Policy recommendations for sustainable plus energy neighbourhoods and buildings

The factsheets provide an overview of existing gaps and barriers in the development and market uptake of SPENs, and provides policy recommendations for Austria, the Netherlands, Spain and Norway.

Sustainable plus energy neighbourhoods (SPENs) can contribute to decarbonising the building stock, while providing additional benefits for residents both at the building and neighbourhood level, enhancing wellbeing and a sense of community. SPENs can provide a range of shared spaces, services and facilities, such as shared heat pumps, PV panels, EV charging, EVs, bicycles, and common spaces with greenery, water and biodiversity. A neighbourhood approach provides additional benefits to demand-side flexibility (DSF) compared to single apartments or buildings. The optimisation of electricity and heat production and sharing renewable energy from various sources is managed by a system of twin modelling and automation.

Shared assets, services and collective energy production installations interact differently with the urban infrastructure thus they often require new legislative frameworks. The Clean Energy Package of 2019 has important provisions to fill in these gaps and allow collective forms of producing, sharing and selling of energy, as well as to encourage prosumers to enter the market.

Written as part of the EU-funded project syn.ikia, these factsheets provide an overview of existing gaps and barriers in the development and market uptake of SPENs, and provides policy recommendations for four countries: Austria, the Netherlands, Spain and Norway. They also map their progress in implementing provisions of the 2018 Energy Performance of Buildings Directive, the Energy Efficiency Directive, the Renewable Energy Directive, and Electricity Market Design. Looking at the latest developments in national, regional and municipal policies, three main aspects are included: i) energy performance, ii) renewable energy and energy communities, and iii) digital technologies and demand-side flexibility.

The factsheets also list the drivers, potential business models and policy support measures that enable investments and wider uptake of SPENs. The policy mapping and recommendations are based on desk research, ten interviews and two workshops with experts from the private and public sectors, including developers and local authorities involved in projects of SPEN and energy communities.

EPBD: Crunch time for future-proof buildings legislation

The Energy Performance of Buildings Directive (EPBD) is entering the last phase of the EU legislative process with the start of trilogue negotiations between the Council and Parliament. Against this backdrop, this briefing provides an overview of where institutions stand at the start of the process and highlights where there is still room for improvement.

The Energy Performance of Buildings Directive (EPBD) is entering the last phase of the EU legislative process with the start of trilogue negotiations, aiming at reaching a compromise between the positions of the two co-legislators (Council and Parliament). The trilogues represent a crunch time for EU legislation, and all efforts should be put into finding workable compromises and agreeing clear and strong provisions to future-proof buildings.

From this assessment of the two co-legislators’ positions, it appears that on many items the Parliament’s approach is closer to delivering a strong vision and framework for the buildings sector. It should therefore be seen as the starting point for the negotiations. Adopting a clear, strong and future-proof EPBD is essential for the EU and Member States to close the gap in building decarbonisation and achieve the 2030 climate targets. It will also deliver massive energy and greenhouse gas savings, protecting Europe against future energy crises and providing citizens with comfortable and clean homes.

With this in mind, this briefing provides an overview of where institutions stand at the start of the negotiations (and compared to the Commission proposal) on expected impacts of key selected provisions: standard for new buildings, minimum energy performance standards for existing buildings, and the information and enabling framework. It highlights important provisions that need to be preserved, but also describes points of attention which need to be improved.  

Minimum standards, maximum impact: How to design fair and effective minimum energy performance standards

Minimum energy performance standards (MEPS) can effectively accelerate deep energy renovation, spur innovation and construction, create demand for renovation services, and provide certainty to market players across the value chain. This paper explains how MEPS can be implemented effectively while remaining socially just, using a differentiated approach that carefully follows a series of design principles.

A policy instrument that effectively accelerates deep energy renovation while being fair to all citizens is urgently needed. Well-designed minimum energy performance standards (MEPS) can meet these requirements and put the building stock on track to meet climate targets.

Europe must urgently accelerate the renovation and full decarbonisation of its building stock. According to the European Commission, the current annual 1% renovation rate should double by 2030, while BPIE’s own analysis concludes that annual deep renovation rates need to reach at least 3% in order to meet the EU’s 2030 climate and energy goals.

BPIE’s EU Buildings Climate Tracker shows that the European Union is not on track to achieve its climate targets in the building sector. Lack of action, delays or weaknesses in implementing effective building decarbonisation policies at the European level are no longer acceptable considering the need to dramatically increase the EU’s energy security. To meet the 2030 and 2050 climate targets in the building sector, deep renovation activity needs to step up significantly this decade.

