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Retrofit of Non-Domestic Properties George Marsh Chair WM Retrofit Steering Group 11 April 13.

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Presentation on theme: "Retrofit of Non-Domestic Properties George Marsh Chair WM Retrofit Steering Group 11 April 13."— Presentation transcript:

1 Retrofit of Non-Domestic Properties George Marsh Chair WM Retrofit Steering Group 11 April 13

2 Birmingham – Scale of Opportunity Public Sector Local Authority Offices Schools Health Buildings Colleges & Universities Leisure Buildings Private Sector Industrial Commercial Retail Leisure

3 Birmingham – Scale of Opportunity Public Sector Local Authority Offices Schools Health Buildings Colleges & Universities Leisure Buildings Private Sector Industrial Commercial Retail Leisure Non-domestic buildings account for circa 20% of carbon emissions Birminghams business energy costs are £500m pa > 40,000 businesses in Birmingham 450 schools with 10% growth required BES non-dom buildings originally envisaged in 8 yr period

4 Tenancy Arrangements Public Sector Local Authority Offices Schools Health Buildings Colleges & Universities Leisure Buildings Private Sector Industrial Commercial Retail Leisure Tenancy Arrangements (Owned or rented) Have a large effect on the commercial and practical implementation of retrofit measures 57% of commercial property is rented

5 Few case studies to date – although a number of lighting retrofits BES Phase 1 – PV on industrial units DECC Go Early Pilots : Birmingham : Schools & Community Centres Solihull : Library (listed building) – switch heating from electricity to gas or biomass – 39% - 62% carbon savings – 5-7 yr payback : School 1 – replacement boilers 4 yr payback - 50 Kw PV – 7 yr payback (FiT) : School 2 - effective energy bills reduced to zero thro biomass RHI and PV (FiT) Solihull College – Lighting, BMS upgrade, Insulation – under 5 yr payback Early Evidence

6 Sustainability Drivers for Property Owners Energy Costs Carbon Tax Landfill Tax Public Opinion Brand Image Stakeholder demands Employee expectations Occupant Comfort Future energy costs Supply Chain Asset value retention Obsolescence CRC EPCs DECs MEPS * CSR Operational Savings Business Risk Legislation * Minimum Energy Performance Standards

7 Sustainability Drivers for Property Owners Energy Costs Carbon Tax Landfill Tax Public Opinion Brand Image Stakeholder demands Employee expectations Occupant Comfort Future energy costs Supply Chain Asset value retention Obsolescence CRC EPCs DECs MEPS * CSR Operational Savings Business Risk Legislation * Minimum Energy Performance Standards But the over-riding requirement for most owners will be bottom-line payback

8 Minimum standards All marketing particulars of property must include an EPC Minimum building energy performance standards by 2018 : Current intention - minimum EPC rating of E (18% of stock) Building the Future Today ( Carbon Trust ) – EPC rating must be 4 grades higher by 2050 than today Resulting in risks to property owners of : Obsolescence and loss of value Negligence claims through not exercising.... the fiduciary duty of trustees and investors to understand and consider sustainable investment issues when looking at investment in real estate.

9 Barriers to non-dom retrofit Long lifecycles of buildings Multiple ownership/occupancy & tenancy Operational Issues - disruption Information related issues – poor data on energy use Commercial Issues – varied and uneven distribution as between landlord and tenant of costs, benefits and control over energy use Legal Issues - constraints within leases on how costs and benefits can be allocated between tenant and landlord Cost of Finance Reversion Risk Low awareness and apathy

10 Practical Areas for Action – 10 Point Checklist Sign a Green Lease Sign a Green MoU Set up a Green Group for building(s) Measure & Report Performance Use Smart Metering Undertake an Energy Audit Undertake no cost initiatives Undertake Retrofit Works Celebrate & Communicate Results

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12 Examples from The Better Buildings Partnership

13 Example – Office Retrofit

14 Example – Retail Retrofit

15 Example – Office Retrofit

16 Thank You


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