Explanatory Memorandum to COM(2016)765 - Amendment of Directive 2010/31/EU on the energy performance of buildings - Main contents
Please note
This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2016)765 - Amendment of Directive 2010/31/EU on the energy performance of buildings. |
|---|---|
| source | COM(2016)765  |
| date | 30-11-2016 |
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
"Energy efficiency first" is a key element of the Energy Union – this proposal puts it into practice.
One of the ways to improve energy efficiency is to tap the huge potential for efficiency gains in the building sector which is the largest single energy consumer in Europe, absorbing 40% of final energy. About 75% of buildings are energy inefficient and, depending on the Member State, only 0.4-1.2% of the stock is renovated each year.
The main objective of this proposal is to accelerate the cost-effective renovation of existing building, which represents a win-win option for the EU economy as a whole. As a matter of fact, the European construction industry has the potential to respond to a number of economic and societal challenges such as jobs and growth, urbanisation, digitalisation, demographic changes, and at the same time energy and climate challenges.
The construction industry generates about 9% of European GDP and accounts for 18 million direct jobs. Construction activities that include renovation work and energy retrofits add almost twice as much value as the construction of new buildings, and SMEs contribute more than 70% of the value added in the EU building sector 1 .
In line with the above mentioned objectives, this proposal will update the Energy Performance of Buildings Directive ('EPBD' 2 ) by:
• integrating long term building renovation strategies (Article of 4 Energy Efficiency Directive), supporting the mobilisation of financing and creating a clear vision for a decarbonised building stock by 2050;
• encouraging the use of ICT and smart technologies to ensure buildings operate efficiently; and
• streamlining provisions where they have not delivered the expected results.
Contents
- More specifically, it introduces building automation and control systems as an alternative to physical inspections, encourages the roll-out of the required infrastructure for
- Key findings
- Scope for improvements
- No-change option
- Policy options
- Option I: Enhanced implementation and further guidance
- Option II: Enhanced implementation, including targeted amendments for strengthening current provisions
- Option III: Enhanced implementation with further harmonization and higher ambition
More specifically, it introduces building automation and control systems as an alternative to physical inspections, encourages the roll-out of the required infrastructure for
Better performing buildings provide higher comfort levels and wellbeing for their occupants and improve health by reducing mortality and morbidity from a poor indoor climate. Adequately heated and ventilated dwellings alleviate negative health impacts caused by dampness, particularly amongst vulnerable groups such as children and the elderly and those with pre-existing illnesses.
The energy performance of buildings also has a major impact on the affordability of housing and energy poverty. Energy savings and efficiency improvement of the housing stock would enable many households to escape energy poverty. This proposal could contribute to taking out from energy poverty between 515 000 and 3.2 million households in the EU (from a total of 23.3 million households living in energy poverty - Eurostat).
To ensure that this proposal has maximum impact, the Smart Finance for Smart Buildings initiative will contribute to mobilise and unlock private investments in a larger scale. Relying on the Investment Plan for Europe, including the European Fund for Strategic Investments and the European Structural Investment Funds, this initiative will support the effective use of public funds, support promoters and investors to bring good ideas to maturity with more project development assistance and project aggregation mechanisms. Ultimately, the Smart Finance for Smart Buildings initiative will contribute to generate trust and attract more investors to the energy efficiency market.
This proposal takes into account the results of a review process based on a broad public consultation, studies, and meetings with stakeholders and is supported by an evaluation and an impact assessment.
Only those articles of the Directive which need to be updated to reflect the 2030 timeframe are included in this proposal.
• Consistency with existing policy provisions in the policy area
The evaluation carried out in advance of this review concluded that the EPBD is consistent with other pieces of EU legislation. The proposal is also coherent with the other elements of the Clean Energy for All Europeans package, such as the new Governance regulation and the update of legislation on renewable energy. The EPBD will directly contribute to the proposed Energy Efficiency Directive (EED) target of a 30% increase in energy efficiency by 2030. It complements measures that Member States are required to take under the EED as well as EU legislation on energy efficiency of products. Ecodesign and energy labelling legislation set requirements for the energy efficiency of building-related products such as boilers, while Member States set minimum requirements for the energy performance of installed retrofitted or replaced building elements under their national building codes. Building elements usually consist of several products, e.g. a heating system is made up of a boiler, piping and controls. Consistency is ensured on a case-by-case basis during the process of developing specific ecodesign and/or energy labelling implementing measures, bearing in mind the requirements of the EPBD. For instance, it was decided not to set ecodesign requirements for thermal insulation as they are already well covered by the national implementation of the EPBD.