To meet the 2030 and 2050 climate targets in the building sector, deep renovation needs to ramp up this decade. A policy instrument that effectively accelerates deep energy renovation while being fair to all citizens is therefore urgently needed. Well-designed minimum energy performance standards (MEPS) can meet these requirements and put the building stock on track to meet climate targets.

To be effective, however, this paper explains that MEPS must take a differentiated approach according to building type and ownership structure, and must be meet the following design principles:

• Address the worst-performing buildings first so that people see an immediate and meaningful impact.

• Be aligned with the owner’s ability to invest.

• Make requirements binding and foreseeable to accelerate innovation in the energy renovation supply chain.

• Have an effective compliance support and enforcement system.

• Define regular and frequent milestones.

To ensure that climate targets are reached, MEPS should apply to all building typologies, with an initial focus on worst-performing buildings. In absolute figures, the floor area of the worst-performing residential buildings is more than twice that of the worst-performing non-residential buildings. Because of this energy saving potential, MEPS should be applied to both residential and non-residential buildings.

The revision of the Energy Performance of Buildings Directive should therefore include these principles in its mandate to EU Member States and should avoid introducing exemptions which could lead to undermining the MEPS system. Any deviation from the principles should only be the case of buildings which fall under a heritage protection status in the Member States. In order to be effective, accessible and affordable, any MEPS scheme put into place must be implemented within a comprehensive ecosystem of supporting policy instruments tailored to the needs of the different target groups.

Energy efficiency in green recovery – Best practices and opportunities for Ukraine

Ukraine's plans for a sustainable and green recovery need to include energy efficiency standards. The DiXi Group together with BPIE, have brought together their EU expertise and best practices on energy efficiency in buildings, to develop an approach for Ukraine's reconstruction and recovery.

The issue of increasing energy efficiency in Ukraine is not new, as it has long been among countries with the highest energy intensity per GDP unit (e.g. twice as high as in Poland). In 2024, Ukraine joined the Energy Community to form a pan-European energy market with binding rules and principles, and in 2024 signed the Association Agreement with the European Union, committing to implement a number of acquis, in particular Directive 2022/27/EU Оn energy efficiency and Directive 2022/31/EU Оn the energy performance of buildings. In addition, in 2023, the country set a goal to halve energy consumption by 2030.

Ukraine has made significant progress in the fulfilment of obligations under the Association Agreement with the EU regarding the implementation of European legislation on energy efficiency. In recent years, a legislative framework aimed at reforming and supporting energy efficiency has been developed and adopted. (…)

In 2024, the issue of energy efficiency gained new value and strategic importance not only for low-carbon development and reliable energy supply, but also directly for the sovereignty and independence of the state. Due to Russia’s terrorist acts against energy facilities and blackmailing the civilised world with energy resources used as a weapon, the issue of reducing dependence on the imports of fossil fuels has become urgent, and energy efficiency has become a true integral component of energy security.

Moreover, for Ukraine, the issue of energy efficiency is cross-cutting in the reconstruction to ensure that this process is sustainable. In the first months of the full-scale invasion, the civil society in Ukraine developed the principles of green recovery, one of which is the development of a low-carbon, energy-efficient economy.

Ukraine is already adopting the European practice of buildings that consume a minimum of energy. Thus, the Concept and National Plan for the gradual increase in the number of nearly zero-energy buildings (NZEB) were adopted. According to the Plan, in the next five years, the creation of a regulatory and legal framework is expected, and after 2025 – the transition to new requirements for construction and commissioning of facilities. In addition, in 2022, the Verkhovna Rada of Ukraine adopted the Law to create conditions for complex thermal modernization of buildings, and in 2023, the Decarbonization and Energy Efficient Transformation Fund was created to finance energy efficiency programs and projects starting in 2024.

Combined with the need to rebuild the country after the Russian full-scale war, the necessity to secure the thermal modernization of buildings to address the climate crisis, and the future of Ukrainian accession to the EU, a lot of work shall be done in the Ukrainian buildings sector in the coming months and years.

Regulierung der Lebenszyklus-THG-Emissionen von Gebäuden – Empfehlungen für Deutschland

Auf Basis der Erkenntnisse aus den Vorreiterländern systematisiert der Bericht die identifizierten Bausteine für eine Lebenszyklus-THG-Regulierung, fasst zusammen, wo Deutschland dazu im Vergleich steht und leitet Empfehlungen für nächste Schritte ab.

