December 13, 2018

In September 2018, we co-launched the “Energy Efficiency and Electric Vehicles” report with the Rocky Mountain Institute. The report covers scenarios and recommendations on how accelerated renovation of buildings can pave the way for the electric vehicle (EV) revolution, while keeping global warming below 2°C.

The report was launched at the UN Earth Innovation Summit in September in Tallinn, Estonia. Estonia currently chairs the UN Environmental Assembly, which will be meeting for UNEA-4 in Nairobi in March 2019. The recommendations from this report will be on their agenda.

You may wonder why the report focused on buildings and transport, two seemingly unrelated subjects. And how are these related to energy and climate scenarios?

First, although climate rhetoric may differ at federal level across countries, almost everywhere the projected CO2 emissions reductions from commitments and initiatives is only roughly half of what is needed to keep global warming below 2°C. From IPCC and IEA analyses, we know that energy efficiency must do between half and two thirds of the job of keeping us below that level. The two big areas that require more ambition and action are buildings and transport. And the elegant relationship between the two is that by increasing rates of building renovation, we can ‘free up’ the energy needed to accelerate the electrification of transport.

The electric vehicle (EV) revolution offers tremendous climate benefits (as well as more comfortable driving), though it requires policy-makers to manage the resulting increase in electricity demand. The accelerated deployment of energy efficient technologies in buildings (where most of our electricity is consumed) is by far the most cost-effective way to accomplish this. The ambitious roll-out of EVs, with 90% of car sales being electric by 2040, requires an additional 3000 TWh of electricity, which is more than the whole of Europe consumes every year. Increasing building renovation rates from the current 1% to 3-5% per year will prevent the need to build and invest in new power generation. (The 5% rate is estimated at the current practice of 30% improvement in a building's energy efficiency, while the 3% renovation rate would require larger improvements.)

Furthermore, EV charging points can be included in buildings, whether residential, commercial or public sector, as part of renovations. We will be charging our cars while we are at work or at home. And a third connection between buildings and EVs is that most, if not all, new efficient technologies - such as LED lighting - are digital. Following renovations, buildings can become smart buildings connected to the Internet of Things. This will enable smart charging and load management that can further reduce power demand on the grid. All in all, renovation makes our buildings fit for the 21st century, as a recent study by the Corporate Leadership Group highlighted.

So, what should be done to make this happen? The report has several recommendations, of which the most important is that policy-makers should develop integrated policy frameworks, particularly on buildings and transport, while combining these with renewable energy policies to make the energy we consume clean and sustainable. An important enabler is that the moment of change in building ownership or tenancy is used for deep renovation. The additional budget required can easily be included in the mortgage or in the real estate portfolio, as renovated buildings will be cheaper to use and are safer investments for individuals and investors. Recent insights even show that an energy efficient building does not require higher investments. It is critical that we get the charging infrastructure right, so that charging can be done wherever we live or work, and that demand response management balances the load on the electricity grid.

Through these scenarios and recommendations, we see that the task at hand is pretty big. Yet I believe that when we embrace these goals and work together to accomplish what is needed, we can get this done. We have seen massive changes over a short period before - the transition to LED lighting is possibly the fastest example in recent decades. Only a little over 10 years ago, two thirds of sales were incandescent light bulbs. Today, 70% of sales are LEDs, and by 2020 every LED on the market will be connected or connectable, fully converting to an IoT portfolio.

Our long-term goal should be a net zero carbon world by 2050. This is why, as Signify, we have joined the WorldGBC’s Net Zero Carbon Buildings (NZCB) by 2030 commitment, as well as The Climate Group's EV100 programme. As a company, our buildings will be net zero carbon and our company fleet 100% electric by 2030. If we can do this in this timeframe, we should be able to do this jointly across all sectors and geographies by 2050.

Published by the World Economic Forum

https://www.weforum.org/agenda/2018/12/how-renovations-building-electric-cars-revolution