Since October last year, all proposed residential developments located in London are required to comply with new set of CO2 emissions reduction requirements, commonly referred as a zero carbon standard. Major developments (comprising 10 units or more) are obliged to achieve a 35% reduction in CO2 emissions above Part L 2013 regulations, while the remaining CO2 emissions are to be set off though cash in lieu. Minor residential schemes are relived from the payment as for now, but the 35% CO2 reduction requirement remains in place.

The policy was introduced as a part of strategy to cut the UK carbon emissions from the building stock to meet the Climate Change Act 2008 target. Since its inception, the new standard met strong opposition from developers, housebuilders and affordable housing campaigners. Those who are against, claim it is not tailored to truly drive decarbonisation. Instead, it acts as an additional barrier for provision of affordable housing in the capital, where the need for new homes is desperate.
On the other hand, the new policy has potent supporters and agrees with Sadik Khan’s 100% clean energy target for London by 2050. As for now, the best possible strategy for developers is to minimise additional costs through smart CO2 emission reduction strategy.

Be Lean- Be Clean- Be Green

The reduction in CO2 emissions can be achieved in a number of ways. First, the focus is on decreasing energy demand (Be Lean). A lot can be accomplished through passive design measures, such as optimising building orientation and site layout to maximise the use of natural light, as well as taking advantage of natural ventilation, or thermal mass. High efficiency lighting and effective mechanical ventilation with heat recovery is also taken into account at this stage, and so are the improvements to the building fabric.
The next step is to consider the connection to the existing heat network systems, such as the Pimlico District Heating Undertaking (PDHU), Whitehall District Heating network, and others, as shown on the London Heat Map. Where a heat network exists in the vicinity of the proposed building, or is planned for the future, the developer must prioritise the connection (Be Clean). At this stage, site-wide heat networks, such as combined heat and power (CHP) must also be considered. The last step is to consider integration of renewable technologies (Be Green). Because of high density of buildings in the city, solar PVs are the most commonly opted option, but other technologies can also be feasible and contribute to the CO2 emission reduction.

The energy statement indicates the CO2 emissions reduction at each stage of this energy hierarchy, as well as the remainder of CO2 emissions that must be off-set by payment in lieu.

How Much Will Zero Carbon Policy Cost You?

In most London boroughs, the off-set payment is set at £60 per tonne of CO2 for a period of 30 years, which gives a £1,800 per tonne of CO2. But if your development is located in Westminster, expect to be charged a flat fee of £7,560 per tonne. This may be not enough to push more energy efficient designs, some argue, but the smaller developers can be hit hard. Based on the current charges, CBRE has estimated than the new requirement will increase the cost of a large scale residential development between £1.5 million and £6 million.
Moreover, the councils are free to change the level of ‘carbon charges’ and it cannot be ruled out that these fees increase in the future. Therefore, it is so crucial for developers to have a CO2 emission reduction strategy in place as early as possible and this is where we can help.

Updated Reporting Requirements

To demonstrate compliance with zero carbon policy, the developer has to produce an energy statement. The energy report provides information on the projected development’s CO2 emissions, measures taken to reduce them and the effect of these efforts expressed as a % of CO2 emissions reduction achieved on site. The calculations are conducted using the government approved software called SAP. The structure of the report has to be in line with the Greater London Authority guidelines; otherwise the council has the right to reject it.

The new standard comes with new reporting requirements. If the development contains both residential and commercial elements, CO2 emission reduction has to be presented separately for each element. Such situation occurs when a block of flats contains retail area on the ground floor, for example.

There is also a requirement to follow the cooling hierarchy, which may include an in depth overheating analysis. The first required step is to minimise internal heat generation through energy efficient design, next – reducing the amount of heat entering the building in summer. Use of passive ventilation and thermal mass are also considered as effective measures of reducing the risk of building overheating, while mechanical ventilation can be used to make use of ‘free cooling.’


  • Residential developments of 10+ units are required to cut generated CO2 emissions by 35% against 2013 Building Regulations on site
  • The remainder of generated CO2 emissions up to 100% is to be set off though cash in lieu
  • ‘Carbon’ charges vary by borough and start from £1,800 per tonne of CO2

How we can help?

C80 Solutions have completed hundreds of energy statements for a wide range of residential schemes across London. We have developed a proven energy statement process which focuses on the simplest and most cost effective CO2 emission reduction strategies.

  • We will make sure all CO2 emission reduction options are considered
  • We will help you minimise hefty carbon offsetting fees
  • We will prepare your energy statement in strict compliance with the Greater London Authority guidelines
  • We will make sure your energy statement is accepted by the Local Planning Authority.
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