IPD: Property market should be braced for carbon legislation (EU)

European and UK governments will likely resort to legislation to decrease the commercial property sector's carbon footprint to meet the 20% target reduction in carbon emissions by 2020, delegates at the IPD Environment Briefing on Wednesday September 15 were told.

Speaking at the breakfast seminar to mark the launch of the second edition of the IPD Environment Code, Paul McNamara, Head of Property Research at PRUPIM told delegates: "On the risk of the impending government legislation, at the UK and European level, politicians are frustrated that the 'low hanging fruit' in the real estate sector is not being picked.

"They are concerned about not meeting their 20% reduction by 2020 targets unless they redouble their efforts. The natural sector to look at is property. Something is going to happen in property and so our property industry bodies need to engage in earnest in a dialogue with politicians - because if we have policies unilaterally imposed on the industry, there could be unintended consequences."

Conference chairman Christopher Hedley, Managing Director at IPD Occupiers said: "Carbon in particular and sustainability in general are issues we cannot hide away from. We all need to decide what metrics we are going to use to track environmental impact from buildings down each year and every year for the next 40 years."

McNamara added: "I am really pleased to see the dialogue IPD is having with BREEAM and LEED on consistently defining the metrics for measurement. What we need are consistent standards of measuring the environmental performance of buildings."

At the briefing – held at Haberdashers' Hall in central London – Simon Ward, Group Property Director at Barclays Bank said that as a major occupier with more than 6,000 properties they take carbon reduction very seriously. "We want to do the right thing, and we support the principle of what the government is trying to achieve. But making the business case for the significant capital investments needed to help us achieve energy and carbon reduction targets can be challenging due to lengthy paybacks."

Charles Woollam, Partner at specialist environmental property advisers SIAM said the Carbon Reduction Commitment and energy reduction league tables could be the concern for organisations. "The league tables could end up as a proxy for corporate performance: if an equity analyst were to see that a company was unable to manage down its carbon or energy consumption and was attracting a disproportionately large CRC bill in relation to its peer group, might they not think it is representative of how the overall company was being managed?"

Introducing the morning seminar, Hedley said the industry has to be very clear about what environmental performance means and how to measure it. He told delegates: "The IPD Environment Code provides a global set of definitions, from which IPD can consistently measure the total environmental impact of buildings, how this compares with previous years, and performance relative to a peer group and the broader market.

"The Code enables organizations to make better decisions to help reduce carbon, energy, water and waste annually. Above all it is about establishing the right processes to make sure organizations are achieving environmental improvements."

The second edition of the IPD Environment Code is complete with a comprehensive overview of accreditation standards, case studies, worked examples, industry body endorsements as well as alignment with BREEAM and LEED methodologies.

The morning briefing also included some market analysis by Glenn Corney, Director at IPD Occupiers, based on the 2010 Occupier Annual Benchmarking Service. Corney told delegates: "The findings do show that some of the trends are not always intuitive. We may feel larger buildings are more efficient but overall it is the other way around."

The energy consumption of the largest offices at just under 500kWm/m² compared with just over 300kWm/m² for the smallest in the data sample. By sector, the greatest carbon emitters were data c

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