‘Net zero’ has been the world’s raging topic since the Intergovernmental Panel on Climate Change’s Special Report regarding the impact surrounding global warming of 1.5 degrees Celsius. The agreement led the world’s government to understand the vital importance of a net zero initiative and have made it their goal for local, state and national governments to achieve net zero. But before we can start understanding the importance of net zero, we must first ask ourselves what exactly is net zero?
What is Net Zero?
Net zero refers to net zero emissions which are when greenhouse gas emissions taken out of the earth’s atmosphere offsets greenhouse gas emissions produced. This is commonly understood as a pair of scales, net zero is when both sides of the scales are equal resulting in perfect balance, ie. generating as much energy as they use
Human activities have caused a rapid change to the earth’s environment and the current projections, global warming likely to reach 1.5 degrees celsius between 2030 and 2052 according to the Intergovernmental Panel on Climate Change’s (IPCC’s) special report. This is likely to give rise to a range of climate-related risks for both natural and human-related systems such as impacting food security, water supply species loss and extinction and many more.
One of the leading culprits of climate change is the construction and building industry which is to be expected due to the nature of the industry. According to the World Green Building Council, globally the building industry alone is responsible for 36% of energy consumption, 38% of energy-related carbon emissions and 50% of resource consumption. This issue can be addressed with dedication and engagement from all stakeholders within the industry to ensure that practices are sustainable and environmentally friendly so that they can continue to prosper in the future.
Why is Net Zero Important?
Achieving net zero emissions is a step to preserve the world for future generations. To put it simply, net zero lowers the probability of global climate-related risks towards health, food security, water supply, human security and economic growth.
The depletion of fossil fuels is not the biggest issue in the short term, the problem is that if not acted on now, climate change will impact human security on a global scale. As previously mentioned, the building and construction industry are one of the culprits of environmental damage and material waste. The lack of effective sustainability initiatives and recycling practices threatens the long-term stability of this industry. However, this issue can be possibly resolved with top-down changes to businesses such as adopting net zero initiatives within their operations which ensures that their industry is sustainable and resource-efficient. It is also important to remember that the government provides incentives and assistance to businesses that are adopting net zero commitments.
Is Net Zero Achievable?
Key factors to achieving this goal are the adaptation and utilisation of renewable energy, increasing energy-efficient practices and reducing waste. Renewables such as solar, wind lack the reliability that traditional energy sources provide. Furthermore, these energy sources threaten grid stability as the transition from centralised to decentralised power generation has begun. What used to be a one-way electricity grid is becoming more distributed with multiple sources of generation, storage and demand management being available making it more feasible for businesses to sell clean energy to other businesses.
Opportunities in the building industry
The proven monetary and non-monetary benefits to those in the building industry transitioning towards a more sustainable net zero approach are twofold. Some of these benefits include improved reliability, stakeholder satisfaction, market recognition, cost avoidance, tenant staff engagement, positive PR and many more.
Building owners responsibilities should be extended beyond providing just the space and service for their tenants and should consider including the environmental impact associated with their operations. Adopting net zero commitments and feasible year-to-year greenhouse gas reductions plans should become a common practice for all building owners.
In order to facilitate the change to a carbon neutral economy, businesses need to adopt the policies that will impact how they operate. For the building industry, in a simplified approach, changes need to be implemented around energy procurement strategies, advocacy for energy efficiency, waste reduction practices and improvement in terms of visibility of energy data. Building owners can leverage data to unlock performance improvements which will drive strategic investments that enable reporting and communication of progress against set targets.
It is essential that these investments are calibrated across energy efficiency, demand management, renewable energy and sustainable energy procurement processes. Carbon offsets are also one of the viable solutions to reducing a company’s carbon emissions, but should only be considered as a last resort as it is not sustainable for both the business and the environment long term. The goal should ultimately be to reduce carbon footprint without maintaining the status quo by purchasing offsets.
In Summary
The building industry in Australia has made significant steps to reduce its carbon footprint in the last 15 years. With the introduction of mandatory building disclosures, NABERS, GreenStar rating and overall industry awareness of climate change has transformed the way we operate and construct buildings. In the wake of this, tenant and stakeholder expectations in terms of sustainability and responsibility have been more demanding than ever before. Some Tier 1 and 2 building owners have either made the commitment to become net zero within the next few years or have already become carbon neutral.
The rest of the industry is lagging behind due to a variety of reasons, one of which is the exorbitant costs related to the implementation of net zero solutions and the impacts it will have on their bottom line. Furthermore, within the industry, there is uncertainty surrounding the reliability of these relatively new solutions and the results they will produce in the future. The question has to be raised whether or not being a laggard in terms of net zero transition will affect business profitability in the long term?
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