Der Gebäudesektor ist verantwortlich für ca. 40 Prozent der THG-Emissionen, wenn man die grauen Emissionen (embodied carbon) mit einbezieht. Mit dem Leitfaden Nachhaltiges Bauen, der bereits im Jahr 2011 für Bundesbauten eine Ökobilanz vorschrieb sowie der Datenbank ÖKOBAUDAT, die im Zuge dessen aufgebaut wurde, hat Deutschland früher als viele andere Länder die Bedeutung einer Lebenszyklusperspektive erkannt.

Andere Länder haben Deutschland allerdings in der Zwischenzeit überholt. Die Niederlande, Frankreich, Dänemark, Finnland und Schweden haben einen rechtlichen Rahmen zur Offenlegung von bzw. Grenzwerte für Lebenszyklus-THG-Emissionen eingeführt. Die Analyse der Prozesse und Schritte, die von diesen Ländern unternommen wurden, legt nahe, dass es neben den wichtigen Grundlagen, wie Verfügbarkeit von Daten und Methoden, weiterer Bausteine bedarf, die für die Entwicklung und Umsetzung einer Lebenszyklusperspektive im Gebäudebereich erforderlich sind. Dazu gehören ein gut moderierter Prozess, der die Interessengruppen und den Wissensaustausch fördert, sowie zusätzliche unterstützende Politikmaßnahmen.

Mit diesen Erkenntnissen ausgestattet, empfiehlt der Bericht Schritte für die deutsche Politik. Dazu gehören u.a.:

• mutig die nächsten Schritte hin zu einer rechtlichen Verankerung von Lebenszyklus-THG-Grenzwerten gehen und damit die Klimaschutzpotenziale, die in einer Lebenszyklusperspektive stecken, zu heben, die Nachfrage anzukurbeln und der Industrie Planungssicherheit zu geben.
• Über eine kluge Architektur der Grenzwerte im Dashboard-Stil eine “Verrechnung” der THG-Emissionen aus der Betriebsphase mit den embodied carbon Emissionen verhindern und so zukünftig gegebenenfalls weitere Grenzwerte, beispielsweise für die Ressourcenschonung, integrieren zu können.
• für die Anfangsphase einen pragmatischen Ansatz für die Lebenszyklus-Bewertungsmethode nutzen, z. B. zunächst eine vereinfachte Ökobilanz mit voreingestellten Bauteilaufbauten.
• Klarheit über den Weg schaffen, indem Meilensteine für einen klimaneutralen Gebäudebestand festgelegt werden, die neben den betriebsbedingten Emissionen auch die embodied carbon umfassen (z.B. im Rahmen der vom BMWK in Entwicklung befindlichen Gebäudestrategie Klimaneutralität 2045).
• einen breiten Stakeholder-Prozesses initiieren, um die Einführung und Umsetzung von Lebenszyklus-THG-Grenzwerten zu begleiten (Ausgangspunkt könnte z.B. der neu aufgelegte Runde Tisch „Zukunftsgerechtes Bauen“ sein).
• gezielt Kapazitäten aufbauen und unterstützende Politikmaßnahmen nutzen, wie z.B. die Förderung von Produktdaten (EPD) oder biobasierten Materialien sowie re-use Konzepte.

Overcoming Financial and Market Barriers to Positive Energy Neighbourhoods

Positive Energy Neighbourhoods (PENs) have a huge potential to boost climate-neutral building stock but many barriers need to be confronted. From inflation, lack of funding or financial and construction sectors working in silos, many market barriers need to be addressed so PENs can reach their full potential.

he opportunities offered by PENs are far-reaching : a more climate-neutral building stock, improved comfort and public health for citizens, more climate resilient buildings and helping to alleviate energy poverty and contributing to our energy security. To make our renovation goals a reality while ensuring a just transition, PENs can be a big part of the solution going forward.

However there are still several market barriers to PENs that need to be dealt with. They are threatened by inflation and higher borrowing costs, dissuading citizens from renovation or making it out of reach. PEN pilots rely heavily on public funding, but more substantial private financing will be necessary for PENs to fully develop and scale up.

Sectors working in silos is also a significant market barrier. Construction and finance sectors continue to use different methods to assess investment risk and sustainability performance. PENs would benefit from a common approach for measuring, tracking and reporting projects’ environmental, social and governance (ESG) impacts, at both the building and the neighbourhood level. Extending the EU sustainable finance taxonomy to include both environmental and social criteria could help fully capture ESG benefits and foster investment in PENs.

This policy brief gives an overview of these market barriers to PENs and ways to address them going forward. The full potential of PENs can be realised but only with more guidance, adequate funding and policy support.

