WEF: Why Real Estate Decarbonisation Needs an Energy Focus
“Responsible for about 40% of all greenhouse gas emissions globally, the real estate sector is already confronted by high climate risks and will face fundamental changes as the global economy decarbonises to meet climate goals,” says the United Nations in its Climate Risks in the Real Estate Sector report.
To provide solutions for real estate’s emissions, the World Economic Forum’s (WEF) Reimagining Real Estate: A Framework for the Future report explores how digital technologies are becoming a cornerstone of sustainable transformation.
As industries face increasing pressure to decarbonise, digital solutions could provide measurable ways to cut emissions, improve efficiency and achieve climate goals.
Digital solutions for energy efficiency
The report identifies several digital innovations poised to transform the real estate sector, including AI, the Internet of Things (IoT) and advanced data analytics.
These technologies could be central in enabling energy efficiency across building operations and resource management.
By leveraging these tools, real estate stakeholders can reduce energy demands and optimise resource usage, aligning with broader sustainability objectives.
Key technologies like smart building systems and AI-driven energy management are designed to enhance the operational efficiency of assets.
According to the WEF report, buildings that comply with certain sustainability benchmarks also experience reduced vacancy rates and enjoy rental premiums, adding economic value beyond energy savings.
Data-enabled systems, such as occupancy sensors, provide critical insights that can help to optimise office layouts and reduce unused space, contributing to a more energy-efficient usage pattern.
“We hope this next iteration of the framework will underscore the urgency and importance of delivering on our commitments in the built environment and the role that real estate plays, as an asset class, as physical infrastructure and as an enabler of our economic and social goals – in the broader global context,” says Christian Ulbrich, Global CEO and President, JLL and Industry Chair for Real Estate at the WEF, in the Reimagining Real Estate December 2024 WEF Report.
Economic and environmental influence
The widespread adoption of digital technologies has the potential to significantly cut global greenhouse gas emissions by 20% by 2050 across several sectors, the WEF says.
On the economic front, digital solutions have the potential to generate US$1.5tn in annual value by 2030, largely through efficiency gains and reduced environmental costs.
City infrastructures, consuming two-thirds of the world's energy, are poised to benefit from investments in renewable energy and smart grid technologies.
Such advancements ensure the distribution of clean and reliable energy, supporting urban decarbonisation efforts.
Upgrading grid infrastructures by expanding storage capacity and deploying smart grid technologies can ensure efficient power distribution to meet increased demands from electrification and vehicle charging.
The report also highlights that manufacturing and supply chains must accelerate decarbonisation through efficiency and retrofitting.
Buildings, including industrial and manufacturing facilities, account for nearly 40% of global GHG emissions, yet only 1–2% are renovated annually, according to JLL.
Retrofitting existing assets is therefore critical, with light to medium energy upgrades unlocking 10–40% in energy savings depending on the asset class.
