Mumbai skyline, photo by Soumik Kar

27 January 2010 – The Royal Institution of Chartered Surveyors took part in CONSTRU India in Mumbai in December 2009 with a presentation on “Challenges and Opportunities in Green Buildings in India”. Following are highlight from that presentation.

Sachin Sandhir, Managing Director and Country Head of RICS India stressed the impact climate change is already having on parts of India, including crucial regions such as the Himalayans and the need for the Indian property sector to curb emissions by adopting more sustainable business practices such as drawing upon traditional Indian design and construction techniques.

“Instead of aping the west and constructing energy guzzlers, look towards traditional architecture that used low energy passive and vernacular architecture techniques.”

He also heeded warnings both about an impending skills shortage in the Indian building sector with regard to sustainable buildings and a general lack of awareness amongst the public and the professions about cost-effectiveness of available technologies.

According to the RICS Zero Carbon Capacity Index, India is one of the lowest carbon emitters in the world in proportion to its GDP per capita. Even though India’s greenhouse gas emissions are expected to rise from the current less than 1.5 billion tonnes to around 4 billion tonnes and 7.3 billion tonnes in 2031, this would still be half the global average according to an Indian Government report.

As part of its climate change policies, India plans to introduce energy efficiency targets for over 700 industries including power generation and cement production that account for more than 40 per cent of the country’s fossil fuel use by the end of 2010, which is expected to save 5 per cent of annual fossil fuel use by 2015.

The Indian energy efficiency market is estimated at $15 billion equalling a 2 per cent reduction of the country’s total current energy use.

To this end, energy efficiency ratings on energy-intensive energy appliances, including air conditioners, distribution transformers and refrigerators, will become mandatory in the country from next year.

However, most of India’s firms are yet to plan for climate change regulations and have not yet initiated emissions monitoring measures or set deadlines for curbing emissions. According to a KPMG survey conducted last year only 40 per cent of major firms have introduced carbon emission reduction goals.

With the Indian economy shifting towards services located in urban areas and a growing middle class, approximately 40 per cent of the country’s population are likely to live in cities by 2020 as compared to the present 28 per cent. Given that over the next 5-10 years, retail and commercial space are expected to grow by 43 million and 150 million square metres respectively, and given a shortfall of over 22.4 million dwellings in housing, the anticipated growth in energy demand is projected to be high in the built environment sector.

The most recent RICS Global Property Sustainability Survey indicates that sustainability is ranked high by the majority of Indian respondents with legal compliance as the main driver for clients. According to the survey, Indian occupiers, investors are willing to pay a 10 per cent premium for green building, while government departments are willing to pay a 12 per cent premium on the same.

The Energy Conservation Building Code sets the minimum efficiency standards for the design and construction of buildings in India, however green building laws and codes established in the country are voluntary in the absence of an explicit nationalised code. This might help to explain the low number of green buildings in the country, which is expected to increase to 5 per cent in the next two years over its present 2 per cent.

Another trend in the movement towards green building is the imbalance across property market segments. While there has been a flurry of activity in the commercial segment, the residential area is lagging behind. India has approximately 320 registered green buildings and a green building footprint equivalent to 200 million sq ft (18.58 million sq m) only 35 per cent of this footprint is attributable to completed projects mainly comprising of commercial spaces, schools and hospital buildings.

However, the residential sector is now catching up. While only 8 per cent of the total emissions in India are accounted for by this sector, these could further be reduced by growing consumer demand for green homes.

Highlights from the RICS presentation in India:

  • Statistics released by the Bureau of Energy Efficiency, whose projections for anticipated growth in energy demand related to buildings clearly show the dominance of residential buildings compared to other sectors of building construction
  • The economy is shifting towards services located in urban centres with a growing upwardly mobile middle class. It is predicted that by 2020 about 40 per cent of India’s population will be living in cities, as against 28 per cent today
  • Real estate development uses about 40 per cent of the energy and it is one of the prime contributors to global warming due to the emission of Green House Gas  caused by the energy used. Therefore there is an extreme need to develop green buildings
  • 76 per cent of the electricity generated by all power plants is consumed by buildings
  • 35 per cent of the energy consumed in a building is because of use of light in the day time
  • Nearly 20-25 per cent of the total electricity utilised in government buildings in India is wasted due to unproductive design (ministry of power)

This report was first published in a RICS newsletter

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