Net Zero Buildings and Workplaces

Global energy costs have soared and many businesses are struggling with the increases to their utility bills. These resources highlight practical measures that business owners and staff can take to make workplaces more energy efficient, reduce energy bills and help with the cost of living crisis, while reducing harmful carbon emissions. These will not only help to mitigate against current and future increases in the cost of energy, but they are also critical steps on the journey to net zero.

Buildings are a huge source of emissions in London. Heating and powering our commercial buildings accounts for one-third of London’s total carbon emissions. This means that businesses have a key role to play in tackling the climate crisis: decarbonising London’s workplaces is crucial to achieving the Mayor’s net zero by 2030 goal. Improving the efficiency of buildings is good for business and good for the planet. It helps you reduce energy bills, and unlocks benefits for your bottom line, staff, and sustainability strategies.

What are net zero buildings?

Net zero buildings have no net carbon emissions during construction and operations (energy consumption). Carbon emissions are reduced as much as possible, and the remaining emissions are offset.

Policies and requirements for new developments and major refurbishments to be considered net zero can be found in the London Plan.

For existing buildings, the following UK Green Building Council (UKGBC) definition is helpful in understanding the concept of a net zero carbon building in operation:

For a building to be net zero carbon in operation, its emissions from operational energy use must be zero or negative. A net zero carbon building is highly energy efficient and powered from on-site and/or off-site renewable energy sources, with any remaining carbon to be offset. At present, the framework addresses scope 1 and 2 emissions only.

Scope 1 emissions are those produced by internal company processes.

Scope 2 emissions are those produced by purchasing of heat and electricity.

Check out our ‘Quick Wins to Reduce Building Energy Consumption’ guidance 

What steps do businesses need to take to be considered a net zero building?

The steps to reach net zero in operations, according to the UKGBC framework, are the following:

1. Establish net zero carbon scope

 Businesses should define their workplace or building net zero scope depending on their ownership/leasing status and ability to influence operational energy use.

For example, in a multi-tenant building, a landlord should be responsible for net zero carbon for areas under their operational control. Likewise, individual tenants should have responsibility for achieving net zero carbon in the spaces that they lease/control.

2. Reduce operational energy use

Businesses should reduce energy demand and consumption through retrofits or energy efficiency measures. For example:

  • Improve the building fabric to properly insulate the building.
  • Optimise Heating, Ventilation and Air Conditioning (HVAC) and lighting systems.
  • Implement/optimise intelligent Building Management Systems (BMS) to operate equipment more efficiently.
  • Calculate and disclose in-use energy consumption annually.

3. Increase renewable energy supply

Businesses should pursue renewable energy sources, prioritising on-site renewable energy. Off-site renewable energy should demonstrate additionality. The most credible sources are:

  • Power purchase agreements (PPAs) for electricity.
  • Certified low carbon district heating.
  • Certified green gas.

4. Offset any remaining carbon

Businesses should offset any remaining carbon using a recognised offsetting framework, and publicly disclose the amount of offsets used.

Although steps 3 and 4 are not necessarily cost saving measures, your business should consider them if aiming to become net zero. This will help to show customers and clients what your business is doing to help address climate change.

Overview of the four steps businesses should take to achieve operational efficiency.

Resources to cut your workplace’s energy consumption and costs

All resources and offers noted are current as of October 2022

Technical assistance and tools

Businesses can access various types of technical support and tools to decarbonise your workplaces. These include:

  1. Energy and carbon measurement and benchmarking: Understanding your building’s energy and carbon baseline is crucial to begin your decarbonisation journey. With detailed data on your building’s performance, peak energy consumption hours, and carbon emissions, you can assess how efficiently your building is operating.Benchmarking your energy consumption against industry standards will allow you to compare how your building is performing compared to similar properties. Energy meters are an important tool to collect your energy data. Understanding what type of metering system your building or workplace has will allow you to access and assess the type of energy data available.
  1. Building energy audits: Building audits are assessments conducted by energy auditors to evaluate your workplace’s operations, type of equipment and building features. These factors influence how much energy your business consumes – auditors can assess how to improve efficiency through better operational equipment use, implementation of greener technologies and retrofits.

Some Business Improvement Districts (BIDs) provide free energy audits for businesses in their membership. Check the BID map in the GLA’s website to locate your BID and see if they provide energy audits.

Procurement

If your business is looking to procure suppliers to implement energy efficiency and renewable technologies review the following websites:

  • Microgeneration Certification Scheme (MCS): The MCS certifies low-carbon products and contractors including heat pumps, solar, biomass, wind and battery storage. They provide a directory of certified contractors and green technologies supported by the UK’s Department for Business, Energy, and Industrial Strategy (BEIS). If your business is looking to apply to grant funding from BEIS to decarbonise your building, contractors and technologies will have to be certified by MCS.
  • YouGen: YouGen is the National Energy Foundation’s independent advice service and provides a directory of green and efficient energy installers.
  • UK government Energy Technology list: The UK government provides a list of independently verified energy efficient products such as lighting, air conditioning, refrigeration equipment and boilers. The list functions as an easy-to-use procurement tool for energy managers, procurement professionals, and facilities managers.
  • Solar Together: Solar together is a solar panel group buying initiative by the Mayor of London. SMEs operating in one of the participating council areas and who own their own their workplace (or have permission from the landlord to install a solar PV system) can register for the Solar Together group-buying scheme.

