Electrifying the UK’s built environment: the way ahead
Executive summary
Introduction
Growing policy and regulatory momentum
The case for electrification
Remaining barriers
Financial solutions
Client Case Studies
Expert insights
Conclusion
Acknowledgements
Jess Tomlinson, Head, Global Real Estate & Housing, Lloyds
The challenges and opportunities of electrification in the built environment vary across different sectors. As you’ll see from the interviews and case studies in this report grid access, the particularities of lease structures, timing, shared incentives, risk sharing and relationships will all impact whether an investment case stands up and a project will proceed.
Electrification is one part of the transition journey and as such, core principles of the retrofit journey remain the same – focus on energy efficiency, optimise usage and increase your data management.
At a time where there is a flight to quality assets in the commercial sectors and energy pricing risk has gone up the agenda with tenants across the board, we hope these case studies support your thinking on the value of electrification, whether and when it is right for you and how to approach it if so.
We are fortunate to serve a diverse client base across both the residential and commercial markets and are grateful to the clients that have engaged in this research and we think that you’ll find great value in their insights into the electrification of the built environment. Our commitment to you is that, working with the Green Finance Institute and others, we will continue to support your transition plans.
James Hooton, Managing Director, Missions, Green Finance Institute
Electrification is an economic opportunity as much as a climate imperative.
Across the economy, organisations are seeking ways to improve resilience, reduce exposure to volatile energy markets and strengthen competitiveness. Electrification is now a key decision point in those Board-level conversations. What was once viewed primarily as a decarbonisation challenge is increasingly recognised as a strategic opportunity to create greater energy security, improve productivity and attract investment. This shift is already visible across multiple sectors. Transport networks are becoming increasingly electrified. Industrial processes are evolving.
Buildings are becoming generators, storage assets and active participants in the wider energy system. Advances in technology, data and finance are creating opportunities that were difficult to imagine when I started my career in Finance.
Yet the biggest barriers are no longer technological. In many cases, the challenge is aligning policy, capital and delivery behind a common objective. Time and again, we see that progress accelerates when investors, industry and policymakers are coordinated, creating the conditions for innovation to scale and investment to flow. At the Green Finance Institute, we work across sectors to identify and overcome these barriers. Our experience consistently demonstrates that when the right partnerships, market frameworks and financing structures are in place, capital can move quickly to support commercially attractive opportunities.
This report examines one of the most significant opportunities: the electrification of crucial parts of the built environment. As the examples that follow demonstrate, the debate has moved on from whether electrification works. The organisations at the forefront are increasingly focused on how to make it work to their commercial advantage. Their experience offers important lessons not just for buildings, but for the wider economy. The challenge now is not whether electrification will happen, but how quickly we can scale it.
We look forward to continuing to work with Lloyds, and all organisations across GFI’s network, to support investment to flow at pace and scale into electrifying buildings across the UK.
