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11/07/2017

Ludovic Deblois' Column - Thermal renovation in buildings

The homes and buildings in which we live, work, and spend our time are undergoing a revolution. The buildings of tomorrow will bear little resemblance to those of today. That’s because they’re at the heart of a three-pronged energy revolution: self-consumption, positive energy, and thermal renovation. Here’s the third and final instalment in our look at what lies ahead: thermal renovation.

In Europe, buildings consume more energy than any other single sector. According to the European Union, buildings account for 40% of total energy consumption and 36% of greenhouse gas emissions. Which means that in order to make the necessary energy transition and effectively tackle climate change, the buildings we live and work in are an obvious target for priority action.

The task is easier with new buildings. The techniques and technologies already exist. A regulatory framework for transition objectives and practiceshas been established by the EU and its member states.

Switching into High Gear

But the bulk of the work to be done is on existing buildings, and the pace of retrofitting is slow. Indeed, only 1% of existing structures are renovated per year, on average. At that rate, it would take a century to make all the necessary improvements. But “Factor 4,” a legally binding target that would see industrialized nations — including France — reduce their greenhouse gas (GHG) emissions by 80%, is set for 2050. What’s more, French minister Nicolas Hulot recently upped the ante: he wants to make 2050 the year France achieves carbon neutrality. That means France would commit to completely eliminating net greenhouse gases emissions by 2050. The objective for EU member states, meanwhile, is an 88%–91% reduction in GHG emissions produced by buildings (compared with 1990 levels) by 2050.

This means the sector needs to switch into high gear. According to Buildings Performance Institute Europe (BPIE), “in order to reach the ultimate objective of transforming the existing building sector into a sustainable one by 2050, renovation rates need to ramp up from the prevailing rate of around 1% of the total floor area renovated annually, to around 3% p.a. from 2020 onwards.”

335 Million Square Meters of “Public” Space to Renovate

One need only consider the current state of French public buildings to realize there is much room for improvement. “Perpetually neglected by public policy, the retrofitting of public buildings is essential to a successful energy transition,” notes economist Alain Grandjean. The numbers speak for themselves: 335 million square meters of low‑efficiency buildings using a total of 70 TWh of energy and emitting 12 million tonnes of CO2. Many public servants work in substandard conditions. The energy expenditures of these buildings, in this day and age, amounts to squandering.”

Most European countries have strategies in place for renovating their public buildings, pursuant to Article 4 of the 2012 directive on energy efficiency. Implementation of these strategies was subject to a thorough review by BPIE in 2014–2015; countries were then ranked based on their performance. Romania, the U.K., Spain, and the Czech Republic were all at the head of the pack, with Austria bringing up the rear. France, Germany, Denmark, and the Netherlands were all middle‑of‑the‑road contenders.

There is still a long way to go and many obstacles along the way. In France, for example, a decree on thermic renovation that had been eagerly awaited for years was finally published on May 10, 2017. Next thing you know, professional associations representing retailers and hoteliers were contesting it in court. The arguments? Too expensive, not enough time to comply. The mayors of France, via their association (AMF), also expressed concern regarding the ambitious order and its looming deadlines, such is their lack of resources. Consequently, the Conseil d’Etat ruled in favour of the plaintiffs and temporarily suspended the decree, even though it had been seven years in the making.

Renovation Pays

With any luck, such obstacles won’t alter the course of things in the long run. The decree calls for tertiary‑use buildings measuring more than 2000 sq. m. to reduce their energy consumption by 25% by 2030 and by 60% by 2050. Building lessees would also need to educate their staff about energy efficiency. The measures are intended for office and administrative buildings, schools, hotels, and retail spaces. The best estimates put the investment at €4.1 billion for the public sector and €3.5 billion for the private sector. Experts were quick to point out that the renovations would eventually pay for themselves — within ten years for public buildings and five years for businesses, give or take — meaning they would truly be an investment, not a mere cost.

France’s Minister for the Ecological and Inclusive Transition, Nicolas Hulot, tabled a climate plan that runs along these same lines. The Minister also champions the view that the renovations, rather than being a cost, are an investment.

France, Germany, and Italy Stand to Benefit

Clearly, France, Germany, and Italy all have an ace up their sleeve in the form of thermal renovation. The construction industry in those three countries alone employs nearly 5 million people — over 40% of total construction jobs for all of Europe. According to Coalition France pour l’Efficacité énergétique (CFEE), the building sector accounts for over 10% of all jobs in France, the financial sector aside.

Value added by the construction industry. Ranking of 10 top member states in 2011.

CFEE also points out that the value the sector adds comes not just from new construction, but also from renovations.

Value added by the construction industry (EU — 2011)

study commissioned by BPIE (“Buildings modernisation strategy: Roadmap 2050”) tallies up the likely benefits of the investments in thermal renovation. The numbers leave little room for doubt. In Poland, energy savings could reach 26% in 2030 if a thermal renovation program is implemented.

Good for the Public Purse

BPIE also cites the U.S. Environmental Protection Agency (EPA), which pegs the economic benefits of thermal renovation at 1.5 times the energy savings. Another example: in the Czech Republic, a €780 million investment in passive houses created 19,000 new jobs and generated state revenues of €2.47 for every euro invested.

In Germany, a €1.4 billion investment in thermal renovations of industrial sites and the construction of passive houses generated €7.2 billion in state revenue. In Poland, the Polish Foundation for Energy Efficiency estimates that a national energy savings plan for buildings could create between 84,000 and 250,000 jobs in the construction industry by 2020.

Of course, the benefits of thermal renovation extend well beyond the economic realm. Thermal renovation would reduce fuel poverty, which is defined as spending 10–20% of a household budget on heating (or air conditioning, in the summer). It would also improve the quality of indoor air and help fight climate change. The regulatory framework is ready, and so is the technology. All that’s missing are the financial stimuli to set the wheels in motion. For France, and for most other countries in Europe, change is right around the corner.