Although urban areas occupy only about two percent of the world’s land surface, their carbon footprint is enormous. Cities account for more than two-thirds of the world’s energy consumption and more than 70 percent of its CO2 emissions1. In buildings around the world, heating and cooling account for 35 to 60 percent of total energy demand and, on average, produce nearly 40 percent of emissions2. Reducing and decarbonising the energy consumption of new and existing buildings is therefore critical for tackling the climate challenge.
The role of energy efficiency
The time to act is now. Looking ahead to year 2100, the world's population is predicted to grow to 10 billion, with the average income per capita expected to quadruple. Coupled with rapid urbanisation – some 1.5 million people relocate to urban environments every week – global primary energy use will likely more than double3 this century.
As a result, effective management of the built environment is becoming increasingly important in reducing carbon emissions. This creates an enormous opportunity for cities to lead a rapid transition toward more energy- and climate-efficient buildings and thus to make a major contribution to achieving the Paris Agreement’s climate goals.
Encouragingly, there are solutions readily available – the most important of which is the energy renovation of existing buildings. In fact, optimising the energy efficiency of buildings could provide up to 55 percent of greenhouse gas emission reductions needed to put cities on a 1.5°C pathway through 20304. Renovating existing buildings for greater energy efficiency is particularly relevant in cities that have already experienced high rates of population growth and economic development.
A tale of three cities
While there is huge potential across all urban environments, the specific challenges facing individual cities can vary substantially. Let’s look at three of the world’s great cities – New York City, Copenhagen and Milan. Each is very different in terms of size, building stock and the main challenges they’re experiencing from urbanisation.
In New York City, for example, its more than one million buildings5 collectively account for 67 percent of the city’s carbon emissions6. The city government has set a goal to reduce emissions by 80 percent by 2050, which requires broad-based and concerted action to significantly reduce the energy demand and carbon emissions among both city- and privately-owned buildings.
In Copenhagen, city leaders are looking to their building stock for different reasons. As the city continues to grow – its population is expected to reach 715,000 by 20307 compared to around 613,000 today – the city’s energy demand especially for heating and cooling is projected to outpace its current supply.
A district heating system already covers 97 percent of Copenhagen’s buildings8. Reducing energy consumption in municipal buildings will decrease greenhouse gas emissions by seven percent, but more importantly, it will help alleviate pressure on the district heating system during peak demand periods9 and thereby help to avoid or postpone the need to invest in new heating capacity for the city.
A substantial part of Milan’s building stock is old and energy inefficient and a major source of the city’s greenhouse gas emissions. City leaders realise that rising energy costs will increase the burden on people living in the city. Potential savings on the energy bill is thus a key driver for Milan’s ambition to accelerate energy renovation of its building stock10.
Milan has a significant number of historic buildings, which present challenges when it comes to renovation. That said, a large portion of its building stock was built between the 1960s and 1990s, with a broadly uniform architecture, which makes renovation easier from a purely technical point of view. Because almost half of Milan’s occupied dwellings are multi-owned or condominium buildings, large-scale renovations will necessarily involve many private building-owners, which can be a major obstacle to deep energy renovation, despite very attractive funding opportunities being available.
Milan is a part of the European-wide Sharing Cities programme11, which aims to establish a common approach to realising smart cities. Renovation actions in Milan’s public buildings are 90 percent funded by the municipality, while Sharing Cities EU funds covers the remaining 10 percent. Private-building renovation is paid by the residents, partly with a very attractive tax payback system as well as support from a Sharing Cities grant.
Different challenges, common solutions, multiple benefits
Even though the three cities have distinct challenges, they each see energy renovation of their building stock as a major part of the solution. But what they have in common goes even deeper.
Municipal leaders in the three cities realise that in addition to the energy and climate benefits that building renovation creates, there are also multiple social and economic benefits. And they want to find ways to quantify these additional benefits on the belief that doing so will help unlock further funding for building renovation by engaging more stakeholders in the planning process.
To support cities like New York, Copenhagen, and Milan in this endeavour, ROCKWOOL and the C40 joined forces to develop a toolkit that enables urban stakeholders to calculate the environmental, social and economic benefits of energy renovation. Being able to calculate and quantify these benefits will help make a stronger case for energy renovation and facilitate a better dialogue with multiple stakeholders to more rapidly scale up energy renovation actions.
Notwithstanding their distinct challenges and motivations to engage in piloting the toolkit, they each had the same feedback: being able to quantify a wider range of building renovation benefits will greatly support their efforts to accelerate renovation in the cities. The toolkit enables them to substantiate the case that renovating for energy efficiency is highly cost-effective and brings multiple benefits – and helps them engage a larger part of the city administrations in the planning. Particularly when preparing city-led renovation programmes, the additional positive impact on social and environmental challenges can be instrumental in gaining buy-in from multiple public and private stakeholders.
Keep an eye on our blog in the coming weeks where we will go into more details on how building renovation can work as a measure for economic recovery – and how this can work in major cities such as Copenhagen, Milan and New York.