Manufacturing the Future: Cutting Carbon on the Road to Net Zero

The offsite construction industry is entering a new phase of transformation. Once defined by its ability to deliver projects faster, with less waste and greater precision, modular manufacturing now faces a broader challenge: decarbonisation. Factory-based construction, long considered inherently sustainable, is coming under the same scrutiny as the rest of the built environment.

This shift mirrors a wider movement across manufacturing, where carbon performance is becoming as critical as productivity and quality. From automotive to aerospace, industries are reengineering processes to meet net-zero targets and offsite construction must do the same. The next frontier for competitive advantage won’t be measured in cycle times or output per shift, but in how effectively manufacturers design, power, and operate their facilities to achieve truly net-zero production.

Why Operational Net Zero Matters Now?

Across the UK, construction is responsible for around 40% of total carbon emissions — and offsite manufacturing is not exempt. Factories are energy-intensive operations, with emissions arising from electricity use, gas-fired heating, diesel transport fleets, paint-curing systems, and compressed air networks. As clients demand comprehensive whole-life carbon reporting, and frameworks such as the UK Net Zero Carbon Buildings Standard and UKGBC’s Net Zero Framework gain traction, operational carbon has become a boardroom priority.

This challenge reflects a wider shift across UK manufacturing, where sustainability performance is fast becoming a key measure of competitiveness. To stay ahead in a tightening market, modular producers must move beyond product efficiency to address the footprint of their own facilities, achieving factory-level net zero as a foundation for long-term resilience and growth.

The Shift from Product to Process Carbon

Sustainable modular design is typically focused on embodied carbon, optimising material use, reducing waste, and enhancing thermal performance. While important, these strategies address only part of the carbon challenge. The manufacturing process itself can contribute significantly to overall emissions, particularly when factories rely on fossil fuel–based heating or diesel-powered logistics.

As an illustration, estimates indicate that embodied carbon in modular construction typically ranges from 300 to 600 kgCO₂e/m², depending on materials and production methods. Operational emissions, both from factory processes and the in-use performance of buildings, can also represent a substantial portion of total lifecycle carbon. These emissions impact not only environmental performance but also long-term operational costs, which may become increasingly exposed to carbon pricing.

In response, many manufacturers are now broadening their focus beyond product efficiency to include factory operations. Measures such as electrifying heating systems, integrating on-site renewable generation, transitioning vehicle fleets, and improving real-time monitoring of Scope 1 and 2 emissions are emerging as practical steps toward lower-carbon production.

Where the Emissions Are and How to Tackle Them

Elemental Consultancy Group have significant experience in industrial decarbonisation that highlights a clear pattern: three hotspots dominate office manufacturing emissions.

Heat and paint curing: Gas-based drying systems in painting and finishing lines can account for 30–40% of total energy use. Replacing these with electric or infrared systems, combined with heat recovery, offers one of the most impactful decarbonisation opportunities.

Electricity demand: As production scales, grid dependency rises. On-site solar PV coupled with battery storage, or participation in renewable PPAs (Power Purchase Agreements), can drive substantial Scope 2 reductions while insulating the business from energy price volatility.

Fleet operations: Many modular firms rely on diesel for internal logistics or transport to site. Electrifying these fleets and installing EV infrastructure is increasingly feasible, particularly as operations remain centralised around factory hubs.

The most effective strategies integrate these interventions to identify the necessary annual reductions, capital investments, and expected payback periods. This approach shifts decarbonisation from aspiration to operational planning.

From Compliance to Competitive Advantage

Decarbonising manufacturing operations is not just a moral or regulatory imperative; it’s rapidly becoming a market differentiator. Clients are incorporating carbon metrics into tender criteria. Organisations large and small that can quantify and demonstrate low-carbon manufacturing gain a clear commercial edge.

Moreover, factory-level net zero aligns directly with government strategy. The UK Industrial Decarbonisation Strategy (2021) outlines sectoral pathways for energy efficiency and fuel switching, while initiatives like Made Smarter and Transforming Construction Challenge support the digitalisation needed for emissions tracking and optimisation.

By embedding these frameworks into their operational roadmap, modular firms not only align with policy but also future proof themselves against tightening disclosure rules from Streamlined Energy and Carbon Reporting (SECR) to mandatory sustainability disclosures under the UK’s green taxonomy.

Digital Tools for a Smarter Transition

A growing trend among leading modular manufacturers is the integration of data (fuel use, production volume, turnover) with emission factors to generate transparent trajectories toward net zero.

At Elemental, we have seen how such models enable scenario testing and quantifying, for example, the combined impact of solar PV and fleet electrification over a 15-year horizon. They not only guide investment decisions but also provide a clear narrative for stakeholder reporting and client engagement.

Crucially, data systems should not remain siloed. Integrating energy monitoring with production planning allows firms to measure carbon intensity with output, establishing a powerful benchmark for continuous improvement and competitive differentiation.

Barriers and the Path Forward

The transition to net-zero operations is not without challenges. There can be high upfront capital costs, limited internal expertise, and uncertainty about technology performance often delay action.

At Elemental we seek to remove these barriers with support expertise, leading with opportunities that provide capital for reinvestment and service models based upon payback.

Equally important is building a culture of operational sustainability. Training managers and maintenance teams to interpret energy data, monitor performance, and engage with carbon KPIs ensures that decarbonisation becomes embedded in everyday decision-making, rather than confined to corporate strategy documents.

A Call to Industry

Offsite construction incorporating design for manufacturing principles already represents the future of efficient building delivery. The next step is to make it the blueprint for low-carbon industrial transformation. By investing in clean energy, electrified systems, and robust carbon management tools, manufacturers can turn their factories into demonstrators of what net-zero industry looks like in practice.

Richard Hipkiss , Director of Energy and Sustainability at Elemental Consulting Group and also Development Director of the The Modular and Portable Building Association states “The opportunity is substantial: to demonstrate that offsite construction and modular manufacturing, often seen as energy-intensive and hard to abate, can lead the way in climate-positive innovation. The focus is no longer on whether factories will decarbonise, but on how quickly industry leaders will translate commitments into measurable operational change.”

Author’s note: This piece draws on the experience of Elemental Consulting Group in industrial decarbonisation and modular manufacturing, as well as insights from the UK Industrial Decarbonisation Strategy and emerging best practices in net-zero factory design.

Author: Padmapriya Ramamoorthy Sustainability and ESG Consultant, Elemental Consulting Group

Elemental Consulting Group helps manufacturers turn that ambition into results. We offer a full suite of solutions — from carbon audits, energy modelling, and whole-life carbon assessments, to EPDs, sustainability certification support, and monitoring. Our team also provides carbon forecasting, develops carbon management plans, and validates targets against SBTi standards. By combining expert consulting with practical tools, we enable offsite manufacturers to reduce operational emissions, achieve net-zero goals, and maintain a competitive edge in a carbon-conscious market.

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