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Is the EU's building renovation wave 'fit for 55'?

Climate & energy targets / POLICY BRIEF
Thijs Vandenbussche

Date: 30/06/2021
The European Commission's recent Renovation Wave Strategy aspires to be a turning point in the European Green Deal. If successful, it will speed up the renovation of buildings while also making them more energy-efficient and less carbon-intensive over their entire lifecycle.

Ideally, the renovation wave and the Commission's new Fit for 55 package, a set of policy proposals to reduce net emissions by 55% by 2030, would work in tandem. Buildings are responsible for about 40% of the EU's total energy consumption and 36% of carbon dioxide emissions. The Fit for 55 package deals with energy efficiency, electrification and the integration of renewables, which are crucial for making buildings more carbon-neutral.  
But is the renovation wave 'fit for 55'? In this Policy Brief, Thijs Vandenbussche analyses the status of and legislative framework for energy efficiency and electrification in the EU's building stock. He argues that the reviews in the Fit for 55 package should go beyond merely adjusting existing targets. They should also scrutinise and improve the governance framework to increase energy efficiency and electrification in the buildings sector and add more incentives for consumers to renovate smartly and sustainably.
To fully realise the emission reduction potential of buildings, the EU should, when reviewing the relevant Fit for 55 legislation, take the following steps:

  1. strengthen the Energy Efficiency Directive's monitoring and control by the European Commission to achieve the national energy efficiency targets;
  2. add carbon reduction aspects to the Energy Efficiency Directive and/or Energy Performance of Buildings Directive; and
  3. prioritise the Energy Taxation Directive review, rather than an extension of the Emissions Trading System to the buildings sector, to encourage the integration of renewables and electrification in buildings and disincentivise fossil fuels.
Aligning the Fit for 55 package and Renovation Wave Strategy in this way will help achieve cost-effective renovation efforts that are parallel to the EU's climate neutrality objectives while keeping in mind the needs of its most vulnerable citizens. The Commission should furthermore have a more substantial monitoring role over member states' energy efficiency plans. Incentives for consuming fossil fuels in buildings should be displaced towards renewables and electrification.

If the EU and its member states do not move in this direction, they risk failing to reach their targets – reducing emissions from the buildings sector, and their climate goals more generally.

Read the full paper here.
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