3of the European Association for External Thermal Insulation Composite Systems (EAE)Thermal insulation of buildings – No time to lose and make progress 4Günther H. Oettinger, EU Commissioner for EnergyEditorial 7Ralf Pasker, EAE Managing Director Technical & Marketing AffairsDr. Wolfgang Setzler, EAE Managing DirectorWhy thermal renovation will be a huge success story 8Oliver Rapf, Executive Director of the Buildings Performance Institute Europe (BPIE)The Green Deal for energy efficiency – The British experience 12Charles Phillips, Deputy Director in the UK Department of Energy and Climate Change (DECC)Status quo in 2012 - Huge potential demands determined action 16Plan for future action - Mission possible 28About our associationEAE – Partners for sustainable building and refurbishment in Europe 40
European Energy Saving Guide 20134Günther H. OettingerEU Commissioner for EnergyIt is time to make significant progress interms of energy efficiency. The efficientuse of energy is a main challenge of ener-gy policy – not only because of climateprotection objectives, but especially as wehave to face limited resources and poten-tially further increasing energy costs.Here the energetic improvement of buil-dings‘ envelopes plays a major role: al-most 70% of EU’s energy consumption ofaverage private households are causedby heating and cooling. Even with exis-ting technologies the energy consump-tion could be reduced by at least a half.In other words: we do not make use ofenergy saving potentials that could be re-alized economically and waste both limi-ted resources and money. Improving theenergy efficiency on the other hand leadsto a win-win-win situation. The compe-titiveness of regions and companies willbe improved, consumers will be relievedfrom energy costs, and the environmentwill be preserved.By adopting the Energy Efficiency Directi-ve we managed to establish a stable andreliable legal framework for necessaryinvestments in energy efficient technolo-gies and systems. Now we can developcompetitive markets for energy servicesthat will realize existing potentials ac-tively.Thermal insulation of buildings –No time to lose and make progress
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7of the European Association for External Thermal Insulation Composite Systems (EAE)Europe will be able to switch to renewab-le sources of energy only if we make everypossibleefforttoreduceenergyconsump-tion of the building stock. The savings inthis field are many times higher than theoutput that can currently be achievedusing nuclear power. Furthermore, savingenergy is probably the most effective wayof protecting our resources.ThisEnergySavingGuide primarilywantsto inform you when planning objectives,political targets and available options.We have drawn together current findingsfrom recent studies in a clear and com-prehensible guide giving you a soundoverview of this very complex topic in ashort time.Only if we can make people aware of allpositiveargumentswewillreachourcom-mon goal of consuming less energy andsupplying most of the remaining require-ment largely from renewable sources.Saving energy, action on climate changeand resource protection are trans bound-ary tasks in a Europe characterized bychanges. Energy-saving renovation of theEuropean building stock is a force drivingthe economy in all countries across Eu-rope. All Europeans can benefit from thisforward-looking task, because the capitalinvestment pays off within the shortesttime by reduced heating costs. For all ofus it makes more sense to invest in a pro-fitable future than to fund existing unem-ployment from tax revenues.As a European association deeply invol-ved in building insulation and as pub-lishers of this Energy Saving Guide, wewould be delighted if you were to helpus spread the findings presented here toother people.Dr. Wolfgang SetzlerEAE Managing DirectorRalf PaskerEAE Managing DirectorTechnical & Marketing AffairsEditorial
European Energy Saving Guide 20138Why thermal renovation will be a huge success story.Oliver Rapf is Executive Director of the Buildings Performance Institute Europe (BPIE) in Brussels. In our interview he talks about thehuge study „Europe’s buildings under the microscope“ and perspectives for thermal renovation in Europe.With the study „Europe’s buildingsunder the microscope“ the BPIE ana-lyzed for the first time the situationof Europe’s building stock in total.Which data occurred to be the mostdifficult ones to be collected?The data the most difficult to collect wereon commercial buildings, the ownershipprofile in the non-residential stock, theenergy breakdown by building type andend-use, and the renovation rates in ge-neral. There is also very little informationon energy efficient renovations, for ex-ample the scale and depth of renovationsandoverallinvolvedcostsatcountrylevel.What do you think about the chancesto close this data gap within the nextfuture?It will be important that the governmentsin the EU countries recognize that relia-ble and detailed data are a prerequisiteto develop and implement policies andprogrammes which significantly improvethe energy performance of buildings. Wewill do our best to support data collectionand transparency through the BPIE datahub which will go online in autumn 2012.With this portal it will be possible to selectsingle data sets and to compare e.g. theenergy consumption of single family hou-sesinGermanyandAustria.Alldatawillbepresented transparently together with theinformationaboutthesource.Iffiguresarebased upon estimations, this will be men-tioned explicitly. The purpose of the datahub is also to show what we don’t know,withtheaimthattheresponsiblepeopleinall EU member states improve data collec-tion. We hope that other institutes and au-thorities will work with us to provide betterinformation over time.What is the highest objective of yourdata hub?We want to make data in the buildingsector much more transparent andwant to work towards harmonization ofavailable data. After all, the EU has setgoals for CO2reduction and energy sa-ving and all Member States will have tocontribute to achieving the targets. If wecannot properly evaluate their contribu-tions and potentials, we have a problem- even in practice. Different standards andmeasuring methods for buildings‘ perfor-mance act as very strong trade barriersalthough we have a common Europeanlabor market. Let me give you an ex-ample from the construction business: ifa German business wants to renovate abuilding in Belgium, it needs deep know-ledge about the national buildings codesand standards, which differ significantlyfrom those in Germany.Looking at the building stock: whichareas of urgent action could be iden-tified by your study?In addition to the need for systematicdata collection and monitoring, we re-commend to develop national renova-tion roadmaps and to create new finan-cing tools incentivizing deep renovationsacross Europe. Today, financing is one ofthe most important barriers to energy ef-
9of the European Association for External Thermal Insulation Composite Systems (EAE)ficient building renovation, especially tocover the high upfront costs. The currenteconomic and financial crisis makes theaccess to public money more difficult,therefore we need innovative financingmechanismswhichchannelmoreprivateinvestment into energy efficient renovati-on projects. On the policy implementati-on side, there should be more attentionpaid to the establishment of sound mo-nitoring systems, to ensure compliancewith building codes and standards,and to develop effective enforcementschemes. Training and education of theworkforce plays also an important role ifit comes to making quality renovationshappen.Keyword financing: how could, accor-ding to your opinion, financial barri-ers be lowered in order to achieve anincreasing refurbishment ratio?Today, institutional investors have verylittle opportunity to invest into energy ef-ficiency projects. For sure, investments inenergy saving measures of the buildingstock could be absolutely attractive for in-vestors with a long term perspective likepension funds, as they provide longterm,low risk and reliable returns. To make ithappen a variety of small private renova-tion projects could be combined to createone large investment project. What willbe important is, that such investmenttools are tailored to national circumstan-ces. At the moment we are in contactwith investors about a project to definehow such investment tools could be de-signed. A role of the government could beto provide guarantees for the projects toa certain extent. This would not requirea big continuous investment like othersubsidies do.According to your opinion, do youthink that thermal renovation of buil-dings could be a driver of economicgrowth European-wide?Absolutely! The technical know-how isavailable, work force is available as well- certainly we should invest in furtherqualification - and there are more thanenough buildings that have to be reno-vated. With respective support the reco-very would not only help the local con-struction businesses and the constructionproductsindustry,butalsocoverthefieldsof construction planning, innovation, re-search and development.Itseemstobearecipeforsuccessevenfor EU Member States highly affectedby the crisis …We only have to take a look at Spain:throughout the past decades they oftenbuilt very fast and cheaply. Many of theserelatively new buildings have big poten-tial to increase their energy performance.With the help of a big governmentalprogram qualified people could find anew job, and money that today has to bespent for unemployment benefits couldbe invested in energy efficiency measu-res instead. Keeping in mind that this willnot be a short-term labor effect and thatthese jobs cannot be transferred abroad,success story.
