Our Net Zero Expert Panel met for its second session at a very special place; the Aldermen’s Court Room design by Richard Gilbert Scott, which is part of the 1970’s extension of the London Guildhall and connected to the NLA’s London Centre.

We used this session to explore Net Zero Leadership. Over the course of the year, we will be responding to thought provoking questions that will help us prepare a collective paper on what it takes to be a leader in Net Zero. 

During this session, we tackled the first three of five questions below. 

1. What are the main challenges in making net zero a priority within the built environment industry?
2. Who are the key actors involved in the built environment’s transition to Net Zero?
3. What (current and future) skills are needed to drive this transition and develop knowledgeable and adaptable leaders?

The conversation was varied, from the challenges around the amount of differing policy to who has the greatest influence and the skills needed to get the industry moving faster towards our Net Zero goals.

Policy

Development financing structures was a key topic of debate, where there is still much “business as usual”, with short-term commercial drivers largely outweighing long-term environmental considerations, thus limiting investment in long term plans. There’s a perception that most of the industry doesn’t value its climate impact. Often lower carbon design is led by ambitious and passionate developers who have a strong ethical stance on sustainable development and/or recognise that having a low carbon product will yield a higher rate of investment return. The risks associated with the cost of doing things differently is stifling the speed of innovation and the maturing of low carbon and circular economy markets. 

In terms of policy, it was agreed that changes are needed quicker. There are many “carrot” policies out there which encourage developers to reach better sustainable targets, such as BREAAM, WELL, LETI and NABERS, and make a building product more valuable. There was consensus among the group that the Net Zero Building Carbon Standard (NZBCS), currently in pilot form, is emerging as the key defining policy.  Setting carbon targets for the industry is vital. How that is achieved can be done with a development-by-development basis, with reusing existing buildings being an easy win.

The age-old debate about VAT not being applied to new build vs retrofit rumbles on. Currently extra cost is lumped onto reuse projects which will typically be more carbon friendly. Though the group recognised in the current climate that financial viability, particularly of residential developments, is tough. Policy amendments are needed to the current Building Safety Act to fast track and reduce development costs.  With schemes that are more commercially viable, there will be more opportunity to innovate and find better ways to reduce carbon.

There are various “stick” policies stuck in government consultation, Part-Z being one of them. The proposed amendment to UK Building Regulations would require developers to assess and report on the whole-life carbon (WLC) emissions of new buildings exceeding a certain size, and later to comply with embodied carbon limits. The EU is already further advanced with similar policies, so the UK is playing catch-up.  

When discussing the key actors needed to transition the built environment to Net Zero, the simple answer was everyone, but can be were distilled to:

·      Government and Regulatory bodies: setting policy, building standards, and financial incentives to steer the industry

·      Financial Institutions and Insurers: to enable investment in net-zero projects through financing, underwriting, and valuation practices

·      Designers/Innovators and Clients: translating technical to real operational strategies.

·      Contractors and Manufacturers: to deliver low-carbon construction methods and materials

·      User and educators

Focusing on skills needed to drive the net zero transition, understanding systems thinking, and enhancing carbon literacy, were recognised as immediate areas where the industry needs to become more proficient. Future skills and jobs will be created through the circular economy, which makes good of building materials that would have previously been sent to landfill or recycled instead of reused.  

It was acknowledged that developing skills related to reducing carbon emissions in the industry should be combined with training in other climate resilience areas, such as improved water management, biodiversity, and nature recovery. These are all important for adapting to climate change. Additionally, leaders will need to consider the social impacts of changes required to achieve Net Zero and formulate strategies to support this transition.  

Looking ahead to our next session in September, the group will be looking to answer the following further questions:

4. Why is system(s) thinking important to achieving net zero in the built environment, real estate and construction industry/ies?
5. In the current industry, what do we call success and is it really success?

It’s a privilege to chair this fantastic panel of passionate expert professionals. We look forward to sharing our work through the NLA later in the year.