This chapter sets the scene and provides the rationale for decarbonising buildings. It analyses challenges which require customised solutions based on varying characteristics of building stock, climate and other factors. Recognising the complex nature of decarbonising buildings, this chapter explains the rationale behind conducting the OECD Global Survey on Buildings and Climate (2024).
Global Monitoring of Policies for Decarbonising Buildings
A Multi-level Approach
OECD Urban Studies
Abstract
Buildings account for nearly 40% of energy-related CO2 emissions worldwide, making them a primary target for reducing greenhouse gas emissions (UNEP, 2022[1]). In the face of rapid urbanisation – with an estimated 2.5 billion more people expected to live in urban areas by 2050 – much of the demand for new buildings will be in and around cities. Without sustainable solutions, the building sector will exacerbate carbon lock-in, further contributing to climate change (UNDESA, n.d.[2]).
The benefits of decarbonising buildings go far beyond reducing greenhouse gas emissions. Studies show that for every million dollars spent on energy efficiency initiatives, up to 30 jobs can be generated (IEA, 2020[3]). Additionally, improvements in energy efficiency can help alleviate energy poverty, with a 1% efficiency gain correlating with a 0.21% reduction in energy poverty rates (CEB, 2019[4]). Moreover, enhancing energy efficiency in buildings has been linked to public health benefits. One study from the United States showed that for every megawatt-hour (MWh) of electricity reduced in buildings in the US, there is another USD 0.63 to 74.66 in health co-benefits, contingent on the location and composition of the electricity grid (Parichehr Salimifard, 2023[5]). Another study quantified health co-benefits across the EU, ranging from EUR 1.4 to 1 508 per MWh of electricity reduced, depending on the country and the grid composition (Gen Pei, 2024[6]). Building characteristics that correspond with lower energy demand in homes can also be linked to on-site public health benefits. One study showed that following thermal insulation retrofits in buildings, lower blood pressure was reported among residents in Japan (Umishio et al., 2022[7]),
Yet, the process of decarbonising buildings presents multifaceted challenges, requiring customised approaches catering to the specific characteristics of the building stock, particularly when considering pathways for decarbonising new versus existing buildings.
For existing buildings, renovating the old building stock is a key task. In the EU alone, buildings constructed before 1945 account for 23% of all building stock. In buildings with multiple owners, additional complexities arise due to potentially conflicting interests. Reaching agreement on renovation plans can also be further complicated by “split incentives”, where owners might be reluctant to finance energy-saving upgrades that primarily benefit tenants through lower utility bills (OECD, 2022[8]). To overcome these hurdles, it is essential to secure political buy-in and provide government support through grants, tax breaks, and targeted policies.
For new buildings, it is crucial not only to incorporate energy efficiency measures, but also to minimise the upfront carbon footprint, notably of construction materials. To reduce the overall negative environmental impact, governments need to prioritise low-carbon materials from the start and take into account the building’s entire life cycle.
Decarbonising buildings is a shared responsibility across global, national and local scales:
At the global level, setting overarching goals and standards, alongside sharing best practices, is key to support countries in implementing effective measures. For instance, the European Green Deal aims to achieve carbon neutrality by 2050, and initiatives such as the Fit for 55 package and REpowerEU seek to reduce emissions and enhance energy security. Moreover, the revised Energy Performance of Buildings Directive (EPBD) focuses on renovating the worst-performing buildings and mandates all new EU buildings to be zero-emission by 2030 (European Parliament, 2024[9]).
At the national level, the involvement of numerous ministries, each with its own set of prerogatives and responsibilities, calls for policy coherence and co-ordination. The pursuit of energy efficiency in buildings cuts across many different policy domains, encompassing energy, environment, housing, building regulations, and urban development strategies. According to the OECD Global Survey on Buildings and Climate (2024), 93% of responding countries have at least three ministries involved in decarbonising buildings. Through collaborative efforts, these diverse policy domains can create synergies and overcome potential discrepancies, ultimately leading to a more sustainable built environment.
At the local level, cities and regions need to significantly upscale their strategies and actions towards decarbonising buildings. Cities and regions deliver 69% of climate-significant public investment (OECD, n.d.[10]) and hold critical prerogatives over policies in the built environment, especially in terms of building regulations and financial incentives. This is even more critical in large metropolitan areas, such as Tokyo, Paris and New York, where buildings account for 73%, 71% and 68% of their respective total emissions (Tokyo Metropolitan Government, 2022[11]; Ville de Paris, 2020[12]; NYC Mayor's Office and Environmental Justice, n.d.[13]).
Recognising the shared responsibility across global, national and local scales, facilitating continuous international dialogue by all levels of governments for decarbonising buildings is paramount. At COP28, the Buildings Breakthrough initiative, comprising 28 member states and 28 organisations, was launched under the leadership of the French Ministry for Ecological Transition and Territorial Cohesion and the Kingdom of Morocco’s Ministry of National Territory Planning, Land Planning, Housing and City Policy. The initiative is also co-ordinated under the umbrella of the Global Alliance for Buildings and Construction (GlobalABC), hosted by the United Nations Environment Programme (UNEP). This initiative sets an ambitious target to make near-zero emissions and resilient buildings the new standard by 2030 (UNEP, 2023[14]).