European Energy Saving Guide 201310Oliver Rapf has been appointed Executive Director of The Buildings Performance Institute Europe (BPIE) in June2011.Before joining BPIE, Oliver Rapf worked for the global conservation organization WWF in various roles. Most recentlyhe was Head of the Climate Business Engagement unit of WWF International, managing strategy and partnershipdevelopment with the private sector. His experience in buildings’ efficiency goes back to the late 1990s when he wasaprojectleaderforseveraldeeprenovationprojectsonbehalfofWWFincooperationwithhousingcompaniesacrossGermany.OtherrolesincludethepositionofdeputyHeadofWWF’sEuropeanClimateChangeandEnergyPolicyUnit.OliverparticipatedinUNFCCCnegotiations,andwastheleaderoftheGermanNGOcoalitionatinternationalclimatechangenegotiations.Where do you see the greatest poten-tial for actions – at EU level or at thelevel of Member States?Both will have to make their contribu-tions. Climate targets, economic growthand energy security are European topicsand require therefore cross-Europeanstrategies. When it comes to the realizati-on of these objectives, Member States areresponsiblefordeveloping,implementingand enforcing national policy measures.In the building sector, this can be ensuredby roadmaps towards nearly zero-energybuildings and large-scale (deep) renova-tions. To design realistic approaches, thebottom-up view is necessary. The respon-sibility therefore must be delegated toMember States. This is where it all has tohappen. But in the end, only a combina-tion of political decisions in Brussels andin the European capital cities will deliverresults such as achieving the Europeanclimate and energy saving targets.According to your opinion: what arethe most important results of yourstudy?Our study illustrates the huge potentialfor building renovation and its environ-mental, economic and societal benefits.It demonstrates the feasibility of a syste-matic renovation of the existing buildingstock and the considerable Return onInvestment. Current practice will not beenough to meet the European climatetargets. A roadmap approach at nationallevel - as now required by the new EnergyEfficiency Directive - is necessary to fos-ter a step change in renovation activitieswhich will stimulate economic growth inEurope.Thank you very much for the inter-view!
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European Energy Saving Guide 201312Climate change is one of the greatest th-reats to UK and global security and pros-perity. There is an overwhelming scientificconsensus that climate change is happe-ning,andthatitisverylikelytobeprimarilythe result of human activity.Energy efficiency is one of the most cost-effective ways of tackling this challenge.The cheapest energy is the energy we donot use, and in a world of increasing ener-gy prices, market volatility and reliance onimports, being efficient with our energyhas never been more important. All cus-tomers and businesses are looking to seehow they can reduce their monthly bills,and energy efficiency is the obvious firstchoice.In the UK, our building stock is among themost inefficient in the world and contribu-tes a sizeable proportion of our emissions.For the country as a whole, properties lea-king heat and money are also propertiesleaking carbon.The central rationale for the new GreenDeal program is therefore to reduce car-bon emissions cost effectively. We knowinsulation is often the most cost-effectiveway to reduce carbon emissions from buil-dings. It is also often one of a package ofimprovements, including heating measu-res, needed to lift a family out of “fuel po-verty”. And many energy efficiency measu-res save money straight away – so what isstopping us adopting them?Our research suggests that people are un-able to act because they cannot afford theupfront costs, or they are unsure whetherthey can trust the quality of work. In thecase of measures like solid wall insulation,which have not in the past been deliveredin large quantities in the UK, there is also alack of awareness of the benefits.Previous Government schemes have ten-ded to be “top-down” – putting an obli-gation on the major energy companies toachieve certain targets, effectively requi-ring them to “push” certain measures likeloft or cavity wall insulation onto consu-mers at reduced prices. The consumer haslittle choice other than to accept, or not,the measure they are offered.The Green Deal is designed to changethat. It puts consumers and consumerchoice at the heart of things, by incre-asing a household’s ability to financewhatever energy efficiency package theychoose, with confidence that it will meetthe standards they expect. At its center isan innovative new financial mechanismwhich eliminates upfront costs and pro-vides reassurance that the costs shouldbe covered by the savings. A “Golden Rule”stipulates that the amount the consumercan pay back should never be more thanthe anticipated savings – so, if the instal-lation of a particular measure is expectedto save, say, £50 a month on their energybills, then they can “borrow” up to that le-velofrepayment. Linkedtothefinancearestrong consumer protections including aGovernment-backed system of accredita-tion for impartial initial assessment, relia-ble measures, and quality installation bytrained installers.The Green Deal for energy efficiency – The British experienceCharles Phillips is a Deputy Director in the UK Department of Energy and Climate Change (DECC) and works on the Green Deal, theUK Government’s new scheme for promoting the delivery of energy effciency measures in households.
13of the European Association for External Thermal Insulation Composite Systems (EAE)And, crucially, the finance is linked to thephysicalproperty(viatheenergymeter)nottotheindividualconsumer.Iftheconsumerwho originally takes out the finance moveshouse, then the new occupant – who willexperience the energy-saving benefits ofthe measure which has been paid for – willbecome liable for the repayments. No debtattaches to the original occupant oncetheyarenolongerreceivingthebenefit. Thefactthatthefinanceattachestotheenergymeter, not the individual, also makes therepayments more secure for the companyproviding the finance – repayments aremade along with the monthly energy bill,forwhichdefaultratesaregenerallylow.The vision for the Green Deal is thus anambitious and far-reaching one. Whe-reas a very large amount of the energyefficiency activity in Britain at the mo-ment is delivered by the six major energycompanies, who dominate the UK energysupply market and are legally obligatedby Government, in future we expect to seea more dynamic, genuinely market-ledlandscape, with a variety of companiesand organizations competing to makethe best offers to consumers. This couldinclude nationwide retail brands, localbusinesses, local and regional Govern-ment, energy suppliers and energy servicecompanies...Repaymentsand Follow UpInstallationAssessment Finance
European Energy Saving Guide 201314And since all these companies will belooking to identify and attract the rightconsumers, there is a huge opportunityfor those firms, including the building andproperty maintenance sector, who are al-ready used to engaging with households.For many consumers, the right moment toconsiderinsulatingtheirwallsiswhentheyfindthemselvesneedingnewplumbing,orwanting a new kitchen– and this createsa new business opportunity for a compa-ny that is selling the plumbing or the kit-chen, whether they choose to diversify intodelivering the insulation themselves, or topartner with a Green Deal company whodoes so.Of course, not every measure will pay foritself for every household. Some homes,due to their construction type, are morecomplex and more expensive to improveand need measures like external (or: solid)wall insulation which may be less cost ef-fective to the household (though still costeffective to the country as a way of savingcarbon). If an external wall installationcosts, say, £10,000, perhaps only £5,000will realistically pay for itself under the Gol-den Rule. Extra funding will be needed tomake it affordable.That is why in Great Britain we are conti-nuing with an obligation on the majorenergy companies (in line with require-ments under the new European EnergyEfficiency Directive). But the obligation willbe very different in future to what it hasbeen in the past. Where past programshave driven significant delivery of thecheaper insulation measures like loft andcavity wall insulation, in future it will focuson more expensive, “hard to treat” measu-res like solid wall insulation. In doing so, itwill also support the growth of the GreenDeal market. Energy companies will belooking to partner with Green Deal com-panies who can provide a proportion ofthe funding, with the ultimate objective ofboosting the overall market, driving downunit costs, and thus over time reducing theproportion of the cost that has to be metthrough socialized, bill-payer subsidy, andmaximizingtheamountthatispaidbytheindividual consumer who benefits.Charles Phillips has particular responsibility for quality, standards and capacity issues relating to the industrysupply side – for example, the solid wall insulation industry which has historically been only a small component ofthe UK insulation market, but which is projected to grow strongly under the Green Deal. He is also responsible for theobligations that Government imposes on the major energy companies to deliver insulation and other energy savingmeasures through programmes such as the Carbon Emissions Reduction Target (CERT) and the Community EnergySavingProgramme(CESP),andthenewEnergyCompanyObligation(ECO).
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European Energy Saving Guide 201316Status quo in 2012 -Huge potential demands determined actionThe EU’s energy and climate targets are certain-ly ambitious. Yet there are many who doubtwhether the requirements for 2020 are realis-tic. Potentials for 20% less energy consumptioncertainly exist – simply making buildings moreefficient would enable attainment of a largeproportion of the targets, as current studies andsurveys clearly show.However, the figures also reveal that in the EUMember States much too little has been done sofar to motivate home owners to modernize theirproperties. In many places there are insufficientsupporting options, too little information and noclearinstructionsfortheowners.Thisisincompre-hensible, especially given that most investmentsin energy-saving building refurbishment bringabout huge monetary savings in the long term.The EU and its Member States must provide theright impulses – for more action and commit-ment to ensure a future worth living.
