The impetus for the DNSH rule is the intention to reduce the environmental impact of human activities. Which projects are assessed under the DNSH principle? Why is modular construction the answer to the increasingly stringent requirements for building projects?

What is the DNSH rule?

DNSH is an acronym for ‘Do No Significant Harm’, which translates as ‘Do No Significant Harm’. The DNSH rule applies to a variety of business projects, including but not limited to construction investments. It assumes that investments are made in such a way that they simultaneously mitigate climate change (or contribute to climate change adaptation) and protect the environment (e.g. prevent water, air and soil pollution or protect and restore biodiversity).

DNSH addresses all six environmental objectives set out in Regulation 2020/852, not just general environmental issues. It also includes precise technical criteria for each investment.

The question of what the DNSH rule is can also be answered in another way - it is a challenge facing the construction industry. When a construction project is to be implemented with EU funds, designers and contractors must take into account the criteria indicated in Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020. Consequently, they face the need to holistically assess the investment and answer the question of how it affects the environment.

Why is the DNSH rule in the construction industry so important?

It is no coincidence that the DNSH rule also applies to the construction industry - it is estimated that this market segment is responsible for around 40 per cent of global carbon dioxide emissions. However, that is not all - the construction sector is also responsible for:

• the consumption of huge quantities of raw materials - modular housing which uses recyclable materials (wood) stands out against this background;
• the generation of noise, which has a detrimental effect on animals and nature - this can contribute to a reduction in the population of various species;
• generation of large amounts of rubbish - it is estimated that the industry is responsible for up to ⅓ of the waste deposited in landfills;
• water and air pollution - water pollution may result from, for example, the discharge of sewage from the development area.

Not all buildings that are put into use are even equipped with energy-efficient solutions, which also translates into maintenance costs. All this means that there is still a lot of scope for reducing resource consumption in the construction sector. The DNSH principle helps to take environmental aspects and social costs into account at the project preparation stage. At the same time, precise criteria make it considerably easier to assess an investment and answer the question of whether it fits into sustainable construction.

Steps in the DNSH assessment of a project

In order to determine whether an investment meets the DNSH principles, it must be assessed. This process is divided into two parts - a preliminary assessment (i.e. screening) and a technical (substantive)assessment. Importantly, the DNSH rule should not only be borne in mind during the design phase - it applies at every stage of the investment, including during implementation and subsequent accounting. What does it look like in practice?

Preliminary assessment

The DNSH rule requires that the first question to be answered is whether the planned construction project will have a negative impact on any of the environmental objectives listed in the aforementioned regulation. If so, there is no getting around an in-depth evaluation, i.e. a technical assessment. Such an assessment is carried out in relation to this environmental objective. The regulation refers to 6 objectives - these are:

• climate change mitigation
• Climate change adaptation;
• appropriate use and protection of water and marine resources;
• circular economy, including waste prevention and recycling;
• prevention and control of air, water or land pollution;
• protection and restoration of biodiversity and ecosystems.

Technical assessment

Carrying out a technical assessment requires reading an additional regulation that establishes the technical eligibility criteria - this is Commission Delegated Regulation (EU) 2021/2139 of 4 June 2021. If the construction project complies with the DNSH rules, the investor will have a chance to receive funding from, for example, the KPO.

Examples of DNSH

Let us assume that a developer plans to build a new building. Such a building is not neutral when it comes to water resources, and it also has an impact on air pollution. Consequently, a technical assessment is required on at least these two points. How does this take place in practice? Here are examples of DNSH:

• sustainable use and protection of water and marine resources - make sure, among other things, that the maximum water flow in showers is 8 litres per minute and the maximum water flow in basin taps and sink taps is 6 litres per minute;
• prevention and control of air, water or land pollution - this involves, inter alia, implementing measures to reduce noise and dust emissions for the duration of the works and, where the building is being erected on a degraded site, pollution surveys must be carried out.

How does the modular construction carried out by Unihouse fit in with the DNSH principles? Modular multifamily or public buildings are made of modules that use wood, a material that can be recycled. Modular buildings also have a low energy requirement and the construction process is shortened, allowing you to account for your investments within the deadlines.