Construction Industry Federation Head of ESG PJ Ryan considers the industry issues that will take centre stage over the coming year
As sustainability takes centre stage in the construction industry, 2025 is set to bring significant regulatory and operational changes.
From enhanced reporting requirements under the Corporate Sustainability Reporting Directive (CSRD) to stricter waste management levies, embodied carbon provisions, and updates to energy performance regulations, these developments will shape how firms operate, report, and innovate.
Below is an overview of key sustainability issues and their implications for 2025. Corporate Sustainability Reporting Directive (CSRD): The start of enhanced reporting
In 2025, the first cohort of the largest firms will commence reporting under the CSRD. While most construction companies will begin reporting in subsequent years, this milestone introduces critical aspects of the new framework:
1. Benchmarking reports
The inaugural reports will showcase the content, structure, and quality of sustainability disclosures, offering benchmarks and case studies for firms preparing to comply in 2026.
These reports will illustrate how companies interpret CSRD requirements, setting the tone for future compliance.
2. Double materiality
CSRD emphasises double materiality, requiring firms to assess both financial materiality and the impact of their activities on the environment and society.
Early reports will reveal methodologies, data sources, and the balance between financial and impact dimensions, serving as guides for future reporters.
3. Auditor expectations
The role of auditors in verifying sustainability information will become clearer, highlighting challenges, rigour levels, and assurance practices under the CSRD.
This will help firms and auditors align on standards and processes ahead of broader implementation.
For firms set to report in 2026, 2025 is a pivotal year to initiate formal data collection processes, particularly for key suppliers and subcontractors, ensuring readiness for compliance.
Phasing out exemptions for construction and demolition (C&D) waste
Waste management policies will see substantial changes in 2025, particularly for Construction and Demolition (C&D) waste:
1. New levies
The landfill levy exemption for greenfield soil and stone will end on January 1, 2025, with a €10 per tonne levy introduced for materials disposed of in municipal landfills. Similarly, a waste recovery levy will apply to larger soil recovery facilities from September 1, 2025.
Brownfield sites will remain exempt temporarily, but reassessment is expected in 2026.
2. Regulatory oversight
The EPA’s National Greenfield Soil & Stone Decision and the Article 28 Recycled Aggregates decision will redefine waste classifications, significantly reducing the volume of materials recorded as waste in national statistics.
These changes underscore the need for contractors to optimise resource management and carefully assess if projects will be subject to the levies.
Supply Chain Sustainability School and CIF Carbon Calculator
To support the industry’s transition to sustainable practices, CIF continues to back two key initiatives:
1. Supply Chain Sustainability School
Celebrating its first anniversary in January 2025, this free resource offers workshops, webinars, and SME membership options to promote best practices in sustainable supply chains.
The summit will highlight innovations and challenges, fostering collaboration across the sector.
2. CIF Carbon Calculator
Launched in June 2024, the CIF Carbon Calculator assists firms, particularly SMEs, in calculating their carbon footprint. It supports large contractors in Scope 3 reporting for purchased goods and services – an essential element under CSRD.
This tool bridges the gap for smaller firms lacking dedicated sustainability resources.
Rising embodied carbon requirements
Embodied carbon is gaining attention through stricter Green Public Procurement requirements:
1. Cement and concrete standards
With cement production responsible for 41 per cent of Ireland’s industrial emissions, new procurement policies mandate:
– 30 per cent clinker replacement in cement
– Product-specific Environmental Product Declarations (EPDs)
– A ban on CEM I concrete
2. Whole Life Carbon Assessments (WLCA)
From September 1, 2025, publicly funded projects in the design phase must conduct WLCAs:
– Non-residential projects over €10million
– Residential projects over €60million
– Infrastructure projects exceeding €60million
These thresholds will lower in 2026, broadening the scope of projects under WLCA requirements. Whole-life carbon metrics will also become critical in public project evaluations under the Capital Works Management Framework.
Energy Performance of Buildings Directive (EPBD) updates
The recast EPBD will drive changes in energy efficiency and carbon tracking for buildings:
1. Zero Emissions Buildings (ZEB)
Updates to Part L of the Building Regulations will mandate a shift from nZEB (nearly Zero Energy Buildings) to ZEB, achieving a 10 per cent improvement in performance and banning fossil fuel heating systems in new builds.
2. Building Renovation Passports
For phased renovations, Building Renovation Passports will become mandatory, ensuring systematic energy efficiency improvements.
3. Global Warming Potential (GWP) Integration
SEAI is developing a GWP calculator to assess embodied carbon in construction. This metric, aligned with WLCA, will appear on Building Energy Ratings (BERs), aiding in transparent carbon tracking.
Regulatory changes, innovative tools, and increased accountability will mark the sustainability landscape in 2025.
The CSRD will set the foundation for sustainability reporting, offering valuable insights for firms preparing for future compliance.
Meanwhile, stricter waste levies, embodied carbon requirements, and updates to the EPBD emphasise the need for proactive measures.
Leveraging resources like the Supply Chain Sustainability School and the CIF Carbon Calculator will be crucial for construction firms, especially SMEs.
Preparing for these changes now will ensure smoother transitions and position the industry to meet growing environmental and societal expectations.
About the author
PJ Ryan supports the development of policy and associated services for the CIF’s membership to enable them to address the critical pillars of ESG and corporate sustainability obligations and develop their business strategies, plans and actions. PJ has worked in a sustainability role since 2008, mainly in the M&E sector as a consulting engineer, where he has managed teams responsible for sustainability modelling, compliance with building energy regulations and third-party rating schemes such as LEED, BREEAM & WELL. In 2021, as convenor of the ACEI Sustainability Committee, he launched the Pledge to Net Zero campaign to get Consulting Engineering firms to practice what they preach concerning science-based reductions with 50 per cent absolute reductions by 2030.
