Arup Q&A: Decarbonising Buildings and the Built Environment

The operation of buildings accounts for 30% of global final energy consumption according to the International Energy Agency.

What’s more, the United Nations Environment Programme says that materials used in the construction of buildings account for around 9% of energy-related CO₂ emissions.

Arup is a global sustainable development consultancy that provides design, engineering, architecture, planning and advisory services across the built environment. 

Stephen Hill is an Associate Director in Arup’s Sustainability team in London, leading its work on carbon and net zero strategy for the London office. 

Stephen specialises in sustainability strategy for property portfolios, masterplans and building developments, with a particular focus on carbon emissions with experience spanning both developments and asset management. 

He was involved in the development of NABERS in the UK and is now part of the NABERS Independent Design Review Panel.

Stephen shares his expertise with Sustainability Magazine.

Why is it important to have net zero buildings?

Keeping global temperatures within 1.5°C is a huge global challenge, and at a fifth of global carbon emissions the property sector is a big part of the problem.

The only way to put the property sector on a path to net zero emissions is through transitioning individual buildings to net zero, both new build and retrofit of existing.

What is needed to make net zero buildings the norm?

Firstly, we need to be clear and consistent about what a net zero building is.

In many global markets this is not yet in place, but the UK has made significant strides with the pilot Net Zero Carbon Building Standard, which is already clarifying the conversation around what a net zero building is and how hard it is to achieve.  

A fundamental shift is required from code compliance to an operational performance framework that rewards real energy performance. This is a fundamental shift in the way energy performance of property is governed. We are starting to see early examples of this in practice. For example, the National Australian Built Environment Rating System (NABERS) in Australia has brought about a doubling of energy efficiency of commercial property since its launch in 1998. This is now also in place in New Zealand and the UK, and under consideration in Germany.

In New York City, Local Law 97 requires disclosure of operational carbon emissions for all buildings. And from 2025 buildings that breach the defined energy intensity limits will be subject to a carbon tax. 

Once we have a definition, transparency is critical, and this is where the role of government is key (whether local or national).  Mandating disclosure of building performance against net zero thresholds gives clarity to investors and occupiers. Once the market starts to prefer net zero buildings, this drives a value premium which in turn will incentivise investment in net zero transformation.

Critical to this is the alignment of the major sustainability certifications with Net Zero.  This would mean a building had to be definitively net zero to achieve major industry recognition of its credentials – like Building Research Establishment Environmental Assessment Method (BREEAM) outstanding or Leadership in Energy and Environmental Design (LEED). 

What is holding back progress in sustainable buildings?

While transparency and aligned incentives can drive the commercial property market towards net zero, the domestic sector requires different drivers. Government intervention is essential. Currently, no country has a comprehensive net zero buildings requirement enshrined in national legislation. The EU Zero Energy Buildings (ZEB) requirement is a step up in standards but remains rooted in a code compliance approach and doesn’t yet address real energy use in operation.

Governments need to mandate transparency and introduce minimum performance standards that increase over time. They can also lead by example, driving net zero transitions across their own estates. In Australia, government-mandated NABERS ratings for its properties significantly contributed to the scheme's success.

What are some policies and initiatives that have been effective at driving net zero buildings forward?

NABERS in Australia has driven a transformation in the energy efficiency of commercial property. The Australian government was crucial to this, both through mandating NABERS ratings for assets over a certain size, and also through enforcing a minimum standard for government buildings.  

Energy performance disclosure in New York City (Local Law 97), as well as other US cities has focused attention on operational performance, and the introduction in 2025 of a carbon tax for buildings that breach limits will no doubt change the narrative again.

In London, the Greater London Authority’s London Plan in 2021 required all major projects to declare both embodied carbon and estimated operational energy. This has really changed the narrative in the London development market, especially around embodied carbon, with leading players racing to deliver the lowest carbon development.  

And this is not limited to the Global North, city administrators in both Jakarta, Indonesia and Kuala Lumpur, Malaysia are developing city-wide net zero buildings roadmaps.  And South Africa is introducing mandatory energy performance certificates based on real energy performance from 2025.

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