min read

The world's largest emitter

Real estate is the largest asset class on Earth. It’s also the largest emitter of greenhouse gasses.

There’s a serious problem

Real estate is the largest asset class on Earth. It’s also the largest emitter of greenhouse gasses, responsible for 40% of global energy use, global CO2 emissions, and 40% of raw material consumption. It’s poses a big threat and something that won’t be going away any time soon. Building floor area is expected to double by 2060, adding 2.4 trillion ft2 (230 billion m2) of new floor area to the global building stock. The equivalent of adding an entire New York City to the world, every month, for 40 years.

With such a large asset class being such a large emitter, there should be an equivalent level of investment targeted towards reducing emissions. This is where there’s a major gap. $60B was invested into climate tech from 2013-2019, but only $4B of that went into the built environment.

That’s about 7%…

It’s a long way off where it needs to be. It is a problem, yes, but it’s also an opportunity.

What can be done?

Of the emissions, approximately 70% are produced by building operations, while the remaining 30% comes from construction. It’s this 70% being produced by building operations where PropTech can play a role in reducing its carbon footprint. This can be broken down into three key areas.

Better data

Getting access to better data is a fundamental component that lays the foundation for everything to come. If you’re making decisions based on crap data, the outcomes will be the same. To get access to better data we need more technology online and connected, whether that be through additional sensors to devices , building systems, or legacy systems that don’t have any data output.

Better insights

Data alone is never enough, you need to draw insights from the data. This is achieved through a combination of data and context. Data is the what, context is the why. This is where people come in, you want someone with domain experience looking at the data, understanding it, putting it into context, then making recommendations on what to do about it.

Better automation

Ultimately, these recommendations should be automated. This is where efficiency comes in because, at the end of the day, we need to take action. One way to automate workflows is to set conditions and rules using the high quality data from all of the connected systems in a building, then use that to trigger actions. Any output from a system can trigger an action on any connected system’s input. For example, using occupancy data to control lighting and HVAC systems.

Where this becomes really effective

At scale. Even a small efficiency applied at scale can have a massive impact. Now imagine every new building from today onwards had the aforementioned automated workflow installed. If it reduced, let’s say, 5% of their total daily energy use. That would have an enormous impact on the overall energy use for the entire sector, especially considering there will be a whole NYC worth of buildings getting built every month.

There’s also government regulation to consider, like Local law 97 in NYC where you get fined per square foot if you don’t meed certain standards.

Energy efficient buildings are no longer a nice to have feature, it’s essential. Not only for the planet, but for the bottom line. If you’d like to learn more about what we’re doing in this space, get in touch.

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