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Determining embodied carbon also requires in-depth information such as environmental product declarations (EPDs) from manufactu- rers and certification companies like UL that indicate the composition of components and their impact on the environment. Sustainability from an environment perspective should also now consider modern concepts such as net-positivity where buildings create more energy or resources in their lifetime than they consume. It's all about the people. The health and wellbeing of people in a building has a lot to do with air quality and temperature, but is expanding to also consider the physical, psychological, and social impacts on the human experience of building occupants. This encompasses everything from the layout and lighting of spaces that enable an interactive and productive envi- ronment, to the ability to prevent disease and eliminate volatile orga- nic compounds (VOCs) and odors in the air. It also means providing a sense of individual engagement and purpose for occupants, as well as ensuring diversity, equality, and other factors that provide occupants with a sense of acceptance and inclusion. "We need buildings to do less harm and not negatively impact our health and wellness. Buildings should be places where we feel safe to sleep at night and where we can do our best work." - Josh Jacobs, Director of Environmental Codes & Standards, UL Considers all operational expenses Business profit considerations that rely on a sustainability approach now include much more than the cost of energy. Today's sustainable smart building must consider all costs associated with operations and maintenance by implementing circular economy principles that aim to reduce waste, increase reuse and recycling efforts, and keep products and materials in use as long as possible. Opera- tional costs reduction should also consider practices like demand response capabilities and net-positivity that can further reduce expense over the lifecycle of the building. Practices like predic- tive maintenance to prevent problems before they arise, and even the ability to efficiently handle building emergencies and prevent cybersecurity attacks, have an impact on operational expense and the sustainability of a building. Industry experts also agree that how a building impacts the productivity, safety, and satisfaction of occupants has a direct impact on operational expense, including tangible costs associated with healthcare and employee turnover. KEY DRIVING FORCES What now constitutes a sustainable smart building is determined by a variety of drivers from marketability, consumer expectations, and evolving regulations, towards an increased focus on cli- mate change and an overall shift in the way people live, work, and play in today's society. Climate change The world today is not meeting previously set climate goals. In 2016, nearly 200 countries signed the landmark Paris climate agreement with its goal of limiting global warming to well below 2°C and commitment to curtailing greenhouse gas emissions by 2030. By the end of 2020, most countries were not on track to meet their targets. 4 Buildings are a significant contributing factor, with an estimated 40% of global carbon emissions attributed to the built environment, including 28% attributed to operational emis- sions alone. 5 In addition, building construction in general is on the rise. Two-thirds of new building construction is expected to occur in countries that do not have mandatory energy codes in place. On top of it all, rising temperatures are worsening extreme envi- ronmental events. Increasing wildfires, rising sea levels, and other environmental problems have increased societal focus on limiting climate change, leading to new regulations, incentives, and market demand that is further driving the need for sustainability. The human factor The human factor and changes in building occupant behavior also significantly impact carbon emissions. Obviously, the vast increase in population and human consumption over the past century are a contributing factor. The expanding globalized economy also means the delivery of more goods and services in the global supply chain and a greater movement of people around the globe that produces more emissions and waste, creating a society that, unfortunately, sustains unsustainability. This became very clear during the current COVID-19 pandemic where stay-at-home orders around the world resulted in a sharp 8.8% decrease in global CO2 emissions in the first half of 2020 compared to the same period in 2019. 6 We also spend more time in commercial and public buildings today than we did a century ago, with studies indicating that humans 4 The Climate Action Tracker 5 Global Status Report 2017, United Nationals Environment Programme 6 Near-real-time monitoring of global CO2 emissions reveals effects of the COVID-19 pandemic, Zhu Liu et. Al, Nature Communications Journal, December 2020 www.lora-alliance.org p.3

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