How SMEs can lead the industry towards a more sustainable future

We all know that there is a pressing need for change in the construction industry. We also know that, through a combination of building operations and the construction process itself, the sector is responsible for roughly 40% of global energy-related carbon emissions. In the UK, the target of net zero by 2050 currently looks wildly optimistic.

But the solutions are undoubtedly out there. I believe that innovation – particularly with regards to energy-efficient housing – can help the construction industry to show the way forward.

Despite some significant progress in recent years, last month the government scrapped policies to force landlords to upgrade the energy efficiency of their properties. The deadline for the transition from gas boilers was also pushed back. 

While I accept that, given the current state of the economy, forcing property owners to spend more on their buildings is a big ask – and might not be politically desirable – it does not mean that a plan is not required.

Many of the UK’s biggest housebuilders were founded by entrepreneurs in their 20s and 30s, but it is no secret that the sector today is dominated by older leaders who are often not far from retirement and therefore arguably less likely to take a longer-term view. 

>> Also read: There is nothing long term about Sunak’s net zero policy U-turn

Many major housebuilders – who inevitably provide the majority of the new housing stock – also lack agility. It is after all difficult to be agile when you are steering a gigantic plc ship, with boardrooms and shareholders to answer to.

The answers – at least when it comes to innovation – are going to come from the growing band of younger, ambitious and well-managed SME housebuilders

It also does not help that box-ticking “sustainability” schemes have played into the hands of some companies with little interest in implementing real change. And businesses that do want to make a difference are being held back by outdated or impractical regulations and a need to satisfy conflicting stakeholders. 

I believe the answers – at least when it comes to innovation – are going to come from the growing band of younger, ambitious and well-managed SME housebuilders. These businesses are more interested in making a difference, not only because they are often more purpose-driven – and driving change is important to them – but also because, in a competitive industry, they need to be attractive in order to survive.

With bills soaring, energy use has become a big issue for every household, not only because of the consequences of fossil fuel use for the environment but because it has a direct impact on people’s day-to-day lives. Changing the way that energy is harnessed and used in the built environment – using innovation largely brought about by SMEs – would potentially have a huge impact when it comes to sustainability.

Significant gains in the decarbonisation of the sector can be made in heating and energy usage because this is the biggest factor in the usability of the buildings. I recently had the pleasure of meeting David Craddock, founder of the innovative property development and timber frame manufacturing company VerdeGO Group.

Cartridge Close, one of his firm’s recent developments of 17 townhouses in Portsmouth, has been recognised in the industry for having some of the most sustainable houses built in terms of design standards and tech applied.

It will undoubtedly take more than 17 homes to redirect the industry, but the important thing about developments such as these is that they are leading the way and pushing up standards. 

The development at Cartridge Close has smart electric boilers, powered by solar panels and controlled by an innovative AI thermostat system. These read the weather forecast through each house’s wi-fi connection and pick up the routines of the people who live there – when they are at work, when they like to shower or have a bath. The system overlays these pieces of information and calculates the best times to take electricity to heat water.

This development also uses infrared heating panels, rather than traditional radiators, mounted on the ceilings. In a well-insulated home, these can be incredibly efficient if properly designed.

The infrared panels work in a different way to regular radiators. Instead of warming up the air, they heat up objects, including furniture, finished flooring, kitchen worktops and,  of course, people. They heat up the person and the objects in the room, rather than the ambient air, which means they use less energy in a properly insulated environment.

Reducing heat leakage is a more straightforward thing in new-build housing, requiring quality insulation, glazing and doors with proper design. But, when it comes to innovation, energy use is the really interesting space. The effective and efficient insulation of existing buildings still provides a challenge that we do not yet have all the answers to, but we are making progress. 

These companies will always be looking for different ways to stand out and to change things for the better, driving progress

While SMEs do not account for the biggest proportion of housebuilding output, sites such as the one in Portsmouth make people – the housebuyers – aware of what is achievable, which in turn recalibrates expectation levels. People are expecting more from the industry these days. And, because of this, the standards of building are increasing. The days of “knock them up fast and cheap” may soon, finally, be behind us.

I expect to see a lot of interesting innovations coming out of the SME space in the coming years. These companies will always be looking for different ways to stand out and to change things for the better, driving progress. This in turn will mean that the national housebuilders will have to keep pace, hopefully propelling the industry towards a more sustainable future.

It is a new space – and there are challenges to that – but it is certainly a move in the right direction. And I believe the use of AI in the management of households is something we are going to see more and more investment in. 

After all, the widespread adoption of sustainable and energy-efficient housing makes sense both for the environment and for the population. Not only would this drastically reduce our environmental footprint, but it would also lead to long-term savings for homeowners and create healthier living spaces.

Charlie Fitzgibbon is the founder and managing director of building contractor and property development company Edinburgh Construction. He founded the company aged 26 after more than a decade working in the construction industry, having left school at 15. Today, the company has a multi-million pound turnover.