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European Parliament adopts Buildings Performance Directive

(eceee news, 13 Mar 2024) The European Parliament yesterday adopted the Energy Performance of Buildings Directive (EPBD) recast, clearing an important hurdle on EU’s path towards improved competitiveness and energy security. Member States now formally must adopt the text at the upcoming Energy Council in April before the Directive can become law.

There had been fears that conservative MEPs from some countries, in particular the influential German EPP group, would derail the vote in the last minute, but after months of difficult negotiations, the European Parliament adopted the Energy Performance of Buildings Directive in plenary. (370 in favour, 199 against).

Rapporteur for the Energy Performance of Buildings Directive Ciarán Cuffe (Greens/EFA, IE) said: “The directive shows clearly how climate policy can have real and immediate benefits for the less well-off in our society. This law will help bring down energy bills and addresses the root causes of energy poverty, while delivering thousands of high-quality, local jobs across the EU. Tackling 36% of Europe’s CO2 emissions, it adds an absolutely essential pillar to the European Green Deal. Today’s result shows that Parliament continues to support a Green Deal that delivers fairness and ambition, in equal measure”.

Although not as ambitious as energy efficiency advocates had hoped for, the adopted text contains several important key provisions for decarbonising the European buildings sector. Once adopted by the Council, the Directive sets out a clear roadmap for member states and stakeholders in the market. The Directive contains important provisions:

  • A binding energy consumption trajectory for the residential sector; member states will have to put in place measures to ensure a reduction in the average primary energy used of at least 16% by 2030 and at least 20 to 22% by 2035.
  • Renovation road map: Member states will have to renovate the 16% worst-performing non-residential buildings by 2030 and, by 2033, the worst-performing 26% through minimum energy performance requirements.
  • One-stop shops, finance and information: Facilitation of the energy renovation process – notably the rolling out of one-stop shops as well as improving access to quality information and finance.
  • New buildings to be zero-emission from 2030; new buildings occupied or owned by public authorities should be zero-emission as of 2028
  • Decarbonising heating systems: Member states have to outline how they will adopt measures to decarbonise heating systems, with a view to phasing out fossil fuels in heating and cooling by 2040. Subsidising stand-alone fossil fuel boilers will be prohibited as of 2025. Financial incentives will still be possible for hybrid heating systems that use a considerable share of renewable energy, such as those combining a boiler with a solar thermal installation or a heat pump.
  • Exclusions: Agricultural buildings, historic buildings, and places of worship, can be excluded

Several actors from industry and NGOs expressed relief and said they were pleased, but also sent stern messages to EU’s national policy makers:

eceee’s President Andrea Roscetti said: “This is not the time to relax”,. “First, the Council must approve the final text. Then, we must start implement it in all EU’s member states.”

EuroACE’s Seacretry General Adrian Joyce said: “Action on buildings is required, whether you look at it from the social, energy dependency or economic angle, and regardless of your political colour. The EPBD ticks a lot of boxes, offering answers to the climate and energy price crises and providing positive perspectives for a new generation of workers. There is no time to lose on implementation!”.

“The energy efficiency industry is ready to deliver and make efficient buildings Europe’s next industrial success. We have a strong regulatory foundation, but while targets matter, it is transposition that will deliver better living conditions and improve the resilience of our buildings. Let’s get to work immediately.”, said Julie Kjestrup, President of EuroACE and Head of Policy and Thought Leadership at VELUX.

WWF commented that “the agreement introduces essential financial measures, such as Mortgage Portfolio Standards, to urge banks to scale up funding for energy renovations of buildings. However, the voluntary nature of these measures is disappointing.”

Mathilde Nonnon, Policy Officer at the WWF European Policy Office commented:
“Achieving our climate objectives cannot happen without extensive home renovations and this demands substantial investments. It is regrettable that mandatory Mortgage Portfolio Standards were not included in the EPBD, as they would have required banks to scale up energy efficiency loans to homeowners, and ensure equal footing among mortgage lenders. The EPBD is an incomplete puzzle and a missed opportunity to mobilise crucial private funding. Nonetheless, the introduction of a delegated act to promote and mainstream green lending practices is a positive step forward. This initiative is essential for enhancing the financial accessibility of home renovations for households.”

View the press release here

Arianna Vitali, Secretary General of the broad Coalition for Energy Savings said: “The European Parliament approved today the EPBD agreement reached in trilogue. It is a significant step in boosting energy efficiency of the building sector, and it will support achieving the new EU 2030 energy efficiency target. Energy ministers must also adopt the deal so that the new EPBD can enter into force and start being implemented by EU countries as soon as possible for the benefit of all Europeans.”