Greta Thunberg did not hesitate to deem the "net zero by 2050" goal of a number of world governments to be no more than an empty catchphrase devoid of any tangible action at the Youth4Climate summit on 28 September 2021. This is a commitment the United Kingdom Government was one of the first to make by way of its 2019 amendment to the Climate Change Act 2008. Since codifying this commitment, the Government has implemented new policies concerning multiple industries, particularly construction and energy, in line with this goal. However, as Rebecca Ardagh explains, the Committee on Climate Change's 2020 Progress Report to Parliament makes it clear that much more is needed if this pledge is going to be anything more than "blah, blah, blah".
The Committee on Climate Change singled out the construction industry as being responsible for 40 per cent of the United Kingdom's emissions and noted that that the long-term focus of the government needs to be "investing in climate-resilient low-carbon infrastructure ... Public money should not support industries or infrastructure in a way that is not consistent with the future net zero economy or that increase exposure to climate risks". It is clear that, if the government is ever to reach its "net zero by 2050" goal, significant changes to the legal and political framework that governs the construction industry are not far off.
So, what do we know so far? In order to meet the target of net zero by 2050, the changes in the construction industry are going to be significant in nature and wide reaching. A number of these are currently being developed and include changes to approved documents and the introduction of the Environment Bill.
Approved Document L
Approved Document L ("conservation of fuel and power") relates to regulation 26 of the Building Regulations 2010, which provides that "where a building is erected, it shall not exceed the target CO2 emission rate for the building ...". Approved Document L provides the means by which these calculations can be carried out as well as guidance to facilitate the government's roadmap to its new future homes standard. The future homes standard aims in part to ensure homes are not overheated or using fossil fuel heating, reducing emissions by 75 per cent compared to current emissions.
There have been numerous criticisms of Approved Document L in its current form, particularly that it does not go far enough to ensure the net zero by 2050 target will be met. There have been amendments made to Approved Document L in 2013 and 2016 and there are new standards expected to be released in 2025 which will significantly increase the obligations when compared to the current standards. In order to ensure progress is being made whilst these new standards are being finalised, the government is releasing interim measures aimed at reducing emissions across domestic and non-domestic buildings, focussed particularly on building fabric and the use of low carbon materials and heating technologies.
The practical implications of Approved Document L and the interim measures are mostly limited to design and testing.
At the design stage, particular attention will need to be paid to the notional specification of the dwelling; where the design meets the notional specification, it will pass. If the design does not meet the notional specification, it will not necessarily fail but savings will need to be shown elsewhere to ensure that the actual building is either the same as, or better than, the target building. There are additional measures required if gas heating is intended to be used, though the 2025 standards will likely move away from this entirely and require heat pumps to be used as the heating source. Essentially, low carbon materials, insulation and energy efficient technology are to be the focus of any new build design.
Testing requirements include air testing, photographic evidence of insulation and plant installation, more accurate energy usage predictions, better handover and more onerous commissioning requirements.
The Environment Bill is part of the post- Brexit legislative framework intended to fill the gaps left by EU law. The purpose of the Environment Bill is to address the biodiversity and climate emergency by requiring targets, plans and policies to address waste reduction and resource efficiency, improve air quality, biodiversity and water quality.
At clause 18 of the Environment Bill (at the date of this article), the Secretary of State is required to prepare a policy statement on environment principles setting out how they are to be interpreted and applied by ministers when making policy and provides at (4) that:
"the Secretary of State must be satisfied that the statement will, when it comes into effect, contribute to –
(a) the improvement of environmental protection, and –
(b) sustainable development."
The requirement to contribute to sustainable development, in particular, is demonstrative of the intended impact of the Environment Bill on the construction industry specifically.
Two of the provisions of the Environment Bill that will impact the industry are the provisions concerning biodiversity targets and conservations covenants.
The Environment Bill introduces the idea of a biodiversity gain; a mandatory provision by which a development will need to achieve a 10 per cent biodiversity net gain in order to proceed. For the first time, this requires biodiversity to be a feature of the design and construction of a project from the beginning. Where this gain may not be able to occur on site, there are some limited options to provide for a portion of the net gain off-site, such as through the development of off-site biodiversity or by buying government biodiversity credits, though it is likely this is going to be discouraged in favour of on-site biodiversity options.
The anticipated biodiversity gain of a construction project will need to be proved in some way, whether it is to be achieved on site or through a combination of on-site and off-site efforts. There is a tool being developed where the details can be input to calculate whether this requirement has been complied with.
There is an acknowledgment in the Environment Bill that the impact of a project on biodiversity will often continue after the practical completion stage of construction, and therefore this projected impact can be considered as part of the 10 per cent net gain, though this will need to be secured in some way and maintained for 30 years. In light of this, the initial stages of the project will need to consider these long-term management and maintenance issues, who will be responsible for them, how they will occur, and how they will be secured.
These biodiversity gain requirements are highly relevant for developers, designers and architects and need to be at the forefront of any initial planning considerations for any new project.
Another consideration that will impact the industry moving forward is the concept of a conservation covenant. This will be a legally binding agreement between the landowner and a "responsible body" to conserve the natural or heritage features of the land (possibly including long-term proposals to comply with the biodiversity net gain requirements) which will bind successors of title. Developers will need to be mindful of these covenants when purchasing land moving forward and, whether these covenants are inherited or negotiated and agreed to by the developer, the obligations need to be carefully understood and communicated to each member of the construction and supply chain to ensure compliance. Potential remedies for a breach of a conservation covenant could include injunctions or damages, for example.
The Environment Bill establishes the Office for Environmental Protection which will be responsible for oversight and enforcement, though it is not yet clear how the OEP will operate and whether, for example, it will have the jurisdiction to investigate companies, individuals of its own accord, or whether it will be limited to responding to complaints.
What does the government's commitment to net zero by 2050 mean for the construction industry?
This commitment is likely to be the most significant driver of change in the construction industry in the foreseeable future. The changes to legislation and policy governing the industry, some of which are highlighted above, will require strict attention by developers, designers and architects in particular. They will be assisted by the simultaneous developments being made when it comes to technologies and materials available to the industry that can be utilised to reduce emissions, increase efficiency and contribute to air quality and biodiversity as part of a construction project as well as over the lifetime of the resulting building or piece of infrastructure.
It will certainly be a task to reach the goal of net zero by 2050 and, given the proportion of current emissions that are attributable to the construction industry, a large amount of this burden will fall to the construction industry. Developers, designers, architects and contractors will all need to make sure they stay on top of legislative and policy changes (which are likely to be frequent) to ensure compliance. These obligations should be incorporated into contracts where possible (which, at this stage, will likely require bespoke clauses to be added to standard form contracts) and communicated down the construction and supply chain to protect against any inadvertent breaches.
This article is taken from Fenwick Elliott's 2021/2022 Annual Review. To read further articles go to Fenwick Elliott Annual Review 2021/2022
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