The SBTi Unveils Framework to Accelerate Buildings Sector’s Alignment with Net-Zero Targets
28th Aug 2024
The SBTi launches sector-specific criteria and calls for building companies and financial institutions to align with net-zero.
- Companies and financial institutions must commit to no new fossil fuel installations and halve emissions by 2030 at the latest.
- The framework now covers global 1.5°C pathways for upfront embodied emissions, including materials production and construction of new buildings.
Today the Science Based Targets initiative (SBTi) launches a groundbreaking science-based decarbonization framework for companies and financial institutions in the buildings value chain. The framework sets 1.5°C-aligned emissions reduction targets for the buildings industry to overcome current climate challenges and create a net-zero future.
The buildings sector is responsible for over a quarter of energy-related emissions and is deeply impacted by the climate crisis. Construction delays due to adverse weather are already costing billions of dollars globally. The SBTi’s new Buildings Sector Science-Based Target-Setting Criteria takes a ‘whole building approach’ - covering all energy consumption and fugitive emissions (e.g. leakage) - to enable businesses to play their part in preventing the catastrophic impacts of climate change.
Four key actions for companies and FIs in the buildings value chain when following the criteria are:
- Stop fossil fuel installations: Public commitment to halting the installation of fossil fuel-based heating, cooking, power generation and hot water equipment from 2030 at the latest.
- Reduce in-use operational emissions: In-use emissions are those associated with a building’s energy use. The SBTi collaborated with the Carbon Risk Real Estate Monitor initiative (CRREM) to develop regional pathways for in-use emissions so that targets reflect variations in local power grids and how buildings are used.
- Reduce upfront embodied emissions: Global floor area is expected to grow ~15% by 2030, nearly 80% of which will be in developing economies. The criteria requires companies to set a target to reduce embodied emissions, i.e. those from raw materials, manufacturing, transportation and construction.
- Retrofit inefficient buildings: 80% of current buildings are expected to remain standing until 2050. Retrofitting needs to more than double by 2030 to align with the IEA’s Net Zero by 2050 Scenario. The SBTi recommends companies commit to implement energy efficiency improvements to decarbonize old buildings.
“This sector now has the tools to build towards net-zero - companies and financial institutions must take immediate action,” said Alberto Carrillo Pineda, Chief Technical Officer of the SBTi.
“Decarbonizing both old and new buildings is paramount to tackling climate change. We call on these businesses to lead the net-zero transformation.”
This framework was developed in consultation with an independent Expert Advisory Group (EAG) made up of companies, financial institutions, non-profit and multilateral organizations. The process included a two-month public consultation and four-month pilot test in accordance with the requirements of the Standard Operating Procedure for Development of SBTi Standards. Get a quick look at the pilot process in the feedback report here.
Prof. Dr. Sven Bienert, Head of the CRREM Consortium said:
"As a long-standing advocate for the decarbonization of the real estate sector, CRREM is pleased to support the release of SBTi's Buildings Criteria and supplementary resources as a technical partner. These tools and actionable guidance provide clear, science-based targets that enable the sector to accelerate decarbonization and drive the global shift to a net-zero economy. CRREM is committed to continuing the collaboration with SBTi to drive meaningful progress in reducing the carbon footprint of the buildings sector."
Peter Heymann Andersen, COO at Ramboll said:
“We at Ramboll applaud the SBTi’s latest targets for Buildings, offering a definitive channel for the industry to align with the Paris Agreement goals. Having science-based targets, recently validated by SBTi, Ramboll has demonstrated our commitment towards reducing carbon emissions, which also includes targeting reductions from our building designs by 50% come 2030. Achieving this is no small feat—it mandates a cohesive effort across the value chain. The SBTi’s guidance is invaluable; it not only demystifies 'Paris-aligned' for the sector but also fortifies our discourse with partners and clients, steering us toward a sustainable future in unison.”
Patrick Ho, Head of Sustainable Development at Swire Properties said:
“As a member of the Expert Advisory Group, Swire Properties is excited to support the launch of the SBTi Building Sector Target-Setting Criteria. The initiative provides a scientifically robust and practical framework for real estate developers and stakeholders to establish pathways aligned with the 1.5°C target for both in-use operational and upfront embodied emissions. Crucially, the introduction of the "whole building approach" — which includes both landlord and tenant-controlled spaces within the target-setting boundary — enhances accountability for emissions reduction and encourages collaboration between landlords and tenants in decarbonization efforts. Together, we can accelerate the building sector's transition to a net-zero economy.”
The world is facing the urgent challenges of climate change, the new SBTi Buildings Criteria is a turning point for the sector. By setting science-based targets, companies can be at the forefront of the net-zero transformation, and help build a resilient and sustainable future.
Get an overview of the criteria, key steps for target setting and FAQs in the SBTi Buildings Sector Criteria in Brief. Join us on October 17 for two global webinars where SBTi’s experts will dive deep into the criteria and answer questions from stakeholders.
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