Luxury Retailer

What did the client need?

The client had set ambitious targets to achieve net zero by 2040. They needed a credible net zero carbon (NZC) strategy with medium and long-term carbon and energy targets, designed to meet investor expectations. To do this, they required a portfolio-wide view of BAU, with identified technical potential and an investment plan to identify gaps to target.

The client came to Verco in response to regulatory requirements and facing increasing pressure from investors to reduce their energy intensity. They wanted to enhance their sustainability commitments and remain competitive within the luxury retail landscape, so they needed a review of their performance and a strategy that could achieve their ambitions.

How did Verco support the client?

The Verco team began with a review of the key stakeholder NZC ambitions and expectations. We identified key targets and gave advice on appropriate frameworks for tracking emissions and change over time. All emission sources and scopes were considered and a bespoke NZC framework was developed. This enabled practical action to track and reduce emissions. It was through this exercise that the client determined a whole-building, operational control approach for energy and GHG. It was the highest priority area for attention and resources. We helped the client to set ambitions and targets for the portfolio and funds within it.

We then reviewed the baseline, providing guidance on the estimation methodology and benchmarking. This allowed for a more accurate recalculation of the baseline and footprint. From here, our experts were able to help the client assess their progress in GHG emissions reduction since the 2019 baseline. We were also able to determine a solid starting point in 2023 from which to forecast pathways and scenarios.

We modelled 3 scenarios at the portfolio, investor fund, and asset level. This helped visualise the BAU, no cost / low-cost intervention, and all intervention impact on the energy and GHG pathways. The BAU scenario encompassed energy use and emissions from current operations, considering any completed or in-progress interventions and upgrades, with electricity supply side decarbonisation forecasts.

The no cost / low-cost scenario built on this to plot the impact of lower cost interventions and behaviour changes to the assets. This helped assign an energy saving to previously unconsidered savings. The all-interventions scenario then applied all identified intervention savings, regardless of cost, to the assets. This helped the client understand the impact of an intensive energy saving programme and identify technical potential across their portfolio. The forecasted scenarios were reviewed against CRREM pathways to understand the client’s alignment and identify risk exposure and any gaps to target between the scenarios and the CRREM pathway.

At this stage, key action areas and assets in need of greater resource were identified. We helped the client set medium and long-term targets aligned with best practice. A tiered approach was developed based on the asset-level and fund-level ambitions. This allowed for some flexibility in targets and the opportunity to adjust resources to achieve CRREM alignment. First tier, ambitious assets set reduction targets to achieve and retain CRREM alignment from 2030, with second tier assets setting reduction targets to achieve and retain CRREM alignment from 2040 (with gradual reduction for alignment by 2050 also outlined).

We provided the client with a suite of recommendations, a net zero roadmap and a monitoring and reporting matrix to help inform their strategy.

What was the result?

Overall, the Verco team delivered an adaptable model used to visualise the impact of different intervention scenarios on the whole building energy and GHG performance of the client's portfolio from 2023 to 2050. The client is now able to update the model when technical potential and feasibility are refined, and has used it to present to investors and inform their CAPEX plans.

Whole-building energy and associated GHG emissions reduction targets were set for the medium and long-term. A tiered approach was developed to help the client better meet investor and partner ambitions and set out adaptive plans for CRREM alignment.

A net zero roadmap was developed to outline the recommended approaches. Key focus points are to achieve net zero at the whole-building, centre, corporate and development levels. Further recommendations on savings were set out for the client’s consideration. These will guide the implementation of savings identified in the model.