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European Energy Saving Guide 201318Energy and CO2status in the buildingsectorThreetimes20%–thatwastheambitioustarget passed by the European Council in2007. By 2020, greenhouse gas emissionsshould decrease by this amount, andboth energy efficiency and the proporti-on of renewable energies should rise bythe same factor. Furthermore, the targetof reducing CO2emissions by at least 80%until 2050 now applies to the EU andother industrialized countries.The study “ENERGY SAVINGS 2020”1re-veals what the energy efficiency targetin particular means in terms of num-bers. The authors calculate that in theyear 2020 energy savings of around 394megatons oil equivalent (Mtoe) will benecessary for achieving the targets. How-ever, in view of the current situation atbest half this figure is realistically attaina-ble, which matches the conclusion of theWWF’s “EU Climate Policy Tracker 2011”2.According to “ENERGY SAVINGS 2020” the2006 Energy Efficiency Action Plan (EEAP)puts a figure of 95 Mtoe on the potentialsavings from all existing efficiency poli-cies, and renewable energy policies andthe economic recession are expected tobring about 20 and 70 Mtoe of savingsrespectively. The remaining gap of 208Mtoe far outweighs the actual savingsbeing made. It is roughly equal to the an-nual primary energy consumption in theUnited Kingdom3.Yet even at the end of 2011 the EuropeanCommission was still optimistic in its“Energy Roadmap 2050”4: “Political com-mitment to very high energy savings; itincludes e.g. more stringent minimum re-quirements for appliances and new buil-dings; high renovation rates of existingbuildings; establishment of energy sa-vings obligations on energy utilities. Thisleads to a decrease in energy demand of41% by 2050 as compared to the peaks in2005-2006.” The most important driversof this development are also mentioned:“Higherenergyefficiencyinbothnewandexisting buildings is the key driver. Nearlyzero energy buildings should become thenorm.” One of the questions is, “...how tofind the cost-optimal policy choice bet-ween insulating buildings to use less hea-ting and cooling ...”Climate targets? Buildings have to beincluded!The precise locations of these efficiencypotentialsareshownin“Europe’sbuildingsunder the microscope”5from the BPIE,which analyzes the building stock in Euro-pemoredetailedthananyotherprecedingstudy.Forexample,in2009householdsac-countedfor68percentoftotalfinalenergyuse in buildings. Most energy goes on hea-ting, although of course the local climateleads to major variations: in SouthernSpain the proportion of energy consu-med in heating residential buildings is 55per cent, which is relatively low, while thefigures for Poland and France are 66 and67 per cent respectively. Yet an equally de-cisivefactoristheefficiencyoftheinstalledheating systems and in particular the pro-perties of the building envelope.Thestudycomparesseveralcountriesfromvarious parts of Europe in terms of finalenergy consumption by typical single fa-mily homes, categorised by year of cons-truction. Some considerable differencesemerge: a detached single family homein the UK built before 1920 has an averageannual energy consumption of 585 kilo-watt hours per square metre of residentialspace, whereas a new home in Sloveniaconsumes only 34. Even if one takes intoaccount influences such as climate andaverage house size, these values still spana huge range.
19of the European Association for External Thermal Insulation Composite Systems (EAE)A similarly large spread appears in aEurope-wide comparison of CO2output.Buildings are responsible for 36 per centof annual emissions, but there is a greatrange above and below the average va-lue of 54 kilogrammes of CO2per squaremeterof floor space. Norway and Swedenhave the best values, of between 5 and15 kilogrammes, while France comesamong the top five with a good 25 kilo-grammes of CO2per square meterof floorspace. The numerous countries in the me-dium range are grouped around the ave-rage mentioned above, while the highestfigures, exceeding 100 kg, are recordedfor Greece, Cyprus, Poland, Lithuania, theCzech Republic and Ireland. When asses-sing these figures it is important to re-member that they are particularly affec-ted by the energy mix prevailing in eachcountry; using renewable energies has anequally positive impact on the result aslarge-scale use of nuclear power, whichalso emits zero carbon dioxide.SloveniaUnited KingdomAverage heating consumption levels in terms of final energy use (kWh/m2a)of single family homes by construction yearGermanySource: BPIE19181957197819872005194819681983199520100100200300400500600Pre1920MidTerracePre1920detachedhousePre1920EndTerrace(with1970)1960‘ssemi-detachedbungalow1980‘sdetachedhousePost2002MidTerrace0100200300400500600Sweden-19711971-19801981-20022003-20082009-20100100200300400500600ItalyPortugal01002003004005006001946-19601961-19711972-19811982-1991>19910100200300400500600>1921-401941-601961-701971-801981-902001-0501002003004005006001991-00Before19501950-19591960-19691970-19791990-19992006-20101980-19892000-2005
European Energy Saving Guide 201320Unclear strategy, huge responsibilityEven this limited overview of the figures gi-ves an idea of the possibilities latent in theEuropean building stock – in relation bothto energy efficiency and to reducing CO2.Thepathtofollowisdescribedonlyinvagueterms by the European Commission in itscommunication entitled “Energy 2020”6:“The energy-efficiency renovation rateshould be accelerated by investment incen-tives,wideruseofenergyservicecompanies,innovative financial instruments with highleverage factors and financial engineeringat European, national and local levels.” Itgoes on to say, “Programmes and technicalassistance facilities are needed ... to developandstructurefinanceforprojectsthattargetbothpublicauthoritiesandprivateactors.”Here great importance is attached aboveall to the final group mentioned, the “pri-vate actors.” According to figures in theBPIE study, the great majority of Europeanhomes are privately owned, and most ofthese are also owner-occupied. The high-est private ownership quotas are found inthe countries of Southern Europe, headedup by Spain with a figure of nearly 100 perMtoeDaysFuels (residental sector) Fuels (non-residental sector)Electricity (residental sector)Historical final energy use in the building sector(EU27, Norway and Switzerland)300250200150100504000350030002500200015000Source: Eurostat database1900 1995 2000 2005 2009Electricity (non-residental sector)cent. The largest proportion of publicly ow-ned residential buildings occurs in Austriaat over20%.These facts rapidly make it clear that tho-se “private actors” have to bear the mainburden when it comes to European effici-ency targets.In detail: potential in existing buil-ding stockFirst, the good news: the massiveshortfall in reaching the EuropeanCommission’s ambitious CO2and effici-ency targets can be almost completelycovered using measures that pay offeconomically. Calculations to this effectappear in the extensive “Study on theEnergy Savings Potentials in EU Mem-ber States, Candidate Countries and EEACountries”7, which was commissioned in2009 by the European Commission andco-ordinated by the Fraunhofer Institutefor Systems and Innovation Research. Itstates: “Energy efficiency measures in thebuildingsectorprovideenormouspoten-tials to reduce CO2emissions in Europe.The energy use of the building segmentaccounts for 40 % of the total energy usein the EU and represents Europe’s largestsource of emissions. This high amountof emissions could be reduced up to 80% by simple measures, e.g. better insu-lation of the different components ofthe existing building stock, of alreadyrefurbished dwellings, as well as for newbuildings ...”Climate action pays offThe paper provides a very detailed sum-mary of the potential savings for vari-ous sectors; for the building segmentthe potentials are shown under differentsets of conditions, which are pooled intothree scenarios. The “Low Policy Inten-sity” (LPI) and the “High Policy Intensity”(HPI) scenarios are based on economicmeasures for raising energy efficiencyand have different overall conditions astheir starting points – with greater or les-ser ambitions among all those involved.The figures of the “Technical Potential”(TP) scenario reflect what is technicallypossible without taking economic perfor-mance into consideration.
