Europe has a leaky buildings stock but the revised directive on their energy performance will still leave some in the cold.
Last Tuesday, the European Parliament adopted the revised directive on the energy performance of buildings, bringing a sigh of relief to many who have worked through the tumultuous revision process for the last 27 months. This vote of approval by MEPs marks a starting point for European Union member states to ramp up their efforts towards holistic building renovation.
Since its conception in December 2021, the significance of the revision has grown. What was initially a legislative proposal drastically to reduce greenhouse-gas emissions from buildings has become something more in the wake of soaring energy prices. The policy must address a multitude of crises, from tackling rising energy poverty to enhancing the EU’s energy security and helping to bring it closer to climate neutrality—all while delivering comfortable buildings and healthy homes.
Despite however the best efforts of the climate, social and housing movements, a promising first step towards more ambitious and just legislation to decarbonise Europe’s largely inefficient building stock was continuously watered down by policy makers, who perhaps listened to the ill-advised and self-serving claims of the fossil-fuel industry and other interest groups. Ultimately, policy-makers fell short in realising the full potential of an ambitious framework for households across Europe. At least though a new foundation, albeit imperfect, has been laid for those member states keen to ensure its strong and fair implementation.
Minimum standards
From the outset, minimum energy performance standards (MEPS) represented a new instrument with promise to upscale alarmingly low building renovation rates, especially when it comes to homes. The initial aim was to signal mandatory renovations for the worst-performing buildings within the EU, to maximise energy savings and cut emissions by as much and as quickly as possible. The initial proposal for MEPS—which came with requirements to design an adequate and inclusive framework to roll out energy renovations—also had momentous potential to address rising energy poverty within the EU, which traps 42 million Europeans.
With adequate financing, technical assistance and strong social safeguards, MEPS could have presented a win-win solution for policy-makers, governments and households across Europe. Yet some member states were determined to hollow out this capacity for change and homes will no longer be required to meet minimum performance levels individually.
As it stands, member states must guarantee a decrease in the average energy consumption of residential buildings, of at least 16 per cent by 2030 and 20-22 per cent by 2035. A limited focus on worst-performing buildings has been kept (55 per cent of energy savings are to come from this segment) but this is diluted by the huge proportion of buildings in the lowest energy-performance category. Without a sharper focus on the worst-performing buildings, there is a serious risk many vulnerable households will be left behind in the renovation wave, a missed opportunity to lift many more out of energy poverty.
For non-residential buildings, member states are required to renovate the 16 per cent worst-performing buildings by 2030 and 26 per cent by 2033. The focus here should be on buildings for essential public services—schools, hospitals, nursing homes—whose renovation can increase the comfort of the most vulnerable sections of society while decreasing the buildings’ running costs. The multiple benefits their renovation could bring are quantifiable and cross-generational and they should be swiftly tapped.
Fossil-fuel phase-out
Decarbonising Europe’s building stock is not possible without phasing out fossil-fuel installations in favour of renewable technologies: solar panels, solar thermal and heat pumps. Sixty per cent of residential buildings depend on fossil fuels for their heating, leaving many exposed in recent times to huge bills.
The text of the revised directive requires fossil-fuel boilers to be phased out by 2040. To keep in line with the EU’s Paris Agreement commitments, however, 2040 should be the deadline for a full phase-out of fossil-fuel use by buildings, not just boilers.
The European Parliament had sought to prohibit installation of fossil-fuel-based heating in buildings. But this was rejected by the member states and, despite setting a 2025 deadline for subsidies for the installation of stand-alone boilers, the text provides considerable flexibility for technologies still dependent on fossil fuels.
To truly embrace the renewable-heating revolution, member states must shift their focus from false solutions such as hybrid technologies. If the EU is to achieve its Paris Agreement goals, while simultaneously alleviating energy poverty, heating urgently needs to become renewable, accessible and affordable for all. Otherwise, millions of households could potentially be forced to use dangerous and expensive fossil fuels for much longer.
Whole lifecycle
There are some wins to celebrate with the parliament’s adoption of the revised directive. A solar mandate will require solar-energy installations on much of Europe’s building stock. Improved financing arrangements and an enhanced role for ‘one-stop shops’ will provide valuable information services to homeowners looking to renovate their homes. These additions will hopefully trigger more energy renovations among wider sections of society.
In terms of greenhouse-gas emissions during the whole lifecycle of buildings, a pioneering requirement has been introduced to calculate the potential contribution to global heating of new constructions. This will highlight the embodied emissions associated with buildings, including the extraction of materials, manufacturing and transport—which, in turn, will help policy-makers introduce emissions limits for developers and contractors. Using fewer resources will meanwhile reduce their costs and risks around resource availability.
After the vote in the parliament, the ball is in the court of the member states, with the Council of the EU to cast one final vote on the directive next month. They should remember that the deal already contains accommodations and it has been made flexible to ensure implementation can start as soon as possible. Beyond transposing the law correctly, member states will have to provide adequate and accessible public finance (which may leverage additional private funds) along with advisory services and strong social safeguards—to ensure no household is left behind.
