Business and Investor Letter on the Energy Performance of Buildings Directive

We are writing to you as leading business and investor networks to highlight the importance of the ambitious reform of the EU Energy Performance of Buildings Directive (EPBD). This key legislation under the Fit for 55 Package is the pre-condition for decarbonising the buildings sector. As such, an effective EPBD is vital for a secure, prosperous Europe that addresses the cost-of-living and heating crises for European residents and achieves its climate and energy goals.

In 2020, about 36 million Europeans were unable to keep their homes adequately warm due to a combination of factors, in particular: low incomes; high-energy expenses; and poor energy efficiency in buildings. This winter, this number is expected to increase due to the cost of living and energy crises.
Improving buildings’ energy performance will combat this to deliver clear social benefits. Ambitious retrofitting also makes strategic and fiscal sense: it will reduce reliance on energy imports and the cost of energy price guarantees. It is also critical if the EU is to achieve its climate and energy targets, as the buildings sector is responsible for 40% of total energy consumption and 36% of emissions in the EU. Addressing the EU’s inefficient building stock can also be a positive stimulator of growth: for every €1 million invested in building energy renovation, an average of 18 local, long-term jobs are created.
Recent economic models also show that renovating Europe’s building stock with energy efficiency measures such as thermal insulation, connection to efficient district heating and cooling systems and electrifying the heating supply with heat pumps will help create 1.2 million net additional jobs and 1% GDP increase by 2050.

In this context, we urge you to take an ambitious and robust position on the Energy Performance of the Buildings Directive in the ITRE committee vote on 09 February. The position which has been agreed by the rapporteur and shadow rapporteurs on energy performance standards and
certificates is an important step in this direction. It will help deliver the depth and rate of renovations required in the EU’s Renovation Wave Strategy. It will provide significant improvements to the lives of millions of inhabitants in Europe, support energy security, help achieve the EU’s climate and energy ambitions, and boost the EU’s skilled green jobs.

Businesses and investors see the opportunities and necessity to deliver and accelerate private sector investment in buildings’ energy efficiency, and deep retrofits. To do this, we urgently need a clear enabling policy environment. Minimum energy performance standards (MEPS) for both residential and commercial buildings will play a key role in the revision of the EPBD. At the same time, progressively harmonising the Energy Performance Certificate system to make it easier to plan and measure progress across EU building stock. The position agreed by the rapporteur and shadow
rapporteurs does precisely this.

We emphasise that addressing the EU’s inefficient building stock can no longer be delayed and is a critical piece in ensuring Europe’s future security and prosperity. With a combination of strong and robust EU legislation through the EPBD, targeted national policy and subsidy schemes, business and investor solutions, it will be possible to implement significantly improved targets for the energy performance of buildings. In the Annex of this letter, we provide a list of business solutions to increase energy efficiency in buildings, research insights on national policies that can support stepping up the decarbonisation and energy efficiency in buildings, as well as mechanisms to accelerate investments in this key sector.

The European Parliament has so far played a key leadership role in setting the EU’s climate action. We welcome the work which the Parliament is doing to lead the way in the buildings sector and look forward to seeing the rapporteur and shadow rapporteurs’ position confirmed in the ITRE vote on February 09th. We repeat that business and investors are ready to play their part in this transition.
We remain at your disposal to further discuss ways to deliver a sustainable and fair climate transition in Europe.