Decarbonization in Commercial Real Estate

As we race against the clock to address climate change, the need for decarbonization in commercial real estate becomes increasingly vital. Decarbonization refers to the process of transitioning buildings to all-electric power in combination with renewable or carbon-free energy sources. The building industry accounts for nearly 40% of the world’s carbon emissions; in California, specifically, residential and commercial buildings are responsible for approximately 25% of our state’s greenhouse gas (GHG) emissions. If we’re to meet California’s goal of reducing statewide GHG emissions, building decarbonization solutions must be implemented into commercial real estate properties.


Decarbonization refers to the act of lowering GHG emissions (the most common of which is carbon dioxide or CO2) by reducing our reliance on non-renewable fossil fuels like natural gas, coal, and oil. When it comes to decarbonization building solutions, two types of emissions come into play: embodied carbon and operational carbon.

Embodied carbon includes emissions that are created throughout the entire building process. This includes extracting construction materials, manufacturing materials, transporting those materials to the job site, and the construction process leading up until the building is considered operational. It also covers building maintenance, demolition, and disposal of the materials at their end life. These activities combined make up approximately 11% of all carbon emissions.

Operational carbon makes up about 20% of total carbon emissions. Operational carbon refers to the amount of carbon emitted through the use of the building and everyday activities, such as heating and cooling, lighting, and cooking.


As commercial buildings play a significant role in emitting GHGs, it’s essential to find effective building decarbonization solutions to lower their carbon footprint. The easiest way to do this is to implement sustainable building practices and all-electric power sources and appliances in the design of new builds. For existing buildings, switching to renewable energy and installing energy-efficient upgrades can significantly cut emissions and reduce overall operational costs.

Decarbonization in commercial real estate presents unique business opportunities. With energy costs rising and climate change becoming increasingly dire with each passing year, the upfront capital costs are investments with tangible rewards. In addition, many consumers are now actively choosing to do business with companies that are known for making sustainable choices in the way they operate. In addition, there are several local incentives and federal programs available to help fund energy-efficient initiatives for businesses.


Founded in 2002, Gilleran Energy Management offers comprehensive consulting services to help developers and commercial real estate owners meet their decarbonization goals. Our experienced consultants stay current with the latest industry certifications, programs, and regulations, and can provide expert guidance on a wide range of green building and energy efficiency solutions, including Zero Net Energy, energy audits and modeling, Solar-PV system sizing, CALGreen compliance, and more.

To schedule a consultation, contact us today at (707) 528-7318 or email us at

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