substantial societal impacts, including reducing energy poverty and promoting smart meter usage. Powering up the grid is a priority to make the transition to renewable energy, requiring better energy storage, smarter trading, and grid tech solutions.
Moreover, the workforce involved in the retrofitting and climate tech sector needs to quadruple by 2030 to meet the demands of this transition. There is a need to address the labor and skills shortage, with a demand for new skills in construction causing global, industry-wide transformations. Deep collaboration between tech companies, construction firms, and investors is needed to introduce tools that materially shift the dial in the built world sector.
Banks can play a critical role in driving the energy transition by financing the built environment and connecting solution providers. Governments can encourage banks to 'green' their loan portfolios through regulations, policies, and incentives. Emerging thermal storage solutions are being developed for higher temperature applications, using green energy.
In conclusion, the priorities centre on grant-supported low-carbon heat installation, compliance to protect funding, energy efficiency upgrades in housing, fostering market readiness for heat pumps, and aligning heating electrification with smart grid developments. The UK, in particular, is facing challenges in meeting its targets for heat pump installation, with only 55,000 installed in 2022, compared to the government's target of 600,000 per year over the next four years. The need for urgent action is clear, and collaboration across sectors is key to driving the transition towards a low-carbon built world.
