Strategic ESG and the Renewable Energy Imperative for Commercial Real Estate
February 17, 2021In the commercial and industrial real estate industry, strategic sustainability has finally come of age. Stakeholders and investors now place a greater emphasis on Environmental, Social and Governance (ESG) strategies — and execution. The events of 2020 have accelerated a rise in conscious capitalism that demands that corporations and operating companies “walk the walk” when it comes to people, planet and profits.
As the CRE industry works through the challenges of early 2021, some may say ESG should take a back seat to more pressing profitability concerns. But stakeholders and shareholders take a different view. Investment groups no longer consider ESG a “nice to have.” It’s an imperative, and it’s driving markets as never before.
Aligning Your Energy Strategy with ESG Priorities
Customers, employees and shareholders are all clamoring for demonstrable action on climate change, and powering operations with renewable energy is one of the most overt climate actions a company can take. As you develop your ESG strategy for 2021, it makes sense to consider how your energy strategy can play a role.
While transitioning to renewable energy drastically reduces energy costs — a crucial advantage in these uncertain times — the ESG benefits may be even greater.
In addition to energy reduction and efficiency measures, integrating renewable energy infrastructure into commercial real estate assets enables your company to take an active role in fighting climate change by lowering carbon emissions while expanding access to solar, energy storage and EV charging to the local community.
Benefits of Onsite Renewable Energy for Commercial Real Estate
The benefits of renewable energy touch multiple pieces of your ESG strategy. In addition to the environmental benefits, renewable energy has important social benefits as well. Onsite renewable energy is a great reminder to your employees that the management team is committed to social responsibility and sustainability, which in turn drives employee retention and productivity. The quantifiable output of renewable energy systems demonstrates that commitment in an extremely visible way.
Here are a few more ESG benefits of the commercial real estate industry making the transition to onsite renewable energy:
- Lowering the carbon footprint of your buildings reduces reliance on and consumption of fossil fuel-based sources of energy generation from your utility;
- Serving as a host for community solar projects is attractive to tenants who would like the option (and not the obligation) to purchase clean energy, and further expands solar energy to members of the community who might not otherwise have access to affordable, clean energy;
- Adding battery energy storage solutions (BESS) reduces demand charges and provides grid resiliency, for businesses, municipalities and utilities.
- Providing onsite EV charging is a valuable tenant amenity, and when shared with the community at large, a strong community relations tool.
Adding rooftop solar or solar parking canopies to commercial and industrial properties can greatly reduce a site’s carbon footprint. Energy storage facilities further optimize energy use and add resiliency during grid outages, avoiding costly, and in some cases, critical operational downtime. EV charging completes this clean energy trifecta, providing a highly valued tenant amenity – the kind that brings more progressive, environmentally-conscious workers back to the office again.
In the uncertainty that still pervades 2021, renewable energy can be a critical tool for retaining a sustainable competitive advantage. Learn more about how Catalyze works with large commercial real estate partners to help them profitably meet their ESG goals with integrated renewable energy solutions.
