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Low Carbon Construction Innovation and Growth Team Final Report

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Low Carbon Construction Innovation and Growth Team Final Report Low Carbon Construction Innovation & Growth Team Final Report Autumn 2010 Low Carbon Construction IGT: Final Report 01 Foreword “I have yet to see any problem, however complicated, which, when looked at properly, did not become still more complicated.” Poul Anderson, New Scientist The question that underlies the terms of reference given to the team that produced this report is a simple one: “Is the construction industry fit for purpose for the transition to a low carbon economy?” Inevitably, the answer is not so simple. Even defining “the construction industry” is a challenge, given the extraordinary range in its activities (from the earliest conceptual thinking of world class designers through to the smallest item of maintenance or repair, long after the initial construction is complete); in the nature of its workload (from a nuclear power station to fitting a single socket outlet); and in the nature and scale of its businesses (from the global players through to almost a million individual tradesmen working alone). It is therefore unsurprising that the degree of awareness, engagement and readiness to deliver products and services that will enable the transition to a low carbon world is equally varied. It is, however, no exaggeration to say that all of these businesses, with all of their differences of skill, experience and capacity, will need to be deeply engaged if we are to meet the commitment of the Climate Change Act to reduce our emissions by 80% by 2050, as so much of that transition depends upon the services of the construction industry in all its breadth and depth. To begin to answer the question, there are British architects, engineers and other consultants working at home and around the world earning the UK a well-deserved reputation as leaders in sustainable design; construction companies and specialist contractors who, as well as building on their existing capacity to deliver the buildings and infrastructure that we need to support “greener” ways of living, are also putting sustainability at the very core of their own businesses; manufacturers producing innovative products and committing the serious investment required to bring them to market; materials producers, many of them intensive users of energy, completely changing their processes to reduce the impact of their operations; distributors promoting those products and developing the logistics necessary to deliver them where they are needed in the most user-friendly ways; and small businesses and individual tradesmen advising customers on simple things they can do to improve the energy efficiency of their buildings. There is also a host of professional and academic institutions, trade 02 associations and specialist interest groups who are deeply involved in research, development and dissemination around the subject of carbon and broader measures of sustainability In summary, the industry is already demonstrating, in parts, that it has both the capacity and the inclination to play a full part in meeting the challenge of climate change, and converting that challenge into an opportunity for growth, both in the UK and in export markets. For all of those already engaged, and the many still to be engaged, however, there are three crying needs: for clarity – for a clearer path through all the complexities which attend the transition to low carbon; for co-operation – for Government and industry to work together in finding that clarity and making plans; and forconfidence – for market failure to be addressed so that building owners and occupiers are incentivised to become customers for commercial offers aimed at carbon reduction. In the meantime, there is a powerful sense of pent up potential in the industry. There is broad acknowledgment within the industry that the transition to low carbon will also demand transformation of the way they do business. Some of the changes required will be radical. To make these changes the industry needs to know that it is doing so with a clear understanding of the future landscape, and with confidence in the emergence of a strong market for its wares. Many of the recommendations in this report are directed to Government, only because the scale of the challenge, and the degree of market failure, is such that only Government can set the framework for action. This is not, however, to understate the challenge to the industry itself: to develop new products and services, to build skills and capacity, and to make the transformation in its own structure and practice that will deliver a transition to a low carbon built environment that is both affordable and assured. Paul Morrell, Chair of Steering Group, Innovation and Growth Team. Low Carbon Construction IGT: Final Report 03 Contents 1. Executive Summary 04 2. Carbon and the Built Environment 12 3. Industry-Wide Issues 42 4. Major Projects 81 5. Housing 92 6. Non-Domestic Buildings 136 7. Infrastructure 174 8. 2050 Group 198 9. Next Steps and Engagement 204 10. Acknowledgements 205 Annex A: Summary of Recommendations 206 Annex B: Members of IGT Steering Group and Workstreams 216 Annex C: Consultees 219 Annex D: Carbon, Major Climate Change and Energy Policies – Tax, Levy and Market mechanisms 223 Annex E: Opportunities in Product Development 226 Annex F: Export Opportunities in Low Carbon Construction 228 04 1. Executive Summary This is the final report of an Innovation and Growth Team (“IGT”), drawn from across the UK construction industry to consider how the UK construction industry can rise to the challenge of the low carbon agenda. It follows Emerging Findings published in March 2010, and builds on those findings, as charged by Mark Prisk MP, the Minister for Business and Enterprise in the Department for Business, Innovation and Skills; and the report has also been produced with the support DECC, CLG and DEFRA. This report wholly replaces the Emerging Findings, with text that is still relevant brought forward to this final report. Unsurprisingly, since it is only 7 months since the publication of that preliminary report, the over-arching context remains much the same: 1. The United Kingdom’s commitment to reduce carbon and other greenhouse gas emissions is now a matter of legal obligation. The strategy by which this might be achieved will reach deep into every aspect of the built environment, and depends for its delivery upon the construction industry working at its best. Over the next 40 years, the transition to low carbon can almost be read as a business plan for construction, bringing opportunities for growth. 2. For companies in the wider construction industry, the task is three-fold: ●● to de-carbonise their own business ●● to provide people with buildings that enable them to lead more energy efficient lives ●● to provide the infrastructure which enables the supply of clean energy and sustainable practices in other areas of the economy 3. This will require innovation – new ways of working and the acquisition of knowledge and skills that will provide competitive advantage at home and internationally, building on the United Kingdom’s reputation as a world leader in sustainable design. 4. These opportunities exist at every scale, and while there remains much to resolve in a 40 year programme of work, there is much that can be done now, particularly in the existing building stock. This work, which extends right across the country, is the daily bread of one million small businesses that operate in the sector, and could provide each of them with a potential springboard to growth, and the country with a maturing supply chain. Low Carbon Construction IGT: Final Report 05 5. A concentration on energy and carbon brings simplicity and rigour, and provides a new focus for action and a sense of priority; but carbon reduction is not the only critical issue for the industry, nor the only measure of sustainability, and plans across all measures, addressing both mitigation and adaptation, need to be integrated. 6. There is a general and growing awareness of the challenge, but few businesses have an accurate understanding of the sheer scale of the undertaking ahead; and there is a level of disbelief about whether or when the difficult decisions that will lead to the necessary changes in customer behaviour will be made. “While buildings offer the largest share of cost-effective opportunities for GHG mitigation among the sectors examined, achieving a lower carbon future will require very significant efforts to enhance programmes and policies for energy efficiency in buildings and low- carbon energy sources well beyond what is happening today.” Fourth Assessment Report, Intergovernmental Panel on Climate Change, 2007 7. The construction industry’s pivotal role in any carbon reduction programme creates the opportunity, almost the obligation, for it to take up a position of leadership – going beyond developing innovative products and services designed with carbon reduction in mind. 8. The construction industry has engaged positively with the issue of sustainability, with many examples of leading edge practice, and it stands ready to play its part in responding to the more focused challenge of carbon reduction; but there needs to be a quantum change in the response to that challenge if the commitments of the Climate Change Act are to be met. 9. This calls for active engagement with the process of identifying the main barriers to transformation, and the means of overcoming them – probably the biggest change management programme that the industry and the society it serves has faced since Victorian times. 10. The IGT has addressed these barriers through a series of work streams that represent sectors with essentially different markets, business models or primary drivers. There are, however, a number of common themes that recur throughout the report and which lead to a number of the key recommendations. These major themes, each of which has a corresponding barrier (or array of barriers) to progress, are: ●● The need for clear leadership.
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