21of the European Association for External Thermal Insulation Composite Systems (EAE)In the housing sector alone the studyidentifies a savings potential of nearly20 Mtoe for 2020 in the LPI scenario,and starting from more ambitious in-itial assumptions the figure climbs toover 50 megatons, reaching a techni-cally achievable maximum of almost80 megatons oil equivalent. There is aninteresting dynamic worked into thesescenarios: for the year 2030 the authorscalculate a savings potential in eachcase that is already more than twice ashigh.If one adds in the potential savingsin non-residential buildings, for 2020there are already possibilities of savingbetween 40 and 118 megatons oil equi-valent in buildings in the EU-27, and awhole 76 megatons could be saved byapplying efficiency measures.Enormous potential in old buildingstockThe regions and countries harbouring the-se efficiency potentials are shown in greatdetail in the study “Europe’s buildings un-der the microscope”8.The 27 EU states, plus Switzerland andNorway, have a total building floor spaceofabout25billionsquaremeters–equalto80% of the total area of Belgium. In addi-tion, the study assumes annual growth ofaround 1% in floor space for the EU states.Three quarters of this area is accounted forby residential buildings, 64 per cent of the-se are single family houses. However, thislevel varies from one country to another,in some cases considerably. The proporti-on of owner-occupancy in Ireland comesto nearly 90 per cent, whereas the figure inLatvia is only a little over 25%.One key factor affecting the energy ef-ficiency of residential buildings is theirage. The BPIE study classifies them intothree age bands. Old buildings are allthose that were built up to 1960. Modernbuildings were constructed in the ye-ars 1961 to 1990, and houses built from1991 onwards are described as recent.On average, in Europe far more thanone third of residential buildings are inthe oldest category, whereas the share ofnew buildings is below 20% in all regions.The comparison reveals that the UnitedKingdom has the oldest building stock.Around 55 per cent of dwellings in the UKwere constructed before 1961, followedat some distance by Denmark, Sweden,France and the Czech Republic. The lar-gest proportion of new buildings is foundin Ireland, at 40%, followed by Spain, Po-land and Finland.Windows6, 000 kWh/aGround/cellar1,764 kWh/aWalls2,200 kWh/aWindows2,000 kWh/aGround/cellar714 kWh/aRoof12,120 kWh/aWalls10,100 kWh/aRoof3,000 kWh/aAnnual heat losses of a single-family house before (left)and after (right) energy-saving renovationSource: “Modernisierungsratgeber Energie”, dena, 2009
European Energy Saving Guide 201322ESITNotesMTGRATNLIEFIFRSEDEDKUKHUROLVLTSIPLSKBGCZEE0% 80%14%19%100%20% 40% 60%Central&EastNorth&WestSouthCentral & EastNorth & WestSouthAverage per region17%37%42%35%49%39%48%Pre 19601990-20101961-1990BG: Based on estimations.EE: Data from 1951 onwards.GR: Data only till 2000.IT: Values exclude heritage buildings before 1950.LT: Data from 1941 onwards.MT: Based on a sample survey with data till 2002.PL: Based on estimations.ES: Based on primary residences (l.e. excluding secondary houses).LT: Data only from 1921 till 2005.Age profile of residential floor spaceSource: BPIE survey
23of the European Association for External Thermal Insulation Composite Systems (EAE)Three scenarios for an efficient futureThe authors of the study used severalscenarios to calculate how this will affectEurope-wide potential savings in buil-dings. The variable factors in all the cal-culation models are the speed at whichrenovation ramps up and the average“renovation depth”, which can go as far as“nearly Zero Energy Buildings” (nZEB).In the two “shallow” scenarios with themost modest retrofitting ambitions, mi-nor energy-saving renovations dominateup to 2035, after which measures requi-ring medium input are the most com-mon, and by 2050 total retrofits make upat best a good 20% of all energy-relatedmodernization measures. The rate of ret-rofits is what tips the balance: if it reachesthe target of an annual 2.6% of the buil-ding stock by 2015, 7% of the energy sa-vings will already be realized by 2020. Ifit does not reach its target until 2035, atmost 4% of the savings can be achievedby 2020.In the “medium” scenario, in the year2020 moderate and deep renovationsform the dominant majority until 2030,accounting for 95%. This will include amaximum of 5% of nearly Zero EnergyBuildings. However, the energy saved inthis variation only becomes noticeable inthe long term: in 2020 it amounts to 7%despite the lower renovation depth, thusmatching the first scenario describedabove; but by 2050 the savings realizedwith this renovation strategy reach 32%to 48%. Total Europe-wide investmentcosts come to 551 billion euro, which isonly 100 billion higher, due to the highersavings but a net gain of 300 billion euroas opposed to only 160 billion.0Baseline3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2MediumAnnual energy savingsBPIE model scenarios BPIE m01,0002,0002,5003,0005001,50016994283271 283527BEnergy0 %50%25%75 %1,3733651,9751,2862,8962,7952020 20502€billionSource: BPIE model Source3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2Mediumgy savingscenarios BPIE model scenarios169283271 2835270Baseline3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2MediumEnergy savings as % of today0 %50%25%75 %71%68%48%32%1,3731,9751,2862,8962,79534%9%2020 2050 2020 20507%13%7%7%4%2%Source: BPIE model
European Energy Saving Guide 201324Two steps to successThe greatest input from investors is re-quired in the “deep” scenario, which en-visages an 85% proportion of total reno-vations by 2020, with 5% of nearly ZeroEnergy Buildings, making up 25% of allrenovations by 2050. Investments of 937billion euro by 2050 are juxtaposed withsavings in energy costs of 1,318 billioneuro – a net gain of 381 billion euro.According to the calculations of theBPIE experts, however, the most efficientscenario is the “two-stage” model. In theperiod up to 2030 it develops like the“medium” version. After this date, initialsmall to medium renovation measuresare upgraded to total modernization ornearly Zero Energy Buildings. With only584 billion euro in investment costs, ener-gy consumption is reduced by 71% until2050, which is translated into monetarysavings of 1,058 billion euro, that is, anet gain of 474 billion euro. In this scena-rio the authors put the annual internalrate of return at 13.4 per cent. CO2sa-vings of 90.7% are added to this, alongwith 800,000 new jobs annually ac-ross Europe due to the renovation work.2020Investment costs and savings20500Baseline3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2Medium€billion€billion107 94161 163255 260 252 265477 487252 26505001,00012501,5002507500Baseline3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2Medium164 1873435304516115518519371,3185851,05805001,0001,2501500250750Investment costs (present value)Savings (present value)Source: BPIE modelBPIE model scenariosSavings to society Average annual net jobs generated0Baseline3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2MediumM2,0006,0008,00010,00004,000238277462532 742853787902 1,4411,6567879020.30.40.6 0.61.20.60Baseline3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2Medium0.50.250.751.25101,1161,2264,5124,8844,0814,4616,4517,0158,9399,767 9,90810,6800.20.5 0.50.71.10.82020 Net saving (cost) to society without externalty 2020 Average annual net jobs generated2050 Average annual net jobs generated2020 Net saving (cost) to society including externalty2050 Net saving (cost) to society without externalty2050 Net saving (cost) to society including externalty€billionSource: BPIE model2020Investment costs and savings20500Baseline3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2Medium€billion€billion107 94161 163255 260 252 265477 487252 26505001,00012501,5002507500Baseline3Deep4Two-stage1ASlow & Shallow1BFast & Shallow2Medium164 1873435304516115518519371,3185851,05805001,0001,2501500250750Investment costs (present value)Savings (present value)Source: BPIE modelBPIE model scenarios
25of the European Association for External Thermal Insulation Composite Systems (EAE)Where do the EU States stand today?Directive 2002/91/EC of the EuropeanParliament and of the Council of 16 De-cember 2002 fired the starting shot for aEurope-wide initiative for greater ener-gy efficiency in buildings to be broughtabout by measures including buildingcertification. The recast Energy Perfor-mance of Buildings Directive (EPBD) hasbeen in force since 8 July 2010. It speci-fies (among other things) that from 2020all new buildings must be nearly “zero-energy” buildings, and public buildingsmust be nearly “zero-energy” buildingsfrom 2018. To the extent technically andeconomically feasible, existing buildingsshould also be adapted to the new re-quirements.The level of EPBD implementation istherefore a good measure of progress inthe European Union. For example, theWWF’s “EU Climate Policy Tracker 2011”9documents the countries with develop-ments related to the EU’s climate andenergy targets from 2010 to 2011, inclu-ding the building sector, in its investiga-tions.In Austria the target depth of renovationis seen as positive, as is a 100 million eurosupport programme for thermal insulati-on, 70% of which is designated for privatehouseholds. Current plans envisage dis-bursing this amount each year.The assessment for Belgium turns out lesspositive: certification of non-residentialbuildings was delayed, and the regions ofWallonia and Brussels received a warningfrom the European Commission in June2011 because they were lagging behindschedule in implementing the EPBD. Bycontrast the Flemish Minister of Energyannounced in September 2011 that 3,000rental houses were to be thermally insu-lated every year, and hoped that by 2020this would result in a good energy efficien-cy rating for all houses in that part of thecountry.The increased budget for energy efficiencyprojects in the Czech Republic is noted bythe authors of the study, but they regardpromotional options for renovation andmodernisation as limited. The standardsfor new buildings, on the other hand, areappropriate to the times: since 2012 newhouses have had to meet the low energystandard, from 2020 the passive housestandard will be mandatory, and evenstricter standards will apply to most pub-lic support programmes. In cases of non-compliance, recipients may be forced torepay the support.In Finland the harsh climate ensuressatisfactory energy performance of buil-dings even though there are hardly anyefficiency initiatives. Grants equalling upto 25% of the investment are paid for im-provements to heating systems, and thelimit values on the energy consumptionof new buildings were brought down by20% in 2012.For new owner-occupied homes inFrance, a maximum annual energyconsumption has been set at 50 kilowatthours per square metre of living spacefrom the end of 2012. As early as in March2011 the ministry responsible announced16 proposals intended to decrease ener-gy consumption in the building sectorby 38% by 2020. One of these proposalswas thermal renovation for an annual400,000 homes from 2013 onwards.The “Climate Tracker” finds that Germanycurrently has at best moderate ambitionsfor implementing efficiency measures inthe building segment. The background isthat funding in this sector was curtailedin 2011 – partly due to premature budgetspendingin2009.From2012to2014how-ever, a total of another 1.5 billion euro willbe available per year, most of which is tobe disbursed via the state bank Kreditan-stalt für Wiederaufbau (KfW). The declaredgoal is to double the rate of refurbishmentin Germany.Ireland is one of the countries receivinggood marks for its consistent tighteningof efficiency regulations applying to newbuildings. The legal amendment of 2008ensured that the maximum permissibleenergy consumption by new buildings de-creased by 40% in comparison with 2005levels. By 2013 this figure is actually inten-ded to reach 60% to 70%. The Better Ener-gy Homes scheme and the Warmer Ho-mes scheme are both mentioned, whichaim to improve the thermal insulation ofowner-occupied accommodation andthe heating technology used. Moreover,since 2010 Irish homeowners have beenable to claim tax relief of up to 10,000 euroon energy efficiency measures on their in-come tax return.The authors of the study find that the am-bitious targets of the Netherlands for theenergy efficiency of buildings by 2020 arenot backed up with sufficient frameworkconditions. There is positive mention ofa test period from October 2010 to June2011: as an incentive for private invest-ment in expansion and modernization,the rate of VAT on work carried out in thissector was reduced from 19 to 6 per centfor a trial period.Thereportnotestheabsenceofbindingtar-gets in Spain for introducing zero energybuildings. For raising energy efficiency the“Sustainable Economy Law” provided for atax break of 10% on all renovation measu-resleadingtogreaterenergyefficiency.Cuts in efficiency-relevant support in theUnited Kingdom are seen as a retrogradestep. Furthermore, the objective of const-ructing only zero carbon houses by 2016was significantly impaired because in 2011the energy consumed by domestic appli-anceswasremovedfromthecalculation.
