The growing demand for sustainable practices and environmental responsibility in the built environment has led to a concerted focus on designing buildings which meet current and anticipated environmental, energy management, and operational goals.
However, as we have highlighted, 80% of the buildings which will be in use in 2050 have already been built. So, the future of our commercial buildings starts with those already in existence, bringing the challenge of preserving our architectural heritage while meeting sustainability goals.
As big a challenge lies in the efficient operation of commercial buildings, most importantly, balancing the often-conflicting demands of its occupants, with a financial and ethical ambition to minimise energy consumption and waste.
At present we measure the theoretical energy efficiency of a commercial property at irregular intervals, using EPCs. This typically occurs during a building sale or new lease negotiation. As a result, it is only a snapshot in time. How a building is operated and occupied dramatically affects its environmental performance. Given escalating energy costs, occupiers are now keen to monitor and analyse real-time data related to the energy consumption of their workspace.
There is already a system which records the actual, rather than not theoretical, energy performance of public buildings, such as schools, hospitals, and government offices. Used primarily when monitoring buildings whose floor space exceeds 250 sq. m, ‘real’ energy consumption is calculated by analysing meter readings and energy bills. The annual assessment, which leads to the issuing of a DEC, provides an assessment of the actual energy performance of as building.
However, DECs are not currently considered to be a viable alternative to EPCs because they do not assess the fabric of the building, heating systems, insulation levels and renewable energy potential, vital metrics if we are to establish “a sustainable future for our built environment” (Baroness Taylor of Stevenage, Parliamentary Under-Secretary of State for Housing and Local Government in the foreword of the EPC consultationdocument).
While DECs concentrate on measuring actual energy use, they differ from EPCs in that they do not provide suggestions for structural improvements or upgrades that could lead to long-term reductions in energy consumption. Instead, DECS offer a snapshot of a building’s present efficiency, typically reflecting how the building is operated, without identifying potential recommendations to address underlying structural inefficiencies.
The government has recently completed a consultation aimed at determining the most effective approach to reforming the Energy Performance of Buildings (EPB) framework. The consultation considered a range of potential metrics including:
Energy cost
This metric could resemble the current EER (Energy Efficiency Ratio), which evaluates the efficiency of HVAC cooling devices, by comparing the amount of cooling output to the electrical energy consumed
Fabric performance
This would likely assess a building’s insulation levels and promote increased fabric performance by monitoring, rather than predicting performance
Heating system
This metric may involve ranking various heating systems according to their efficiency and associated carbon emissions
Energy use
This is expected to focus on the energy consumed for heating and lighting, potentially including ‘plug in’ devices and appliances
The results of the consultation are due to be published this year, with final policy decisions and revised regulations scheduled to be finalised in 2026.
In many buildings, the occupiers manage functions such as heating, cooling, and lighting. Relying on human judgement inevitably leads to inefficiencies. For example, temperature fluctuations are often the result of manual interventions in response to an immediate need or even well intended actions, like turning off the heating at night. This can result in fundamental changes to the core temperate, which takes significantly more energy to correct.
To meet both the environmental and commercial demands of occupiers and owners, we are becoming more reliant on self-regulating intelligent buildings. Automation and smart systems, leveraging smart technology and Internet of Things (IoT), already play a greater role in how we optimise energy consumption in commercial buildings, as new stock comes to market and retrofitted buildings adopt smart HVAC systems. These technologies limit the need for human interventions, optimise energy use, ensure consistent comfort levels for occupiers, and significantly reduce operational costs.
This shift is being driven by legislation, occupier demands and consumer attitudes to the need for adaptation to address climate change issues. The latter is probably one of the most compelling reasons why almost every major UK company and organisation is making public net zero commitments.
Businesses are now actively discriminating in favour of properties which reflect their commitment to environment related best practices, in terms of their operational performance, as well as their commitment to social responsibility. In addition, the rising cost of utilities is also proving influential when it comes to businesses and their ‘energy conscious’ agenda.
Larger corporate tenants are leading this change, using their market influence to push for more sustainable and more technologically enabled ’smart’ buildings. Smaller occupiers may not have enough influence to initiate change alone, but they gain from larger players’ broader investments.
Despite positive innovations and behaviour changes, the question still remains: what do we do with our heritage buildings? Most people associate smart buildings with new builds, but the Pirelli 35 building in Milan, a 65-year-old, 45,000 sq. m, 11-storey property, proves that heritage architecture can be successfully fused with cutting edge technology to create a smart, energy-efficient asset which benefits the environment, occupiers and its investors. Heritage and sustainability do not need to be mutually exclusive.
The new integrated management system there brings together HVAC, lighting, fire safety, and electrical distribution, using advanced environmental sensors to enhance both energy efficiency and tenant comfort. Facility managers can monitor and optimise every system through a single, cyber-secure interface that provides access to a network of smart sensors.
The result is enhanced energy performance, with energy consumption reduced by 60% and CO2 emissions reduced by 2000 tonnes a year, as well as enhanced occupiers’ comfort.
Given the fact that there are almost 20,000 heritage buildings in the City and Greater London, the opportunity to transform most of them into energy efficient assets is enormous. However, innovation usually comes with a cost. The challenge is to find cost-effective solutions which align both commercial and financial realities, with legislative requirements.
It is interesting to note that listed buildings in the UK are not exempt from EPCs, although they can claim exemptions if implementation of energy efficiency measures would alter the buildings fabric or character. Landlords willing to embrace bold, forward-thinking strategies will find exciting opportunities to innovate. Among these, hydrogen stands out as a renewable energy source that is pivotal to industrial decarbonisation. Its ability to be stored efficiently and its resilience to climate variability, unlike wind and solar, make hydrogen a compelling option for commercial buildings.
As the sector evolves, hydrogen is poised to play an increasingly significant role in sustainable energy solutions, offering year-round reliability and supporting the transition to a low-carbon future.
From an investment perspective, whether making operational improvements or investing in major upgrades, these changes are vital. Buildings which perform well operationally and meet the expectations of modern occupiers will retain stronger rental yields and remain attractive to occupiers.
In a market as competitive as London, future proofing commercial property through smart, sustainable solutions is a strategic imperative.
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