2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
• Legal basis
The EPBD is based on Article 194(2) of the Treaty on the Functioning of the European Union, which provides a legal basis for a Union policy to promote energy efficiency and energy saving. As the Treaty contains a specific energy-related legal basis, it is considered appropriate to use it for this proposal.
• Subsidiarity (for non-exclusive competence)
There are several reasons why a collective EU approach is beneficial.
First, the added value of addressing building energy performance at EU level resides mainly in the creation of an internal market, supporting the EU’s competitiveness and taking advantage of synergies with climate policy and the modernisation of national regulations in the building sector across the EU.
Second, the finance sector needs more comparability of energy performance measurements across the EU. Financial institutions have clearly indicated that work is needed at both national/local and EU levels to increase public and private investments' effectiveness and to contribute to the development of attractive financing products on the market.
Third, although countries have different building code requirements, building typologies and local and climatic conditions, there are multinational users too. Owners of service-providing chains (such as supermarkets or hotels) have requested more unified and comparable methods of certification of the energy performance of buildings.
Finally, EU action leads to a modernisation of national regulations in the building sector, opening wider markets for innovative products and enabling cost reduction. Before the adoption of the 2002 EPBD, many Member States did not have energy efficiency requirements or promotional instruments in their regulation and building codes. As a result of the 2002 and 2010 Directives, all Member States have now energy efficiency requirements for existing and new buildings in their building codes. The 2010 EPBD has resulted in significant modernisation of national building codes through the introduction of the concept of cost optimality, followed by the adoption of nearly zero energy requirements.
The proposed amendments respect the principle of subsidiarity, and Member States will retain the same flexibility as today, allowing adaptation to national circumstances and local conditions (e.g. building type, climate, costs of comparable renewable technologies and accessibility, optimal combination with demand side measures, building density, etc.).
• Proportionality
In accordance with the principle of proportionality, the proposed modifications do not go beyond what is necessary to achieve the objectives set.
As explained above, EU policies on energy efficiency have expanded prudently, limiting their intervention to areas where they are necessary to achieve the Energy efficiency objectives. This is covered in Section 3 of the impact assessment. The scope of the amendments is limited to the aspects that require EU action.
• Choice of the instrument
A Directive is the appropriate instrument to ensure Member States comply while leaving them the margin of manoeuvre adapting to the different national and regional specificities. A regulation would not allow for this element of flexibility. Several Member States and stakeholders made it very clear during the consultation that this combination of enforcement and flexibility is the best combination and the right instrument for policies in this field.
Furthermore, as this proposal amends an existing Directive, an amending Directive is the only appropriate instrument.
3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS
• Ex-post evaluations of existing legislation
The evaluation shows that the Directive is effective and is delivering on its general and specific objectives. Implementation to date shows broadly good performance on the other four analysed criteria: efficiency, relevance, coherence, and EU added value.
The evaluation identified the following key findings and lessons regarding implementation and the scope to improve the functioning of certain provisions and take advantage of technological progress to accelerate the decarbonisation of buildings.
There is evidence of around 48.9Mtoe additional final energy savings in 2014 compared to the 2007 baseline of the EPBD. These savings occurred mainly within the scope of the EPBD – space heating, cooling and domestic hot water – and a significant part can be attributed to factors influenced by policy interventions.
The figure of 48.9Mtoe in 2014 seems therefore in line with the 2008 Impact Assessment supporting the EPBD which estimated that the EPBD would deliver 60 to 80Mtoe of final energy savings by 2020.
The evaluation shows that the overall architecture of the Directive, combining minimum requirements and certification, is working, in particular for new buildings. The choice of the cost-optimal methodology to steer existing national energy performance requirements towards cost-efficient levels has proved to be an effective approach.
Targets for all new buildings to deliver nearly zero-energy consumption by 2020 have ensured a future-proof vision for the sector and stakeholders have mobilised accordingly. However, the same level of ambition is missing for existing buildings.
Consequently, a considerable cost effective energy saving potential subsists in the building sector. Increasing the rate, quality and effectiveness of building renovation is the biggest challenge for the coming decades. The long-term renovation strategies developed by Member States under Article 4 of the EED should result in increased renovation rates through mobilising finance and investments in buildings’ renovation. These strategies should include a clear forward looking vision with 2030 and 2050 perspectives, sending sufficient market signals to households, building owners/managers, businesses and investors.
