S Africa’s green building adoption lags despite benefits

23rd June 2023

The global construction industry accounts for about 40% of global greenhouse gas (GHG) emissions. Yet, while green building practices have been posited as effective tools to counter the effects of the construction industry on the climate and natural environment, and are gaining traction globally, adoption in South Africa has been muted, says Cliffe Dekker Hofmeyr director Joe Whittle.

He, senior associate Krevania Pillay, and construction and engineering sector associate designate Kananelo Sikhakhane outline the factors hindering the development of green building in South Africa and how the latest MSCI South Africa Green Annual Property might encourage stakeholders to embrace green building practices.

Factors Hindering the Adoption of Green Building

The Cliffe Dekker team notes that academic Eric Simpeh identifies five categories of factors limiting the adoption of green building practices in South Africa, namely cultural, professional, financial, regulatory and information barriers.

Expanding on cultural barriers, they note that, historically, the South African construction industry has been slow to adopt change, owing to inaccurate perceptions and vague knowledge of the concepts relating to green building practices and the cost of change in this regard.

The latter also ties into professional barriers, which include a lack of knowledge, training and education regarding green practices and a lack of knowledge of the impact of non-green practices on the environment.

Meanwhile, from a financial perspective, the higher initial costs relating to green technologies and materials as compared with conventional building, coupled with a fear of the (relatively) unknown concerning the adoption of green building solutions, can be off-putting to some in the industry.

Lastly, regulatory and information barriers refer to the lack of policies incentivising the adoption of green building practices and insufficient information regarding the benefits of green building projects, including inadequate cost data and haphazard and/or ambiguous information relating to the applicable practices and policies.

Benefits of Green Building in South Africa

Positively, the MSCI Property Index 2022 is a signpost that the South African environment and economy stand to benefit greatly from green practices as green-certified buildings foster numerous benefits.

Firstly, early proponents of green building have long associated green buildings with improved air and water quality, reduced waste and the conservation of natural resources. True to this notion, green-certified office buildings in South Africa reported 4.5% lower electricity usage, and 14.3% lower water usage per square metre, when compared to non-certified office buildings. “These savings are not negligible considering the prevalent water and energy crises facing South Africa at the moment.”

Further, while the above savings on water and electricity reflect an indirect benefit of green-certified buildings, green-certified offices delivered a total return of 6.1% above the non-certified offices’ return, with the Green Building Council South Africa (GBCSA) reporting that, since the index’s inception in 2016, “the sample of green-certified offices outperformed the non-certified sample by a cumulative 20.9%”.

Further, green-certified offices enjoyed higher occupancy rates and reduced cost-to-income ratios when compared to non-green buildings.

Recommendations to Drive Adoption

The CDH team outline several recommendations that could help facilitate the shift to green building, which, in its view, is “critical to the government achieving its stated commitment of reducing carbon emissions by 2030”.

The first is to create organisations tasked with educating the construction sector about environmental and sustainability concepts and to help raise architecture, engineering and construction professionals’ awareness of the Building Act.

Further, there needs to be an uptick in institutions financing green construction, and in public sector actors that provide low-income housing promoting the use of green building techniques.

Additionally the GBCSA should adopt policies that explicitly target low-income housing development to assess the socioeconomic viability and environmental impact of the houses built and help provide access to education, training and upskilling for stakeholders.

Government should also create and regulate the laws and policies that govern the implementation and use of sustainable building, and universities must incorporate sustainability into their teaching and research to encourage sustainable growth in the built environment.

The CDH team notes that MSCI Property Index 2022 is a good indicator that developers, investors, inhabitants and the environment at large stand to benefit from going green. A key factor necessary to encourage the adoption of green practices is an upskilling of stakeholders at various levels and sectors of the construction industry to facilitate a full-scale adoption of green practices for the benefit of the South African economy and environment.

“While South Africa has made great strides in mobilising the green movement, the approach toward it is still fragmented and lacks regulatory and legislative incentives, which would assist in facilitating a holistic shift to environmentally sustainable and economically responsible building,” they conclude.