Report calls for greater investment in commercial sector energy efficiency to convert a threat to profitability into an opportunity for business

Date: 28th November 2013

A new report produced by Westminster Sustainable Business Forum and think tank Carbon Connect has recommended an increased impetus from the Government to stimulate energy efficiency within the commercial real estate sector in the UK.

The report is the result of an inquiry chaired by Labour peer Larry Witty and Conservative MP Oliver Colvile into how to reduce energy demand from commercial buildings.  The commercial property sector in the UK is currently  responsible for 10% of all the UK’s greenhouse gases and the inability to seize energy efficiency opportunities is believed to be worth £1.6 billion of cost-savings.

Two of the main components of this inertia from the commercial property sector are: financing and a lack of understanding as to the means of capitalising on opportunities within commercial retrofit. The report calls on the wider use of the UK Green Investment Bank to fund a non-domestic subsidiary of The Green Deal Finance Company, under guarantee from HM Treasury, to offer low interest loans to SMEs to stimulate the market for energy efficiency.

Talking about the report, Colvile said there was a need to “increase the resilience of our businesses against the threat of climate change”

He added: “The obvious cost savings, coupled with improved productivity that can be realised from energy efficiency, makes it quite clear that now is the time to invest on a large scale.

“To do that requires government intervention – to raise awareness, guarantee low cost loans, stimulate the market and incentivise the landlords.”

The report said that commercial buildings were responsible for 10% of the UK’s greenhouse gas emissions and that rising energy prices and taxes were a threat to the UK’s profitability.

It said that the commercial sector was currently “failing to link business growth to energy costs”.

 

The report makes the following recommendations to Government:

• Compile a database of the energy performance of commercial buildings
• Require reports written under the Energy Savings Opportunities Scheme to be signed off by a senior executive
• Embark on a national advertising campaign for the commercial Green Deal as well as a street-by-street promotional campaign.
• Issue guidance to Local Enterprise Partnerships encouraging the uptake of energy efficiency measures
• Remove the golden rule from the non-domestic Green Deal, which mandates that total savings from a Green Deal must outstrip the cost
• UK Green Investment Bank to fund low-interest Green Deals for SME’s
• Publish case studies of projects from the London Re:Fit programme, which has funded upgrades of commercial buildings in London in recent years
• Integrate international performance measurement standards into the Green Deal
• Introduce strong penalties for landlords that don’t meet their minimum energy performance certificate (ECP) obligations
• Enforce legislation requiring display energy certificates (DECs) in its own buildings
• Develop a routemap for increasing energy efficiency in the commercial sector with industry
• Extend the length of time that landlords can receive empty property rate relief from Local Authorities to 12 months to encourage landlords to undertake energy efficiency projects

The report is currently available here to download.

 

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