European Energy Saving Guide 201326Unified standards: not apparentIn its summary the “EU Climate Policy Tra-cker” also comes to the conclusion thatcurrent EU policy will go only roughly onehalf of the way to achieving the climate-related targets by 2020. Twelve countriesdid in fact institute new steps in the fieldof energy efficiency in buildings withinthe period of investigation, but these aregenerally small-scale measures and donot exploit the full potential of energyefficiency improvements in buildings.The authors see a much higher rate of re-novation as necessary for a turnaround:“Public authorities will be required to re-furbish at least 3% of their buildings (byfloor area) each year.” Yet in many casesincentives for homeowners were not inplace.The paper entitled “Implementing theEnergy Performance of Building Directive(EPBD)”,10published in April 2011, identi-fiedwhereinparticularthestructuralpro-blems lie. Its foreword says the following:“Buildings are at the core of the EuropeanUnion‘s prosperity. They are important toachieve the EU‘s energy savings targetsand to combat climate change whilstcontributing to energy security. An enor-mous unrealized energy-saving potentiallies dormant in buildings. In untappingthat potential, not only more energy ef-ficient buildings, but also better livingconditions, financial benefits and sustai-nablejobscanbeprovidedforEurope‘sci-tizens.” This finding is presented alongsidea number of challenges, which expertsfrom the EU Member States have docu-mented in minute detail in the study.For example, the experts complain that itis almost impossible to compare variousnational approaches to implementingthe EBPD. “There is a need for harmo-nized terms and definitions, taking intoaccount national calculation methods,neither limiting the technological optionsnor hindering innovation”, the report says– and adds, “Intercomparisons are extre-mely complicated ...”The study states that also many countriesare heavily interpreting the requirementsof the Directive and adapting them tosuit their own needs and possibilities –often owing to the absence of a bindingmethodology for drawing up suitablereference values. “Member States wouldwelcome a simple yet robust frameworkfor the cost-optimum methodology,which should also be as consistent aspossible with the established procedures.”Communication is necessaryThe authors also find that work is nee-ded to catch up in the field of commu-nication. The substantive issues willhave to be better communicated to theowners of the properties if the energyefficiency of buildings is to be increased.“The professional parties that are in di-rect contact with the building owners(such as designers of buildings, buildingassessors, financial parties, legal parties,suppliers of products and materials, me-dia, consumer organisations etc.) arean important group that has a decisiveinfluence on improving the energy per-formance of buildings, and therefore onthe impact of the EPBD.” In the opinionof the experts, it would be necessary tohave better dissemination of informa-tion about possible national support,to get these groups more involved. Thiscould be done, for instance, via a linkwith the relevant certification procedu-re: “By linking financial instruments tothe Energy Performance Certificate, theimpact of the EPBD can be heightened.When consumers, building owners andinvestors have an insight into the diffe-rent kinds of financial opportunities onoffer, there is a higher possibility thatthey will implement energy saving mea-sures.” The authors determined that oneimportant argument in this regard wasthe increasing market value of proper-ties with good energy performance.Some of these challenges can already beovercome today as the following chap-ter will show, using individual examplesfrom the Member States. However, forother challenges new ideas will be nee-ded, along with common pan-Europeanaction for greater energy efficiency in thebuilding sector.
27of the European Association for External Thermal Insulation Composite Systems (EAE)
European Energy Saving Guide 201328Numerous examples show clearly that there isnoshortageofideasorsolutionsthatensuregre-ater energy efficiency in buildings and can offera realistic chance of attaining the EU’s climategoals. Innovative financing models are availab-le and several countries and regions prove thatan integrated and sustainable efficiency policy ispossible.Plan for future action -Mission possibleYetapparentlythereisstillnovisionofalargeEu-ropean Community project or the political will toset out on this path.Rarely have the chances been as good as theyare now that these plans will find broad supportamong the general public. And now more thanever, the states of Europe would benefit from theenormous economic effects that an internatio-nal energy efficiency programme would provide.So why is so little happening?
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European Energy Saving Guide 201330Energy efficiency requires consistentpoliciesSuccessful long-term climate action re-quires not only active commitment fromthose involved, but above all a reliablelegislative framework. This demand isaddressed primarily to the European Uni-on, because according to informationfrom the “Climate Policy Tracker”11almosthalf of the climate-policy preparationsmade in the Member States can be tra-ced back to decisions from Brussels: “Themajority of new policy developmentsin EU member states are either a directimplementation of EU legislation or arelinked to EU legislation. This reinforces themessage that intensification of policiesat the EU-level can have a large impacton countries’ performance.” However, theconclusion on national climate policiesduring the observation period is rathermore sobering: “Nine EU member stateshave, on balance, made progress, andfive have fallen further behind. Overall,current effort remains insufficient tomeet a low-carbon vision.”In buildings in particular, the report doesindeed see “a focus on measures to sti-mulate renovation policy and improvedcertification of buildings”, but it calls formore “Guidance to member states onhow to encourage retrofit for energy ef-ficiency and renewable energy as partof the Energy Performance of BuildingsDirective”. Furthermore, it points out thelack of long-term strategies and targetsfor the period beyond 2020 and greaterambitions for saving energy during thisperiod.And there is one more problem onwhich most publications are unan-imous: energy poverty. In the UnitedKingdom it was precisely this topic thattriggered the initial steps towards large-scale promotional programmes afterthe turn of the millennium. With an everincreasing number of people on lowerincomes, energy costs were consuminga disproportionate share of householdincome, with the result that sufficientsupplies of electricity and gas representeda poverty risk on their own. Such tenden-cies can now be observed throughoutEurope owing to further rises in energyprices – and should also spur nationalgovernments to take urgent action.Small steps are good, but not enoughDespite all the criticism, the publication’slist of recommendations ends by notingthat every EU member state has an activi-ty that could serve as an example to otherstates. The authors mention, for instance,Germany’s “bolder nuclear energy phaseout plans”, the massive resistance of Ita-lian voters to a return to nuclear power,the environmental taxes for transport in-troduced in Austria, and the Irish plans todouble the CO2tax in the year 2014.All the same, many small successes can-not replace concerted action. The study“Improving National Energy EfficiencyStrategies in the EU Framework”12bringstogether a number of proposals forachieving trans-national success in themedium term. For example, it urgent-ly recommends the EU-wide introduc-tion of Minimum Energy PerformanceStandards (MEPS): “By setting stringentenergy performance standards basedon life-cycle cost, a minimum level ofenergy efficiency is ensured and at leastthe most inefficient buildings and tech-nologies are excluded from the market.”
