Blog

Net-Zero for Construction: What are the Costs?

01.08.2022

A Look at What Net-Zero for Construction Means For Outgoing Spend as we Move Towards the 2050 Target

 

Net-zero for construction is becoming a key focus. It’s something which has become an integrated part of almost every industry’s CSR (Corporate Social Responsibility) targets; since the 2015 Paris Agreement, 192 countries plus the EU have pledged to become carbon neutral by 2050. And with the built environment responsible for 40% of carbon emissions (UK Green Buildings Council), it’s vital that construction lead the way.

However, what does the transition mean for costs? Decarbonisation takes innovation and re strategising, which can mean investing into additional resources. With the construction industry overall operating at low-profit margins, this could pose a significant challenge. However, there is evidence that, the greener option can also be the cheapest. Through repurposing, energy savings and increased efficiency significant savings can be made.

Overall, costs must be considered within net-zero targets in order to ensure both profitability AND decarbonisation. Whilst many decisions will be situational and project-dependent, there are also industry-wide trends which can be addressed. With this, construction as a whole can accelerate toward a net-zero future.

 

Cutting Out Waste: Moving from a Linear to Circular Economy

 

The construction industry currently operates on a mostly linear economy. This essentially means a model of take—make—waste (opposite to a circular economy where resources are repurposed). This is not only unsustainable, but extremely cost-inefficient too.

Most UK buildings are constructed from virgin raw materials, with very little reuse or repurposing. In fact, in 2014, 210 million tonnes of minerals were extracted in the UK, 83% of which were used in construction (Hertfordshire Gov).

When no longer fit for purpose, most construction material is sent to landfill. And the UK construction industry alone contributes 32% of landfill waste (Hertfordshire Gov). Not only does this cause significant greenhouse gas emissions, but it’s a loss of financial savings from potential repurposing too.

Though site waste management is no longer a legal requirement, many construction companies have continued to self-monitor, gradually moving from the linear to circular model. Through increased resource efficiency, reduced waste and material reuse, construction companies are not only improving sustainability but saving on spend too.

 

The Cost of Building Net-Zero for Construction from the Ground Up

 

There are many aspects to consider over a building’s life cycle in meeting net-zero. However, the primary construction phase is vital; building a sustainable foundation from the get-go can vastly increase long-term efficiency and help avoid expensive retrofits further down the line.

On route to this target, the UK Green Building Council’s (UKGBC) 2021 study Building the Case for Net Zero has stated that new builds, in-line with 2025 standards, could help save costs due to the easy avoidance of later retrofitting.

The study, according to Julie Hirigoyen (UKGBC Chief Executive), “provides long-awaited evidence that building today to the standards of energy and carbon efficiency required by 2025 doesn’t have to cost a fortune and is likely to be offset by enhanced value”.

The importance of avoiding costly retrofitting can’t be emphasised enough: A recent PWC report indicated that subsequent owners are unlikely to pay for necessary retrofits for efficiency when buildings don’t structurally meet requirements. It’s further evidence that sustainability from initial construction is vital for both money saving and net-zero progress.

The UKGBC’s 2021 study does note, however, that 2030 targets are expected to see costs rise by as much as 17%. This is put down to the industry “not yet [being] geared up to delivering [targets] at scale”. However, this can be tackled with financial government incentives, supply chain regulations, and an eventual rise in supply and demand for sustainable resources. It shows a strong need for industry shifts, yet a way forwards still.

net-zero for construction

Moving Forwards Sustainably…

 

With the built environment’s significant greenhouse gas contribution, construction are central in driving UK net-zero targets. High sustainability stakes call for a top-down industry transformation. Though this undoubtedly presents a challenge, the relative financial incentives can’t be ignored. In acting now, a sustainable foundation for a greener future can be set out. And with collective industry shifts, net-zero goals can be both achievable AND affordable.

Find out what ENGAGE can do for Construction Companies…