A piecemeal approach on energy standards for buildings won’t work

by Adrian Joyce*

Decarbonising Europe’s building stock requires robust Minimum Energy Performance Standards (MEPS), not a piecemeal approach that fails to regulate buildings that are ripe for renovation projects, writes Adrian Joyce.

The European Union has an immense superpower that its officials sometimes forget to use: industries, sectors, and stakeholders more often than not respond effectively to the issued regulations, rules, and directives.

Regulation, and the clarity that comes with it, are often craved, especially by stakeholders that appreciate asset value. And building owners rank highly within that category, given that buildings are the world’s most valuable asset class.

Regulation has proven successful in driving significant changes in the buildings sector in the last decades. But there is still plenty of potential yet to tap in Europe’s leaky buildings, and the climate emergency has brought this sharply into focus.

As the EU aims to curb the carbon footprint of the building stock in the EU, which is responsible for nearly 40% of the bloc’s emissions, the sector’s willingness to be regulated cannot be underestimated and should be fully leveraged.

Minimum energy performance standards (MEPS) are one of the key instruments that must be deployed if the EU’s ambitious Renovation Wave initiative and overall emission reduction targets are to be met.

MEPS are segment-based rules that set a future to achieve a given performance level and are the most effective means of making measurable progress. They bring market predictability and can help the labour market adapt to demand.

Suppose the industry knows that, for example, shopping centres need to reach a certain level by a specific date. In that case, preparations can be made to train enough workers and provide whatever certification is needed to carry out the works on time.

It is logic that is already working in practice. For example, in the Netherlands, social housing must reach EPC levels B by 2021 and office buildings EPC levels C by 2023. Both are on track to be met, with the bonus of banks having reacted positively and adapted their lending strategies accordingly to encourage even higher energy savings. There is no reason this success cannot be replicated across the EU.

Building segments ripe for action

But there are indications that the upcoming revision of the Energy Performance of Buildings Directive (EPBD), due in December, will not exploit the full potential of MEPS and will only mandate their use for the worst-performing buildings.

Whilst tackling the ‘worst-performing buildings’ will achieve significant energy savings and will also help to reach the vulnerable consumers suffering from energy poverty, mandating MEPS only for this building segment would be an enormous missed opportunity.

This would squander the potential for substantial energy savings from buildings in other segments that would be highly receptive to regulation, such as office blocks. The Renovation Wave, in particular, can ill-afford to miss out on such low-hanging fruit.

It is essential that all building types in every segment of the sector be covered by these standards well ahead of the 2050 deadline. Policy-makers need to hit the ground running and make sure MEPS coverage is as comprehensive as possible to provide certainty on achieving the stated 2030 and 2050 goals outlined in the Long-Term Renovation Strategies.

Only scratching the surface

Public and private money is starting to pour into building refurbishments, but risks being wasted if works do not achieve at least 60% energy savings. It makes no sense to boost the number of buildings refurbished every year if those works are not up to scratch.

MEPS, together with Energy Performance Certificates (EPCs) and robust monitoring, will help regulate deep renovations of existing buildings.

Financial and technical support measures for owners and occupiers in the MEPS framework can also help to maximise their impact and ensure they are affordable for all. Further, banks implementing a Mortgage Portfolio Standard would naturally be keen to support the maximum upgrades of low performing homes in their portfolios.

The scale of the task ahead is admittedly daunting. But policy-makers already have the tools needed to make a success of it; they just have to provide the proper framework and the correct standards. The EPBD review should be an easy win for the Commission.

*director of the Renovate Europe Campaign
**first published in: www.euractiv.com