Building construction and operations account for 36% of final energy use and nearly 40% of energy-related carbon dioxide (CO2) emissions globally, making the sector the largest energy user and producer of greenhouse gases (GHG), says Green Building Council of South Africa (GBCSA) CEO Dorah Modise.
“Improving the energy efficiency in buildings has proven to be a low-hanging fruit in reducing carbon emissions brought about by a largely coal-powered electricity grid and promoting energy security, given South Africa’s current electricity challenges.”
She explains that the South African government has implemented and is in the process of rolling out a number of policies and legislative instruments that will require ambitious action by property sector stakeholders.
Moreover, in February, Parliament passed the Carbon Tax Bill, with the first phase of the programme rolling out from 2019 to 2022. The tax rate will be set at R120/t of CO2 produced; and the total tax-free allowances can be up to 95%. The draft Carbon Tax Bill makes provision for the carbon offsets allowance which “provides flexibility to firms to reduce their carbon tax liability by either 5% or 10% of their total GHG emissions by investing in projects that reduce their emissions”, according to National Treasury.
Meanwhile, in 2018, the Department of Energy (DoE) published the draft Regulations for the Mandatory Display and Submission of Energy Performance Certificates for Buildings. With this draft, the DoE is trying to extend the scope of buildings that require display of their energy performance certificates (EPC), beyond government buildings.
Private buildings used for entertainment, public assembly, theatres, indoor sport arenas, places of instruction, and offices which have been in operation for at least two years and have not been subject to a major renovation within the past two years of operation will be affected.
Further, in 2016, the DoE published the first draft of the Post-2015 National Energy Efficiency Strategy (Post-2015 NEES), announcing that its vision was to “promote energy efficiency as the ‘first fuel’ in driving balanced, socially inclusive and environmentally sustainable economic growth, boosting job creation and leading technological innovation across the region”. This followed on from the NEES of 2005, which set a national target for energy intensity reduction.
The goals, targets and measures of Post-2015 NEES are set out across three sectors, which, when achieved, will have a significant impact on South Africa’s energy use.
The first is the public buildings sector, the goal in this sphere is to accelerate the current rate of improvement in energy consumption per square metre in buildings occupied by the public sector at national, provincial and municipal levels. The target is to have a 50% reduction in energy consumption by 2030, relative to a 2015 baseline.
Some of the measures to achieve this include developing the “Lead by Example” brand, successive tightening of building standards, EPCs, broadening the scope of mandatory labelling and minimum energy performance standards.
Secondly is the residential sector, with the Post-2015 NEES goal being to transform the market for household appliances in favour of more energy efficient models – a targeted 33% reduction by 2030. Another aim is to substantially reduce the average specific energy consumption of the stock of residential buildings – a 20% improvement by 2030.
Some of the measures to achieve these goals and targets include successive tightening of appliance minimum energy performance standards, energy endorsement labelling, a scrappage scheme for appliances, successive tightening of building standards, energy performance certificates and financial incentives to undertake thermal improvements.
Lastly is the commercial sector, with the goal being to accelerate the current rate of improvement in energy consumption per square meter of inhabited floor space in the commercial sector, with a targeted 37% reduction. Measures similar to the above categories include successive tightening of building standards, EPCs, green leases, a scrappage scheme, energy endorsement labelling and alternative financing solutions.
Meanwhile, the building regulations are requirements set out by an authority that focus on reducing the energy used for a specific end use or building component. Examples of these are SANS 10400, which provides the minimum standard for health and occupational safety for occupants in buildings; SANS 10400XA, a new section included to address the reduction of GHG caused by buildings and extensions to buildings; SANS 204, which specifies the design requirements for energy efficiency in buildings and of services in buildings with natural environmental control and artificial ventilation or air conditioning systems; and SANS 1544, which, from 2015, required all government buildings to display their EPCs in the foyer.
In addition, the 12L Income Tax Allowance on Energy Efficiency Savings that was introduced in 2013 provides a tax deduction for savings achieved through proven energy efficiency measures. It is not only available to large-scale energy projects but includes measures such as upgrades to buildings. The incentive is, however, not applicable to key players in the property sector as they are not the final taxpayer; for example, real estate investment trusts.
Moreover, Modise notes that the GBCSA welcomes the introduction of these instruments in an effort to promote energy efficiency but also notes that government still needs to do more work in enhancing the means of implementation of these policies and in creating an enabling environment for the private sector to act.
“As the GBCSA, we advocate for voluntary action that goes beyond minimum requirements. Sustainability requires audacious leadership and commitment that comes from a desire to do good by the environment and society – this commitment always goes beyond just compliance,” she concludes.