The global green building materials market is expected to grow at a compound annual growth rate of 11.25% over the forecast period. The market is expected to be driven by the increase in residential housing construction, rising demand for energy-efficient buildings, and favourable government regulations and policies for green building houses and other structures. Moreover, with the aftershocks of the COVID-19 Pandemic, individuals have been taking effective measures to protect themselves from various diseases. According to the WHO, lung, and respiratory diseases, which had been associated with a poor environment, are major causes of death. Green Buildings provide ample daylight, a better ventilation system, and freshwater availability. Various research studies have shown that natural daylight reduces stress levels and surges productivity by approx. 15% in individuals.
Reducing Carbon Emissions
The reduction or achieving carbon neutrality would be a major factor in the overall market growth, during the forecast period. The United Nations recently stated that green buildings hold a key to achieve net-zero carbon goal. According to the UN report, buildings account for approx. 38% of the planet’s C02 emissions from energy. The emission from the building has surged due to the increasing use of fossil fuels for energy or electricity generation. The report also stated that green buildings would be a major factor in combating climate change and reducing carbon emissions from the environment. There has been a surge in spending on energy-efficient buildings in recent years. Major countries have been planning and taking measures to reduce or achieve carbon neutrality in the coming decades. In 2017, Sweden stated its goal to achieve carbon neutrality by the year 2045, which had made it the first nation to put into law a given and expected timeline, intending to achieve Paris Agreement Target. The country had planned to reduce absolute emissions by approx. 85%, as compared to 1990 levels. The remaining 15% would be completed through investments and spending on projects such as building greenhouses and other environmentally friendly projects. In June 2019, The United Kingdom also stated that it had set a target to reach carbon neutrality by the year 2050. The country’s carbon emissions had reduced by 29% over the last ten years. Other countries have also been making major efforts to reduce or become carbon neutral in the coming decades. In June 2019, France announced legislation to achieve net-zero greenhouse emissions by the year 2050. The country had been taking measures to enhance around 7.2 million poorly insulated households, as its housing sector produces around 25% of the carbon emissions. China, which has been the world’s biggest emitter of greenhouse gases, announced its plans to become carbon neutral by the year 2060, in September 2020. The country also has a significant share in the clean energy market, as it is one of the biggest investors in the clean and green energy sectors. In October 2020, Japan, one of the biggest economies in the world, announced its ambitions to achieve net carbon neutrality by the year 2050. In October 2020, South Korea also announced its ambitions and plans to achieve carbon neutrality by the year 2050. The country had been spending major capital on green projects. In July 2020, South Korea launched a novel Korean Deal for USD 135 Billion, which would focus on investments in digital and green technology. This is expected to be a major development in the green building materials market, during the forecast period.
Rising Construction Expenditure and green building initiatives in The United States
The market is expected to be driven by the increase in construction expenditure, worldwide. According to the U.S Department of Commerce’s Census Bureau, around 50% of construction spending in the country is generated from the housing sector. The upcoming administration in the United States has stated its plans to spend USD 2.4 trillion on energy and infrastructure to achieve carbon neutrality by the year 2050. According to the Census Bureau, in October 2020, USD 1.48 trillion was spent on construction spending, out of which USD 646 billion was spent in the housing and residential sector. The country has also been making significant developments in the sustainable and green buildings sector. According to the United States Government, the number of LEED-certified projects in the country grew from 296 certifications in the year 2006, to 67,200 in the year 2018. Green Building systems like ICC 700 National Building Standard and Leadership in Energy and Environmental Design, is expected to the market growth in the coming years. The United States government had adopted LEED and other related green building certifications for the development and construction of green buildings.
India and China are expected to drive the market
India will also play a major role in market growth, in the coming years. According to the International Finance Operation, approx. 70% of the buildings required by the year 2030, have to be constructed in the country. The market is one of the nascent and initial stages of development in the country, with approx. 5% of buildings have been classified as green in the country. The market is expected to be driven in the country because of the lower energy costs of green buildings as compared to other conventional buildings. Various government schemes are expected to give a major boost to the green buildings market. Pradhan Mantri Awas Yojana, one of the major housing schemes launched by the government of India, aims to provide and give affordable housing to the urban poor by 2022. The scheme was introduced in June 2015. The government stated that eco-friendly and sustainable technologies would be used for the construction of the houses. This is expected to drive green building materials market growth in the coming years. Other Indian Government schemes such as Eco- Niwas Samhita, a green housing project and scheme, would provide a boost to the green building market. China is also expected to have a major share in the market in the coming years. In 2012, the country’s central government announced the implementation of accelerating the development of Green Buildings in China, which provides substantial and specific subsidies for green-rated buildings. The country had also launched the National Urbanisation Plan, intending to increase the proportion of green buildings in novel construction by 50% in 2020.
1. In January 2021, Nexii Building Solutions, one of the major players in the market, announced that it had been on track to open the company’s first manufacturing facility in Pennsylvania, United States. The plant would be operated by NEXUS-1 and John Wolfington, through the company’s manufacturing program. The company would produce retrofit and green building products using the company’s process and material, called Nexiite.
2. In December 2020, HDFC Ltd. India’s major finance company, announced that it had signed an MOU with the Indian Green Building Council, intending to promote green buildings in India. Under this MOU, HDFC would work to promote financing and create awareness of green buildings in the country.