Our Net Zero Carbon Project Services
With 39% of global emissions coming from buildings and their construction alone, the built environment sector has a very important role to play in the fight against climate change.
Turning ambition into action: Navigating net zero for owners and facilities managers
In England and Wales, 7% of buildings over 1,000m² account for more than 53% of energy used by commercial and industrial buildings. Operating these buildings and others in an energy and carbon efficient way is essential to meet the UK’s statutory net zero 2050 target.
Rising regulatory pressures to decarbonise, together with growing expectations from local authorities, investors, and occupiers, mean owners, property managers, and facilities managers must understand what net zero requires in practice to protect occupancy levels, asset value, access to funding, and reputation.
Our building performance and sustainability experts, Erieta Dimitriou, David Callaghan, and Jen Hamilton, share practical steps to achieve net zero across your portfolio, from measuring and reducing emissions to aligning with evolving regulations and frameworks, and closing the performance gap.
Erieta Dimitriou David Callaghan Jen Hamilton
Understanding carbon in buildings
Achieving net zero buildings requires addressing two key dimensions of carbon:
- Operational carbon – emissions from daily building use, including heating, cooling, and power.
- Embodied carbon – emissions generated from the materials and construction processes, both in construction, maintenance, and end-of-life stages of a building’s lifecycle.
A comprehensive strategy is needed that adopts a whole life carbon assessment approach, and addresses carbon emissions generated during the post occupancy phases of a building’s lifecycle. These emissions can be assessed using methodologies such as the UK Net Zero Carbon Buildings Standard or PAS2080 Carbon Management in Buildings and Infrastructure.
From measurement to management
As Peter Drucker said, “what gets measured gets managed”. By measuring asset level operational emissions, organisations can combine them to report Scope 1, 2, and 3 emissions under the Greenhouse Gas Protocol, a reporting methodology that underpins corporate climate targets, such as the Science Based Targets Initiative.
The Streamlined Energy and Carbon Reporting (SECR) framework mandates UK companies to disclose their annual energy use and greenhouse gas emissions in their Directors' Reports, enhancing transparency and accountability. This publicly available information is easily accessible to wider stakeholders, including potential tenants, purchasers, funders, and climate activists.
Decarbonising buildings is key to delivering corporate climate pledges. Delivering on these commitments at asset and organisational levels requires evidence-based planning and phased investment. Energy audits, dynamic simulation and thermal modelling, retrofitting strategies, and renewable integration, such as rooftop solar panels or heat pumps, can significantly reduce operational emissions. Funding and incentives are increasingly available for these investments, including green loans and sustainability-linked finance. An informed approach can unlock these opportunities whilst ensuring compliance with evolving regulations.
Overcoming common challenges
Many organisations struggle with data gaps, retrofit costs, or limited internal capacity to implement these changes . The most effective strategies share these traits:
- Early transition planning: Landlords must align their corporate climate commitments and translate them into clear actions across their portfolios. This will ensure they can deliver them, put financial plans in place to smooth the funding of investments, and manage market expectations, in particular if there’s a short-term impact on profitability.
- Start with data: Strategic energy metering and sub-metering are important to inform decisions and clarify reporting boundaries and responsibilities. Use results of the energy audits and modelling to guide investment decisions and behavioural change campaigns targeted at occupiers.
- Collaborate widely: Bring all stakeholders together, including facilities managers, finance teams, and occupiers to align objectives and unlock investment opportunities. Create feedback loops so occupiers and facilities managers, who understand how buildings operate in practice, can inform design teams tasked with infrastructure and operational changes.
- Incentivise: Owners can incentivise facilities managers to deliver and sustain energy improvements within facilities management contracts. As well as set energy use reduction targets over time, with requirements to engage with occupiers to drive necessary behavioural changes.
The market has spoken
The UK Government has predominantly used the EPC system to assess energy performance and carbon emissions in buildings. An EPC assessor evaluates the building’s fabric and energy using building services through theoretical modelling, and models how the building might perform based on the behaviour of a ‘typical occupant’. This assesses how the building should perform. Owners can improve their building’s EPC score through investment in the building’s fabric or building services systems. However, the EPC does not measure metered energy consumption or associated carbon emissions. Metered energy consumption will depend on how well the building is maintained, and how efficiently regulated and unregulated energy is used in the building post occupancy.
