Accelerating the sustainability agenda in Africa's built environment

Real estate insight by Nawale Saoud, Director, Project & Development Services North Africa

March 23, 2023

Sustainability is becoming an increasingly important consideration in the construction industry as businesses and governments around the world strive to reduce their environmental impact and mitigate the effects of climate change.

The COP27 conference in Egypt has refocused the world's attention on reducing carbon emissions, which is nowhere more important than in Africa.

Despite contributing just 4% of the world's carbon emissions, Africa is, in many ways, the most vulnerable continent to the impact of climate change. Given its relatively low GDP per capita and rapid population growth (Africa is projected to account for 25% of the global population by 2050), what is a desirable outcome in other parts of the world is an absolute imperative in Africa.

Therefore, Africa's fifth COP (COP7 Marrakech, COP12 Nairobi, COP17 Durban, COP 22 Marrakech and COP27 Sham el-Sheikh) concluded with a historic breakthrough for richer countries to help vulnerable countries deal with climate related' losses and damages. This aligns with the "common but differentiated responsibilities and respective capabilities" principle enshrined in the United Nations Framework Convention on Climate Change (UNFCCC).

While much work remains to be done in flushing out the details of this agreement and even more effort on how it can be effectively financed and enforced, Africa has much to gain from the in-principle agreement.

The built environment accounts for around 40% of global carbon emissions, with the majority (70%) of these emissions emanating from the operation of existing buildings rather than the construction of new ones.

Achieving a significant reduction in these emissions requires a revolutionary new mindset supported by concerted and unified actions across all components of the real estate sector. This will also require the breaking down of the actual siloed approach to reducing carbon emissions found across Africa. More collaboration is urgently required between countries, across sectors (public/private) and stakeholders (investors, developers, occupiers, architects, engineers, policymakers and regulators) to create a new sense of cooperation, knowledge-sharing, and culture of innovation. In contrast, the current siloed approach increases costs and reduces overall well-being.

Since most real estate sector emissions are from existing buildings, more focus is required on promoting energy efficiency. The biggest game changer in this regard could be the realisation that energy efficiency is good for the planet and the financial performance of real estate assets. There is growing evidence of this effect in more mature markets, with a recent JLL research highlighting the negative impact on real estate values of poor energy performance.

Creating energy-efficient buildings requires a fundamental rethink of design and delivery practices. For example, shifting the design of a shopping mall from an enclosed space to an open-air centre provides an enhanced customer experience, greater COVID pandemic resilience, reduces carbon emissions and lowers the developer's OpEx and capital costs.

Another vital component is the introduction of green accreditation schemes. Compared to more mature markets, Africa has been slower to adopt globally recognised green building certification programs such as EDGE, BREEAM and LEED. However, there are encouraging green shoots in some markets, including Morocco, where JLL actively participates in ongoing discussions with the Morocco Green Building Council. The country has set a target of generating 52% of its electricity from renewable sources by 2030 and has already made significant progress towards this goal, with the construction of the world's largest solar power plant, the Noor Ouarzazate Solar Complex, which has a capacity of 580 MW.

At the macro level, there is growing recognition that there is no correlation between a rising carbon footprint and economic growth. To debunk the degrowth principle – less production and consumption means greater social and ecological welfare - can also play an important part in stimulating a lower carbon footprint.

Recent data from The Economist indicates that over the last decade, approximately 35 countries (home to over 1 billion people) have been able to increase their GDP while reducing their emissions.

This has been largely due to the rapid growth of renewable energy sources. Africa is playing its part as countries recognise the benefits of green energy.

One of its most ambitious projects is the giga-watt green hydrogen industry pilot development near the Namibian port city of Lüderitz. It will harness solar and wind energy to generate green hydrogen, which will be further processed into green ammonia. The project is expected to attract $9.4 billion of investment, a considerable boost to an economy with a GDP of approximately $12 billion.

Although clean energy technologies are the primary source of power generation in 22 out of 54 African countries, the continent still has a considerable task over the next decade to produce sufficient energy supply to meet its increasing population. The International Energy Agency (IEA) estimates that Africa must double its power generation from 260GW in 2020 to 510GW by 2030. While there is far to go, this provides an opportunity to prioritise green energy solutions as part of the future energy mix.

The goal is clear but getting there will require a far greater level of collaboration between real estate stakeholders than has been achieved to date. The road ahead is likely to involve many twists and turns but its urgent that the journey commence now.

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