EU tightens requirements for building renovation

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February 2023

At the beginning of February, the EU Parliament presented a draft amendment to the Buildings Directive. The aim of the so-called EU Energy Performance of Buildings Directive (EPBD) is to establish minimum standards for energy refurbishments and thus enable climate targets to be achieved in the building sector. According to the draft, new buildings are to be climate-neutral by 2030 at the latest and existing buildings are to become zero-emission buildings by 2050. The legislators in Brussels are thus going even further than the proposals of the EU Council of Ministers.

Uniform EU-wide energy standards

The plan is to introduce a uniform EU-wide minimum standard for energy efficiency. This system is to include various efficiency classes, from A to G. The idea is to introduce these standards gradually. By 2030, existing residential buildings are to achieve at least efficiency class E , followed by class D by 2033. All other buildings - including those in public ownership - will have to be brought up to speed sooner: They must achieve efficiency class D as early as 2030. The Haus & Grund association advocates for the integration of the building sector into the European trade in CO2 emission certificates as quickly as possible. This would enable the climate targets to be achieved effectively and cheaply.

Zero emissions thanks to mandatory solar energy

From 2028, every new building is to be constructed as a zero-emission building, and public-sector buildings from 2026. The EU Parliament is also envisaging the introduction of a solar obligation for new buildings by 2028 - wherever it is technically and economically feasible. For extensively modernized existing residential buildings, a solar obligation until 2032 is under discussion. Among other things, exceptions to the climate neutrality rules for real estate may apply to historic buildings, houses of worship, and buildings used for defense purposes.

Prioritize refurbishment of particularly inefficient buildings

The European Commission had already presented the first proposals for the new directive on the refurbishment of buildings in December 2021. Six months earlier, it had already agreed to make all buildings in the EU climate-neutral by 2030 - as part of the so-called "Fit for 55" plan. This plan from the EU Commission describes how greenhouse gas emissions in Europe can be reduced by at least 55 percent by 2030 compared to 1990.

Among the proposals from Brussels is that by 2030 at the latest, no building may belong to the worst efficiency class, G. This applies throughout Europe. This applies to more than 15 percent of old buildings throughout Europe. The German Housing Association (GdW) assumes that around three million buildings in Germany will need to be fundamentally renovated by 2030 at the latest.

The cost of climate neutrality

A climate-neutral Europe does not come cheap. According to the EU Commission, this will require costs of almost one trillion euros. The EU budget is to pay for about half of this sum itself, as the Commission had already decided at the beginning of 2020. The remaining money is to come from public and private investments - for which appropriate incentives are to be created. The Commission has set all this out in the Sustainable Europe Investment Plan for the European Green Deal.

However, the EU member states are not making any real progress with the renovations. At the end of 2021, the average renovation rate was no more than 1.2 percent. This rate would have to be at least doubled if the EU climate targets are to be achieved.

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