The building sector is responsible for a staggering 10 gigatonnes of CO2 emissions annually – 37% of global energy and process-related emissions. In the effort to limit global warming to 1.5 degrees, we need to slash that number by 4.2 gigatonnes of CO2e (GtCO2e) annually over the next decade. It’s time for low-carbon construction. Can cities make it a reality?
The hidden carbon footprint of buildings
According to the IEA, human construction activity will lay claim to an area the size of Paris every week from 2023 to 2030 – generating huge quantities of emissions.
Strong policy measures are being put in place to reduce the emissions generated during a building’s use phase — which make up about three-quarters of the building sector’s total emissions. However, 25% of a building’s lifetime emissions come from embodied carbon – emissions that are “locked in” during the construction phase from resource extraction, material production, transportation, and installation of building materials, as well as those from maintenance and demolition. And, as the operational efficiency of buildings improves, embodied carbon will make up half the lifetime emissions from new buildings by 2050.
One of the key strategies for reducing embodied carbon is adopting low-carbon construction practices. This includes using circular materials – such as recycled steel, reclaimed wood, or reused concrete – to minimise the need for virgin resources. It also involves selecting low-carbon alternatives – like green cement, which is produced using methods that emit less CO2 than traditional cement – and bio-based insulation, as well as designing for material efficiency to reduce waste. Low carbon cement substitutes – such as those used in London’s iconic ‘Walkie Talkie’ building – can reduce carbon emissions by around half compared to conventional cement.
To accelerate the shift to low-carbon construction, policy makers are seeking regulate the whole life carbon (WLC) of buildings – including processes and materials deployed in the construction phase. Our recent report showed that nearly half of countries surveyed expected to prioritise embodied carbon policies in the future, compared to only 18% today.
Policy makers are turning their attention to embodied carbon and building materials
Cities are changing the face of construction
Cities are moving ahead of national governments in piloting these low-carbon construction methods and regulations.
In Finland, Helsinki piloted carbon footprint limit values in their new city plan for new apartment buildings ahead of national mandates. The city studied over 60 buildings to understand its building stock’s carbon intensity, calculate emissions and set appropriate limits. This limit has already been reduced by 12.5% since the scheme was launched and will continue to reduce as low-carbon materials and processes become more attainable.
Other Finnish cities are demonstrating what is possible using their own buildings. In Tampere, a carbon footprint assessment must be submitted to the City Council for the design of new public buildings, with the Council typically prioritising lower-carbon designs over the least expensive options. A low-carbon design was selected for the Hiedanrannan School and Daycare Centre project, which is expected to reduce the whole life carbon emissions of the project by 18% compared to the baseline.
Cities are also using their softer convening power to promote low-carbon construction techniques. Malmö in Sweden has established a platform uniting over 200 stakeholders from the local construction sector under six focus groups to foster innovation and collaboration throughout the city’s construction supply chain. From 2025, developers will require environmentally friendly electricity and ban fossil fuels in all new and existing buildings and by 2030, all their building sites are expected to achieve climate neutrality throughout construction, operation, and demolition stages.
Yet cities need support from national governments to sustain progress. The OECD Global Survey on Whole Life Carbon of Buildings found that 5 out of 7 local governments saw increased workload from implementing WLC policies as a key challenge, and four reported a shortage of WLC experts. To overcome these barriers, national governments must work to boost local capacity and skills to make change happen.
Working together to build a better future
As cities continue to push boundaries on low-carbon construction, they are paving the way for a more sustainable built environment. But they cannot do it alone. Achieving deep emissions cuts in the construction sector requires stronger partnerships across all levels of government, greater investment in local capacity, and clear national frameworks that empower cities to act boldly.
With the right support, cities can remain powerful laboratories for innovation – showing what’s possible today and shaping the buildings of tomorrow. Now is the moment to scale what works, support local ambition, and let cities lead the charge towards net-zero buildings.
For more information, read the full OECD report: Zero-Carbon Buildings in Cities: A Whole Life-Cycle Approach.
Marie Hanagata is a Policy Analyst at the OECD Centre for Entrepreneurship, SMEs, Regions and Cities (CFE) where she actively contributes to the work of Decarbonising Building in Cities and Regions and Urban Policies and Sustainable Development. Her role involves providing support to national and subnational policymakers on topics related to the zero-carbon transition in cities, energy efficiency in buildings, urban resilience,and nature-positive urban growth. Before joining the OECD, she worked in the housing and construction industry, where she specialised in life-cycle assessment of buildings and construction materials.