Building retrofits: the underrated weapon in the fight to decarbonise cities

The built environment's sprawling carbon footprint can be reined in by giving old buildings a 'climate makeover' as cities grow. The Eco-Business Podcast talks to Vinod Jethani about the benefits and challenges of retrofitting old buildings.

Buildings have an outsized climate impact, accounting for 39 per cent of total man-made emissions. That carbon footprint is projected to rise, as the world urbanises and greenery makes way for concrete. The urban population is expected to be more than double its current size by 2050, when seven in 10 people will live in cities.

Urban planners and building owners are increasingly trying to find ways to reduce the carbon cost of buildings. One way is to give old buildings a climate makeover. Replacing cooling systems with more efficient chillers, installing smart energy systems, LED lights and solar panels could rein in the biggest carbon impact of the built environment — the operational carbon, which comes from the energy used to keep buildings running. Retrofits can also improve a building’s indoor air quality and the wellbeing of its occupants. 

In Singapore, an incentive scheme offers funding to building owners who reduce the carbon footprint of their buildings with retrofits, as the city-state aims for 80 per cent of its buildings to be green by 2030. Sydney and Shanghai are aiming to lower their carbon emissions by 70 per cent and 65 per cent respectively by 2030, while Tokyo has a cap-and-trade programme which incentivises building owners to reduce emissions and use renewable power.

There is a growing trend of upgrading buildings to a high environmental standard rather than tearing them down and building new ones. 

Vinod Jethani, Asia Pacific business development manager, commercial buildings, Danfoss

Vinod Jethani, Asia Pacific business development manager, commercial buildings, for engineering company Danfoss

Vinod Jethani, APAC business development manager, commercial buildings, Danfoss. Image: LinkedIn

Despite the obvious benefits, retrofitting faces obstacles. One is the perception that only new buildings can be green buildings. Another is the belief that retrofitting is prohibitively expensive, even though retrofits tend to pay for themselves over the longer term through reduced energy costs.

Joining the Eco-Business Podcast to talk about the benefits and challenges of retrofitting old buildings is Vinod Jethani, Asia Pacific business development manager, commercial buildings, for engineering company Danfoss. 

Tune in as we talk about:

  • Why retrofitting buildings matters to the climate fight
  • Are retrofits always less carbon-intensive than building new?
  • Where are the low-hanging retrofit fruit?
  • What is the ROI of retrofits?
  • The challenges of retrofitting old buildings
  • Which companies and industries are leading the way?

Find the full transcript of the podcast here: 

Robin Hicks (RH): This is the Eco business podcast, I’m Robin Hicks. Buildings generate more emissions than almost any sector. But as the world urbanising and greenery makes way for concrete, there is one underrated way to rein in the carbon footprint of the built environment: retrofitting.

Giving old buildings a climate makeover by replacing cooling systems with more efficient chillers. Installing Smart Energy Systems, natural ventilation LED lights and solar panels can help reduce the impact of a sector responsible for 39 per cent of global carbon emissions. The emissions that comes from manufacturing building materials, known as embodied carbon makes up to 11 per cent of that 39 per cent. But the other 28 per cent the operational carbon can be reduced by greening existing real estate.

As famous American architect Carl Elefante once said: “The greenest building is one that is already built.”

In Singapore, an incentive scheme offers funding to building owners that reduce their carbon footprint with retrofits as the city state is aiming for 80 per cent of its buildings to be green by 2030. But more than half of Singapore’s buildings more than 20 years old, still have not been retrofitted. So what are the challenges of retrofitting old buildings in Asia, and can retrofits be done fast enough to meet climate goals?

Joining the Eco business podcast to talk about the benefits and challenges of retrofitting old buildings is Vinod Jethani, Asia Pacific Business Development Manager, commercial buildings, for engineering firm Danfoss.

Welcome to the podcast, Vinod.

Vinod Jethani (VJ): Thank you, Robin. Thank you for having me.

RH: Well, it’s great to have you back on the show, Vinod. And I want to move straight into the first question I had for you, which is the importance of retrofitting old buildings to the climate conversation. Why does it matter?

VJ: Thanks for the question. Climate change has become our biggest challenge to overcome. So it is significantly important that we focus on how to make our buildings more energy efficient, less carbon intensive and more sustainable. The construction sector has traditionally been one of the biggest culprits in carbon consumption. Thus, reusing old building is more carbon friendly than building new ones. And of course, retrofitting old building using new technologies also means they will be more energy efficient.

Similar to most countries today, right here in Singapore, government is looking to make 80 per cent of built environment green by 2030. On one hand, this is a really challenging task. But on the other hand, it is minimum, we have got to do to keep the well below those two degrees centigrade warming and avoid those most devastating impacts of climate change. And this impacts are today becoming quite real. All those things which scientists have been predicting in the past, they are actually happening now. For instance, increase in the frequency and intensity of extreme weather events, such as frequent and prolonged heat waves, flash floods, rising sea levels, and then these things are no actually irreversible in our lifetime, and then they are going to get worse. So staying on those targets to keep two degrees centigrade limit are non negotiable.

