Incentivizing energy efficiency for cities

The problem

Buildings are responsible for nearly 40 percent of global greenhouse gas emissions. Addressing these emissions will be essential for decarbonization in cities. One challenge right now is incentivizing the necessary changes like retrofitting older buildings with smart thermostats, solar panels, heat pumps or energy-efficient insulation. Owners are responsible for the cost of efficiency investments like these. But tenants are the ones who will benefit from lower energy bills.

Fixing it

The energy transition is capital intensive, but there are a growing number of energy infrastructure investments that address the split-incentive problem in multifamily buildings, according to Canary Media. Boosting energy efficiency in older buildings is necessary to meet climate goals. One of Fifth Wall's portcos, Runwise, is tackling this issue with wireless sensor technology that improves building heating systems. Runwise's technology replaces building management systems that, in many cases, were installed in the '60s and '70s. Plus, it's a low upfront cost for owners and quick to set up, Reuters reported. There's more too: Some other climate-friendly updates to older buildings include shared solar and backup battery installations and electric vehicle chargers in multifamily building garages and parking lots.

Looking ahead

Policies like New York’s Local Law 97 will continue to put pressure on building owners to improve efficiency. In fact, Local Law 97 is expected to drive demand for $18.2 billion in efficiency retrofits from 2024-2030. That’s 13 times the current spending trends, according to Canary Media. The bottom line: Energy efficiency remains one of the cheapest way to combat climate change for the built environment.

• The Verge takes a look at the real science behind Apple’s new star-studded climate change drama series, Extrapolations.
• Volts dives into how evolving tech can capture carbon from the air and permanently sequester it in concrete (a first!).
• The New Map is a great read for those curious about how energy, climate and geopolitics will influence our future. (Plus, it’s a favorite of Fifth Wall’s Co-Founder and Managing Partner Brendan Wallace.)

Could a 4-day work week cut emissions?

After a trial testing out the shorter work week in the UK found that workers were less stressed and maintained productivity, the majority of companies involved in the trial adopted the schedule. But a shorter work week has bigger implications, especially for the environment, reported Sustainability Magazine. It's been shown that countries with longer working hours consume more resources and emit more carbon. A four-day work week trial with Utah state government employees projected that shutting down buildings on Fridays would lead to a decrease of 6,000 metric tons of carbon dioxide emissions annually.

However, any potential energy-savings gains depend on how companies and individuals use resources, the Washington Post reported. If employees opt for remote work different days of the week it might not be as beneficial. Or if folks spend their day at home they could end up using more energy or resources than if they were at the office.

“It doesn’t matter how many days you work if we’re still using fossil fuels,” Juliet Schor, an economist and sociologist at Boston College who researches work, consumption and climate change told the Washington Post.