Getting an EU perspective

03 June 2020 - Published by Deirdre Buist 2
EU-wide, 15 billion euros of public resources are spent annually on energy renovation for all types of buildings. However, the impacts of these investments are not yet enough to reach EU emission targets. Stronghouse wants to improve the effectiveness of support measures and enhance their impact.

Currently we are researching relevant literature and policies for lessons learned, to ensure complementarity and avoid duplication. Project Coordinator Hein Braaksma has taken a close look at a recently published review of financial and fiscal instruments across Europe, produced by the EU Joint Research Centre. It provides both interesting lessons and a broader context for the Stronghouse project. We’ve taken some notes from Hein’s analyses of this report to share here.

Energy efficiency targets

The Joint Research Centre (JRC) describes the energy renovations needed to achieve the EU energy efficiency targets for 2030 and the transition towards climate-neutral Europe by 2050. These goals are defined as ‘various intervention measures on the envelope of a building and its technical systems resulting in significant energy efficiency improvements […] often complemented with renewable energy technology installations.’

 

Grants and subsidies

According to the JRC, grants and subsidies are the most commonly used instruments to support energy renovation, also by individual homeowners. They can support the uptake of new technologies, assist vulnerable groups and low-income households and help to realize smaller projects.

However, the JRC also signals a number of challenges.

Grants and subsidies are:

  • More suitable for individual interventions

  • Often ‘bothersome’ to apply for 

  • Limited because of budget restrictions 

  • Susceptible to potential (fraudulent) misuse.

Stronghouse aims to reach vulnerable groups and low-income households and hopes to improve their access to grants – learning from good practices from our Orkney partner. Moreover, we are investigating how grants can enable a more integral energy renovation.

Loans

The JRC review sees loans as a more sustainable means of investment in energy renovation, especially when projects include multiple intervention measures, i.e. wall/roof insulation and double glazing, solar panels etc. Considering the uncertain times we’re now experiencing all across Europe, we must question the willingness of - and possibilities for - households to take on (additional) debt just now.  

Stronghouse aims to develop or redesign loan schemes, pooling our knowledge and good practices   to answer some of the challenges noted by the JRC. Our project also wants to develop digital instruments to measure the effect of the investments realized through these loan schemes on CO2 reductions

Fiscal instruments

A number of fiscal instruments such as income tax credits / deductions, property taxation and VAT reduction are also described by the JRC. While these instruments are important for individual homeowners - and Stronghouse - the role of Stronghouse partners will be limited to informing their stakeholders about national fiscal instruments related to energy renovation.

One-Stop-Shops & Customer Journeys

One-Stop-Shops have many potential advantages. In Stronghouse the Linnaeus University shares knowledge regarding this approach, while ProjectZero small piece its experience with the closely related ‘Customer Journey’ method that identifies key stages of the renovation process and the support needed by homeowners at each step. Stronghouse works on the development of both these models by creating a better understanding and by re-designing elements to fit homeowners’ needs and interests.

Private Financing

The JRC report notes that financial institutions are becoming increasingly active regarding energy renovation, offering specialized financial products: commercial loans, energy efficiency mortgages, crowdfunding cooperatives and insurance. For Stronghouse it is relevant to know how energy efficiency mortgages can offer better borrowing terms for energy renovation. Also relevant is how energy cooperatives engage citizens to support renewable energy projects and energy renovation. The Province of Drenthe and the Municipality of Noordenveld have valuable experience in that area to share with the partners

 

You can find the full article written by Stronghouse Project Coordinator Hein Braaksma here.

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Access the JRC report here:

https://publications.jrc.ec.europa.eu/repository/bitstream/JRC117816/accelerating_energy_renovation_investments_in_buildings.pdf