EU Buildings Climate Tracker: A call for faster and bolder action

The EU Buildings Climate Tracker, now in its second edition, confirms that the EU is facing a considerable gap in its progress towards climate neutrality. To achieve its 2050 goals, the EU must rapidly accelerate the rate of building decarbonisation.

The EU Buildings Climate Tracker (EU BCT) monitors the progress of the building stock in the European Union towards the goal of achieving climate neutrality by 2050, in the form of an index. This second edition analyses the progress of the EU building stock towards climate neutrality from 2015 until 2020.

The tracker finds that the EU building stock remains off track to achieve climate neutrality by 2050.

Compared to the previous results, the decarbonisation gap is slightly reducing, but not to the degree necessary to bring the sector on track towards climate neutrality. The tracker’s value for 2020 should be at 18.1 points but is only at 7.8, resulting in a gap of over 10 decarbonisation points. This significant gap means that the effects of policies and support programmes to decarbonise EU buildings must urgently increase in the coming years. 4.7 points of progress in the decarbonisation of the EU building stock are now required every year to get on track by 2030.

The analysis for the CEE countries shows an even more worrying trend: by 2020 the progress to decarbonise the building stock is 21 points off the required decarbonisation path, the largest gap since the beginning of the tracker period in 2015. This requires a significant increase of efforts to implement effective policies in the near future. Based on the current situation, 5.7 points of progress in decarbonisation are required every year in the CEE region to get on track by 2030.

Key findings

The tracker corresponds to an index composed of a set of five indicators monitoringCO₂ emissions, final energy consumption, renewable energy share, investments in renovation, and domestic energy expenditures.  When looking at the progress between 2015 and 2020, the results for most of the indicators show a gap between the current status and the values required to be on track towards climate neutrality.

• In 2024, CO₂ emissions from energy use in buildings reached 422 Mt CO₂, more than 18% higher than the required goal value. The reduction of CO₂ emissions from the EU building stock is clearly off track.
• The share of renewable energies for heating and cooling was around 30% lower than required, which calls for a clearer roadmap to decarbonise the heating and cooling sector.
• Accumulated investments in renovation in 2024 were 40% lower than required.
• Energy expenditures per household were close to achieving the targeted values in 2024, but the subsequent increase in energy prices may negatively impact this indicator. The consequences of not reducing household energy expenditures can be significant, especially in regions with high energy poverty levels like the CEE region, where house

Building back better: 6 investment criteria to drive a sustainable reconstruction of Ukraine’s built environment

Following the “build back better” principle, BPIE presents in this publication six investment criteria to guide a sustainable reconstruction of Ukraine's heavily damaged built environment. The report calls on multilateral donors and the Ukrainian government to allocate funding to projects that meet ambitious energy efficiency, renewable energy, climate adaptation, and circularity criteria.

The Russian Federation’s war of aggression against Ukraine has caused enormous damage on a multitude of levels. A recent assessment from the World Bank shows the massive extent to which the Ukrainian building stock has been affected by the war. For the housing sector alone, the total cost of the damage exceeds an estimated USD 55.9 billion, while more than USD 80.3 billion is needed for reconstruction.

Following the “build back better” principle, this report stresses that reconstruction that should strengthen the entire Ukrainian energy system. Reconstructing the Ukrainian building stock will also support the country’s accession process to the EU, create an environment where people can thrive and attract people to return to home.

The six investment criteria proposed by BPIE are aligned to scenarios representing different levels of damage (minor, moderate and heavy):

1. Investments should be directed towards projects that consider minimum energy efficiency requirements for individual building elements. 

2. Buildings damaged during the war should not be exempted from minimum energy efficiency requirements.

3.  Investments should be directed towards projects that involve technical building systems based on renewable energy solutions.

4. Investments should be directed towards projects that improve the entire energy performance of buildings.

5. Investments should be directed towards projects that support climate change adaptation.

6. Investments should be directed towards projects that address material circularity.

The ‘build back better’ principle, when applied to buildings, is aimed at accelerating the energy transition and the decarbonisation of the building stock after major disaster. Multiple EU Member States, such as Croatia, Italy or Germany, after facing natural disasters, have based their recovery and reconstruction programmes on this principle, and designed strategies that include energy efficiency goals.

Multilateral donors are encouraged to allocate funds to projects that address the entire energy performance of buildings, taking the Nearly Zero -Energy Buildings (NZEB) standard as a benchmark. The Ukrainian government is also encouraged to accelerate implementation of the legal framework for energy efficiency and sustainable construction standards.