Solar energy gives tenants a clear advantage

Sustainability reporting has tightened to. From 2024, large companies with more than 250 employees will have to report on environmental, social and governance (ESG) conditions. This includes, among other things, the requirement to document greenhouse gas emissions in three categories: direct emissions (Scope 1), indirect emissions from energy use (Scope 2), and emissions throughout the value chain (Scope 3).

“For many tenants of commercial buildings, energy consumption and associated Scope 2 emissions from the premises will account for a significant part of their overall climate footprint. Then it becomes crucial to choose energy-efficient and climate-friendly buildings,” explains Adrian Bergem, CFO of Sunday Power.

Installation of photovoltaic systems on the roofs of commercial buildings brings significant advantages:

• Reduced greenhouse gas emissions: Solar energy reduces the building's total emissions and contributes to lower indirect emissions (Scope 2) for tenants.

• Increased property value and attractiveness: Buildings with photovoltaic systems achieve better energy labelling and attract environmentally conscious tenants.
  

• Cost savings: Solar power can reduce electricity expenses, to the delight of both landlord and tenants.

The CSRD also emphasizes that companies should document how they are adapting to the transition to a low-emission economy. For tenants, this means that sustainable choices, such as renting premises in buildings with renewable energy solutions, can contribute to more holistic and credible reporting.

“By going for solar, landlords can attract quality tenants who want to strengthen their sustainability reporting, while avoiding “using up” emission allowances on renting in buildings with a high environmental impact, concludes Bergem.
‍

---- The whip works

There is much to suggest that the market is already feeling the effects of stricter reporting requirements.

Akershus Eiendoms' annual ESG survey for farm owners shows that tenants are now ruling out buildings because they are not green enough.

The survey, which was conducted at the end of 2024, shows that “an increasing number of companies include sustainability in their requirements specification for new office space, and last year we saw several examples of companies completely excluding buildings that do not have a sufficiently good environmental profile,” writes Kari Due-Andreassen, chief economist at Akershus Eiendom, in a column in Dagens Næringsliv.

Moreover, she writes, the reporting whip is now helping to push the willingness to pay for green premises up on a wider basis. Akershus Eiendom sees examples of buildings that are not green enough losing out in the competition for the largest and best tenants.

Read also: Solar PV plants gave lower interest rates

‍