‘Green buildings’ save Hong Kong developers New World, Swire Properties a fortune on electricity
- Swire Properties and New World Development (NWD) said they have saved a combined HK$86 million (US$11.09 million) on electricity in the last financial year
- Banks like Standard Chartered have bolstered the sector by offering lower interest rates on loans earmarked for construction of environmentally-friendly buildings
Banks have helped to bolster the sector by offering lower interest rates on loans earmarked for the construction of environmentally sustainable buildings.
“In 2019 alone, via our energy-management strategy, we have already reduced energy consumption by 26.9 per cent or 62.7 million kWh. This is equivalent to savings of HK$74.6 million on electricity,” said a written reply from Swire Properties.
It aims to cut its direct and indirect greenhouse gas emissions from electricity usage by 52 per cent per square metre of its property portfolio by 2030 compared from 2018 levels. For its tenants’ power consumption, the target is 28 per cent in the same period.
One of Swire’s projects, Sino Ocean Taikoo Li, in Cheungdu in the mainland Chinese province of Sichuan, is now entirely powered by renewable electricity.
Meanwhile, NWD said it achieved a 22 per cent reduction in the financial year ending June 2020, translating to an HK$11 million saving on its electricity bill.
“For every HK$100 million of revenue we earn, we aim to halve the carbon intensity required by 2030,” said Ellie Tang, the developer’s head of sustainability.
NWD’s energy-saving initiatives include the adoption of a “facade-integrated solar energy generation system” and a high-efficiency air-conditioning system in a 22-storey office building in Quarry Bay. K11 Atelier King’s Road in Hong Kong features Asia’s largest installation of hybrid solar panels in a building.
“It will set a benchmark for our future new property projects. By 2025, our property portfolio is expected to be three times bigger than it is now, with 38 new projects under the brand of K11 to be rolled out in Greater China,” said Tang.
She said a corporate tenant at another of its green buildings, K11 Atelier Victoria Dockside in Tsim Sha Tsui, has saved HK$6,000 a year on electricity for each floor it rented.
While the energy saving features mean higher construction costs, the savings and sustainability benefits are worth the investment, Tang said. The company was able to lower its financing costs by raising green loans and issuing green bonds, she added.
Standard Chartered Bank said close to a “double digit” percentage of its commercial property loans in Hong Kong today are green.
Recently, Standard Chartered extended a HK$500 million revolving credit facility to a developer at an interest rate linked to its performance as gauged by the Environmental, Social and Governance (ESG) Reporting Guide.
“There are enough incentives for our corporate clients to keep delivering on their ESG agenda,” said Amit Tanna, managing director and regional head of corporate finance Greater China & North Asia at Standard Chartered during a webinar on December 8.
Another HK$1 billion green loan was arranged and granted to a Hong Kong-based private equity fund as financing for the acquisition of a building.
Standard Chartered aims to provide US$40 billion of project finance services for infrastructure that promotes sustainable development by 2024 globally.
“This will obviously include sustainable green buildings,” said Tanna.
By 2030, the lender is targeting zero carbon emissions from its operations in 60 markets.
“We want to start it from ourselves and show our commitment,” he said.
