Green Choices: Growing renewables uptake by the real estate and construction sector

According to the International Energy Agency, in 2021, the buildings and construction industry contributed to around 37 per cent of the global operational energy and process-related carbon dioxide emissions. However, when we talk ab­o­ut decarbonisation, we primarily consider sectors such as power, transport and industries. Buildings- and construction-re­la­ted emissions are often ignored.

This is a major concern, especially for India, where the real estate sector is boo­m­ing and is expected to have a 13 per cent share in the country’s GDP by 2025, as per recent industry studies. Estimated to become a $1 trillion market by 2030, India’s real estate and construction sector is one of the top employment generators in the nation. With increasing urbanisation and the surging demand for new commercial and residential buildings, the real estate sector is also perhaps the largest offtaker of huge land tracts, as some of these housing and commercial complexes are spread over several acres in the form of townships. Thus, it is only logical that the real estate and construction sector also contributes to the country’s decarbonisation journey, especially since these players have the required resources. And procuring renewable energy is not only a convenient way to reduce their emissions, but it also has many other benefits for real estate players as well.

Renewable energy is not just the future; it is also the present. All major corporates and industries are opting for green power in their energy mix, and there is a global movement towards decarbonisation of operations in all sectors. Solar power, obviously, has emerged as the top choice for most of these players, including the real estate sector, due to its ease of implementation, versatility and negligible operating costs. It can be installed on roof­to­ps, the ground, car parking lots and even on ponds. Moreover, solar power prices have declined significantly over the past few years, making it highly affordable co­m­pared to the grid power purchased from discoms. Further, given that some parts of India are still facing power supply issues with erratic and prolonged power cuts as well as a dependence on costly and polluting diesel generators, solar power provides assured and quality power supply. If storage is added, the power supply can be made more consistent.

Fortunately, real estate players have plenty of land and buildings in various parts of towns and cities that can be used for deploying solar power. Specialised developers have emerged in the renewable power space that can provide green po­wer solutions to real estate players, with innovative opex-based business models and competitive prices. These players can choose between on-site rooftop solar de­ployment and procurement of green po­wer through open access or group ca­p­tive arrangements from offsite projects. Various policy provisions exist to support this transition, such as comprehensive roof­top solar frameworks with net and gr­o­ss metering regulations, green open ac­c­ess rules, virtual net metering, financial incentives and support for residential so­lar projects. Meanwhile, a few forward-th­in­king discoms also support demand aggregation and development of community solar projects.

Another important point to note is that conscious consumers are making environment-friendly choices and have started opting for real estate establishments that are more energy efficient and procure gr­een power, conserve water and other re­so­urces, and focus on sustainable de­velo­pment. Even investors are now looking to collaborate with businesses that have environment-friendly strategies in place.

While very few companies have taken initiatives to green their energy mix, there are a few conscious builders and real es­tate players that have taken measures to adopt renewable energy, both on-site and off-site. These may serve as lessons for others in the sector as there are so many advantages that can be gained from adopting renewable. For instance, the following three leading home-grown real estate players in the country have taken significant measures for green energy adoptions.

Lodha Group: The Mumbai-based Lodha Group is a front runner when it comes to adoption of green energy. It aims to become a net zero company with respect to operations (Scope 1 and 2 emissions) by 2024, and is committed to achieving carbon neutrality for Scope 3 emissions by 2050. The company also launched the Lodha Net Zero Urban Accelerator programme in partnership with the Rocky Moun­tain Institute in 2022. According to the company’s Integrated Annual Report 2022-23, Lodha is also keenly focusing on increasing its renewable energy adoption through solar water heating, rooftop solar photovoltaic systems and green power utilisation for construction work at its projects, construction sites and offices. In 2022-23, renewable energy accounted for 55 per cent of the company’s total energy consumption. Further, the company so­ur­ces over 90 per cent of renewable power for its construction sites and standing as­sets through a mix of captive on-site projects and purchase of renewable power from discoms.

The group’s Palava City project already has over 4 MW of rooftop solar power in­stallations on residential buildings, whi­ch helps to offset most of the power requ­ire­ment of common areas. Mean­whi­le, an ad­ditional 3 MW of on-site solar ins­ta­ll­a­tions have been completed or are under implementation, to cater to the po­wer req­uirements of central amenities and commercial projects such as multilevel car parks, pump rooms and clubhouses.

DLF Limited: DLF Limited, which is based in Gurugram, is adopting various measures such as energy efficiency and renewable energy to reduce its carbon emissions. By 2025, it plans to increase the sha­re of renewable energy consumption in its re­ntal properties by 20 per cent, considering the 2019-20 levels as the baseline. Ac­cording to the company’s Busine­ss Res­po­nsibility and Sustainability Repo­rt for 2022-23, DLF uses on-site renewable pow­er to meet a part of its power requirements.

The company has 3.5 MW of rooftop solar plants installed across its rental buildings. In addition, it uses wind power at its commercial buildings. Further, DLF procures power through the open access route fr­om solar and hydropower plants for its re­tail properties and hotels respectively. The DLF Cyber City project in Gurugram has 940.6 kW of solar power projects install­ed, which generate a cumulative 613,586 kWh annually.

Godrej Properties: As a group, Godrej procures 65 per cent of its energy from renewable energy sources, according to the Godrej Properties Integrated Annual Re­port 2022-23. Further, the group has witnessed a 23 per cent reduction in Sco­pe 1 and 2 emission intensity from 2020 levels.

In particular, 95 per cent of all homes built by Godrej Properties are green and Leadership in Energy and Environmental Design-certified with a Silver rating at minimum. The company has also committed to the Science Based Targets initiative for a net zero transition, and will announce its internal targets soon. At Godrej Proper­ties’ project in Mamurdi, Pune, the company had installed a 100 kW solar power plant. Now, similar projects have been set up at five more company project sites in Pune. By the end of 2021, 22 per cent of projects across the company’s portfolio had adopted on-site renewable energy, and this number has increased since then.


While a few environment-conscious developers have taken encouraging steps towards greening their energy mix, this is just a drop in the ocean. The situation ne­e­ds to improve drastically.

Take the example of Gurugram, where I live, and which is witnessing a massive su­r­­ge in real estate development and an expanding skyline. With this construction activity, the city has seen a significant inc­rease in pollution and dust, which reaches alarming levels when mixed with smog during winter months. There has been no significant effort to control this situation by the authorities or the real estate players, and only a few of these cash-rich co­mpanies have adopted sustainable practices. The dust control portal launched by the Haryana government for monitoring pollution levels at construction and demolition sites has witnessed very few registrations. Most of these buildings are al­ways brightly lit from inside and outside (even when closed and unoccupied); are not built using green design concepts; and have not adopted any clean energy technologies such as rooftop solar deployment, despite having so much space to do so.

Renewable energy adoption is easier for larger, established developers as they have the required land or rooftops to do so with economies of scale. Moreover, they have greater power demands and thus they can opt for open access through virtual power purchase agreements, group captive means, or even directly from discoms or exchanges.

Real estate remains a largely untapped market for renewable energy deployment, providing significant potential for uptake in the coming years. Thus, more large real estate developers must take visible steps towards green energy adoption to establish a learning curve for others.

By Khushboo Goyal