Energy procurement is a critical factor in achieving Net Zero in the UK

Energy procurement is a critical factor in achieving Net Zero in the UK

New guidance from UKGBC provides stakeholders with the tools to make informed energy procurement decisions which help accelerate the transition to a resilient, zero carbon electricity grid.

  • Delivering a decarbonised electricity system by 2035 is mission critical to the UK achieving Net Zero.
  • The delivery of a decarbonised grid can be accelerated if the built environment industry changes how it procures energy for buildings to increase the rate at which renewable generating capacity, and the supporting infrastructure required, is deployed.
  • UKGBC’s guidance empowers businesses to effectively navigate the energy market and make energy procurement decisions that enables them to realise their climate ambition, while supporting the continued decarbonisation of the electricity supply sector.
  • The energy market needs to evolve to support the transition to net zero carbon buildings and reward building owners who operate their assets with greater flexibly, responding to the availability of renewable electricity on the grid.

Fully decarbonising the electricity system by 2035 is central to delivering Net Zero in the UK. With buildings responsible for over 60% of the UK’s national electricity demand, the built environment industry has a critical role to play in achieving this target, and the way electricity is procured for our buildings can accelerate our transition to a reliable, resilient, and zero carbon grid.

Launched today, new guidance from UKGBC on Renewable Energy Procurement seeks to empower stakeholders tasked with procuring energy in the built environment to do so in a way that enables them to realise their climate ambition, while supporting the continued decarbonisation of the electricity supply sector. Across a suite of guidance documents, UKGBC’s new series of reports gives industry the tools to make more informed procurement decisions. Key aspects within the guidance include:

  • Three principles for good quality renewable electricity procurement – Renewable, Additionality and Time-matched – along with actions to meet these principles. The best electricity procurement approaches will seek to maximise the extent to which they respond to these three principles.
  • A toolkit to better engage with your energy supplier and source the information needed to compare the procurement routes available to you in the market.
  • A rating system for assessing the performance of a building or organisation’s overall electricity strategy, including electricity procured from off site, as well as any onsite generation, demand management, and storage.
  • A summary of procurement routes available in the market, with more detailed information on many of the Power Purchase Agreement variants, as well as some of the factors that may affect an organisation’s ability to engage with certain procurement options.

The guidance highlights the urgent need for greater collaboration between customers and their energy suppliers, as well as for more transparency and better-quality information from suppliers about their products, to enable customers to make informed decisions about how and where they source their electricity. UKGBC also outlines why market evolution is needed to incentivise building owners to operate their assets with greater flexibility, to minimise operational emissions whilst supporting a grid increasingly powered by intermittent wind and solar.

Ultimately, the guidance provides the tools stakeholders need to effectively navigate the electricity procurement landscape and ensure the way they buy their power meaningfully supports the essential decarbonisation needed from our energy supply sector.

UKGBC’s Head of Climate Action, Yetunde Abdul said:

“Decarbonising the electricity system is a top priority for achieving Net Zero. Critical to enabling this, is understanding the active role our buildings and the way we procure energy must play. However, distinguishing the high-quality products that are supporting the energy system’s transition from the other ‘green’ offerings in the market is currently challenging.

Our guidance provides industry with the much-needed tools to better understand their procurement options, benchmark the performance of their building’s electricity strategy, and effectively engage with energy suppliers to make more informed decisions. We strongly believe the collective voice of built environment stakeholders demanding more from their energy suppliers will be a powerful mechanism for driving change in the energy procurement sector and improve the product offering for the entire industry.”

CBRE’s Associate Director – Renewable Energy, Rebekah Needham said:

“This fantastic new guidance brings long-needed clarity and transparency to the electricity market and CBRE is pleased to have supported this important work. Moving towards a decarbonised electricity system and the procurement of renewable energy is a collective responsibility, since the procurement decisions made by one party – such as a landlord or occupier – can directly impact the decarbonisation progress made by the other. All those within real estate must be aligned and working towards the same net zero goal if we are to guarantee a successful transition.”

This guidance is primarily intended to support those procuring energy on behalf of businesses or commercial buildings, rather than domestic customers (i.e., corporate procurement). It can also be applicable to anyone involved in the design, delivery, or operation of a building and will be useful for energy systems designers, renewable energy generators, and energy brokers/suppliers.

This project forms part of UKGBC’s Advancing Net Zero Programme, which has been made possible this year thanks to the generous support of our Programme Partners: BAM Construct UKBerkeley GroupBuro HappoldCBREGrosvenor Property UKHoare LeaISGJLLLloyds BankROCKWOOL UKTurner & Townsendand Project PartnersAmpersandLandsecLow Carbon AllianceMacfarlanes and Stanhope.