In addition to meeting the needs of both the residential and commercial sectors in Cardiff in the coming years, the development industry will have to grapple with net zero targets. Delivering more renewable energy sources, particularly for new buildings, and improving the energy efficiency of existing stock will be critical.

Wales is leading the way among the home nations in setting out plans to meet net zero ambitions. The Wellbeing of Future Generations Wales Act 2015 requires that development and use of land contribute to improving the economic, social, environmental and cultural wellbeing of Wales. Future Wales, the national development framework, provides a spatial plan for policies that are a national priority, including the provision of affordable housing and the location of renewable energy generation technology.

The Welsh Government’s Ministry of Climate Change combines the environment, energy, housing, planning and transport portfolios. The minister in charge – Julie James – has directed that all new housing in Wales will have to reduce carbon emissions by 37% under changes to the building regulations that will be implemented in 2022. This reduction is seen as a stepping stone towards further reductions in 2025, when new homes in Wales will need to produce at least 75% less CO2 emissions than ones built to current standards.

The Plan also sets requirements and ambitions for low carbon and renewable energy infrastructure, aiming to reach 70% energy generation from renewables by 2030. Consequently, the National Plan has designated Cardiff as a priority area for District Heat networks. Proposals for large-scale, mixed-use developments of 100 or more dwellings or 10,000sqm or more of commercial floorspace will have to assess the potential for a heat network. However, there is also potential for heat networks below this threshold.

Encouragingly, a pipeline of renewable schemes is emerging across South Wales, with an installed capacity of almost 800 MW. The majority of schemes are for solar energy, but the Welsh National Plan has designated priority areas for wind across The Valleys.

CHALLENGES AHEAD

While the framework is in place to deliver more efficient development supported by renewable energy in the future, there is still considerable work to be done to retrofit Cardiff’s existing stock. Over 97% of new build homes delivered in the last five years have an EPC rating of B, but only 5% of second hand home sales in the same period achieved this rating. Instead almost 50% of second hand stock is rated EPC D, with a further 16% rated E or below. Applying this ratio across all of Cardiff’s housing stock suggests that around £838 million of investment will be needed to bring all properties up to a C or above.

Turning to offices, Savills Research has analysed the EPC ratings of the current stock across Cardiff, where the city has 67% of space below a B. With 27% of this space an E and F it does highlight the scale of the challenge to improve the energy efficiency within the City. However, on a more positive note, the percentage of stock which is EPC A stands at 16% (regional average is 2%), with developers continuing to respond to the demand for sustainable office space with 230,000 sq ft of space under construction, all of which is certified as BREEAM ‘Very Good’ or above.