Civic initiatives prompt commercial properties to target sustainability

Guardian

Government and city support is helping businesses assess the environmental impact of their premises and improve energy efficiency
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Milan's Piazza Gae Aulenti Modern buildings
Changed regulations have enabled buildings in Porta Nuova, Milan to tap into an aquifer beneath the city.

Payback times are short and the benefits are obvious. So why have owners and operators of commercial buildings been reluctant to implement efficiency measures?

One problem is that landlords have little incentive to act, given that they foot the bill for any improvements, but the tenant benefits from lower energy bills. Although more efficient buildings with lower energy costs are more attractive to tenants, this is often outweighed by other considerations, such as the upfront costs involved.

Central government regulations and initiatives such as Australia’s National Australian Built Environment Ratings System (Nabers) and theUK’s Carbon Reduction Commitment play a role in making commercial buildings more efficient – but the recent announcement by New York mayor Bill de Blasio that the city will spend $1bn improving the energy efficiency of its public buildings over the next decade shows how city governments can be a real driving force in promoting energy efficiency.

London takes a different approach, according to climate data collector CDP. “The city’s planning policy requires new developments to follow an energy hierarchy, in which energy efficiency is prioritised through building design,” the group’sGlobal Cities report (pdf) says.

But as Matthew Pencharz, senior environment and energy advisor to the Mayor of London, says, 80% of existing buildings will still be in use in 50 years’ time, so it is crucial to mobilise the retrofit of older buildings as well.

Tapping underused resources
Some cities have the power to encourage change through their regulations. Milan, for example, was able to simplify the procedure for gaining access to groundwater. In the Porta Nuova business district of the city, for example, buildings were permitted to use water from an aquifer below the city, which remains at a constant temperature of 15C all year round. This enabled heating and cooling company Climaveneta to create an energy-efficient system for providing heat and cooling that cuts energy consumption by up to 50% and CO2 emissions by more than 40%.

“In Milan, the aquifer has always been particularly rich and accessible. In fact, after water-intensive manufacturing was replaced by the service industry, there was an increased risk of flooding, as well as other urban planning problems,” says Andrea Bertelle, communications manager at Climaveneta.

“The municipality found a way to turn this growing challenge into an opportunity, by encouraging groundwater use for heating and cooling in combination with smart, electricity-driven heat pumps. This, along with better control of the aquifer level, also allowed a reduction in carbon emissions and pollutants from fossil fuels, with a significant air-quality improvement in the city centre.”

Other schemes, such as London’s Business Energy Challenge, recognise companies that take measures to cut their energy use. The winning companies will be honoured at an awards ceremony in November, hosted by Boris Johnson, the Mayor of London. “It is a way of recognising the great work that has been done – and having the mayor involved helps to elevate it to the level where stuff really gets done,” says Pencharz.

“This is important not just from a carbon perspective but also because, by cutting costs, it helps make London more competitive and a more attractive place to invest in. There is great competition between the world’s megacities to attract businesses,” he continues.

Local authorities could also offer council tax rebates for energy efficiency improvements, says Bownass, although such rebates should not cover the entire cost, because the landlord gains a commercial advantage by having a more efficient property.

Many authorities have focused more on improving the efficiency of their own buildings and private homes although this may be down to a misguided notion that “businesses were already doing this”, says Vivienne Thomson, a senior consultant at JLL. These programmes can encourage private sector initiatives by acting as a role model for energy efficient buildings and fleets.

Energy efficiency benchmarks, which many American and European cities have in place, are also an effective tool.

In New York, for example, every building bigger than 50,000 sq ft must submit data on the amount of energy and water consumed every year. The city believes the regulations “will give building owners and potential buyers a better understanding of a building’s energy and water consumption, eventually shifting the market towards increasingly efficient, high-performing buildings”.

Analysis by the US Environmental Protection Agency has shown that benchmarked buildings save an average of 7% in energy over three years.

“Benchmarks are really powerful because they help businesses understand how they are performing, particularly in relation to similar-sized companies,” Thomson says. Appealing to businesses’ competitive nature may yet prove to be one of the most effective ways of prompting significant steps forward in commercial property sustainability.

This content is brought to you by Guardian Sustainable Business in association with Climaveneta. Produced by Guardian Professional to a brief agreed and paid for by Climaveneta. All editorial controlled and overseen by the Guardian