Retrofitting existing buildings represents another sizeable investment opportunity and plays a key role in reaching global climate goals.
To bring the buildings sector onto a 1.5°C compatible pathway, 3 percent to 5 percent of the existing global building stock would need to be renovated every year until 2050.
The vast majority of the buildings built today will still be used in 2050. This means that almost every building that is not carbon neutral will need to be retrofitted at some point in the next 30 years.
Undertaking these retrofits presents both a challenge and a significant
investment opportunity.
The retrofit market is expected to grow at a compound annual growth rate of 8 percent from 2018 to 2023.
Energy efficiency retrofits have shown attractive returns on investment, even for short-term investors. This is because in addition to generating direct cost savings, these measures positively affect the overall value of buildings.
Author: International Finance Corporation (2019). Green Buildings | A Finance and Policy Blueprint