3 Ways to Reduce Carbon Emissions in the Built Environment

Article
June 29, 2026

Summary

Last updated: June 29, 2026

  • The built environment accounts for up to 42% of global emissions. Sustainable housing can lower emissions through better design, lower carbon materials, and improved building operations.
  • AI helps during early design by improving planning decisions and selecting sustainable building materials with lower embodied carbon.
  • Operational emissions can be reduced using smart building systems that adjust heating and cooling based on real-time data instead of fixed schedules.
  • AI-driven digital twins help future-proof buildings by modelling climate risks and comparing retrofit options to cut emissions over time.

Related services: Built Environment Expertise; Clean Technology Adoption

Globally, buildings account for up to 42 % of annual emissions. Of this, two-thirds are generated by heating, cooling, and electricity used to power buildings. The remaining third comes from embodied carbon, which is the emissions from extracting and producing construction materials. To top it off, roughly one-third of all water consumption and waste generation occurs during building construction, operation, and maintenance. 

The built environment presents a significant opportunity for carbon savings in sustainable housing and commercial buildings. The integration of artificial intelligence (AI) provides a tool to enhance traditional engineering methods, static engineering modelling, and rule-based building management. In fact, AI modelling can reach up to 20% higher accuracy in carbon predictions. It can also reduce operating emissions by 15% and improve energy efficiency by 25%

This article outlines three pathways to integrate AI into both new construction and existing buildings to achieve carbon reductions.  

1. Design Out Carbon in Buildings

Reducing operational carbon in buildings often dominates conversations in building sustainability. However, building design and the selection of sustainable materials should be the first steps. They help create high-efficiency, net-zero buildings, including passive house design. 

Instead of relying on traditional, static modelling, developers can use AI-based generative design software to test different building design options, allowing them to compare simulations that meet requirements and design out carbon from the very beginning.

Through building information modelling, architects can input structural requirements, regional climate considerations, and local zoning laws, enabling the AI tool to identify equivalent alternative building materials before the design is finalized. These approaches follow core design principles that prioritize efficiency, material selection, and early-stage carbon reduction, which can be further optimized by procuring low-carbon building materials using Environmental Product Declarations (EPDs). By leveraging EPDs, developers can easily identify products with lower embodied carbon and environmental impacts, ultimately supporting long-term energy conservation based on local weather conditions and building use.

2. Reduce Building Operational Carbon

Energy usage in older buildings is inefficient. The largest energy losses in buildings occur through the building envelope, poor ventilation, and window design. Increasing energy efficiency with upgraded materials and electrified systems will lead to reduced greenhouse gas emissions. 

In new builds, the operational emissions are primarily from Heating, Ventilation, and Air Conditioning (HVAC) systems. Traditional building management systems operate on static schedules. They maintain a consistent temperature regardless of the environment and the dynamic activities occurring inside and outside the building.

To reduce their carbon footprint, owners of new and existing buildings can adopt smart building technologies. Integrating deep reinforcement learning (DRL) agents with localized Internet of Things (IoT) digital twins can make a building’s HVAC system more predictive. It can adjust heating and cooling based on indoor temperature and air quality, weather forecasts, occupancy schedules, and real-time energy costs. 

Adjusting for these factors, proactive measures can be taken to optimize and reduce energy consumption, such as pre-cooling or pre-heating if the weather is forecast to change quickly. Increasing energy efficiency reduces operating costs. Further, data relayed back to the municipal grid can inform renewable energy load requirements to effectively manage usage fluctuations. 

3. Future-Proofing Sustainable Buildings

Future-proofing the built environment requires designing and retrofitting buildings to adapt to the variability of climate change. This is especially important as building mechanical systems will inevitably lose efficacy over their 50 to 100-year lifespan. 

AI-driven digital twins offer a solution. Digital twins are virtual replicas of a building's infrastructure and physical performance in real time. They create an adaptable digital model that enables the construction of sustainable buildings based on future environmental stressors rather than historical data. This includes modelling for climate resilience and weather adaptation, such as wildfire or flooding risks.      

These models can inform building decarbonization by simulating various energy and envelope retrofits in existing buildings, de-risking capital investments. Understanding the impacts of upgrading insulation versus installing triple-glazed windows or solar arrays accelerates localized decarbonization across the sector.   

The case for AI in real estate offers practical environmental and economic opportunities to future-proof the built environment. Driving the adoption of these tools not only protects building valuation but also decarbonizes the sector through resource efficiency.

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