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Net-zero buildings – the way to a sustainable real estate industry by Schneider Electric

Estelle Monod

Sustainability is a hot topic for today’s commercial real estate investors, owners, and operators. This post discusses the drivers behind the journey to ‘net-zero’ and how transforming your buildings into all-electric, all-digital Buildings of the Future can help meet your sustainability, regulatory, and financial goals.

Why pursue a net-zero strategy?

Voluntary corporate environmental, social, and governance (ESG) reporting is now a standard part of annual reports, and for a good reason. Financial visionary Larry Fink of Blackrock recognized that sustainable assets are now consistently outperforming other asset classes.

Sustainability reporting may also soon become mandatory in some parts of the globe. Take the example of the EU Taxonomy, which Harvard Law School helps explain as “a classification system for organizations to identify which of their economic activities, or the economic activities they invest in, can be deemed environmentally sustainable.” In effect, since 2020, financial market participants and large companies in the EU now need to report against the Taxonomy. We can imagine introducing similar reporting requirements in other parts of the globe.

Further, building owners must comply with increasing regulations as governments take action on their emissions reduction targets. For example, U.S. President Biden recently announced an executive order designed to reduce emissions across federal operations, including a goal to create a “net-zero emissions building portfolio by 2045, including a 50 percent emissions reduction by 2032.”

Finally, investment in sustainability is no longer considered a burden – rather, it can be financially positive. The WEF estimates that “buildings are responsible for 40% of global energy consumption and 33% of greenhouse gas emissions.” And most waste 30% of the energy they consume. A greener building is a far more energy-efficient one. This is a big opportunity to save money while reducing equivalent emissions.

These drivers demonstrate that more sustainable buildings can create short- and long-term value for all stakeholders. But is net-zero achievable? How can you go even further?

Achieving net-zero buildings and beyond

The term net-zero has become popularized recently. The UN reports that, so far, over 70 countries and 1200 companies have published their commitment to becoming net-zero. Further, the Net Zero Asset Managers initiative includes an international group of 236 signatories with USD57.5 trillion in assets under management committed to supporting the goal of net-zero greenhouse gas emissions by 2050 or sooner.

If you want to offset the impact of your buildings on global emissions, you need to decarbonize every stage of the building lifecycle.

Decarbonizing the building lifecycle

One obvious way to decarbonize is to use materials and components that boast low embodied carbon.

For example, Schneider Electric offers the newest SF6-free switchgear and Green Premium products that use recyclable plastics and no harmful chemicals. Some can also be refurbished and reused, reducing waste further through the circular economy.

What may seem less obvious lies in all-electrical, all-digital approaches – we call this Electricity 4.0 – and accelerating this transition has the potential to transform real estate as a critical criterion in defining the winners and losers when it comes to future-proofing assets.

There is a clear shift towards electrical technologies in many domains.

Electricity is 3-5x more efficient than other energy sources and is also the best vector for decarbonization. Electrify every aspect of your buildings by replacing fossil-fuel-based loads like heating with electrical equivalents like high-efficiency heat pumps. And consider the energy efficiency of every major component in your electrical and HVAC infrastructure.

Support eMobility by designing an electric vehicle-charging infrastructure. Then add a renewable-energy-based microgrid that includes intelligent microgrid management and on-site storage. Whether using solar, wind, or other sources, the locally produced sustainable energy will help offset all energy consumed annually.

We believe digital transformation will affect a seismic change in the real estate ecosystem as the full potential of technologies like IoT, AI, and machine learning are unleashed.

Digitizing power and building management infrastructures will provide the necessary data to reveal opportunities to save energy, money, and carbon over the entire operational life of your building.

Leveraging IoT connectivity, the cloud, analytics, and advisory services will help you prioritize projects and validate savings while using active energy management to optimize efficiency. Of course, ensure this added connectivity is secure by choosing a partner like Schneider Electric that follows cybersecurity best practices at every level.

Another dimension of digitalization is building information modeling (BIM) tools like Autodesk Revit and RIB MTWO. These are saving design firms time while helping them specify higher-efficiency facilities with greener materials. These systems also help construction contractors save time, minimize or eliminate rework, and stay on schedule. Less waste means reduced carbon.

Since your all-electric, all-digital building will already be very efficient, you may be able to go beyond net-zero to become net positive energy, helping you offset your building’s embedded carbon. Grid-interactive load management, green energy procurement agreements, and renewable energy credits can help further reduce carbon costs.

Proven technology delivers net-zero results

The combination of digitalization and electrification shapes Buildings of the Future to create sustainable, hyper-efficient, risk-resilient assets that are better designed for occupants. There are now thousands of recognized solutions that can help you on this journey. For example, many Schneider Electric technologies and solutions are included on the Solar Impulse Foundation‘s list of “1000+ profitable solutions to protect the environment.”

Can these solutions help achieve net-zero today?

Yes, they can. A proven example is the new Schneider Electric IntenCity building in Grenoble. With enough solar panels to fill 15 tennis courts, the facility generates almost a terawatt of power a year. It uses eight times less energy than the average European building while generating enough on-site renewable energy to power over 200 homes. It is expected to achieve Platinum LEED certification and be fully net-zero energy.

Another example is the United Therapeutics building Unisphere, the largest net-zero commercial building in the U.S. It uses a mix of advanced technologies that make the building fully sustainable. Beyond a hybrid system of geo-exchange wells and heat pumps, the building includes 3,000 solar panels that enable it to sell a surplus of power back to the grid, representing more power than it buys. All aspects of the building operation are integrated through the Schneider Electric EcoStruxure platform. Schneider Electric also played a significant role in systems integration for Unisphere, mocking up systems during the design phase to pre-validate them before the building became fully operational.

Recognized in Corporate Knights’ Global 100 for the 11th year in a row as one of the world’s most sustainable companies, Schneider Electric is leveraging its experience and success with our customers and partners. Discover more about our vision for Electricity 4.0, Buildings of the Future, and our EcoStruxure IoT solutions for real estate.

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