The certification of the energy performance of buildings is delivering a demand-driven market signal for energy efficient buildings and is achieving its aim of encouraging consumers to buy or rent more energy efficient buildings. However, the evaluation shows that national certification schemes and independent control systems are still at early stages in several Member States and their usefulness could be improved.
Due to the diversity and disaggregation of the building sector value chain, it remains challenging to acquire reliable data on building characteristics, energy use, and financial implications of renovation in terms of cost savings or asset values. This generalised lack of data has negative consequences on the market perception of the cost-effective energy saving potential of the EU building stock, and on the enforcement, monitoring and evaluation of the Directive. Existing energy performance certificate ('EPC') registers/databases can be a key instrument for reinforced compliance, improving knowledge of the building stock and better informing policy makers and supporting the decisions of market players.
The evaluation reveals relatively limited regulatory failures. There is, however, scope for simplifying and streamlining outdated requirements, and for enhancing compliance through fine tuning of existing provisions and better linking them with financial support. Additionally there is a need to modernise the Directive in the light of technological developments and to increase building renovation rates while supporting the decarbonisation of buildings in the long-term.
The evaluation identifies aspects of the national transposition and implementation that could be further developed through better enforcement, compliance monitoring and evaluation. Opportunities for simplification or modernisation of outdated provisions and streamlining existing provisions in the light of technological progress were also detected, in particular:
– the requirement to assess the technical, environmental and economic feasibility of high-efficiency alternative systems under Article 6(1) of the EPBD is effectively redundant because the obligation for all new buildings to be nearly zero-energy buildings implicitly requires an assessment of locally available high-efficiency alternative systems. That requirement of Article 6(1) becomes an unnecessary burden and is therefore deleted;
– the regular inspection of heating and air conditioning systems under Articles 14 and 15 of the EPBD ensures that buildings operate efficiently over time. The option of alternative measures is deleted as these have not proven to be effective and is replaced by the possibility of electronic monitoring and control systems which have been found to be a cost effective alternative to inspections.
In fact, technological progress towards ‘smarter’ building systems offers opportunities to support a more efficient implementation of the EPBD and also creates enabling conditions: to provide information to consumers and investors on operational energy consumption; to adjust to the needs of the user; to run the efficient and comfortable operation of the buildings; its ability to connect to electric vehicle charging; to host energy storage, and to support demand response in a modernised electricity market.
• Stakeholder consultations
The evaluation began in June 2015. It looked at past and current performance and was based on the assessment of outcomes, results and impacts of the EPBD with a view to its effectiveness, efficiency, relevance, coherence and the added value of action at EU level. A literature review, information on the implementation of current policies, analyses of previous monitoring and evaluation activities, input from stakeholders and specific studies and projects were the main sources of information.
Stakeholders were consulted through:
– an open internet-based public consultation that ran from 30 June 2015 to 31 October 2015;
– more specific consultation of Member States, according to the terms of Article 19 of the Directive, was organised in particular through the EPBD Concerted Action meeting on 26 and 27 November 2015, and a meeting of the Energy Performance of Buildings Committee on 1 February 2016;
– thematic technical workshops on specific topics that were held from June 2015 to January 2016;
– stakeholder event on 14 March 2016.
The internet consultation closed on 31 October 2015 and summarised results of the 308 response are available on line 3 . More than half (58 %) of respondents were organisations, mainly representing the construction sector industry, followed by companies (20 %) operating in Member States. Individuals, public authorities and others represent 7-8 % of the respondents.
Overall, most respondents consider that the EPBD established a good framework for improving energy performance in buildings and that it has raised awareness on energy consumption in buildings, giving it a more prominent role in energy policy. Its contribution to 2030 and 2050 energy and climate targets was recognised. A majority of respondents think that the EPBD has been successful while a third believes it has not. Several respondents said that it is too early to say how successful the EPBD has been as it is difficult to isolate its effect. Others consider that the EPBD is not as effective as it could be, considering the huge potential for improving energy consumption that remains in the building sector.
The negative responses mentioned as reasons for limited effectiveness the delayed and inconsistent implementation in the Member States, poor quality of EPCs, slow uptake of measures and a low renovation rate, as well as the missing definition of nearly zero-energy buildings and the need for an improved use of financing instruments. Several respondents also highlight poor compliance and enforcement of measures while others recognise that the economic crisis in the construction sector has slowed improvements. Several respondents stated that while the EPBD has been successful in improving energy performance for new buildings it does not sufficiently incentivise energy efficiency renovations.
