Using insights from the Energy Efficient Mortgages Action Plan (EeMAP) and the network’s work on Level(s), WorldGBC Europe’s response advocated taking a pragmatic starting point for the taxonomy. The response welcomed TEG’s proposal to evaluate the use of Energy Performance Certificates as a proxy but stressed that in the medium term, the taxonomy should evolve to focus on in-use carbon emissions, whilst respecting the principle of energy efficiency first.
The response further stressed that a life cycle approach to buildings is the level of long-term ambition our sector needs to aim for. Therefore, the taxonomy must give a clear signal to the financial sector that sustainable built environment assets must aim for net zero carbon across their whole life cycle in order to be Parisproof and deliver the EU’s vision of a climate neutral Europe.
To achieve this level of ambition, and to make the choice of a pragmatic starting point acceptable, the taxonomy metrics and thresholds must be flexible and reviewed and updated at regular intervals in the period up to 2050.
Energy performance increasingly important for the value of buildings
On 8 February, a report by the European Commission’s Joint Research Centre (JRC) outlined that higher energy efficiency is increasingly important for how buildings are appraised and is linked to lower payment default risks. The report has evaluated existing literature, including WorldGBC’s EeMAP project, to explore the impact of energy efficiency improvements on the value of buildings.
The main findings of the report include:
Energy efficiency improvements result in an increase of about 3–8% in the price of residential assets, and an increase of around 3–5% in residential rents compared to similar properties.
For commercial buildings, the premium seems to be over 10%, and in some studies even over 20% of sales price increase compared to similar properties has been reported. Rental prices of commercial buildings have also been positively affected, by 2-5%.
There are differences across regions and countries, as well as different property types (e.g. apartments vs houses).
As higher energy performance is becoming the norm, higher values are associated with better performance.
The report concludes that energy efficiency upgrades change the basic characteristics of the buildings affected and therefore has an impact on other value drivers, such as comfort, safety and maintenance. It further states that lower default risk linked to energy efficiency should also be considered and reflected in financial products.
WorldGBC is currently working with EeMAP project partner RICS to develop an energy efficiency checklist for valuers that will help improve the consistency of how energy performance is taken into account. The full checklist and guidance are expected to be released in late April.
European Commission outlines vision and roadmap for Level(s)
On 25 February, The European Commission published a report outlining their vision and mission for Level(s). Level(s) is an EU level framework of building performance indicators aimed at driving improvements across six areas: lifecycle emissions, resource efficiency, water use, health and comfort, resilience and adaptation, and cost and value. Level(s) is now being tested by over 130 building projects in 21 countries across Europe. The results of the testing phase will be used to update this beta version, ahead of a final release in March 2020.
In the report, EU Commissioner for the Environment, Karmenu Vella, states that Level(s) will serve as a powerful source of data and insights for national policy-makers looking to build sustainability and circularity into their building codes. Commissioner Vella further states that Level(s) presents an opportunity to grow Europe’s sustainable building sector into a world leader, in a growth area for the construction and real estate sector globally.
The European Commission is now starting to work with the stakeholder community to develop a roadmap of the future actions needed to support the mainstreaming of sustainable building and life cycle assessment. Initial activities identified to drive this change include awareness raising, capacity building, increased use of digital tools and alignment of certification tools and national policies.
These initial actions are partly based on things that are already happening, but not yet at scale. The report concludes with an invitation to construction stakeholders to work with the Commission to further develop this roadmap of the future actions needed to support the mainstreaming of sustainable building and life cycle assessment.
EU Council and Parliament progress discussions on EU 2050 GHG Strategy
In November, the European Commission published a draft strategy which outlined the European Commission’s vision of a net-zero greenhouse gas economy in 2050. This strategy is now being debated by both the EU Council and the EU Parliament with a final decision on the EU’s 2050 objective expected in either May or October 2019. WorldGBC’s response to this strategy can be found here.
Draft conclusions from the EU Council indicate a high level of support for the vision of climate neutrality by 2050 with a draft statement from Council highlighting the opportunity that the September 2019 UN Summit in New York will provide in “mobilising the political will to raise global ambition” on climate change. This will coincide with the launch of a major global report on embodied carbon from WorldGBC.
In parallel, the European Parliament is also considering its position on the strategy. However, the opportunity of Parliament to respond is more limited as elections take place in May. Further, a dispute has emerged between two of the parliamentary committees which may hinder progress as both Parliament’s environment and energy committees drafted a resolution on the strategy. Although both resolutions endorse the vision of a climate neutral Europe, the two committees are split on the level of emissions cuts needed by 2030 to support the vision, and when these should be debated.
Both resolutions will be sent to the next plenary sitting of Parliament between 11-14 March. Depending on the outcome, the Parliament’s governing body, the Conference of the Presidents, could decide to merge the two resolutions.
Further information on the negotiations can be found here.
Member States need to do more to meet 2030 EU energy efficiency target
An assessment of draft national energy and climate plans submitted by Member States to the European Commission at the end of 2018 has revealed that the contributions from MS fall short of achieving the EU 2030 energy efficiency target.
By the end of 2019, Member States are required to finalise the integrated national energy and climate plans. However, the initial findings of the drafts suggest that the initial contributions need to be increased by Member States in their final plans to ensure that the achievement of the EU 2030 energy efficiency target is within reach.
The analysis assesses 15 national contributions representing 51.3% of EU28 final energy consumption. These contributions would only reach 28.7% energy efficiency by 2030, compared to the EU target of 32.5%.
In response to the findings, The Coalition for Energy Savings has called on Member States to engage with stakeholders to put in place the relevant targets, policies and measures.
On 7 February Eurostat published figures revealing that the gap to achieving the EU energy efficiency target for 2020 continues to widen. According to Eurostat, energy consumption in Europe rose for the third consecutive year in 2017. Energy consumption in the EU increased by 1% in 2017.
In 2017, primary energy consumption in the EU was 5.3% above the efficiency target for 2020, while final energy consumption was 3.3% above target. Since 1990, consumption has fallen by only 0.4%, Eurostat indicated.
Germany unveils draft law to get to net-zero emissions by 2050
In Germany, a draft climate law has called for net-zero emissions by 2050. Under the proposed law, the environment ministry is calling for an emissions reduction target of “at least 95 per cent” by 2050 compared to 1990 levels. It also includes a “neutrality” target that would require the remaining 5% of emissions to be offset by negative emissions measures or technologies.
The draft would also include existing interim targets for 2020, 2030, and 2040, as well as sectoral targets for different industries, including buildings. The details and design of the law will be debated and discussed among ministries and in federal parliament, throughout 2019.
Spanish government pledges €47bn euro in support of a carbon neutral economy
Ahead of a general election on 28 April, the Spanish government has unveiled a proposal which sets a goal to make Spain carbon neutral by 2050. The plan would see the release of a €47bn green public investment plan in support of its goal of building a ‘carbon neutral’ economy by 2050.
The ten year package aims to increase investment in low carbon infrastructure which would be in part funded by green bond issuances and EU support. Embedded in the programme is the principle of a ‘just transition’ which would provide support to those who lose their jobs in polluting industries.