KPMG: AI is the Key to Reducing Emissions in Offices & Homes

In the race to reach net zero, AI has started to emerge as the most effective tool for reducing the energy consumption and associated carbon emissions of the built environment.

According to new research from KPMG, AI-based solutions are in fact far more effective and affordable than retrofitting – the process of swapping out technology for newer, more efficient alternatives.

The research, detailed in KPMG's new report How AI is Helping to Improve Energy Efficiency and Management in Real Estate, indicates that Strategic Energy Management (SEM) frameworks enhanced by AI technology could be essential for meeting 2050 net zero targets, offering advantages beyond traditional methods like upgrading boilers or improving insulation.

These AI-powered frameworks integrate with building systems through IoT connectivity, enabling automated energy usage optimisation. The technology makes real-time decisions about when to activate or deactivate various building systems, leading to substantial energy savings.

Real-world validation

Exergio CEO Donatas Karčiauskas, whose company specialises in commercial building energy efficiency, validates KPMG's findings with practical evidence. "AI is already helping buildings cut waste by 20-30% in our projects, no matter the climate or the age of the property," Donatas says.

"But those savings only last if there's smart energy management behind them," he adds, emphasising that continuous operational oversight is crucial for maintaining efficiency gains.

Structured implementation approach

The research presents a three-tiered strategy for implementing energy efficiency improvements. The initial focus is on optimising existing infrastructure, with AI systems automatically adjusting HVAC, lighting, and control parameters based on real-time conditions.

According to Donatas, this represents "a task of AI at the moment as we want to achieve faster savings."

The second tier involves upgrading outdated equipment to more efficient alternatives, while the third tier incorporates renewable energy installations and long-term power agreements – but only after baseline consumption has been optimised.

AI-enhanced management framework

While traditional SEM typically yields 5-7% annual savings, the integration of AI technology can boost efficiency gains to 20-30%. The system operates through a comprehensive cycle of assessment, planning, implementation, capability building and monitoring.

AI systems within this framework analyse occupancy patterns, weather data and usage metrics to regulate HVAC systems, while facility managers maintain control over energy targets and comfort parameters.

Human oversight and transparency

The findings emphasise maintaining human control within AI-powered systems. Donatas explains that his company's platform "connects to the building's energy management systems and uses metrics such as sensor data and occupancy patterns to adjust HVAC simultaneously."

This integration ensures that "efficiency becomes a continuous management task, not something postponed until the next renovation."

KPMG advocates for "human-centric AI" that maintains transparency and builds user trust while delivering automated optimisation. The research suggests that effective energy management practices, rather than hardware upgrades alone, may offer a more rapid path to reducing emissions.