Furthermore, in March 2024, the French government, in collaboration with UNEP, hosted the Global Forum on Buildings and Climate – which included a ministerial-level meeting specifically for the building sector. The Chaillot Declaration, signed by 70 countries, calls for actions including the implementation of roadmaps, regulatory and financial frameworks, and building and energy codes for moving towards more carbon-neutral buildings, as well as the promotion of low-carbon building materials and collaborative value chains for developing innovative solutions. It underscores the insufficient current pace of renovations and construction of sustainable buildings, and highlights the disparity between the sector’s trajectory and the Paris Agreement’s objective of limiting global warming to below 1.5°C by 2100 (Ministry of Ecological Transition and Territorial Cohesion, 2024[15]). To address these issues, the Declaration sets forth the path towards national commitments and international collaboration to reduce carbon emissions in the pursuit of decarbonising buildings and enhancing climate resilience.
In alignment with these efforts, the OECD conducted a Global Survey on Buildings and Climate (2024). The goal was to collect cutting-edge and comparable data and information across 28 countries, while accounting for their varying economic sizes, geographical characteristics and governance structures. This survey encompasses a range of topics from national regulations to local initiatives to gather granular information on decarbonising buildings efforts all across the world (Box 1.1)
Survey Structure
This report draws key findings from the OECD Global Survey on Buildings and Climate. The survey aimed to collect comprehensive information about policy measures undertaken to decarbonise buildings as well as to identify policy challenges. This includes efforts to reduce operational carbon emissions, address embodied carbon, and enhance climate resilience.
The survey draft benefited from insightful feedback from the OECD Programme on Decarbonising Buildings in Cities and Regions’ task force group, including experts from UN/Global ABC, UN-Habitat and the Partnership for Energy Efficiency in Buildings (PEEB). As a result, the survey encompassed the following key areas:
Survey Dissemination
To achieve global participation, the survey was disseminated to policy makers in both OECD member and non-member countries. The survey targeted building policy makers within the Global ABC network. Additionally, delegates from the OECD Working Party on Urban Policy played a key role in disseminating the survey and contributing their own responses. This collaborative effort resulted in participation from 28 countries across the world (Figure 1.1).
Note: The survey was conducted only in Belgium’’s Flanders region. Consequently, the results cannot be extrapolated to represent the entire country.
References
[4] CEB (2019), Energy Poverty in Europe, How Energy Efficiency and Renewables Can Help, https://coebank.org/media/documents/CEB_Study_Energy_Poverty_in_Europe.pdf (accessed on 22 February 2024).
[9] European Parliament (2024), .
[6] Gen Pei, J. (2024), “Assessing the climate and health impacts of energy consumption in European”, The paper is a non-peer reviewed preprint submitted to EarthArXiv, https://doi.org/10.31223/X5MM6G (accessed on 17 July 2024).
[3] IEA (2020), Sustainable Recovery World Energy Outlook Special Report, https://iea.blob.core.windows.net/assets/c3de5e13-26e8-4e52-8a67-b97aba17f0a2/Sustainable_Recovery.pdf (accessed on 22 February 2024).
[15] Ministry of Ecological Transition and Territorial Cohesion (2024), , https://www.ecologie.gouv.fr/diagnostic-performance-energetique-dpe (accessed on 16 April 2024).
[13] NYC Mayor’s Office and Environmental Justice (n.d.), NYC Greenhouse Gas Inventories, https://climate.cityofnewyork.us/initiatives/nyc-greenhouse-gas-inventories/ (accessed on 23 February 2024).
[8] OECD (2022), Decarbonising Buildings in Cities and Regions, OECD Urban Studies, OECD Publishing, Paris, https://doi.org/10.1787/a48ce566-en.
[10] OECD (n.d.), , https://www.oecd.org/regional/subnationalexpendituretracking.htm#:~:text=Key%20data%20on%20subnational%20government,or%200.4%25%20of%20GDP). (accessed on 22 February 2024).
[5] Parichehr Salimifard, M. (2023), “A novel method for calculating the projected health and climate co-benefits of energy savings through 2050”, Building and Environment, Vol. 244, https://doi.org/10.1016/j.buildenv.2023.110618 (accessed on 17 July 2024).
[11] Tokyo Metropolitan Government (2022), Final Energy Consumption and Greenhouse Gas Emissions in Tokyo, https://www.kankyo.metro.tokyo.lg.jp/en/climate/index.files/Tokyo_GHG_2019.pdf (accessed on 23 February 2024).
[7] Umishio, W. et al. (2022), Association between Indoor Temperature in Winter and Serum Cholesterol: A Cross-Sectional Analysis of the Smart Wellness Housing Survey in Japan, https://www.jstage.jst.go.jp/article/jat/29/12/29_63494/_article.
[2] UNDESA (n.d.), Around 2.5 billion more people will be living in cities by 2050, projects new UN report, https://www.un.org/en/desa/around-25-billion-more-people-will-be-living-cities-2050-projects-new-un-report.
[14] UNEP (2023), , https://www.unep.org/news-and-stories/press-release/buildings-breakthrough-global-push-near-zero-emission-and-resilient (accessed on 18 April 2024).
[1] UNEP (2022), 2022 Global Status Report for Buildings and Construction, https://www.unep.org/resources/publication/2022-global-status-report-buildings-and-construction (accessed on 22 February 2024).
[12] Ville de Paris (2020), Bilan des emissions de gas a effet de serre de Paris, https://cdn.paris.fr/paris/2020/02/06/dc2edb10d13ae050815850f721f5a837.pdf (accessed on 23 February 2024).