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Action on Climate Change: Proposals for Improving the Energy Performance of Existing Non-domestic Buildings - A Consultation by the Scottish Government

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04 The importance of the energy performance of non-domestic buildings in our strategy to tackle climate change

4.1 The Stern Review indicates that by 2050, energy efficiency has the potential to be the biggest single source of emissions savings in the energy sector. It argues that this would have both environmental and economic benefits because energy efficiency measures cut waste and often save money. 2 Stern goes on to suggest that global carbon dioxide reductions from greater energy efficiency could be between 31% and 53% of the total achievable by 2050.

4.2 The Scottish Government is committed to reducing energy use and promoting microgeneration as it believes they can play an important role in reducing harmful carbon emissions, tackling fuel poverty and maintaining a secure energy supply, as well as reducing costs for consumers, public services and businesses. Following the recent consultation on the draft Energy Efficiency and Microgeneration Strategy, in March last year and the subsequent publication of the Scottish Government's response to the issues raised during the consultation process, the Scottish Government is now developing a plan that will translate our key objectives into action. Improving the energy performance of buildings is a key part of this action plan and of our wider strategy to tackle climate change as set out in our consultation on climate change.

4.3 This is because the buildings in which we live, work and spend our leisure time and the processes involved in the construction and operation of buildings are significant users of energy and producers of carbon dioxide emissions. Action to reduce carbon emissions will be needed in every sector of the economy, but clearly we need to focus first on the areas where we can make the most impact for the least cost. A recent report from the Confederation of British Industry ( CBI) used modelling by the McKinsey consultancy to show the cost-effectiveness of different interventions. 3 This showed that most measures relating to buildings, such as retro-fitted wall and roof insulation, and use of condensing boilers, will actually save money - as well as saving carbon.

4.4 As outlined in the introduction, a range of measures is already in place to encourage and incentivise the owners of existing buildings to improve their energy performance, including advice and in some cases, financial incentives. There are also legal requirements to reduce carbon emissions and optimise the energy performance of new buildings and new building work as set out in Scottish building regulations.

4.5 Scotland already leads the UK in terms of the energy standards set by building regulations. Scottish Ministers established a panel of experts, which met in September 2007, including contributors from Norway, Denmark and Austria along with energy specialists, designers, developers and contractors, to recommend measures to make houses and buildings in Scotland even more energy efficient. The output from this meeting was the Sullivan Report - 'A Low Carbon Building Standards Strategy for Scotland' 4 - which suggests proposals for both new and existing buildings. One of the major workstreams emerging from the Sullivan Report is consideration of how building standards can be progressively enhanced towards the aim of zero carbon new buildings. A review of energy standards is already underway, with public consultation proposed for early 2009.

4.6 This consultation, however, focuses on measures for existing non-domestic buildings which are particularly important given that new buildings comprise only around 1% of the stock each year. This means that existing buildings will remain the large majority of the built environment well into the future. In regard to existing non-domestic buildings, the Sullivan Report's recommendations included the proposal outlined in this consultation to introduce legislation to require all owners of non-domestic buildings to conduct a carbon and energy assessment and produce a programme for upgrading; together with the empowerment of local authorities, or similar public bodies, to check such assessments. The Sullivan Report also recommends that consideration is given to developing practical performance standards for existing buildings (aligned with Energy Performance Certificates). Our proposals reflect these recommendations and go beyond them in that we invite views on whether or not owners should be required to make improvements to energy performance following an assessment.

4.7 Historic and traditional buildings can also contribute to emission reductions if they are managed in a sustainable way. For example, extending the life of a building or its individual elements so that they need to be replaced less often means that the carbon emissions associated with their replacement are reduced. Preliminary work carried out by the Building Research Establishment on life cycle analysis of historic/traditional buildings has shown that a building constructed of new materials will have used a larger quantity of carbon relative to an equivalent building made from traditional materials.