While the building sector accounts for 37 per cent of global carbon emissions, recent progress on the decarbonisation front has stalled.
The Global Status Report for Buildings and Construction (GSRBC) 2025–2026 report calls for a multi-pronged approach that builds resilience from the ground up: with smart design that works with nature to reduce energy needs, scaling of cost-effective locally generated renewables like rooftop solar, and wider adoption of high-efficiency heat pumps.
In 2024 alone, the world added new floor area equivalent to five times the size of Nairobi, twice the size of Delhi, or four times the size of Berlin. Three-quarters of this was for housing to meet the urgent global demand for decent homes.
While USD 2.3 trillion has been invested in efficiency since 2015, the report identifies an additional USD 3.6 trillion investment gap by 2030 that must be closed to align with a net-zero pathway.
For the first time, the report reveals that global floor space grew by 20 per cent over the last decade while energy demand grew by only 11 per cent.
The emissions locked in by materials like traditional cement are a major threat to 1.5°C targets.
The technology to decarbonise—from high-efficiency heat pumps to rooftop solar—are already mature and proven but industry is stuck in “pilot mode” the report said.
Australia remains a global leader in decentralised energy; in 2024 alone, over 300,000 units with a total capacity of 3 GW were installed. This trend continued into 2025 with an additional 115,000 installations in the first half of the year.
The high volume of rooftop PV capacity additions is a primary driver in reducing buildings' indirect emissions from the grid.
Released last month the report warns that since 2020 the green transition has not kept pace with the rate of construction. leaving it both a major emissions source and increasingly vulnerable to climate impacts and energy price shocks.
The report was released by the UN Environment Programme (UNEP) and the Global Alliance for Buildings and Construction (GlobalABC).
UNEP executive director, Inger Andersen, said with half of the world’s buildings are yet to be built or renovated by 2050, governments have a critical opportunity to drive zero-emission, and resilient construction through better policies, codes, and investment.
Every day, the world builds an estimated 12.7 million square metres of floor area –roughly the equivalent of adding the entire city of Paris in new floor space nearly every week.
“To align the sector with a net-zero pathway, policymakers should accelerate energy efficiency improvements, and the fossil fuel phase out,” he said.
“Investment in building energy efficiency must reach USD 5.9 trillion by 2030, which is equivalent to USD 592 billion annually.”