31of the European Association for External Thermal Insulation Composite Systems (EAE)The authors state that this could lead tomarket adjustments like those alreadyseen in Germany, Holland and Denmark:accordingtothestudy,singleglazingandnon-condensing gas boilers have alreadycompletely disappeared from the marketin those countries.Best practice – ideas for EuropeThe study provides some indication ofwhat an integrated and consistent policyapproach might be like, using the UnitedKingdom and Upper Austria as examples.For instance, in recent years the UK haslaunched an ambitious package of mea-sures for housing construction, parts ofwhich have already been implemented. Itacts through legal requirements such asMEPS and energy performance certifica-tes, information and motivation from in-stitutions such as the Energy Saving Trust,and economic incentives.Today’s new buildings must be at least40% more energy-efficient than thosebuilt ten years ago, and the zero carbonstandard will apply from 2016 onwards.For the refurbishment of old buildings –which will still account for three quartersof the total building stock in 2050 – thereare additional modernisation program-mes, some of which are run in co-opera-tion with the regional energy utilities. Forexample, the latter are also obliged to re-duce final energy consumption by meansof efficiency measures such as thermalinsulation in existing buildings. Program-mes of this type also enable householdson lower incomes to benefit more easilyfrom energy efficiency measures.The Home Energy Conservation Act(HECA) also obliges all local authoritiesresponsible for buildings to report regu-larly on the energy efficiency status of allresidential buildings in their area.The next stage will start in the autumnof 2012. As part of the “Green Deal”,households in the United Kingdomshould have the opportunity to investin the energy efficiency of their houseswithout having to provide funding for itin advance. The costs will be recoveredthrough savings on heating bills.Successful model since 1993The measures in Upper Austria, the fourthlargest federal state in Austria, are si-milarly comprehensive. Here the UpperAustrian regional energy agency O.Ö.Energiesparverband has been using acombination of legal regulations andattractive financial incentives, vocatio-nal training and information since 1993.As the individual Austrian states are re-sponsible for defining energy efficiencystandards, the agency has a lot of flexi-bility. It has exploited this, for instance,in determining an energy saving goal ofone per cent per year, introducing MEPS,coupling financial investment incentivesto energy performance certificates, andhaving rating results with requirementsthat become more stringent each year.Furthermore, people who are interestedin state support have to have on-siteenergy consultation.The impacts of these and other measu-res are impressive. From 1993 to 2007, atotal of 74,000 buildings were either builtor retrofitted in conformity with the strictefficiency requirements, which has re-sulted in an annual energy saving nowreaching 350 million kilowatt hours. Thecosts per kilowatt hour saved come to 1.8euro cents.Broad consensus for courageousactionIt is obvious that implementation of asimilarly comprehensive concept at Euro-pean level would represent a formidablechallenge for all those involved. But onthe other hand, interest in sustainablebuilding technologies is greater than everbefore, as reported by the recent “Ener-gy Efficiency Indicator Study”13from theJohnson Controls Institute for BuildingEfficiency: “The 2011 European survey re-veals an increasing emphasis on energyamong decision-makers in both privateand public-sector buildings. The EEI datashows decision-makers taking concreteactions and seeking government incen-tives and rebate programs to supportefficiency and clean energy. Ninety percent of European respondents conside-red energy efficiency at least ‘somewhatimportant.’ Nearly 20% said energy effici-ency is ‘extremely important,’ while 43%considered it ‘very important.’”Now we have to strike while the iron is hot,to find new common paths in Europeanenergy policy that will have a sustainableimpact. However, to this end – to enhance“communication”–abroadsocialconsen-sus will be required. Private house ownerswill have to recognize their role in thischallenge that will last for generations tocome, because for them, too, the issue willnot solely be reducing energy costs. One ofthe questions will be how responsibly wehandle limited resources and the environ-ment – also in consideration of later ge-nerations. Then there is security of supply:lower energy consumption increases theeffect of renewable sources of energy andsimultaneously reduces Europe’s depen-dence on energy imported from politicallyunstable regions.
European Energy Saving Guide 201332Promotion of economic growthState promotion of private investmentin energy-efficient buildings is very oftenviewed solely in relation to the expenditu-re – taking this view, every euro spent ma-kes a hole in the state coffers. But in factthis argument does not go into the mat-ter in enough depth. Several investiga-tions have calculated the positive effectsthat energy efficiency programmes canhave on the national economy – hugeimpacts on the labour market, economicperformance and the public budgets forsocial services. The paper “ENERGY SA-VINGS 2020. How to triple the impact ofenergy saving policies in Europe”14statesthat as a rule, energy-saving program-mes create added value and promotejobs in an order of magnitude far greaterthan the volume of the promotion. Thepaper cites, for example, a study from theUK15, which takes as its starting point 10to 30 person years of direct employment– for every one million pounds investedin measures for raising energy efficiency.A survey in Hungary16came to the con-clusion that by 2020 between 43,000 and130,000 new jobs could be created in thecountry if a large-scale programme forGermany’s example: impacts of KfW programmes forenergy-efficient construction on the federal budget* Financial effects of the promotion for the federation, federal states, municipalities and social insurance** Overtime scenario (OS): the construction measures initiated are implemented during overtime only.Job scenario (JS): the construction measures initiated are implemented exclusively through new jobs. Only in the job scenario are unemployment costs reduced.2008 2009 2010The resulting investments and effects on employment lead to the following increased revenue and decreased expenditure for the state*:InmillioneuroWage tax, social insurance contributions 1,167 2,273 2,282VAT 1,173 2,313 2,343Taxes on products, minus subsidies 170 334 339Taxes on corporate income and investment income 261 441 388(reduced unemployment-related expenditure)** (857) (1,800) (1,823)Programmecosts(federalbudgetfunding) -1,167 -2,273 -2,282Lowerlimitoftheneteffectonthestatebudget(OS)** 1,478 3,323 3,987Upperlimitoftheneteffectonthestatebudget(JS)** 2,335 5,126 5,810Source: „Energiesparkompass 2012“, Fachverband WDVS
33of the European Association for External Thermal Insulation Composite Systems (EAE)efficiency retrofitting of buildings were tobe implemented. According to the calcu-lations the impacts on the labour marketdepend on the level of retrofitting, whichcould range from a 40% energy saving in150,000 residencies up to 75% to 90% in250,000 residencies per year.Looking back to 2010, Dr. Norbert Irsch,chief economist at the German develop-ment bank “Kreditanstalt für Wiederauf-bau” (KfW), drew a very positive balance:“The energy-efficient building and retro-fitting measures in the state programmespromoted by investments in 2010 eithersecured or created 287,000 jobs. The greatServicesIndustryConstructionBusiness as Usual Percentage ChangeGreen GrowthEnergyAgricultureProduction (in billion$ 2004)Effects of green growth on individual sectorsSource: „A new Growth Path for Europe“, European Climate forum, 20110 20.0005.000 10.000 15.000 0 20 255 10 15majority of investments promoted areimplemented by medium-sized enterpri-ses, most of them in the local construc-tion business and the local craft trades.… These impacts on the economy andemployment are made possible by theenormous promotional leverage. In 2010state funding of 1.4 billion euro was usedto initiate investments in the Germaneconomy worth sixteen times as much.”17Irsch puts a figure on the gain for the sta-te from the KfW programmes for 2010 ofclose on 4 to 5.8 billion euro, comprisedof additional tax revenues and savings inemployment benefit.
