Energising Decarbonisation Across the Built Environment

Global energy markets are feeling the strain of mounting geopolitical instability and are in a race against time to decarbonise utility grids.

Consequently, this industry pressure is being passed onto consumers in the form of elevated wholesale prices. Energy resilience is now a major topic in boardroom conversations, paired with the ever-present discussion on how Net Zero Carbon targets are going to be accomplished with more pace and urgency. An organisation’s ability to hit targets while managing costs and mitigating risks surrounding these topics is pivotal in shaping its profitability and influencing future investments.

For a lot of organisations, improving the energy performance of their real estate and facilities is crucial for them to thrive as a business in a future where there will be increased pressure on operational expenditure and carbon emissions. Currently buildings and industrial systems contribute to 68% of global energy consumption, however positively, building systems are inherently inefficient and present many opportunities for owners, operators, and occupiers to drive enhancements without significant disruption.

But are organisations succeeding in their quest to create energy efficient real estate portfolios and facilities?

To better understand current market sentiment, Arcadis launched a survey asking clients to shed light on how they are responding to the aforementioned challenges. Do they have confidence in their energy and carbon targets being achieved? Is relevant data readily available to clients so they can make informed decisions? Are they seeing a return on investment from initiatives implemented to date?

Survey results from over fifty clients across multiple sectors suggest that although the industry is mobilising initiatives to drive energy improvements and facilitate accelerated change, progress has stalled when it comes to practical implementation. Many organisations admitted to not having the necessary data, tools, and capacity to keep pace with proposed timelines. This has led to an emerging sense of uncertainty about the effectiveness of existing strategies and how realistic they are.

Nearly 90% of respondents confirmed that energy consumption and operating costs were now a top three priority for their organisation, but only 45% had the relevant data to allow them to identify the root cause of performance issues. Furthermore, only 30% of clients had seen any success in implementing energy reduction measures to date and under half had a robust method to validate return on investment. A Managing Director within the hospitality sector summed up the challenge of translating data into actionable insight by stating that their organisation had lots of data but was finding it “very hard to isolate the root cause of variances” in energy performance across a vast portfolio.

Based on the outcome of this survey exercise and through feedback from regular conversations with our clients, the Arcadis Intelligent Buildings team has formed its top three takeaways. These takeaways aim to prepare clients at any stage of their journey to drive energy efficiency improvements and decarbonisation measures across their real estate portfolios.

• Managed Service over Software: Translating Plantroom Data into Boardroom Insights.

Often, those responsible for the energy performance and decarbonisation of real estate portfolios lack the quality of information they need to make informed decisions. Quality over quantity is important; gigabyte after gigabyte of raw data does not guarantee positive results and immediate value for your business.

Make sure you have qualified people with the necessary skills to give context to your building data and translate it into actionable insight. These skills typically include specialists in energy systems, data integration and decarbonisation.

• Beyond Changing Loo Rolls: Maintenance Contracts That Promote Positive Change

Traditional maintenance contracts are predominantly reactive, often designed to fix something when it breaks instead of driving efficiencies and continuous improvement. Organisations are starting to realise the benefits of moving to performance-based agreements that incentivise proactivity around energy performance.

Consider whether your facilities management contracts are fit for purpose and facilitate the continuous optimisation of your real estate. Emerging building standards, such as NABERS UK, demand year on year improvements through real time measurement of actual energy usage data.

• Low Hanging Fruit: Quick Wins Funding Longer-Term Decarbonisation.

Building owners and occupiers typically consider poor energy performance to be an expensive problem to solve. However, we have seen examples of organisations leveraging no-cost or low-cost measures to deliver a rapid return on investment, which in turn can unlock funds for more capital-intensive initiatives.

Do not overlook quick wins to provide you with a self-funded route to achieving your energy efficiency and decarbonisation objectives. Seek out rapid technology pilots where advanced software can expose high impact opportunities in a short timescale.

• The Reporting Dilemma: Paving the way to Transparent Sustainability

Meeting ESG and Net Zero Carbon targets has become shortform for businesses’ commitment to ethical responsibility. This has led organisations to rush to software tools in aid of navigating the plethora of reporting frameworks, but technology providers have struggled to meet the growing market need.

Reporting data is sourced from many outlets across a real estate portfolio with varying degrees of data integrity. This is a continuous struggle for many organisations who have invested in a technology suite which has not delivered on the pitch. Our survey respondents found data pipelines to be highly tenuous, difficult to manage and misaligned to the capabilities of their selected technology partner. It is vital that data pipeline management is fleshed out for long term high integrity reporting and that your technology partner has the ability and agility to solve challenges and adapt their solution.

• Public Policy Foresight: Preparing for the Future Regulatory Environment

With the ever-increasing public spotlight on climate change and a rapidly evolving regulatory environment, we have seen many examples of government policies being rushed to market that have had massive implications for the built environment and the organisations that operate within it, leaving minimal time for businesses to react.

Legislation continues to be the key trigger for agency and investment by organisations into energy use interventions, even though it lags behind technology innovation. From survey feedback and our market experience, real estate owners who proactively invest in a data architecture that enables them to play in a future landscape of flexible demand response events, will be most resilient and adaptable to both regulatory change and energy market spikes.

It is clear that the challenges organisations are currently facing are only going to be exacerbated as global energy deadlines get closer. For our clients, the present volatile state of energy in the built environment is concern enough.

In response, Arcadis is working closely with organisations to guide them through the complex landscape of energy optimisation and decarbonisation, taking ownership over the performance of clients’ real estate portfolios. This brings together subject matter expertise from across our global business and has proven energy savings of over 30% within a matter of weeks of teams being mobilised.

Get in touch to find out how Arcadis can help address your energy and decarbonisation challenges by contacting Will Readshaw: will.readshaw@arcadis.com