Achieving net zero isn’t just a technical challenge – it’s a financial one. As we transition to a more sustainable future, we must understand how to finance the decarbonisation of our built environment.
This was the central theme of a recent panel at the Footprint+ conference, hosted by RLB’s Sustainability Associates Mike Bentham and Peter Hayakawa, with guest speakers including Richard Winter, Climate Change Officer at Bolsover District Council, Bevan Jones, Director – Bevan Jones, and Maria Dutton, Consumer Finance Lead at the Green Finance Institute.
Why It Matters: The Sustainability Challenge
A recent NPJ[1] Climate and Atmospheric Science report highlights a stark reality: after 2035, global climate conditions are projected to diverge dramatically from today’s norms. With the current pace of fossil fuel reduction falling short, the cost of inaction could far exceed the investment required today.
Buildings account for 39% of global emissions.[2] In the UK specifically, 95% of building emissions in the next 30 years will come from existing buildings.[3] Retrofitting existing builds is key, yet we must scale efforts by 10 to 20 times the current rate to meet net zero targets.[4]
Scaling Up Retrofit
Richard Winter, Bolsover District Council, stressed that local authorities cannot decarbonise in isolation:
“As a local authority, we need to understand our pipeline, feed this into the local educational facilities, school leavers need to be encouraged to then sign up to the courses to be able to upskill themselves to deliver retrofit and know that there are jobs for them post college.”
From a commercial perspective, Bevan Jones explained that there are three factors that commercial success depends on. Firstly, better planning and execution of retrofit projects, secondly, smart asset prioritisation to maximise returns and finally, strategic integration of technologies like solar panels, potentially on car parks or underused land.
Bridging the Funding Gap
And of course, for large-scale retrofitting to really happen, the funding gap for the decarbonisation of estates needs to be addressed. As RLB’s Peter Hayakawa acknowledged although there is a growing capacity and awareness around funding net zero initiatives, current financial decision-making is still not fully aligned with sustainability goals. Research from the Green Finance Institute and Oxford University estimates that the UK will need £650bn in infrastructure and building investment over the next decade to meet its net zero ambition and to generate this finance, there is a need to recognise long-term commercial value of green initiatives.
Still, there’s cause for optimism. Maria Dutton from Green Finance Institute noted encouraging momentum with more green mortgages and loans coming to market, and credit unions in particular driving expanding access to green finance. Maria also pointed to the rise of community-based funding models, such as credit union lending and local climate bonds, which are helping to embed green finance at a local level.
Maria Dutton, Green Finance Institute:
“Green financial products have come a long way in the last five years. Not just in terms of the quantity of products, but the depth of them. We are seeing traction across all markets and all products.”
Making a Business Case for Green Finance
RLB Associate and Chair, Mike Bentham, raised the question, ‘How do we create a compelling business case for green finance?’
Peter Hayakawa, Sustainability Associate from RLB, shared insights from a Sheffield City Council project, where sustainability, cost management and project management teams worked together to build cost models for each social housing building typology in the Council’s portfolio – providing accurate financial forecasting for decarbonisation. By framing retrofit goals in terms of cost and lifecycle value, stakeholders could build better cases for finance.
Connecting Decarbonisation to Economic Growth
The green economy is now growing three times faster than the wider UK economy and is quadruple the size of the UK manufacturing sector. But how can we connect this growth to retrofit efforts?
The panel agreed: net zero won’t replace existing trades, it will enhance them, creating jobs, and boosting local economies. Maria Dutton referenced a recent Rightmove report showing that improving a property’s EPC rating from D to C can boost its value by an average of 3%. Upcoming legislation, such as the simplified approvals for heat pumps set for 29 May, could also accelerate adoption. And it was pointed out that investors and estate managers will benefit from uplifts in asset value through decarbonisation and retrofitting work.
Making Effective Partnerships
All of the panel speakers emphasised the importance of cross-sector collaboration.
Effective green funding strategies require cooperation between local authorities, educational providers, businesses and financial institutions. But it’s not just about working together – it’s about truly understanding what each partner needs in the retrofitting ecosystem.
Richard Winter, Bolsover District Council:
“We need to get out of our comfort zones and learn from our partners.”
Financial institutions may offer capital, but they rely on informed stakeholders who understand the long-term value of decarbonisation and can deliver viable, scalable retrofit solution.
A Systemic Challenge. A Shared Opportunity
Achieving net zero in the built environment is not just a technical or financial challenge – it’s a systemic one that requires alignment across policy, finance, education and industry. The insights from the Footprint+ panel highlight that while the road ahead is demanding, it is also full of opportunity. By fostering strong partnerships, investing in skills and aligning financial strategies with long-term sustainability goals, we can close the funding gap and unlock the full potential of green growth.
[1] Estimating global mean sea-level rise and its uncertainties by 2100 and 2300 from an expert survey | npj Climate and Atmospheric Science
[2] Embodied Carbon – World Green Building Council
[3] CITB b06414_net_zero_report_v12.pdf
[4] Overcoming the challenges of financing retrofit in the UK: A pathway to net zero | WCPP
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