JLL: Real Estate Going Electric
Commercial real estate releases carbon emissions from natural gas boilers, diesel back-up generators and other sources, but JLL, Chicago, said efforts are growing to power buildings entirely by electricity.
“Electrification is the direction everyone is moving, as it is one of the most important tactics for decarbonizing our sector,” JLL Energy and Sustainability Director Ian McDonald said in a new report, Why Real Estate is Starting to Go Electric.
The report noted pressure for climate action is changing the sector. It said the Global Real Estate Sustainability Benchmark reported a 22 percent jump in participation last year as global investors, pension funds and financial institutions demand environmental, social and corporate governance factors performance be incorporated into their investments’ risk-adjusted returns.
“Businesses need to adopt a total systems approach to managing risk around social inequality, climate and regulation, then seize the commercial opportunity through effective measurement and investment into net-zero carbon technology solutions,” JLL Global Head of Sustainability Services and ESG Guy Grainger said in the report.
Governments are also making policy moves, JLL said. California is encouraging and sometimes mandating all-electric buildings and providing incentives for the use of electric heat pumps over gas boilers.
The report said heat pumps and heat-recovery chillers are the main technologies that enable building electrification. “Heat pumps can provide either heating or cooling and are three to five times more efficient than natural gas boilers,” JLL said. “Artificial intelligence is making the technology even more efficient.”
JLL noted electrification is relatively easy in new buildings, but upgrading existing buildings is more challenging.
“COVID-19 has heightened our collective understanding of risk and demonstrated our ability to change behavior when we have to,” Grainger said. “Now we need to maintain the need for rapid action, applying ourselves and organizations to net-zero.”