Sustainable premises your business

Sustainable premises your business

Corporate sustainability is not just about making your business processes sustainable. Evolving to sustainable premises for your business is at least as important, especially as the government keeps raising the bar.

Sustainable buildings

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Buildings are an important element in European climate policy. Buildings generate 11 percent of CO2 emissions in Europe. The figure is even higher in Belgium, with a report by KU Leuven university suggesting a figure of around a quarter. Moreover, three-quarters of all buildings in Europe do not meet current energy standards, while 85% are more than 20 years old.

The European Green Deal aims to reduce CO2 emissions by 55% by 2030 compared to 1990 levels. For buildings, the European Commission has translated that into an ambitious target: double the current annual rate of renovation of old buildings in Europe by 2030. At present, 1% of buildings are renovated each year. So the target is to double that to 2% per year by 2030. That translates into 35 million renovated buildings.

Drastic action is needed to significantly reduce CO2 emissions from buildings. It will be an immense challenge. And we also need to keep up that frenzied pace of renovation if we are to be completely climate-neutral as a continent by 2050.

Kim Creten, CEO KBC Real Estate

Renovation obligation

Sustainable buildings are set to become a key focus for companies in the coming years. Since 1 January 2022, a renovation obligation has applied in Flanders on transfer of ownership for all non-residential buildings. Within five years of a transfer of ownership, those buildings must meet minimum standards for roof insulation, glazing, heat generators and cooling systems. In addition, small non-residential buildings up to 500 m² must achieve an energy rating of C or better within five years of transfer. For larger non-residential buildings, a minimum 5% renewable energy obligation has applied since 2023. That must also be achieved within five years of the transfer of ownership. In addition, from 2025 every large non-residential building must have an energy performance certificate (EPC).

‘There is undeniable pressure from the government to make the building stock more sustainable,’ says Creten.

Yet regulation alone is not a sufficient driver to make business premises more sustainable. Els Mignolet, Head of Enterprise Loans Real Estate at KBC: ‘There is also increasing pressure on companies from society to adopt a more sustainable course. No company can act as if it is on an island and not pay attention to sustainability."

Reducing energy costs

But even this increasing pressure need not be the most important reason for choosing greener commercial buildings. ‘Doing so also offers opportunities for businesses. Sustainable investments usually have a cost-reducing effect in the long term, especially now that a lot of green technology has also become affordable,’ says Iwan Barrez, Sustainability Manager at KBC. For example, companies can make big savings by installing more economical LED lighting or solar panels. ‘Companies still too often focus on the costs of investment, whereas they should be looking much more at the total cost of ownership over the entire lifecycle. Such systems are more expensive to buy, but more energy efficient and cheaper to run,’ says Barrez. A combined heat and power (CHP) plant, for example, is expensive to buy but generates both heat and electricity.

Energy-saving renovations

Providing finance is obviously the core business of a financial institution, yet KBC sees its role as being much broader than simply that of mere lender. ‘We want to guide and support our customers in the transition to a sustainable business. Our aim in doing that is also to convince them of the importance of energy renovations,’ Creten says. ‘Eventually, the entire system will need to be renewed. As a bank, it would be irresponsible for us not to make our customers aware that investments in making their business premises more sustainable are inevitable in the long run. By starting that conversation now, we can proactively include this in the company's financing plans.’

KBC also offers guidance in helping customer choose specific energy-saving measures and investments. Creten: ‘We are not energy experts ourselves, but our collaboration with external specialists means we can offer companies guidance.’ For example, KBC has partnered with Encon for KBC Corporate Banking customers. Companies can receive targeted advice from Encon on a variety of topics, including energy efficiency and renewable energy. Encon can also map a company's carbon footprint, assist with building certification and provide guidance in the creation of a sustainability strategy and reporting.

Circular construction

A sustainable buildings strategy is about much more than renewable energy or individual energy-saving measures. It also concerns the building's impact on its surroundings. ‘Companies have to consider many aspects when deciding to build sustainably, ranging from not building unnecessarily on scarce open land, to adequate water management and sustainable mobility,’ Creten says.

The construction itself also needs to become much more sustainable. A lot of CO2 is released during the construction process. That too can be improved, for example by using low-carbon cement or concrete, which is still in a fairly experimental phase at present. Circular construction is also becoming increasingly important. This involves designing buildings in such a way that their function can be changed more easily, whilst also maximising the use of recyclable materials. ‘Gone are the days when you could smash buildings to rubble with a wrecking ball without worrying about the waste mountain. It is clear that the real estate and construction industry is changing fundamentally. And that’s essential if we want to meet our climate ambitions,’ Mignolet concludes. 

KBC expressly points out that the use of terms such as 'green' and 'sustainable' on this webpage in no way suggests that what is described is already (fully) in line with the EU Taxonomy.