European Energy Saving Guide 201334Energy-efficiency as a social way outof the crisisEU-wide the “Green Paper on Energy Ef-ficiency”18assumes that energy-savingmeasures could create one million newjobs by 2020. The labour-intensive jobswould be carried out locally and wouldtherefore benefit the respective regions. Itstates that direct supra-regional employ-ment is also possible in the manufactureof equipment and materials, and in mo-nitoring energy use, efficiency, marketingand consulting.These figures make it clear that a con-sistent efficiency policy can have far-reaching positive impacts – on bothclimate and economy in equal measu-re. Nonetheless, the publication “A NewGrowth Path for Europe. Generating Pro-sperity and Jobs in the Low-Carbon Eco-nomy”19noted that such success necessi-tates a huge effort in several areas. “Thenew growth path implies a major effortto retrofit buildings and enhance the builtenvironment. This is advantageous inview of employment because people withverydifferentvocationalskillscanoperatein these sectors after a few months of on-the-job training (in construction, as in theindustry, nowadays the majority of jobsare not centered around manual work –and there too, on-the-job training can bevery effective).” Once again the authorsrepeat that “Energy efficiency is mainly,but not only, a matter of buildings.” Logi-cally, the study sees the development op-portunities for the construction industryas positive – with the possibility of up to25 per cent growth.In the EU countries in crisis in particular,this potential could become the urgentlyneeded motor for creating jobs. No nati-onal economy can cope with long-termyouth unemployment rates from 30 toover 50% 20– either financially or socially.For example, many Southern Europeancountries need major remedial measuresbecause it takes huge amounts of energyandmoneytoair-conditiontheirbuildingswhich have little or no thermal insulation.The effect is that far more energy is usedthan would be needed for buildings withmodern insulation. Corresponding EUsupportprogrammesforenergy-savingre-novation could have huge consequencesfor the economy and the labour market,especially in these regions.LithuaniaPortugalItalyYouth unemploymentTotal unemploymentSpainGreeceEU totalIrelandGermanyBulgariaSlovakiaUnemployment rate in selected EU countries(March 2012), data in percentBoosting the economy – but how?Source: European Commission51,251,121,724,136,135,915,39,834,333,914,313,932,830,312,614,57,922,65,610,2
35of the European Association for External Thermal Insulation Composite Systems (EAE)Added value includedThat growth due to energy efficiency alsoaffects buildings’ value and performance,is spelled out by the paper “Sustainablereal estate. From niche to mainstream”21.“Three prominent studies examined theperformance of office buildings usingUS data vendor CoStar’s database, com-paring buildings with high green and/orenergy ratings to buildings lacking thesegreen credentials. Using somewhat dif-ferent methods and assumptions, thesestudies nonetheless reach comparableconclusions: rent and value premiums ofat least 5% and occupancy gains of threeto eight percentage points. That also theadditional construction costs of sustaina-ble buildings are reasonable, in particularin view of the state support, is evidencedby a number of other studies.”Yet the authors of the study also drewattention to one of the largest problemsthat plays a major role in the case of ren-tedbuildings:“However,thefundamentalshift towards sustainable real estate stillhas obstacles to face. Investor interest ishampered by factors including the agen-cy problem, which is manifested in theunequal distribution of owners’ costs andtenants’ benefit. Another major obstacleis the lack of unified standards and con-sistent data and indicators, which ren-ders it difficult to estimate how profitableit is to invest in green buildings.”These comments reveal once again thatsolutions are required at European level,on the one hand when standards forcomparable data are being designed andon the other in the search for innovativesolutions to the agency problem. This isbecause the latter also exerts a major in-fluence on the acceptance of energy-sa-ving renovations in residential buildings,as the “tenant-landlord dilemma” (alsocalled the “split-incentive”), even in coun-tries with a relatively low proportion ofowner-occupied accommodation.But even in the case of owner-occupiedhousing it may be assumed that in fu-ture the energy standard will be the keydeterminant of the value of a property.For houses without modern thermal in-sulation this could mean that the expec-ted costs of refurbishment will reduce thepurchase price accordingly.Making climate action affordableThe figures in the previous chapter clear-ly show that it must be in the interest ofeach EU Member State to improve energyefficiency. However, since the great ma-jority of housing is privately owned, thechallenge will be to provide incentivesfor the owners to implement the relevantmeasures. The study “Improving NationalEnergy Efficiency Strategies”22summari-ses by saying that on the one hand eco-nomic incentives and financial supportare required to initiate the necessaryefficiency measures, which could be re-alized via tax benefits, low-interest loansor grants. In addition, however, there is alack of innovative financial schemes.Many of the support programmes neverbenefit homeowners, as they still requi-re considerable financial outlay that isonly recovered in the long term throughsavings on energy bills. The publicationproduced by the Institute of Internationaland European Affairs in Dublin entitled
37of the European Association for External Thermal Insulation Composite Systems (EAE)“Thinking Deeper: Financing Options forHome Retrofit”23therefore represents aremarkable overview of classical and lesswell known means of financing – with aparticular focus on the extensive refur-bishment of owner-occupied housing.A great deal of space is given – not wi-thout good reason – to the “Pay as yousave” (PAYS) model in which the moneynecessary for retrofitting is provided by apublic lending body such as a state gu-arantee fund. The value of the loan is at-tached as a legal charge to the property.The interest payments and instalmentsfor repaying this loan are funded solelyfrom the reduced energy bill for the pro-perty. This method of funding has twomajor advantages: the homeownerscan retrofit their property practically wi-thout having to invest any of their owncapital, and when they sell, the loanremains attached to the house. Sincethe new owners will also save energybecause the house has been retrofitted,they can take over the loan without anyproblem and once it has been paid offthey benefit directly from the low energycosts. This model also makes long-terminvestment in energy-efficient buildingsattractive also in regions with a dynamicproperty market, as illustrated by thesuccess of the Property Assessed CleanEnergy (PACE) system in the USA. Theprogramme was given around $150 mil-lion of government funding in 2010 andthe study estimated that with the aid ofprivate investors a total of up to $500million could be reached if the fund wasbacked with federal loan guarantees. Inthe USA the loan is usually repaid over aperiod of 20 years, and the mechanismof repayment is the property tax bill. Onsurveys among US homeowners “42%said they would be ‘extremely’ or ‘very’interested in using PACE for energy effici-ency and renewable-energy projects.”Avoiding the split-incentive dilemmaThe study describes “PAYS to Energy Me-ter” as a comparable financing model inwhich the debt is attached to the energymeter. Here, too, the debt used to pay forthe property to be retrofitted is financedby the monetary savings, but the bill pay-er, i.e. the beneficiary of the savings, is res-ponsibleforrepayment.Thismodelislike-ly to be of interest in particular in regionswhere a large proportion of apartmentsor houses are rented. The repayment ins-talments are collected as an extra chargeon the energy bill, and several safety me-chanisms ensure that demands for pay-ment do not exceed the actual savings.Given the necessary state support, thismodel could possibly even present a so-lution to the split-incentive issue: houseowners do not have to fund retrofits thatwill bring most benefit to their tenants.The Irish study also lists several approa-ches to financing such support pro-grammes. For example, a “Green Bank”or government risk guarantees wouldbe suitable means for interesting finan-ciers in funds backing environmental orethical projects. The study cites the ex-ample of the KfW Bankgruppe in Germa-ny, which provides services such as low-interest loans for increasing the energyefficiency of buildings, and its AAA ratingand state-backed guarantees make it anattractive option for many investors.
European Energy Saving Guide 201338Attractive offers for private investorsThe authors of the study regard GreenFunds as useful for attracting private ca-pital – especially in countries with highlevels of savings, such as Ireland. There theSpecial Savings Incentive Account (SSIA)pulled in 16 billion euro in the five yearsfrom 2001, which was topped up with ataxcredit.Anotherexamplegivenisthatofthe Netherlands, with its Green Bonds andcertificates with a fixed term, value andinterest rate, on which capital gains taxis waived on investments of up to 52,0001990 2005 2020without measuresWithout action Europe‘s total primary energy needs will dependfor 62% on imports by 2020Source: Primes 2009, ECOFYS, Fraunhofer isi 45 % 54 % 62 %55% 46 % 38 %euro. Such incentives or tax credits havesince become established as importantcriteria for the successful financing ofenergy-efficiency measures. And so manycountries including France, Italy and Bel-gium, along with California, are propo-sing tax credits for private investments inenergy-efficiency measures.Traditional financing methods such asmortgages are mentioned in the studyfor the sake of completeness, but are notregarded as options for bringing large be-nefitsinthesenseofreducingobstaclestoinvestment.
39of the European Association for External Thermal Insulation Composite Systems (EAE)Opportunities do exist: use them!The wide range of options shows thatthere are ways for Europe to achieve itsenergy-efficiency and climate goals.Admittedly, for this to happen some ofthe small, innovative ideas will have tobe given a broader base – yet the indi-cations are that acceptance levels willbe high. The “ENERGY EFFICIENCY IN-DICATOR STUDY”24clearly shows thata need for action at the highest level isperceived, and not only in view of risingenergy prices. “Not surprisingly, cost sa-vings remains the most important driverfor pursuing efficiency activities. Beyondcost concerns, however, respondentscited markedly different drivers in 2011than in 2010. Respondents in 2011 sawcost reduction, government rebates andenergy security as the top three drivers foraction.” The paper goes on to say: “Thistrend toward energy efficiency and GHGemissions reductions is evident in that91% of European respondents had im-plemented at least one energy efficiencymeasure during the past year. Lookingforward, respondents expressed highestexpectations for technologies that willlead to ‘deep’ energy savings, such as ad-vanced building materials and new ligh-ting technologies.”25Thelargenumberofmeasuresimplemen-ted in companies should be sufficient toinduce political decision-makers to makesubstantial improvements in the over-all conditions and financing options forsuch measures. The fact that this is not aloss-making business is illustrated by thepublication “Financing Mechanisms forEurope’s Buildings Renovation”26, whichsuggests learning from experience inGermany and the UK. For example, from2006 to 2009 public subsidies providedvia the German KfW Bank helped to sti-mulate a total invested volume of 54 billi-on euro. And the British Green Deal, withitstargetinvestmentquotasof0.5to0.7%of the gross domestic product, has alrea-dy triggered energy-efficiency measuresin up to 14 million British households. Theratio of public money to the total volumeof investments stimulated here is estima-ted to be between 1:4 and 1:9.Such figures illustrate very well that morecommitment to energy efficiency can payoff for all the EU Member States. Perhapsit is impulses like these that could boosteconomic activity in times of crisis – tothe benefit of the countries, the EuropeanUnion – and not least the environment.