Green Leases

Green leases are standard leases with additional clauses included which provide for the management and improvement of the Environmental Performance of a building by both owner and tenants. Green leases can support all building stakeholders to work together to decarbonise their building by establishing clear responsibilities over the operation and implementation of energy efficient technologies and retrofits. You can find more information here:

  • Better Buildings Partnership Green Lease toolkit: The BBP toolkit provides an introduction to the concept of green leases, best practice recommendations for introducing them, a memorandum of understanding with a written agreement setting out how a building’s Environmental Performance will be managed and improved, and a model form with green lease clauses.

Funding/financing for building decarbonisation

Energy efficient technologies and building retrofits can be costly. You can find guidance on available funding/financing for your business’ energy improvements here:

1. UK government grants

  • Boiler Upgrade Scheme (BUS): The Boiler Upgrade Scheme (BUS) is a UK Government initiative providing grants to encourage property owners to install low carbon heating systems such as heat pumps. The scheme is open to domestic and small non-domestic properties. Businesses can get:
    • £5,000 off the cost and installation of an air source heat pump
    • £5,000 off the cost and installation of a biomass boiler
    • £6,000 off the cost and installation of a ground source heat pump

 2. Mayor of London financing

  • The Mayor of London’s Energy Efficiency Fund (MEEF): MEEF is a £500m investment fund supporting projects that deliver new low carbon technology or upgrade existing infrastructure to help achieve the Mayor’s ambition to make London net zero by 2030. MEEF is funded through a combination of public and private sector capital, and the Mayor has committed £81.4m to the fund so far. MEEF can provide senior debt, mezzanine debt or equity depending on the requirements of the project. MEEF is open to SMEs and targets investments from £3m to £20m but will consider investments of £0.5m+.

3. Grants from London Boroughs

Some London Boroughs provide grants to support businesses and residents to cover the implementation cost of energy efficient and renewable technologies.

  • Brent Council : Brent Council’s Energy Saving Scheme provides small and medium-sized enterprises (SMEs) with a free on-site energy audit and a £18,000 grant to fund up to 60% of an energy project’s cost.
  • Camden Council: The Camden Climate Fund provides up to £10,000 to members of the Camden Climate Change Alliance towards the installation costs of renewable technologies and/or energy efficiency improvements. Measures include solar panels, lighting and lower carbon heating upgrades. Successful applicants are required to match-fund 50% of costs, plus any additional over the maximum allowance.
  • Hounslow Council: Hounslow Council’s Innovate and Grow business support programme provides 20 SMEs in the borough with a grant of up to £7,000 grant to help them become more energy efficient.
  • Islington Council: Islington Council’s Energising Small Businesses programme provides grants to small businesses in their borough. Businesses can access up to £1,500 for measures such as upgrading lighting to LEDs, and up to £5,000 for replacing a gas boiler with a heat pump.
  • Tower Hamlets Council: Tower Hamlets Council’s Energy Improvement Grants Programme provides grants to SMEs to cover 50% of the energy reduction project costs. Businesses can access up to £10,000 to replace gas boilers with a form of electric heating (such as a heat pump) or installing a renewable energy technology (such as Solar Panels). Businesses can access up to £5,000 for all other energy retrofit projects, such as lighting and other equipment replacement.

4. Other grants

  • Community Solar Accelerator: Community Solar Accelerator is a European Regional Development Fund (ERDF) funded, SME support project, delivered by Brighton Energy Co-op. They provide match-funded grants of up to £25,000 towards solar PV arrays and electrical vehicle charging stations. Community Solar Accelerator grants are predominantly for SME’s registered and operating in the Coast to Capital LEP area, though organisations from other areas might be considered.

The Mayor’s Business Climate Challenge

The Mayor’s Business Climate Challenge (BCC) is an energy efficiency programme which supports businesses to reduce their energy consumption, save them money and to accelerate building decarbonisation efforts in London. The Mayor is running the Challenge in partnership with 9 business organisations across London.

The programme will provide SMEs with:

  • An energy audit / building walk through to spot simple actions to save energy.
  • Access to an energy data management platform.
  • One to one support to enter energy data, understand it and reduce energy use.
  • Recommendation report to get their workplace to net-zero.
  • Open to: London businesses with influence over their workplace- priority for SMEs.
  • Ideal for owners and occupiers .

Find out more

Energy efficiency actions

The Climate Hub provides climate action frameworks for businesses in different sectors, resources and top tips to reduce building energy use.

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