Can Profitable Also Be Sustainable?

Two years ago, an article was published discussing whether demand-controlled indoor climate is a profitable investment. Recently, there was a request to revisit and comment from a two-year perspective on whether the topic is still relevant or if there have been any changes affecting the course of the blog.

If we were to write this blog today, we would rephrase it, and the headline would change from rhetorical reflections on whether demand-driven indoor climate control is a profitable investment, to the question – is it a sustainable investment? Let's work together on this question!
Like many other organizations and institutions, many real estate companies have to adapt their business strategies to promote a sustainable future and help achieve the United Nations (UN) global sustainability goals. Therefore, real estate companies' sustainability plans often include goals such as reducing energy consumption in buildings, minimizing the climate impact of new construction and renovations, and achieving net-zero carbon emissions in the future. It's crucial to emphasize that economic sustainability or profitability is very important to ensure long-term tenant retention, and this will happen if they are satisfied. In addition, several real estate firms strive to increase the proportion of certified properties, partly to attract green financing and to gain competitive advantages.
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Energy Consumption, Indoor Climate, and Sustainability Goals

Returning to sustainability goals. Some of the UN global sustainable development goals according to the "2030 Agenda" are particularly relevant in the context of expanding and managing real estate. The opportunities to contribute to these goals are significant:

• Goal 3: Good health and well-being
• Goal 11: Sustainable cities and communities
• Goal 12: Responsible consumption and production practices
• Goal 13: Climate protection measures

So, returning to the questions – is it sustainable to invest in demand-controlled indoor climate? Can the choice of indoor climate solution contribute to a transition to more sustainable development? Could such an investment qualify for green financing? To answer this, some aspects need to be clarified. In the Western world, buildings consume about 40% of total energy consumption, and the energy used for ventilation, heating, and cooling constitutes a significant 15% part. When a real estate company takes measures to increase energy efficiency, often the largest energy savings are found in the area of ventilation. This is because older buildings are often excessively ventilated, lacking the means to ventilate, heat, or cool according to the actual needs inside the building. Simply put, there is a lack of demand-driven ventilation.
Another important aspect to consider in responding to the new question formulation is that people in the Western world spend almost 90% of their time indoors. To feel good and comfortable in an indoor environment, it would be crucial to achieve the aforementioned UN's third goal. At Katedralskolan school in Linköping, Sweden, energy savings after the renovation project reached an impressive 70%. The transition to new air handling units with high heat recovery efficiency and investments in energy-efficient
demand-driven indoor climate systems created this impressive difference in energy consumption. At the same time, teachers and students note significant improvements in the indoor climate, today they are much more satisfied with the indoor environment. So, it is possible to significantly reduce energy consumption without deteriorating the indoor climate, thereby ensuring satisfied tenants. All this clearly relates to the
aforementioned UN sustainability goals.

From Profit to Sustainability

Properties can be certified according to various construction certifications to verify how sustainable a property truly is. Indoor climate and energy efficiency are central components of most certification programs, and if a building is provided with a demand-controlled indoor climate system, it creates a great basis for both certification and its high ratings. Moreover, a property with a good
energy class and built according to environmental certification requirements has good chances of obtaining green financing. Even renovations that initially may not meet good energy class and high environmental certification criteria can qualify for green financing if the expected annual energy efficiency improvement meets certain requirements. As mentioned earlier, a demand-controlled indoor climate can create significant energy savings and therefore is likely to qualify as a green investment.

Investing in a demand-controlled indoor climate system is sustainable because it can lead to a significant reduction in energy consumption while simultaneously having a positive impact on health due to a good indoor climate – two factors that are closely related to economic sustainability.

Original: https://blog.swegon.com/en/can-profitable-also-be-sustainable