Inflation is ‘spanner in the works’ of net-zero ambitions

Inflation of key materials and fuel present a major threat to contractors’ aims to decarbonise the industry, experts have warned.

Researching new, more energy-efficient products and analysing alternatives to current energy supplies is “already well under way”, Bam Construct head of procurement Dan Billinge said at Construction News’ Decarbonising Construction conference earlier this week.

“[But,] the spanner in the works for [contractors] is the inflation of prices, which is impacting the commercial side of the business,” he added. “There are a lot of challenges out there.”

Inflation of energy, material and everyday prices has hit construction hard.

Last month, Mace chief executive Mark Reynolds warned that businesses are facing “real challenges” with inflation, far beyond what had been seen in recent years. He called on the industry to work together to limit the impact of inflation on UK firms.

The Bank of England has warned that inflation could rise to 11 per cent.

Despite these issues, Billinge said Bam’s concept designs had already been “rubber-stamped” and that it was working with partners to increase collaboration on decarbonisation.

“We’re looking at the way they operate. We’re understanding what we can do to support them, if that is needed, and try[ing] to align our businesses.

“That allows us to start to work through the designs and we can start looking at more efficient products, whether that’s from a concrete or a steel perspective.”

One of Bam’s regional offices is working with a consultant who is analysing different product combinations to work out their potentials and efficiencies, said Billinge.

In a separate discussion on energy-positive buildings, UK Research and Innovation (UKRI) challenge director for transforming construction Sam Stacey said he was “surprised” at the affordability of solutions to climate issues. The suggested changes came from the Transforming Construction (TC) programme, funded by UKRI.

“What we discovered with TC is that a greater proportion of the solutions make economic sense in terms of attractive payback periods, and something that none of us could have predicted was what happened in Ukraine, which has spiked the energy prices,” he said, adding that it had “considerably changed the equation” when it comes to payback periods for investment in decarbonised solutions.

“Everything is pointing in the direction of rapid and substantial change in these areas,” said Stacey.

The transforming construction challenge is part of the 2018 Construction Sector Deal, which aims to accelerate the shift towards manufacturing and digital processes, and a “value outcome approach”.

It has already pumped £170m of investment into the scheme, which has been matched by £250m from the industry, Stacey revealed.

The third virtual conference on Decarbonising Construction comes amid warnings from MPs that the government must do more to help the sector meet future net-zero ambitions, making a shift towards greener construction methods even more relevant.

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