Authorities and public entities can influence the construction industry through regulation and taxes as well as financial incentives. Private stakeholders can also use incentives to promote green construction. These methods are already being put into use as can be seen in the development of limit values for emissions from construction in the Nordic countries. Meanwhile, public procurement is being used to propel emission-free construction by way of rewards for low-emission construction. Private investors and financial institutions now often require sustainability in financed projects to be reported on or offer lower interest rates for sustainable construction projects. Nevertheless, current construction regulations can hinder emission reductions, especially in respect to waste and material reuse. Regulations and carbon taxation that aim for the decarbonisation of transportation also influence the construction industry.
6.1. Financial incentives
At the national and regional levels, financial initiatives must promote emission-free construction sites. It is especially important that private stakeholders, such as banks, take action against climate change. Part of the solution to achieve this is the creation of private and public loans to improve the sustainability of construction. A good example of such an initiative is the green residential loan established by Arion Banki in Iceland. Arion Banki has allocated special financing for several sectors with "green” eligibility criteria that both facilitate and support responsible investments in Iceland. The green residential loan established by Arion Banki has a list of criteria to determine whether a building can be considered "green” pursuant to Icelandic standards. Similar criteria lists could be established for emission-free construction sites.
Carbon emissions: ≤ 6.84 kgCO2/year/m2 required.
Proximity: Must be within 750m of public transit.
Climate resilience: Elevation data not used.
Waste/recycling: Excluded if in non-recycling areas.
6.2. Green procurement
In relation to emission-free construction sites, several questions arise regarding procurement processes. In addressing these critical questions surrounding procurement in emission-free construction, a delicate balance is needed between ambition and practicality, market integration, incentivisation, strict oversight, and transparent validation methods in order to foster emission-conscious construction practices.
A key challenge is determining how to establish ambitious yet attainable criteria aimed at achieving emission-free construction sites. This involves defining clear and practical benchmarks that can drive the reduction of emissions in construction practices. An important concern is the realism of these criteria. Feasibility within the construction industry must be evaluated, considering technological advancements, available resources, and the practical limitations faced by construction companies. This should involve engaging in dialogue with stakeholders.
It is imperative to explore potential incentives in order to encourage private companies involved in procurement projects within the construction industry to integrate emission reduction into their tender requirements. In turn, it is essential to identify mechanisms that motivate and reward companies for integrating emission-reducing measures within their bids. This could involve fiscal incentives, preferential treatment in procurement processes, or public recognition for sustainability efforts.
The simultaneous co-ordination of tender requirements for emission reductions across both the public and private sectors is hugely significant. Aligning criteria and standards between these sectors streamlines the bidding process for contractors. Such co-ordination fosters a more consistent and standardised approach, making it easier for contractors to engage with and bid on projects across various sectors. Ultimately, this synchronisation promotes wider participation.
An equally critical aspect is the establishment of a binding follow-up mechanism to enforce compliance with procurement requirements. A significant challenge comes in the form of determining the level of oversight required and how it should be executed. This could involve stringent monitoring, reporting, periodic audits, or random on-site inspections of a select number of construction sites coupled with the imposition of penalties for non-compliance to ensure adherence to the procurement requirements.
6.3. Regulation
The limit values for emissions from construction that are being developed and implemented in the Nordic countries address emissions from construction sites as a part of the embodied carbon of buildings (Boverket 2023; VCBK 2023). A similar regulation is in place in France (`Réglementation environnementale RE2020’ n.d.). Legislation for waste handling is in place in the Nordic countries, which promotes waste prevention and reuse, leading to less construction emissions (Fufa et al. 2023).
This legislative framework is aimed at reducing greenhouse gas emissions on construction sites as well as in construction in general. The legislation does not, however, aim for emission-free construction sites. The emission limits start out as something close to the current industry average and there are no goals set for reaching zero emissions. However, the intention is for these limits to become stricter over time.
Specific regulations can be developed for the construction process to speed up the transition to truly emission-free construction sites. In this regard, construction waste can be targeted, as can the use of fossil fuels.
Examples of such regulations include the restriction of fossil fuels in certain areas, such as for electricity generation and heating. Limiting sales of fossil fuelled construction machinery is another possible avenue. Stricter regulations on construction waste and regulations for circularity could limit waste-related emissions (Krzysztof Pikoń et al. 2023).