Energy Efficiency, GHG Emissions, Regulation  -  May 2, 2022 - By Lotte Schlegel, IMT

The Role of Buildings in the 2022 IPCC Report

Climate change is already happening, but the latest United Nations climate report shows us two critical lessons: 1) we still have choices to make in what happens next, and 2) we must improve built environment to create a more sustainable and just future.

The 2020-2030 decade is critical for accelerating the learning of know-how, building the technical and institutional capacity, setting the appropriate governance structures, ensuring the flow of finance, and in developing the skills needed to fully capture the mitigation potential of buildings.  
   - United Nations Intergovernmental Panel on Climate Change, AR6 Climate Change 2022: Mitigation of Climate Change: Summary for Policymakers

Buildings contribute to approximately a third of U.S. emissions and 40% of global emissions, so we cannot meet consensus climate targets without transforming the buildings sector. Even if we increase renewable energy on the grid, increase the number of people driving electric cars, and start to scale up carbon dioxide removal – something people ask me about often these days – we still need to reduce energy use in buildings, this decade, to have a chance at keeping global temperatures down. The total amount of energy-related carbon emissions in 2021 is approximately 31.5 gigatons (IEA) and the world’s largest carbon capture firm can only process about 4,000 tons/year, or about three seconds of humanity’s annual output. This is one reason all models for keeping our planet under 1.5 degrees Celsius assume the built environment hits zero carbon by 2050.

Achieving that target means much more ambitious building codes, an enormous scaling up for retrofits, and a transformation of the real estate industry. That seems daunting, and it is, but what’s most promising about reducing energy in the building sector is that we already know how to do it. We’ve been honing energy efficiency techniques for decades, or centuries in some cases, and there is a real business case to take action as ESG goals and climate disclosures become standard practice.

Adding to these motivations is a moral one; there is tremendous injustice in the way that climate change is playing out. Those who will bear the greatest burdens are people who contributed least to this crisis, and who have the fewest resources to move or adapt.

There are three ways we can best advance building decarbonization while also addressing the social considerations:

1. Expand the definition of what it means to be a high-performing building. Energy reduction and fuel switching are critical to global carbon targets, but buildings can also better support health and community resilience, and there is enormous potential for workers from historically disinvested communities to benefit from building improvement jobs. Building owners, developers, and managers should also consider deliberately pursuing opportunities to make high-performing buildings accessible to people living on lower incomes and in under-resourced neighborhoods.
2. Support early adopters. Jurisdictions like those participating in the National Building Performance Standards Coalition understand that local climate goals are impossible without addressing buildings, and that, by leading with community engagement, buildings can be a tool for social equity as well as sustainability. Leading real estate companies are already setting carbon targets for themselves and taking action on retrofits, purchasing and leasing policies.
3. Make it easier to act. We need to align policy incentives with the outcomes we want to see (e.g. building performance standards, performance-aligned leasing), and arm building decision-makers who have not yet taken action with the knowledge and training to carry through in changing their business practices, such as creating a local resource center like the Building Innovation Hub in Washington D.C.

None of these tasks are easy, but all of them have clear paths forward. The Washington, D.C. real estate market has been a leader for some time in building sustainability, in part because there has been policy action promoting this for the past 15 years. Over the last decade, DC’s population grew by more than 16 percent, numerous buildings were constructed, and summer temperatures have increased, but citywide emissions decreased 31 percent compared to the 2006 baseline. The top drivers of these results are related to energy switching and to decreasing energy use intensity in commercial buildings. These numbers are likely to improve further as the city’s Building Energy Performance Standard now requires energy improvements in coming years, and there is a Retrofit Accelerator specifically focused on assistance for affordable housing properties. While every location is different, this data offers an initial proof of concept for what we can achieve when we prioritize building performance.

What’s most important is that the real estate industry acknowledges its role in climate change, and the opportunity to shift buildings to a different, much more positive role in our climate story. Real estate decision-makers need to commit to this effort, partner with government and community, and then take advantage of the many examples we already have of how to move forward. The IPCC report is a grim read, but it also contains specific suggestions of what we can do, and offers us all a choice in what lies ahead.

This column originally appeared as a blog from IMT (Institute for Market Transformation).

Lotte Schlegel is the Executive Director of the Institute for Market Transformation (IMT), a national nonprofit organization that is laser-focused on increasing energy efficiency in buildings to save money, drive economic growth, reduce harmful pollution, and tackle climate change. Under her guidance, IMT is a trailblazer in the energy efficiency field, recognized across the globe for accelerating investment in energy-efficient buildings through hands-on guidance, technical and market research, policy and program development, and promotion of best practices. As IMT’s Executive Director, Lotte guides the organization’s growth and leads the implementation of its multi-year strategic plan. She oversees internal operating systems and processes with an eye on both big-picture vision and tactical execution.

Lotte first became interested in energy efficiency while living “off grid” and relying exclusively on solar and wind power for water pumping and electricity. She is a graduate of Wellesley College and holds an MBA from Georgetown University’s McDonough School of Business.

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