Rising energy costs accelerate green transition in real estate sector

ISTANBUL

Increasing energy costs driven by geopolitical tensions, including the ongoing U.S./Israel–Iran conflict, are accelerating the shift toward sustainable energy solutions in the real estate sector, making green transformation a strategic necessity rather than a preference.

According to the International Energy Agency’s (IEA) Global Energy Policy Outlook 2026 and related sector reports, supply disruptions triggered by conflicts in the Middle East have pushed oil and natural gas prices higher, prompting countries to accelerate reforms in renewable energy support mechanisms.

The report highlights a growing transition from fixed-price subsidy models to market-based mechanisms, noting that approximately 60 percent of new energy capacity expected to come online between 2025 and 2030 will be developed under such frameworks.

Burak Ustaoğlu, Chairman of the Real Estate Investment and Technologies Association, said volatility in energy markets is driving investors toward more predictable and sustainable solutions.

“In this context, solar energy and energy storage systems have moved beyond being environmentally driven choices and have become strategic necessities,” Ustaoğlu said.

He noted that rising oil prices are boosting demand for energy-efficiency technologies, particularly smart home systems. “Solutions that optimize energy consumption, reduce costs and offer greater control to users are being adopted more rapidly as energy prices increase,” he added.

Ustaoğlu emphasized that if geopolitical risks persist, global awareness of sustainable solutions is expected to grow further, with investment preferences shifting toward renewable energy-integrated, AI-powered smart housing.

“Next-generation investors are increasingly prioritizing residential projects equipped with renewable energy infrastructure. These properties also provide significant advantages, particularly for charging electric vehicles,” he said.

He also pointed to the expanding role of artificial intelligence in smart home technologies, noting that AI-enabled systems can optimize energy use based on consumption patterns.

“In the future, real estate players that fail to adapt to artificial intelligence and renewable energy solutions will lose their competitive edge,” Ustaoğlu warned.

Despite growing interest, Ustaoğlu highlighted that high initial installation costs and limited financing options continue to constrain demand. “While consumers can pay electricity bills on a monthly basis, they often struggle to access the upfront capital required for investments such as solar panels,” he said.

However, he added that the current crisis environment could accelerate incentive programs and financing mechanisms, further boosting investment in renewable energy technologies within the real estate sector.