European Energy Saving Guide 201340Since it was founded in 2008, the Euro-pean Association for External ThermalInsulation Composite Systems (EAE) hasbeen working towards a “culture of sus-tainability” in the construction sector.The members of the EAE include elevennational ETICS associations and four ofthe largest European insulation materi-al associations. Together they representaround 85% of the European ETICS mar-ket and share across national borderstheir unique competence in the field offaçade insulation. Their common aim isto improve the energy efficiency of theEuropean building stock. This comesabout through continuing technical de-velopments in materials, constructionmaterials and technologies, and throughongoing dialogue with politicians.However, measured against the technicaland economic requirements, up to nowall European states have lagged a longway behind their savings potentials, andinthebuildingsectorsomecountriescon-sume far more than 50% too much ener-gy. The largest portion of this is wasted oneither heating or cooling poorly insulatedbuildings, and this is one reason why Eu-rope is becoming increasingly dependenton imported energy. This is problematicfor several reasons. On the one hand,the EU states buy large quantities of oiland gas from other countries, includingpolitically unstable regions, which oneday may affect the security of supply andtherefore the standard of living in the EU.On the other hand, the increasing volati-lity on the energy markets results in evergreater economic restraints and risingprices, which increasingly inhibit growthin Europe. This in turn threatens internati-onal competitiveness and prosperity.In addition, this gigantic waste of energygives rise to issues of action on climatechange. The European Union has alreadymade important political preparations inthe form of its targets for climate actionand energy efficiency. Yet unless there isa massive rethink and binding require-ments for each Member State, particular-ly in the construction sector, the targetswill not be met. For this reason the EAEand its members are in continual dia-logue with the decision-makers in theirgovernments and in Brussels. This is be-cause business and politics will have towork together on the ambitious energyand environmental targets if the dreamof sustainable construction and life in Eu-rope is to become reality.About our associationEAE – Partners for sustainable buildingand refurbishment in Europe
41of the European Association for External Thermal Insulation Composite Systems (EAE)The EAE is therefore issuing a Europe-wide invitation to discuss a seven-point programme that examines the key problem areas in theEU – and to elaborate solutions together.1. Tell people about energy efficiency! EU citizens lack knowledge and information about energy efficiency. This has got to change so that people can contribute.2. Improve the promotional options! Too little, too complicated, and too uncertain – in many EU countries those who could potentially refurbish buildings have onlyslender chances of obtaining financial assistance from the state.3. Use efficiency measures to boost the economy! Energy-saving refurbishments stimulate the economy and create jobs: there is virtually no better way to invest state funding.4. Combine renewable energies with efficiency programmes! No competition! Renewable energies are the perfect complement to energy-efficient buildings. If total consumption is reduced,we will be able to successfully switch to renewable energies even faster.5. Think beyond political borders and parliamentary sessions! Energy efficiency needs long-term, responsible approaches and stable framework conditions. This topic is too important to beovershadowed by political posturing and electioneering.6. Create comparable standards in Europe! Technical standards and political targets vary from country to country; this creates massive barriers to comparability, competi-tion and concerted action.7. Get the energy suppliers on board! Vendors of energy have little interest in economical customers. But despite this the utility companies have to be won over aspartners for a sustainable future.European Association forExternal Thermal Insulation Composite Systems
European Energy Saving Guide 201342• Qualitätsgruppe Wärmedämmsysteme, Austria• IVP, Werkgroep ETICS, Belgium• Cech pro zateplování budov, Czech Republic• Groupement du Mur Manteau, France• Fachverband Wärmedämm-Verbundsysteme e.V., Germany• Consorzio per la cultura del sistema a capotto, Italy• Branchevereniging Producenten gepleisterd Bouwen, Netherlands• Stowarzyszenie na Rzecz Systemów Ociepleń, Poland• Združenie pre zatepľovanie budov, Slovakia• Verband Wärmedämmverbundsysteme, Switzerland• Insulated Render and Cladding Association, United Kingdom• European Manufacturers of Expanded Polystyrene• European Phenolic Foam Associaton• European Insulation Manufacters Assocation• The European voice of the polyurethane insulation industryE T I C SPGBbrancheverenigingFachverbandWDVSWärmedämm-VerbundsystemeBesserbauen–Besserleben!EXCELLENCEININSULATIONFull membersExtraordinary members
43of the European Association for External Thermal Insulation Composite Systems (EAE)1 “ENERGY SAVINGS 2020. How to triple the impact of energy saving policies in Europe”, Ecofys and Fraunhofer ISI, September 20102 “Main report. EU Climate Policy Tracker 2011”, published in November 2011 by the World Wide Fund for Nature (WWF), Brussels, Belgium3 Source: Eurostat (http://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&init=1&language=de&pcode=ten00086&plugin=1)4 “Energy Roadmap 2050”, European Commission, 15 December 20115 “Europe’s buildings under the microscope. A country-by-country review of the energy performance of buildings”, published in October 2011 by Buildings Performance Institute Europe (BPIE)6 “Energy 2020. A strategy for competitive, sustainable and secure energy”, European Commission, 20107 “Study on the Energy Savings Potentials in EU Member States, Candidate Countries and EEA Countries. Final Report”, For the European Commission Directorate-General Energy and Trans-port, March 20098 “Europe’s buildings under the microscope. A country-by-country review of the energy performance of buildings”, published in October 2011 by Buildings Performance Institute Europe (BPIE)9 “Main report. EU Climate Policy Tracker 2011”, published in November 2011 by the World Wide Fund for Nature (WWF), Brussels, Belgium10 “Implementing the Energy Performance of Buildings Directive (EPBD). Featuring Country Reports 2010”, Concerted Action Energy Performance of Buildings, Brussels, April 201111 “Main report. EU Climate Policy Tracker 2011”, published in November 2011 by the World Wide Fund for Nature (WWF), Brussels, Belgium12 “IMPROVING NATIONAL ENERGY EFFICIENCY STRATEGIES IN THE EU FRAMEWORK. FINDINGS FROM ENERGY EFFICIENCY WATCH ANALYSIS.”, Wuppertal Institute and Ecofys, March 201113 “2011 ENERGY EFFICIENCY INDICATOR STUDY: EUROPEAN REGIONAL RESULTS SUMMARY”, Johnson Controls Institute for Building Efficiency, 201114 “ENERGY SAVINGS 2020. How to triple the impact of energy saving policies in Europe”, Ecofys und Fraunhofer ISI, September 201015ACE research (2000). Energy efficiency and jobs: UK issues and case studies. A report by the association for the conservation of energy to the Energy Savings Trust16 Ürge-Vorsatz, Diana et al. (2010). Employment Impacts of a Large-Scale Deep Building Energy Retrofit Programme in Hungary. The Center for Climate Change and Sustainable Energy Po-licy (3CSEP), Central European University, Budapest, Hungary. http://3csep.ceu.hu/projects/employment-impacts-of-a-large-scale-deep-building-energy-retrofit-programme-in-hungary17 “Energiesparkompass 2012”, Fachverband Wämedämm-Verbundsysteme, Baden-Baden, 201218 COM(2005) 265 final. Doing More With Less. Green Paper on Energy Efficiency19 “A New Growth Path for Europe. Generating Prosperity and Jobs in the Low-Carbon Economy. Final Report”, European Climate Forum e.V., Potsdam, June 201120 „Boosting the economy – but how. Unemployment rates in selected EU countries as at March 2012“, in %, European Commission21 “Nachhaltige Gebäude. Von der Nische zum Standard”, Energie und Klimawandel - Aktuelle Themen 483, Deutsche Bank Research Frankfurt am Main, 11 May 2010 [first sentence quotedfrom the condensed English version: “Sustainable real estate. From niche to mainstream” published on the Internet: http://www.bnpparibasip.com/whitepapers/Investment%20case%20for%20Sustainable%20real%20estate.pdf, accessed 27 August 2012]22 “IMPROVING NATIONAL ENERGY EFFICIENCY STRATEGIES IN THE EU FRAMEWORK. FINDINGS FROM ENERGY EFFICIENCY WATCH ANALYSIS”, Wuppertal Institute and Ecofys, March 201123 “Thinking Deeper: Financing Options for Home Retrofit” The Institute of International and European Affairs, Dublin, September 201124 “2011 ENERGY EFFICIENCY INDICATOR STUDY: EUROPEAN REGIONAL RESULTS SUMMARY”, Johnson Controls Institute for Building Efficiency, 201125 “30% - Why Europe should strengthen its 2020 climate action”, Climate Action Network Europe26 “Financing Mechanisms for Europe’s Buildings Renovation. Assessment and Structuring Recommendations for Funding European 2020 Retrofit Targets”, European Insulation Manufactur-ers Association, January 2012The European Association for ETICS would like to thank all member associations and their member companiesfor supplying beautiful pictures of insulated buildings, expressing that all architectural designs are possible atall types of buildings. We would also like to thank Eric Braunreuther, Oliver Rapf and Charles Phillips for theirvaluable contribution to this European Energy Saving Guide.
European Association forExternal Thermal Insulation Composite SystemsFremersbergstraße 3376530 Baden-BadenGermanyPhone: +49 (0) 7221-300989-0Fax: +49 (0) 7221-300989-9E-Mail: email@example.comInternet: www.ea-etics.com