The built environment contributes, as we all know, 40 per cent of the total carbon footprint. And I think in the construction industry, we are really getting a grip for new builds, making them super low-energy buildings or net zero buildings. However, in many large cities, globally, 60 to 80 per cent of the buildings that will exist even in 2050 are already being built. So it is so crucial for us to meeting those carbon targets and tackling climate change that we focus on decarbonising our existing building stock. And further, we are seeing there is a growing trend in large cities worldwide, not even in the Southeast Asia or Asia Pacific, but globally, the retrofit old buildings and upgrading them to a higher environmental certification standards, instead of tearing them down and building the new ones.

RH: You mentioned climate impacts. I’m sitting inside a freezing building in Singapore while outside we’re going through a heatwave. And heat waves seems to be a huge issue at the moment, including in India. Now I want to ask you about going back to retrofitting old buildings. Is it always cheaper, easier and less carbon intensive than building new lower carbon buildings?

VJ: In general, we make a typical assumption when it comes to renovating old buildings — that it will be in a very expensive affair. And as much as people who love the look and feel of heritage buildings, [people think that] it is cheaper to build new buildings up to new standards and codes, and to make them and safe and comfortable. But this is not the real case.

In general, it is both cheaper and quicker to retrofit an existing building. For instance, in Singapore retrofitting can be as low as 40 per cent cheaper than knocking it down and starting all over again. Unless there is a good compelling reason for knocking a building down, I would say it will always make commercial sense to retrofit rather than building new again. We need to do the holistic assessment of the whole lifecycle carbon emissions of a building, which is a combination of embodied and operational carbon emissions. So by retrofitting buildings, we are not only reducing operational carbon emissions, but we are getting away completely from generating embodied carbon emissions a second time. The first time we have emitted carbon while constructing the building — that is the embodied carbon. Making retrofits simple and affordable will not only reduce the carbon footprint of our aging built stock, but will also create skilled jobs along the way.

RH: That’s an interesting point about jobs and you mentioned some compelling data. So what are some of the low hanging fruit for building owners to consider when retrofitting old buildings to reduce emissions?

VJ: Typically, energy efficiency is one of the cheapest and easiest ways to reduce emissions. In short, the greenest energy is the energy that we don’t use. So the low hanging fruits today will be available for builders or to building owners are the proven technologies which are readily available to increase the efficiency of buildings and make the systems within them more efficient. Often, however, even the low hanging fruits are not being captured, and that needs to change and rapidly.

One way to capture to full potential of retrofits is through adopting stage renovation process, which offers a cost effective approach to integrate energy efficiency solutions into renovation plans. And well-planned stage renovation allows for a more flexible approach with the end goal that is the carbonisation of the building. For example, HVAC [airconditioning] system consumes roughly around 40 per cent of building energy and lighting would consume 20 per cent. So here we have a choice to implement stage retrofits replacing new-generation LED lights under a financing scheme, and replace replacing ageing pumps and chillers independently without even impacting the operation of buildings and upgrading building management systems for better controls and lifting the overall building efficiency to the next level.

The other low-hanging fruits are the grants from government, zero capex from the financial Institutes, and so on. In Singapore, to help existing buildings become more energy efficient, the BCA, the Building Construction Authority, has launched a new S$63 million incentive scheme that will help building owners lower the upfront cost of retrofits.

RH: That’s interesting that there are available incentive schemes for retrofits. But what kind of ROI what kind of return on investment can building owners expect to see from retrofits, Vinod?

VJ: This is most commonly asked question on a daily basis. The ROI from retrofit projects largely depends on three factors: the type of building, the operational intensity, and the energy tariffs.

Case studies have shown that projects that were implemented across various commercial buildings have an average return on investment period of one to 1.5 years for buildings with high operational intensity such as hotels, hospitals, data centers, airports, malls and so on. It varies to three to five years with low operational intensity buildings like commercial offices, schools, universities, and sport complex, etc. In general, the ROI period for commercial office buildings averages slightly below five years. So this longer ROI periods can be attributed to their lower operational intensity compared to other types of buildings, with commercial office usually operating approximately 10 to 12 hours a day only for five days per week. So typically ROI from commercial office buildings would be slightly less than five years. And lastly, ROI periods are also dependent mainly upon prevailing energy tariffs. And as such payback periods in Thailand, Vietnam, Malaysia and Indonesia are generally longer than those in Philippines, Cambodia and Singapore, where we see a higher electricity tariffs.

