Avoiding a retrofit crisis

A crucial piece of the puzzle in the Government’s ambitious goal of Net Zero by 2050 lies in retrofitting the UK’s non-domestic building stock. However, our research report, ‘The Role of Retrofitting our Non-Domestic Buildings in the Race to Net Zero’, reveals that many organisations are falling short in making their premises environmentally sustainable.

The fault for this doesn’t lie with facilities managers and property heads, who despite having a huge workload and many competing pressures to deal with, want to do more to play their part in their organisation’s move to Net Zero. Instead, the problem is the obstacles in their path.

THE OBSTACLES FACILITIES MANAGERS FACE

The 101 facilities and property heads we questioned in our study are facing several challenges to get retrofit projects for their organisations off the ground. These include:

• Lack of Board Acknowledgment: A significant roadblock we identified is the lack of recognition from boards regarding the importance of retrofitting in their Net Zero strategy. Despite the majority (76 per cent) of organisations working towards Net Zero, over half (55 per cent) of the facilities and property managers we interviewed for the report said that their boards do not acknowledge the need for retrofitting at all.
• Building Heads’ Involvement: This perhaps explains why many organisations are not involving building heads in Net Zero planning. Nearly 23 per cent of those we spoke to have had no involvement at all, and most have not seen their company’s five-year sustainability plans.
• Underestimation of Carbon Pollution: We found that organisations are often underestimating the carbon pollution produced by their buildings which is leading to a lack of urgency to reduce it. There’s also confusion; the vast majority (86 per cent) of organisations do not understand how retrofitting can enhance a building’s energy efficiency.
• Misconceptions about Building Stock: Many decision-makers harbour misconceptions about the life span of the UK’s existing non-domestic building stock, assuming that the majority will be replaced by 2050. In reality, approximately 70 per cent of today’s buildings will still be in use. This misunderstanding dampens the enthusiasm for retrofitting because it isn’t deemed necessary.

OVERCOMING THE OBSTACLES

To help facilities managers address these obstacles we’ve identified five things which we believe need to happen:

• Education: Retrofitting needs to be put on agendas and seen as a viable and often preferable alternative to building new. For instance, 24 per cent underestimate the impact of retrofitting, and 45 per cent mistakenly believe carbon-neutral grid energy will negate the need for energy efficiency measures. Also, many organisations ignore the carbon which has been used to create a new building – this must be factored in when weighing up the options.
• Involvement: Boards must recognise and harness the expertise of facilities and property heads. Facilities leaders are already involved in other strategic decisions such as the role of buildings on their employer brand or in improving staff wellbeing, performance, and retention. The sustainability agenda is surely another area where property heads can play a major part. Their expertise needs to be respected and deployed.
• Budgeting: Retrofit programmes require substantial investment. They cannot be accommodated within day-to-day budgets. Yet over half (54 per cent) of boards base their building budgets on the previous year, which doesn’t consider inflation or energy price fluctuations, let alone a large retrofit project. A new, more strategic approach to building budgets is needed.
• Expert Support: Even with their expertise, facilities heads need external support to navigate the complexities of achieving Net Zero and evaluating the benefits of retrofitting vs a new build. Expert guidance is crucial for making informed decisions, prioritising projects, choosing technologies, and building strong business cases.
• Incentives: The Government needs to help too. Incentives for energy-efficient buildings are currently lacking. Addressing issues such as VAT treatment for retrofit programs can level the playing field with new builds and encourage more retrofit initiatives.

PRACTICALITIES OF RETROFITTING

Overcoming these obstacles is crucial, but we recognise that implementing retrofit strategies can also pose challenges. For instance, almost a third (31 per cent) of facilities heads surveyed feel delivering retrofit projects without causing disruption is a tough challenge.

However, the long-term benefits of retrofit projects, including achieving Net Zero goals, enhancing building efficiency, ensuring employee health and wellbeing, improving productivity, and attracting and retaining staff, outweigh short-term disruptions. Proper planning with multidisciplinary consultant teams can minimise disruption, allowing organisations to continue operations during retrofit projects.

While many organisations are making strides in reducing their carbon footprint, the role of buildings in this endeavour remains underestimated. To make substantial progress, a collaborative approach is needed to address the five key areas hindering retrofitting efforts. Once these are tackled, with the right practical support and expertise, facilities management professionals can truly play a pivotal role in delivering the UK’s Net Zero ambitions.

The full report can be accessed at: https://ridge.co.uk/insights/the-uks-retrofit-crisis/