Introducing a Performance-Based Policy Framework in large Commercial and Industrial Buildings in England and Wales

Published: 9 August 2021

Commercial and industrial buildings have a key role to play in helping the UK achieve net-zero greenhouse gas emissions by 2050.

The Department for Business, Energy and Industrial Strategy set out a consultation on proposals to introduce a national performance-based policy framework for rating the energy and carbon performance of commercial and industrial buildings above 1,000m² in England and Wales, with annual ratings and mandatory disclosure as the first step.

These proposals aim to build on international best practice and have been developed in close collaboration with industry.

Key points

Energy Systems Catapult broadly supports the proposals put forward by BEIS to introduce a performance-based policy framework in large commercial buildings. We would urge Government to consider some important factors in developing its policy proposals.

As suggested in the consultation document, the Energy Performance Certificate (EPC) does not measure metered energy consumption or associated carbon emissions. The Catapult’s general view is that the UK should be thinking more radically about the future of building performance measurement, including reforms to the way in which the Standard Assessment Procedure (SAP) and EPC are used in relation to net zero.

  • The ideal option would be a complete overhaul and reform of the EPC system to reflect carbon performance accurately, with a push towards digitalisation to reflect carbon emissions and energy use more accurately (including more reliance on smart metering data).
  • However, a new assessment method (for example similar to the National Australian Built Environment Rating System (NABERS)) which takes into account actual energy use and carbon performance could prove a crucial first step towards reform.

The proposals to create a new, simplified rating mechanism could be a useful first step on the pathway to net zero for non-domestic buildings and, would in theory allow for comparison between large and complex buildings. Clearly this is reliant on voluntary participation from building owners in the first instance. We would hope that, over time, the proposed approach will be enough to entice more buildings to fall under the system over time.

Whilst the consultation only covers buildings above 1000m2 which account for over half of all energy use by commercial and industrial buildings, we look forward to hearing the phasing approach to capture the remaining buildings, in government’s objective to create a truly zero and low carbon built environment over time.

Public, annual disclosure of energy performance in large non-domestic buildings is a useful first step, provided it forms part of a wider set of changes to improve incentives and opportunities across all relevant stakeholders to decarbonise at scale, perhaps with some element of government intervention to drive market demand.

Experience from the Catapult’s Modern Energy Partners (MEP) programme suggests that it is often difficult to obtain granular site and building data from public buildings. ESC suggests that the public estate should be captured within these proposals to drive better energy monitoring and
improvements in control.

The Catapult broadly agrees with the proposals set out which encourage large building owners to take responsibility for the carbon emissions of their buildings. We would encourage this as part of a wider set of policy measures to support building decarbonisation in general. Our thinking on domestic buildings is set out in our Six Steps to Zero Carbon Buildings framework.

The UK does not yet have the skills and capacity needed to deliver the green jobs required to meet our Net Zero target. The buildings sector will need to attract both new entrants, upskill current professionals and develop new working practices if Net Zero is to be achieved; this can be done but only if there is a genuine step-change in our approach to the skills agenda.

  • With the introduction of a new performance-based framework, the assessment, advice and evaluation aspects of this concept should not be underplayed – we would encourage government to support this throughout energy transition.