• Collection and use of expertise
Information on the implementation of the EPBD is also available from the work of the EPBD Concerted Action 4 , the regular dialogue with Member States and the work of the Energy Performance of Buildings Committee.
The outcomes of projects funded under the Energy efficiency chapter of Secure, clean and efficient energy under H2020 and its predecessor the Intelligent Energy for Europe programme were analysed 5 and referenced where relevant.
In addition to the consultation activities undertaken by the European Commission, the evaluation made use of other sources of information, e.g. research papers identified through literature review.
• Impact assessment
The impact assessment was submitted twice to the Commission’s Regulatory Scrutiny Board. A draft dated 1 July 2016 received a positive opinion on 26 July. The executive summary of the impact assessment and the two opinions of the Board can be found on the Commission’s website 6 .
The following options were considered by the impact assessment:
The no-change of the EPBD option means no additional measures beyond the existing ones. It implies that the current EPBD and related regulatory and non-regulatory instruments continue to be implemented as now. This approach could be complimented by measures to maximise the EPBD's impact. Sharing of good practices, stimulated by exchange platforms (e.g. Concerted Action), could help to improve compliance. It is assumed that under the no-change option, this work would continue.
Most of the proposed measures can be implemented via soft law (Option I) and/or targeted amendments (Option II). Some measures go beyond the current legal framework and would require fundamental revision of the current Directive (Option III).
This option considers a set of proposals that enhance the implementation of the existing regulatory framework without amending the Directive. It builds on the work being done at EU, national and regional levels to actively implement the Directive. It goes one step further than the no-change option, proposing soft law and guidance that could improve the implementation and enforcement of the legislation and could encourage the use of voluntary measures which have not yet been explored by Member States.
Option II: Enhanced implementation, including targeted amendments for strengthening current provisions
This option includes the Option I proposals, but goes beyond and requires targeted amendments of the current EPBD to address the problem drivers more extensively. However, contrary to Option III, this option stays in line with the framework of the current EPBD, with better information provided to the end-users and adequate minimum performance requirements that avoid sub-optimal intervention on buildings.
This policy option is the most ambitious one, and goes beyond the current approach of the EPBD, by requiring for building owners to renovate their buildings.
The comparison of the three options led to the following conclusions:
– Option I focusses on continuous enforcement of the current EPBD, while supporting Member States by providing guidance and support. The ability to address possibilities for improvement identified in the evaluation report and public consultation to further enhance the removal of barriers to energy efficiency in buildings will not be fulfilled.
– Option III includes ambitious measures for increasing the renovation rate and therefore the resulting impact is very high. It introduces a significant change in the building sector, in particular by making mandatory the renovation of thousands of buildings. However, this measure raises some issues such as obligatory investment, which might not be considered cost-effective in a financial perspective. It also raises practical concerns (e.g. further harmonisation of energy performance calculation methodologies, or EPCs) and may be thought to not fully respect the principle of subsidiarity (e.g. obligations to renovate buildings when changing ownership or tenancy, public financial support for mandatory thermal building renovation and mandatory training for builders and installers).
– Option II is the preferred option because it is best aligned with the outcome and findings of the evaluation of the EPBD and the existing framework. This option introduces significant improvements and simplifications to the EPBD and the overall regulatory framework and will improve the energy performance of buildings via targeted amendments whilst allowing a high level of flexibility for the implementation at national level, as follows:
– It allows keeping the existing prudent scope underpinning EU action on building efficiency whilst ensuring subsidiarity, proportionality and cost-effectiveness and leaving significant flexibility with Member States.
– It preserves the main objectives, principles and overall architecture of the Directive which is working well and is supported by stakeholders, including Member States.
– It includes only targeted amendments, allowing the continued implementation of key provisions in the current Directive that are already delivering and are cost-effective.
– It strikes a balance between guidance and limited legal revisions to introduce new focussed provisions to address in particular existing building and the link to finance.
Following up on the European Strategy for Low-Emission Mobility and building upon the leading example of some Member States, the preferred option also proposes a measure to support the development of electro-mobility and contribute further to the decarbonisation of the economy.
