What the UK Net Zero Carbon Buildings Standard means for your project pipeline

The Pilot of the UK Net Zero Carbon Buildings Standard (“the Standard”) has arrived. The Standard will enable the real estate sector to robustly prove its built assets are Net Zero Carbon and in line with the UK’s climate targets.

Performance benchmarks align with science-based trajectories needed to achieve Net Zero by 2050, and a 78% reduction by 2035 in the UK (i.e. what is known to be required to stand a reasonable chance of mitigating global warming to 1.5°C).

So what do you need to know?

‘Whole Building’ approach

The Standard adopts a ‘Whole Building’ approach to Net Zero. To claim your building is ‘Net Zero Carbon’, it must meet performance targets for both Embodied and Operational Carbon.

Projects will need to drive down upfront carbon emissions, but also prove how operational energy is effectively reduced once buildings are in use, for a minimum duration of 12 months. Licensed verifiers will then review submissions against a defined Reporting Period.

This is welcome and necessary. A holistic approach will be critical in accelerating the industry’s Net Zero transition to meet climate deadlines.

Evolving targets and annual verification

The Standard’s performance benchmarks are not static. Targets will evolve to 2050, becoming more demanding. This ensures the industry keeps pace with what is required to get to Net Zero.

The decarbonisation of the grid will do some of the heavy lifting, but this alone can’t be relied on.

Projects will need to be aligned with target completion year Standard benchmarks. Design teams must consider low carbon materials and reuse from the offset to achieve such targets. On-going flexibility will be important to incorporate innovative materials as they come to market.

Operational energy will be reviewed on an annual basis. This is an important step forward, demanding continual Energy Use Intensity (EUI) improvement. This is a marked improvement compared to EPCs that can result in years of inaction once awarded. To succeed here, Landlord and Tenant engagement and cooperation will be key.

New Build vs. Retrofit

The inclusion of separate targets for New Build and Existing Buildings could be a game-changer. For refurbishment projects, which typically face more barriers than their new construction counterparts (e.g. 20% tax compared to new builds that are exempt), the differentiation is an advantage.

This presents an opportunity for the industry to focus on transitioning standing assets – which will form 80% of buildings in 2050. In a step change it may be future New Builds that become the stranded assets (a trajectory most often reserved for older buildings), unable to meet the Net Zero performance targets of their projected completion year – stranding before they are occupied.

Let’s now look at the Embodied and Operational Carbon performance targets in more detail.

Embodied Carbon

There are Embodied Carbon benchmarks for new builds, refurbishments and fit-outs, across building typologies. These are also split for ‘Whole Building’ and ‘Shell & Core’ boundaries for New Build. ‘Retrofit’ and ‘Reportable Works’ which would cover ‘in-cycle’ upgrades such as secondary refit or upgrade of individual systems. Targets are incremental across each right up to 2050.

The inclusion of Retrofit and Reportable works within the Standard is welcome. These will help with repositioning and cut & carve project target setting.

Embodied Carbon targets for Offices across key dates (N.B. Whole Building should include Cat B Fit-Out allocation):

Year	New Building (Whole)	New Building (Shell & Core)	Existing Building (with One-Go Retrofit)
2030	550 kgCO2/m2	355 kgCO2/m2	450 kgCO2/m2
2040	235 kgCO2/m2	150 kgCO2/m2	195 kgCO2/m2
2050	60 kgCO2/m2	35 kgCO2/m2	50 kgCO2/m2

Our view is that the Embodied Carbon benchmarks have been adjusted from previous LETI & RIBA levels to provide a more realistic trajectory, which hopefully provides a tangible framework to work towards. At the same time, in the past three years so much more has been learned in the industry and measurement practices have improved, making for more detailed and higher results.

Ultimately, the answers are in decarbonising extraction, manufacture, transport and use; technological advances in key materials (concrete & steel); genuine circular solutions; robustness and longevity; and, evidently, less new build.

Energy Use Intensity

Energy demand reductions projected to be required to enable a Net Zero Carbon energy supply sector are included as Energy Use Intensity (EUI – kWh/m2/yr) targets.

EUI targets are provided for a broad range of building types and subtypes, on an annualised stepped basis. For example, the Offices sector includes General / Call Centre / Trading Floors, which recognises varying consumption needs.

As mentioned, there are different trajectories for New Build vs. Retrofit. A Stepped Retrofit plan is suggested to enable existing and distressed assets to better respond to the benchmarks and demonstrate alignment to the Standard. This is good news, as it recognises the asset cycle and encourages alignment across the board.

The benchmarks have also been presented against Gross Internal Area (GIA) but also Net Internal Area (NIA) which is helpful considering the drive to amenity rich assets (reduced NIA) and “flex-office” uses.

EUI targets for Offices across key dates:

Year	New Building	Existing Building (with One-Go Retrofit)	Existing Building (with Stepped Retrofit)
2030	72 kWh/m2GIA/yr	85 kgCO2/m2	99 kgCO2/m2
2040 & 2050	45 kWh/m2GIA/yr	55 kgCO2/m2	55 kgCO2/m2

In both cases, by 2040, the EUI target must be met. This is 15 years away; the average length of MEP equipment life cycle. This means any MEP overhauls being undertaken currently and over the next five years will have to address the challenge. Any assets requiring fabric overhaul to meet the Retrofit benchmark will have to budget the works in the current / next cycle.

While MEES / EPC regulation is driving a lot of activity currently, asset owners cannot ignore this is the time to review projects using CIBSE TM54 and identify and improve their EUI. EPC upgrades will not be enough. Every existing building will need a Net Zero Carbon Action Plan.

Our final thoughts

This is a welcome cross-industry initiative that presents a real chance to hit Net Zero. The targets will challenge the industry, but they’re needed given the scale of transition required.

We’re looking forward to seeing how the Pilot develops. There are elements that could be added into the final version, and some areas for refinement. We’re interested to understand how delineation in buildings between landlord and tenant is shaped, especially regarding energy and carbon responsibility. Also, how the equivalencies of other standards in the market such as NABERS shape the success of the new Standard and the ultimate goal of aligning to 1.5C.

If you’d like to understand more about how the Standard will impact your current and future projects, say hello@verteltd.com.

Additional contributions provided by Lee Cleeton, Director, and Salem Qunsol, Principal Sustainability Consultant.