The economic case supporting ambition in the EPBD

The EU cannot afford inefficient buildings. Years of inaction on energy efficiency in the building sector are having a dramatic impact on households and public finances. Energy bills were expected to triple in some Member States compared to previous years, exposing millions to the risks of energy poverty and/or the inability to make mortgage payments. In turn, this becomes a credit risk for banks, as demonstrated by the European Central Bank climate stress test of July 2022.

A Bruegel assessment indicated that around 4% of EU GDP had already been spent by Member States on subsidising energy bills. This amount is greater than the Commission’s own assessment of how much would be needed per year to double deep energy renovation in the EU.

Support is already on the table. There has never been as much financial support available for households and businesses as today, at European level with the future Social Climate Fund and at national level with programmes such as MaPrimeRenov’ in France, the ‘Sanierungsscheck’ in Austria, ‘New Green Savings’ in Czechia and the Superbonus in Italy.

Ambition in the EPBD is good for growth and job creation. Minimum Energy Performance Standards provide much needed medium- and long-term market visibility, and 18,000 jobs are created per €1 billion invested in energy efficiency. For example:

• Croatia: the multiplier of the funds invested in the energy saving renovation of residential and public buildings is estimated at 2.5-2.9
• Estonia: an average of 17 jobs generated per €1 million invested in renovation
• France: the deep renovation of 7.4 million inefficient dwellings (class F-G) by 2025 would create 126,000 net FTE jobs
• Germany: an employment potential of 283,185 additional jobs to achieve the 2050 targets
• Italy: the Ecobonus programme could help create over 1.7 million jobs over a 10-year period
• Poland: €1 million invested in energy efficient renovation could generate 42 jobs

Beyond energy savings, energy efficiency measures provide multiple benefits such as better indoor environmental quality, greater comfort, improved health and wellbeing as well as increased productivity: investing millions to save billions.