RH: That’s really interesting. Now, I imagine that some building owners put up a bit of resistance and take a bit of time to be convinced that they need to retrofit their buildings right. What are the biggest challenges that building owners face when retrofitting, Vinod?

VJ: So when it comes to retrofitting, there is no one standard solution available for making buildings greener and more efficient. And in my own experience, clients and building operators are looking for that one single, you know, generic solution that will work for every single building. So every existing building is very different from one another. And we need to look into a different starting point for each building. We need to evaluate several aspects like what are the cooling and lighting system in the buildings? How close are those systems to the end of their life? Should we replace them? How efficient is the facade? Should we reuse them? How old is building? How flexible is the existing structure and lots of variables we need to consider.

In contrast, building new means we have got higher flexibility to select our equipment and systems. But for retrofitting, we have got fixed parameters to work with — we need to be much cleverer in making our choices. So we can’t look at things in isolation as an example of how efficient glass lights and carpets are, which impacts cooling load and determines the size and sustainability of cooling system we might choose. So lots of different variables, we need to understand them and put them together.

Another key challenge building owners are facing today is simply how and where to start the retrofitting process. However, now we have got published guidelines available from different standards and government that would help owners to understand the baseline performance of their buildings, set targets and then select a possible solution.

RH: Great stuff. We’ve talked about challenges there. Can you name a few good examples of well retrofitted buildings in Asia Pacific that have successfully reduced emissions and their environmental footprint?

VJ: Though we have retrofitted several buildings in Asia Pacific, I would like to mention specifically two of them here. The first one, Keppel Bay Tower, was certified by Building Construction Authority BCA as a green mark platinum zero energy building in 2020. It is the first commercial building in Singapore to achieve this status as a part of Keppel Land’s effort to transform Keppel Bay Tower into Singapore’s first green mark platinum Zero Energy commercial building in 2018. Keppel Land leveraged a grant from BCA to test with five new and emerging energy efficient technologies Keppel Bay Tower, which would reduce the building’s energy consumption significantly and improve its energy efficiency by 20 per cent as compared to other BCA green mark platinum buildings. It was first time that any of these technologies were implemented in a development in Singapore. So by February 2020, Keppel Land has achieved a reduction of 22.3 per cent in annualised energy consumption of the building exceeding its initial target of 20 per cent.

Some of these new innovative technologies that were being used in this project are like intelligent building control systems Smart Lighting System, high efficiency air distribution system, which was supplied by Danfoss Novenco EC+ system, and cooling tower water management system, integrated sensor system to optimize fresh air intake.

Another example I would bring is in the data centre sector: NEXTDC in Australia is an expert in innovative data center outsourcing solutions. One of their facilities in Melbourne [called M1] is a 15-megawatt hyperscale colocation facility, which is the largest independent data centre in the Victoria region. It has received 4.5-star rating in 2016 for its incredible building performance. But that wasn’t enough, they they improve their system even more, receiving a five star rating in 2019. From the national Australian Built Environment Rating System, the M1 data center became the first to ever receive five stars in Australia.

Danfoss worked with smart chiller group to provide a leading solution for NEXTDC cooling plant in Melbourne, Australia. The pilot which we executed with the support of Smart Chiller Group, the low lift configuration was installed on one of their chillers at the M1 Melbourne data centre, so that it could run efficiently during low-lift scenarios. This means it will activate when the ambient temperature of the data centre is within an optimum threshold of what the cooling system requires. So this method significantly cut energy cost for that chiller by up to 31 person depending on the ambient condition. And this low-lift operation also produces the highest efficiency possible today. And further, the oil free technology also means there is no performance degradation over time, which will represent 10 to 20 per cent improvement in efficiency over oil lubricated chillers. The Danfoss solution also supports data centres 100 per cent uptime guarantee as the compressors eliminate potential downtime. And most important this system is offering 30-second restart — the shortest ever restart time in the industry.

RH: That is encouraging, especially given that data centres — being huge energy guzzlers — are under quite a lot of pressure to reduce their emissions and impact, aren’t they? Now, my final question for you, Vinod: which industries would you say are leading the way in retrofitting old buildings?

VJ: There is no any specific building which is leading the way, but I see data centres as leading the way. They have technologies which are being tested and implemented, like the direct-to-chip cooling instead of air conditioning, the entire space where the servers are been planted. So, instead of cooling the entire space now, we are adopting a direct-chip cooling technology, which will allow us to improve the power usage effectiveness — that is the efficiency measurement parameter for any data centre.

RH: Any final thoughts for us, Vinod?

VJ: Build less, build clever, build efficiently — which obviously means more retrofits and more refurbishment rather than building new buildings.

RH: That makes very good sense. Vinod Jethani, Business Development Manager, commercial buildings, Asia Pacific, for Danfoss, thank you so much for joining the Eco-Business Podcast.

VJ: Thank you, Robin.

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