In large, complex buildings, a building’s EPC score and its actual energy and carbon performance in practice can vary significantly. Under the Minimum Energy Efficiency Standards (MEES), the UK Government has made it unlawful to lease commercial buildings with an EPC rating below an ‘E’. This is expected to become more stringent by moving to a ‘C’ rating by 2027 and to a ‘B’ rating by 2030. Buildings that fail to meet these standards risk becoming ‘stranded assets’ and being devalued due to their unmarketability.
Aligning with evolving regulations
In 2019, the UK Government consulted on the introduction of an annual mandatory ‘performance-based’ rating system and disclosure, similar to the National Australian Built Environment Rating System (NABERS). A ‘performance-based’ rating scheme measures real energy use from meter readings, placing the occupant at the centre. These schemes typically report a building’s energy intensity on a square metre basis to standardise different building sizes and factor in the building’s operating hours and number of occupants. This allows the building’s performance to be benchmarked for similar building categories and highlights whether it’s being run efficiently or inefficiently, compared to others. Although a UK policy framework to mandate such measurement and assessment of building performance hasn’t yet been introduced to address this widely acknowledged ‘performance gap’.
While government policy across the UK has stalled, market pressures are driving the transition from the bottom up, with the buildings sector taking the initiative. The Better Buildings Partnership launched NABERS UK, in conjunction with the Building Research Establishment (BRE), Chartered Institution of Building Services Engineers (CIBSE) and the Australian NABERS scheme.
Voluntary rating schemes like the recently released BREEAM version 7 standard are also raising the bar higher. The updated standard introduces new minimum energy performance, and whole life carbon standards across more categories, and requires whole life carbon assessments at three key design stages where, an ‘Outstanding’ or ‘Excellent’ rating is targeted. Facilities managers can now provide their clients with value added advice by gaining credits available and operational insights that focus on in use performance.
In parallel, mandatory climate disclosures for large or listed organisations, such as the Task Force on Climate Related Financial Disclosures (TCFD) and the Corporate Sustainability Reporting Directive (CSRD), will drive increased transparency to allow stakeholders access to information on energy efficiency, carbon impact, and resilience. In this fast-evolving landscape of net zero standards and reporting, low-carbon buildings support long-term resilience, competitiveness, access to green finance and attract premium rents.
Looking ahead
Net zero buildings will soon be the baseline for how property assets are valued, financed, and operated, with on-site renewable generation helping deliver carbon negative buildings. Carbon pricing mechanisms for buildings are currently indirect, such as the Climate Change Levy (CCL), which is an indirect tax on the energy supplied to non-domestic consumers, but impacts the energy cost of building operations, and may increase in the future. The Emissions Trading Scheme (ETS), a cap-and-trade system for carbon intensive industries, may be extended to buildings. The ‘do nothing’ or ‘wait and see’ option has now become an operational, financial, and reputational risk, as well as a climate risk.
AI-driven analytics are already transforming how we monitor and optimise building performance through smart building management systems. Forward-thinking organisations are preparing for change by:
- Setting science-based climate targets and preparing transition plans to deliver them at asset level
- Building internal technical and governance capability and capacity
- Embedding net zero goals into procurement, maintenance, design of new building specifications and retrofit and maintenance strategies
- Gathering data through energy audits and modelling to inform target setting and transition planning
- Engaging with occupiers on targeted behavioural change campaigns to reduce operational energy and carbon
What next?
The urgency is clear, but so is the opportunity. By combining data, collaboration, and clear strategic planning, property owners, with the support of their facilities managers, can turn the challenge of net zero into a driver of long-term value and resilience.
At Tetra Tech RPS, we translate policy and technical standards into actionable pathways. Our multidisciplinary team brings expertise in sustainability consulting, whole life carbon assessments, energy modelling, planning, and retrofit design to help clients plan and deliver decarbonisation confidently on their path to net zero carbon.
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