2040 climate target: Efficient buildings driving EU’s path to climate neutrality

We welcome the European Commission’s new Communication on the 2040 climate target. It is a crucial step on the path to climate neutrality by 2050.

Buildings are at the heart of this transition. As one of the largest GHG emitting sectors, the role of buildings is pivotal to reaching the 2040 and 2050 climate goals.

According to the European Commission’s 2024 Impact Assessment:

• We must achieve 35–38% energy savings in buildings by 2040, increasing to 40% by 2050.
• We need a rise in the investment-to-GDP ratio of 0.4 percentage points in 2031–2040.

Energy efficiency, especially renovation, is the main lever to deliver these savings. Ambitious and coherent policy frameworks will be critical to unlock the necessary investment and innovation.

Electricity will become the backbone of the building sector. The Commission projects over 67% of energy demand to be met by electricity by 2050.

Direct emissions from buildings must fall from 450 MtCO₂ in 2015 to just 190 MtCO₂ by 2030, which is a 57% cut in 15 years.

Long-term visibility is fundamental for companies to plan, invest, and scale the solutions needed to drive the transition. Clear policy direction to 2040 gives the private sector the confidence to act boldly.

We look forward to working with policymakers and industry partners to help make this vision a reality.