Less than 1% of office buildings occupied by State are A-rated for energy

The recent announcement from the Government regarding its plans for the retrofitting of public buildings has brought the issue of sustainability and energy-efficiency back into the spotlight. Eamon Ryan, Minister for the Environment, Climate and Communications, has revealed that the retrofitting project could cost up to €9 billion and take approximately 30 years to complete.

This ambitious yet long-term plan echoes a decade of promises from successive governments to prioritise energy-efficiency and retrofitting. However, the slow progress is evident, with just two out of 238 office buildings occupied by government departments and State agencies having achieved an A-rating for energy-efficiency.

Nevertheless, the State defends the current situation by emphasising the use of the Display Energy Certificate (DEC) standard, which measures actual consumption over a 12-month period, as opposed to the Building Energy Rating (BER) measure, which indicates predicted energy performance.

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Public bodies will need to tackle both and it will be the operational performance that will be tracked for public-sector bodies in delivering on their targeted emissions reduction in the Climate Action Plan. However, under European legislation, the draft Energy Efficiency Directive is targeting that both 3 per cent of public-sector building stock is retrofitted to nearly zero-energy building (NZEB) standard annually, and that public bodies purchasing or entering rental agreements for building are also to NZEB standard. NZEB is calculated using the same methodology as the BER standard.

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Poorer-rated buildings are often dependent on fossil fuels to heat them, which adds potential risk to decarbonising the building. Many government buildings are still falling short of acceptable energy-efficiency levels. Indeed, government data shows 78 per cent of its Dublin office space was built between 1955 and 2005 – well before NZEB standards were introduced.

While the Government is setting its retrofitting plans in motion, there are still other options to consider. For the 46 per cent of buildings (98) rented by government bodies in Dublin, lease breaks present the best opportunity to vacate older, poorly rated buildings which are dependent on fossil fuels, and occupy newer buildings with better energy ratings, with more potential to decarbonise using renewable sources. The buildings will be delivered by third parties in a competitive market, without the need for the State to divert resources, be they financial, staff and management time, to the upgrade of its property portfolio. If ever there was a readily outsourceable and price competitive solution, this is it.

The private sector has demonstrated how innovative technologies and sustainable design principles can dramatically improve overall sustainable performance

Irish Government Economic and Evaluation Service data suggests that OPW leases on 446,000sq ft of office space are due to expire between 2023 and 2025, representing 20 per cent of the OPW’s total leased portfolio in Dublin. These lease expiries provide the State with an opportunity to enhance a fifth of its rented office stock over the three-year period, which is a substantial amount of space and a positive step towards decarbonisation of the built stock.

The private sector has demonstrated how innovative technologies and sustainable design principles can dramatically improve overall sustainable performance. Commercial properties with renewable sources and intelligent heating and cooling systems are no longer the exception, but increasingly the norm. These outcomes are being driven by the requirements of international companies which are voluntarily ahead of the State in adopting the very standards being imposed by the State, and often going well beyond the minimum standards. As the Government embarks on its lengthy retrofitting journey, it should actively seek to lease NZEB buildings that meet the highest standards of energy-efficiency and carbon emissions.

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In 2022, the public sector took 184,000sq ft of space, 44 per cent of which was attributed to An Post’s signing for additional A3-rated space at the Exo Building in Dublin’s north docklands. This demonstrates that the State can acquire and recycle office space at a significant pace. However, the State also took on 89,000sq ft of C- or D-rated space, raising concerns about its future obligations, particularly regarding lease lengths that might go beyond 2030, and possible refurbishment requirements imposed by lease obligations if not negotiated out.

The €9 billion retrofitting plan shows an understanding of the scale of the challenge, but it’s not just about spending money and retrofitting older buildings. It’s also about making smarter choices about the buildings we occupy in the future, using lease breaks to transition into more energy-efficient spaces, and mirroring the private sector’s commitment to sustainable design principles and innovative technologies.

The onus will be on the Government to lead by example and demonstrate the same level of commitment to sustainability and energy-efficiency that we’ve seen in the private sector

The process of decarbonisation is a complex one, requiring an integrated approach that considers not only the state of the buildings themselves but also how they are utilised and managed. Rather than taking a piecemeal approach, the Government must aim to create a comprehensive strategy that covers all aspects of decarbonisation, from building design and retrofitting to leasing decisions and sustainable management. But it also must consider means to accelerate its programme, not just meet the targets, given it will be difficult for all targets to be met across the entire Government plan (beyond real estate). Why not use opportunities for wins when they exist?

Mr Ryan’s announcement is a positive sign of the Government’s commitment to addressing the climate crisis. However, it also highlights the enormity of the task at hand. With a third of the nation’s carbon emissions coming from the built environment, it’s clear that the path to decarbonisation will be a long and challenging one.

However, if the Government can learn from the private sector and apply these lessons to its portfolio of public buildings, it can make significant strides towards its environmental goals. By marrying the long-term strategy of retrofitting with the shorter-term opportunity presented by lease breaks, the Government has the chance to make substantial and immediate progress in reducing carbon emissions.

As we move forward, the onus will be on the Government to deliver on its promises, lead by example and demonstrate the same level of commitment to sustainability and energy-efficiency that we’ve seen in the private sector. If it can do this, then the future of Ireland’s public buildings, and indeed, the future of the country, looks more bright and sustainable.

Orla Coyle is head of energy and sustainability at Savills Ireland