Overcoming the barriers to going green is not easy, says KPMG’s Richard Threlfall. Which is why the government, builders, suppliers and clients need to tackle it together
The rallying cry by Building for a collective recommitment to the green agenda in the UK’s infrastructure and construction industry comes not a moment too soon. It challenges us all to be honest about where we stand at the moment. As a community we are all weary of “green rhetoric”, sceptical if we can afford to be green, and unconvinced that it should be a priority when the industry is struggling in the “post-Olympic” slump.
However, let’s be blunt: without action, progress will continue to be glacial. The alternative that Green for Growth offers is the potential to revive and excite the industry through a focus on construction projects that create a more resilient, efficient and sustainable society. It’s a glimmer of hope for a recovery. But only if all of the parties involved can align their thinking.
The alternative that Green for Growth offers is the potential to revive and excite the industry through construction projects that create a more resilient, efficient and sustainable society
“Green development” isn’t seen as easy by anyone involved in it. Perhaps the biggest challenge is that the concept is still mired in what I refer to as “between the block and the hard case”.
The “block” is the current lack of availability of public and private capital needed to back projects that are innovative and sometimes riskier, whether that means SME funding for the development of innovative construction technologies, or billions of pounds for wave, wind and biomass projects.
Despite £250bn of capital projects being coordinated as part of the National Infrastructure Plan, the launch of the Green Investment Bank, and £1bn announced late last year to enable “shovel ready” projects to get off the ground faster, most of this is just rebadging of already allocated capital. Much more support and stimulus is needed. And perhaps some re-education too as it is the fear of the unfamiliar, as much as the reality of the risk, that often stands in our way.
The “hard case” is the difficulty in creating business cases that show that sustainable projects can not only save energy, water and waste (i.e. money) but can also last longer, reduce the use of scarce natural resources and perform their functions better. Rationally we should all want the lowest whole-life cost, yet still the majority of clients - and dare I suggest the majority of the industry - want to build cheap.
In fairness, through the use of BIM and experience gained from more than a decade of green building schemes such as BREEAM, the industry is starting to make some aspects of green buildings much more commonplace, but the industry, investors and end users need to be bolder in moving beyond the “that’s how we build them” attitude that the industry is still tarred with.
If escaping the trap between the block and the hard case is the challenge, it is compounded by the lack of agreement as to how to try to get out of it. Within the government, industry, consultancy and suppliers there is a wide range of views of what the definition of green and sustainable is, how to get there and who should pay. Each party seems to think the other doesn’t necessarily want green construction, or won’t pay for it. The sector is acutely aware that several years since the announcement of the requirement for carbon-neutral homes in the UK was made, there is still no real agreement over what that even means.
To find a solution requires nothing less than a full collaboration across the whole of the construction industry to bring together builders (large and small), suppliers, government, tenants and funders to work together to find a way to rebuild the industry and support the UK’s sustainable, long-term growth towards a more resilient economy.
The emerging successes of innovative ways of structuring deals between multiple stakeholders, such as ESCOs, show how multiple organisations can come together to unlock potential new work that delivers benefits for all parties involved. They do, however, require all parties to invest up front and the creation of a level of trust over time.
This is why campaigns like Green for Growth are important in reminding us all that this is not about trade-offs but around collective benefit, and the greatest collective benefit of all would be economic growth - which in turn will fund the more sustainable society we are seeking.
Richard Threlfall is head of building, infrastructure and construction at KPMG