In a global survey conducted by the Economist Intelligence Unit, 75 percent of real estate and construction leaders agreed that building energy efficiency legislation is beneficial to their business.
Washington, DC-October 18, 2012- According to more than seven in ten real estate and construction executives in the European Union, India, China and the U.S. (75 percent), energy efficiency legislation benefits the building sector. More than a third of respondents (34 percent) to an Economist Intelligence Unit survey commissioned by the Global Buildings Performance Network (GBPN) say a lack of enforcement of existing regulations is a leading obstacle to investments in energy efficiency.
This positive view of legislation presents significant opportunities for decision makers in all regions of the world to develop policy tools that can increase building energy efficiency and performance. It shows that companies are linking energy efficiency with financial performance.
“Given the fact that buildings account for about a third of total energy use worldwide and of energy-related CO2 emissions, the research suggests that business leaders are ready to go deep and are waiting for the right policy signals that can scale up energy efficiency in the sector,” said Peter Graham, GBPN Executive Director.
The report Energy efficiency and energy savings: a view from the building sector explores how real estate and construction executives approach energy efficiency regulation in their business. Key findings include:
• There is a large consensus among executives worldwide on the issue of climate change. In Europe, China, and India, 84 percent of respondents consider cutting carbon emissions associated with their business to be their responsibilities. In the U.S., about 60 percent of respondents are of that opinion.
• Many companies are ill-informed about energy realities and the true cost of energy consumption. One third of the respondents underestimated the financial significance of energy consumption in their own businesses. Many are also unclear about the costs of constructing highly energy-efficient buildings. While the actual additional costs vary between 5 to 15 percent, two thirds of respondents overestimate the cost, saying that energy-efficient buildings cost 15 percent more than a standard construction.
• There is clear evidence that the message of energy efficiency being good for business is gaining momentum across the building sector. 63 percent of the respondents say that energy efficiency influences their investment decisions, and this is true across all regions. Hal of the respondents are taking a longer-term view of investments. More than 50 percent of respondents are ready to tolerate payback terms of five years or longer.
• Companies are already taking action and going beyond equipment upgrades. Half of the respondents are adding building insulation. Nearly the same proportion is adopting more efficient HVAC systems and replacing inefficient lighting (57 percent).
• Businesses welcome carrots and sticks. They see legislation as a way of leveling the playing field, thus strengthening the business case for energy investments. 68 percent of respondents estimate that carbon taxes are helpful to drive investments in efficient buildings. And the same proportion believes that global agreements limiting carbon emissions would create a level playing field for businesses.
About the survey
In the summer of 2012, the Economist Intelligence Unit conducted a survey of 423 senior executives from the real estate and construction industries. This survey was global in scope with 27% of respondents based in the U.S., 24% in the European Union, 25% in China and 24% in India. All respondents were drawn from the operations, strategy, and finance functions. Over half (51%) were C-level executives or above and nearly half (49%) came from organizations with more than U.S. $500m in global annual revenue.
The Global Buildings Performance Network aims to achieve deep mitigation of GHG emissions from the building sector. We are a global non-profit partnership organization advancing knowledge and expertise on building energy efficiency and performance. The GBPN operates a global centre based in Paris and four regional hubs in the U.S., Europe, China, and India. Through our network we help decision makers and business leaders craft policy packages that can make today’s leading state-of-the art policies in each region the standard by 2020.
The Institute for Market Transformation (IMT) is the United States Hub of GBPN. Visit imt.org to learn more.
About the Economist Intelligence Unit
The Economist Intelligence Unit is the business information arm of The Economist Group, publisher of The Economist. Through our global network of more than 700 analysts and contributors, we continuously assess and forecast political, economic and business conditions in 200 countries. As the world’s leading provider of country intelligence, we help executives make better business decisions by providing timely, reliable and impartial analysis on worldwide market trends and business strategies.