On Thursday, February 20th, we gathered an ambitious group of industry professionals to talk about carbon in construction. Carbon is one of the hottest topics in sustainability and many companies are heavily pressed to reduce their carbon impact. Construction too is taking a stand and committing to reduce it’s carbon impact, with nearly all of the Tier 1 contractors setting deadlines to be ‘Net Zero’. However, in construction, there isn’t enough knowledge sharing around this topic. Everyone seems to be taking their best guess at how to handle the issue.
We wanted to dig into this topic further; exploring how companies are currently approaching this challenge and what Qflow could do to support these efforts. After an immersive morning, with lots of spirited conversation, debate, and questioning, we extracted some valuable insights that we want to share with you.
At Qflow we are dead set on helping the industry be more sustainable at every step of the development process. With the vital data we capture during construction, on materials in and waste out, we are exploring how this can be used to allow companies to seamlessly track carbon and execute on their ambitious carbon reduction strategies. If you want to get involved in this, please reach out to Brittany Harris on Brittany.email@example.com or drop as a line on our websites contact form.
In the meantime, we want to share these insights with you and continue to support the conversation around carbon as well as the knowledge sharing culture across the industry.
Where do we stand?
Before we can move into the future of carbon reporting, we need to take inventory of the current state of the industry. We need to set a baseline, understand current best practices and get an idea of where the industry is falling short.
To kick off the roundtable, we asked all participants what they are currently doing in the realm of carbon reporting and what their perception was of the industry standard.
1. Scattered responsibility
One of the most frequently occurring concerns was the fact that nobody across the value chain appears to take responsibility for managing carbon throughout the project. On top of that, it is far from evident who inherently should claim responsibility. Each stakeholder looks to the other to see if they will do anything about reporting on carbon, but nobody wants to take on the risk and cost of tackling this mountain of a task. The problem here is that to tackle carbon across the industry, the entire value chain must collaborate. This isn’t happening because no single stakeholder wants to go out on a limb and risk being the only one to invest time and capital with no guarantee of positive returns.
“If they don’t do it, why should I?”
2. Critical role of procurement
As it stands today, carbon is not weighted heavily enough to take on cost as a driver for winning tenders. When carbon does not fall under the list of priorities, it gets lost in the mix. Even when the most ambitious teams set targets for carbon reduction, it is too difficult to achieve due to the lack of perceived importance. These targets often get ‘value engineered’ out, or get passed through the procurement team, down to the commercial team, and on to the site management team, with poor cross-team communication. Throughout this process, the original goals get diluted or simply forgotten. As mentioned above, because nobody is taking full responsibility for the achievement of the carbon targets, nobody is held accountable, and there are few consequences when projects fail. This is a self-perpetuating system that needs to be broken to set the industry on a new path.
3. Current tools fall short
There is a selection of carbon tools in the market that are frequently used by the construction industry. The industry opinion is consistent, claiming that these tools fall short in many areas. Primarily, these carbon tools are difficult to manage, don’t provide a great deal of flexibility, and therefore aren’t very malleable to serve a variety of construction projects. Additionally, to ensure maximum efficiency in carbon reduction, it is important to have the capability to feed your carbon data back into design, currently absent in most tools.
However, the main concern with current tools is the quality of the data going into them. This is not the fault of the tool itself, but is baked into the nature of the industries workflows. Qflow’s first step was to tackle this very problem, improving data quality and streamlining these work-flows, ensuring that when we pump out numbers from models, we can be confident that they are telling us something useful. Now we have the quality data, we are looking at what a tool needs to do to really support the industry in this major change.
4. Retrospective practice
Across the industry, carbon is measured retrospectively, collating and aggregating data, and applying carbon conversion factors to arrive at an end result. This approach makes it difficult to proactively set targets and identify specific opportunities for improvement. Most troubling, this locks in carbon from the start of a project. Real-time carbon assessment could provide the opportunity for continual improvement.
There is often a gap between ‘design’ and ‘as built’, but with heavily aggregated data it is impossible to truly identify why, and to improve designs moving forward.
The future of carbon in construction
It has now been established what the industry standard for carbon is and where there are apparent weaknesses. The consistency of responses was remarkable and indicated that the perception of carbon management across the industry is close to unanimous.
Many big contractors have arrived at a critical point where their clients are demanding significant reductions in carbon and comprehensive carbon reporting throughout the project. The tools and insights to support contractors in delivering these ambitious targets are lacking.
We asked “What do you want to change about your current approaches?” and “With respect to carbon management, where do you see the industry being in 5-10 years?”.
1. Reactive to proactive
Almost everyone attending agreed on this critical point. Too many areas of construction take a reactive approach to respond to problems. With something as important as carbon, this simply will not suffice. The industry would like to see proactive, industry wide carbon reporting and carbon reduction strategies implemented. There was consensus in the room that technology will be fundamental in enabling them to take a proactive approach to managing carbon.
2. Standardised reporting
In one variation or the other, standardisation of carbon reporting is widely requested across the industry. We heard from contractors who wanted one set standardised platform across the entire industry that was legally mandated. That way, the data would be consistent across every company. Currently, every contractor reports on carbon in different ways so it becomes very challenging to share data, learn from past projects, or even to get an accurate estimate on whether or not the industry is improving. Although complete standardisation may be difficult, there might be something to draw upon. Some countries use Environmental Product Declarations to quantify embodied carbon in materials. This is a form of standardisation that has been effective in various countries across Europe, France being one of them. Regardless of how standardisation is achieved, it is evident that there needs to be some form of standard approach to carbon reporting for the industry to achieve efficient and effective change.
3. Financially connect the supply chain
To make carbon reporting as efficient as it needs to be, it is important that the entire supply chain is invested in carbon reporting and reduction. Since it is difficult to guarantee that every stakeholder through the supply chain is emotionally invested in accurately reporting on carbon, it becomes vital that we bind every step in the development process financially to carbon reporting. This will help ensure that every stakeholder consistently focuses on carbon without any stray suppliers avoiding the responsibility. This brings us to the final point…
We mentioned earlier that there are few financial consequences when projects fail to hit their carbon targets, well this is changing. The Greater London Authority is placing higher demands on construction firms reducing their carbon through the New London Plan. Projects that do not meet these carbon targets will be facing a steep increase in carbon costs and over a 50% increase in carbon offset payments. Additionally, new contractual incentives and ambitious strategies from developers such as Landsec could be leading real change in this space.
4. Make carbon part of the contractual agreement
This goes beyond just the supply chain. Ultimately, implementing carbon reporting and an efficient carbon reduction strategy is incredibly difficult without the right incentives. As of right now, the best incentives we have access to, that will motivate almost every organisation, is either commercial or legal. A majority of construction representatives at our round table agreed that making carbon a major contractual component was going to be one of the most efficient ways to see results across the whole industry in the future.
Whether you are have a deep interest in carbon or not, the reality is, we all need to take responsibility for this growing crisis. As innovators, we see it as our responsibility to facilitate this process and help make carbon reduction as easy and frictionless as possible for the industry. If you would like to learn more about what we are building, please feel free to reach out to us at any time!