The estimated impacts are the following:
– Economic impact: a slightly positive impact on growth, driven by the extra energy efficiency investment and reduction in energy imports, a boost to construction and engineering which are highly related to additional investment, positive impacts on the insulation and flat glass sector and investment in building renovation benefiting especially SMEs.
– Social impact: the employment impact will follow a similar pattern to GDP, albeit smaller in scale. Improvements to the indoor climate will significantly reduce mortality, morbidity, and health care costs. A moderate positive impact is expected on energy poverty.
– Environmental impact: greenhouse gas emissions decrease slightly in all Member States.
• Regulatory fitness and simplification
Taken together, the measures of the preferred policy option would reduce the administrative burden of the EPBD by EUR 98.1 million per year. The calculation of the impact on administrative burden for the preferred option can be found in Annex 9 to the Impact assessment.
4. BUDGETARY IMPLICATIONS
The proposal does not have any implication for the EU budget.
5. OTHER ELEMENTS
• Implementation plans and monitoring, evaluation and reporting arrangements
This proposal makes no change to the Member States' current reporting obligations. The legislative proposal on Energy Union governance will ensure that a transparent and reliable planning, reporting and monitoring system will be put in place, based on integrated national energy and climate plans and streamlined progress reports by Member States, regularly assessing the implementation of national plans in terms of the five dimensions of the Energy Union. This will ease the administrative burden on Member States but still allow the Commission to monitor Member States' progress towards their energy efficiency targets and the overall EU target.
The proposal introduces new obligations that will be monitored under decarbonisation of buildings, building renovation, technical building systems, financial incentives and market barriers, while it will simplify obligations for new buildings, on inspections and reports for heating and air-conditioning systems.
• Detailed explanation of the specific provisions of the proposal
The proposal for a Regulation on the Governance of the Energy Union aims to reduce and streamline Member States' reporting and planning obligations as well as the Commission's monitoring obligations. The Governance proposal will also set up an iterative process between Member States and the Commission in order to collectively meet the objectives of the Energy Union. The plans and reports required under the Governance proposal should enable the Commission to assess and monitor the progress of Member States in reaching the objectives of the Directive.
The Directive is amended as follows:
– the definition of technical building systems under Article 2(3) is extended to on-site electricity generation and on-site infrastructure for electro-mobility;
– the current Article 4 EED on building renovation is moved to this Directive for greater consistency, and will include additionally the consideration of energy poverty issues, support for smart financing of building renovations and a vision for the decarbonisation of buildings by 2050, with specific milestones in 2030. The long-term building renovation strategies will become part of (and annexed to) the integrated national energy and climate plans and will be notified by Member States to the Commission by 1 January 2019 for the period post 2020 following the procedure set out in the Regulation on the Governance of the Energy Union. The strategy will cover the renovation of the national stock of residential and non-residential buildings;
– Article 6 on new building is simplified by limiting it to the provision identified in the impact assessment as the most useful, i.e. the general obligation for new buildings to meet the minimum energy performance requirements. Other provisions that were more cumbersome are deleted;
– Article 8 is updated to take into account the revised definition of technical building systems. A new paragraph introduces requirements as regards:
(a)infrastructure for electro-mobility; new non-residential buildings with more than ten parking spaces, and non-residential buildings with more than ten parking spaces undergoing major renovation will have to equip one parking space per ten for electro-mobility. This will apply to all non-residential with more than ten parking spaces buildings as of 2025, including buildings where the installation of recharging points are sought under public procurement. New residential buildings with over ten parking spaces, and those undergoing major renovation, will have to put in place the pre-cabling for electric recharging. Member States will be able to choose to exempt buildings owned and occupied by SMEs, as well as public buildings covered by the Alternative Fuels Infrastructure Directive 7 ;
(b)reinforcing the use of building electronic monitoring, automation and control in order to streamline inspections; and
(c)the introduction of a ‘smartness indicator’ rating the readiness of the building to adapt its operation to the needs of the occupant and of the grid, and to improve its performance.
– Article 10 is updated to include two new provisions on using EPCs to assess savings from renovations financed with public support are to be assessed by comparing EPCs before and after renovation; and public buildings with a surface over a certain threshold must disclose their energy performance;
– Articles 14 and 15 on inspections are streamlined, while more effective approaches to regular inspections are implemented with the updated Article 14 and 15, and could be used instead to ensure that building performance is maintained and/or improved; and
– Annex I is updated to improve transparency and consistency in the way energy performance is determined at national or regional level and to take into account the importance of the indoor environment.