Survey Highlights Key Drivers of Smarter Buildings

This article was machine translated.

Buildings are strategic assets with a vital role to play in moving the world toward net zero. Although building technologies and decarbonization strategies continue to advance, overall progress remains uneven.

The buildings-focused edition of the Siemens Infrastructure Transition Monitor 2025, Inside Smarter Buildings, surveyed 1,400 senior executives across a range of industries worldwide. Its findings highlight key trends in the transition to smarter buildings that can lower costs and reduce greenhouse gas emissions. Three major themes emerge:

• Energy efficiency in buildings is rising rapidly in importance and has become the top infrastructure priority for organizations worldwide over the next three years. More than half plan to increase investment in energy efficiency (57%), smart building technologies (55%), and electrification (54%). However, cost concerns and access to financing remain significant challenges, particularly in commercial real estate, where 60% of executives believe decarbonization is too expensive.
• Retrofitting is a critical mechanism for decarbonizing buildings, yet the current global renovation rate remains below 1% per year—well short of the 2% annual rate required to achieve net-zero targets. New service models such as Energy-as-a-Service (EaaS) are emerging as practical solutions that reduce the burden of upfront capital investment.
• Digitalization is one of the most powerful drivers of the transition. More than half of respondents believe digital tools have strong potential to reduce costs (56%) and greenhouse gas emissions (53%), while 54% say their organizations are ready to deploy building automation. The next challenge is to scale these solutions broadly, remove financial and regulatory barriers, and align all relevant stakeholders.

Energy Efficiency: From Seventh to First

The survey reveals a clear shift in infrastructure priorities. Improving energy efficiency in buildings and facilities, which ranked seventh in 2023, rose to first place in 2025—even though it remains the objective showing the least overall progress, with virtually no improvement since 2023.

Several countries have launched major initiatives to improve energy efficiency. The United Arab Emirates, for example, has introduced a decarbonization program to retrofit 60 government buildings with advanced energy-efficiency technologies. The initiative aims to reduce energy and water consumption by 27% and is expected to cut greenhouse gas emissions by approximately 15,400 tonnes of carbon dioxide equivalent.

Overall, more than half of organizations plan to increase investment in energy efficiency (57%), building technologies (55%), and electrification (54%) in the years ahead. This underscores why energy efficiency is often the strongest starting point for building decarbonization, from both financial and strategic perspectives.

Accelerating Building Retrofits and Unlocking Capital Through New Models

The International Energy Agency’s (IEA) Net Zero by 2050 roadmap states that approximately 20% of the world’s existing building stock must be retrofitted to zero-carbon-ready standards by 2030. Achieving this will require a sustained deep-renovation rate of more than 2% per year. Yet the current global rate remains below 1%, and most projects involve only shallow renovations that are insufficient to deliver a genuine transition.

Sixty percent of real estate executives believe decarbonization is too expensive, compared with an average of 49% across all sectors. Only 33% say their organizations have sufficient access to funding for decarbonization, below the overall average of 47%. Financial factors have become markedly greater barriers to the transition than they were in 2023. The three factors showing the largest increases are all financial: insufficient capital, the cost of equipment and technology, and energy prices.

To address these financing challenges, Energy-as-a-Service (EaaS) is emerging as an important option. It replaces large upfront capital expenditure (CapEx) with pay-as-you-use operating expenditure (OpEx) under long-term service agreements. The service provider bears the cost of efficiency upgrades and is compensated through the energy savings and carbon reductions actually achieved. This enables organizations to accelerate returns on investment without taking on the initial cash burden.

Building Regulations: An Underused Lever for Decarbonization

A United Nations report indicates that the buildings sector could reduce global greenhouse gas emissions by as much as 11% by 2035—equivalent to taking one billion cars off the road each year. Building regulations have therefore become a critical decarbonization lever, with many countries introducing requirements that address both operational carbon and embodied carbon from construction. Nevertheless, according to the IEA’s 2024 report, more than 50% of new construction worldwide is still not covered by any building energy code.

Digitalization: Unlocking the Potential of Buildings

More than half of respondents believe digitalization has high or transformational potential to reduce costs (56%) and improve energy efficiency (55%). Digital technologies also deepen operational insight, enable smarter transition strategies, and unlock new operating models such as predictive maintenance and automated adjustment of operating conditions.

However, only half of respondents (50%) say their organizations have enough data to make decarbonization decisions. This suggests that many organizations still lack a basic understanding of the equipment and systems installed in their buildings, creating a barrier to planning future improvements.

Digital platforms that connect ecosystems of service providers and partners are another important driver of the transition. Yet the survey finds that only 42% of organizations are highly prepared to build digital ecosystems with partners and suppliers.

Automation: The Future of Buildings That Think for Themselves

The survey shows that the three digital technologies respondents expect to have the greatest positive impact on decarbonization are all AI-driven. This reflects growing recognition of AI’s role in optimizing energy use, forecasting carbon emissions, and creating smarter infrastructure. One example is the concept of grid-interactive buildings, which can communicate with and respond to the power grid in real time when they receive external signals such as electricity prices or carbon intensity.

These systems can automatically reduce energy use or adjust on-site energy generation and storage while maintaining occupant comfort and operational performance.

Most respondents expect building automation to deliver positive outcomes. Lower operating costs rank as the leading benefit, followed by improved energy efficiency, more effective responses to abnormal conditions, stronger physical security, and better occupant well-being.

Most executives agree that the benefits of building automation outweigh the costs:

59% believe the benefits of building automation outweigh the costs.

59% believe that, regardless of how advanced technology becomes, building occupants will continue to want human oversight of building operations.

58% believe building automation will play an important role in reducing greenhouse gas emissions.

54% say their organizations are ready to deploy building automation.

51% say their organizations will invest significantly in building automation in the years ahead.

From Global Trends to a Roadmap for Thai Businesses

Although the survey reflects trends among organizations worldwide, Thai businesses and industries can draw a clear lesson from its findings: buildings and infrastructure should be viewed not merely as operating costs, but as strategic assets capable of reducing costs, improving efficiency, and supporting corporate sustainability goals.

For organizations looking to begin, improving energy efficiency is one of the most practical ways to deliver tangible results. Retrofitting existing buildings with the right technologies allows organizations to build on the assets they already have rather than starting over. Where capital constraints present a barrier, new financing models such as Energy-as-a-Service are another option worth considering.

Looking ahead, digitalization, data, and automation will play a growing role in helping organizations gain clearer visibility into building energy use and performance, make data-driven decisions, and adjust system operations efficiently as conditions change.

The central lesson from global trends is not to adopt every technology at once, but to begin with clearly defined business needs, invest first in initiatives that deliver measurable results, and then build toward more connected and intelligent building systems over time.

This article is based on Inside Smarter Buildings: How innovations are saving costs and cutting emissions, part of the Siemens Infrastructure Transition Monitor 2025.