Insulation of a multi-storey building in Riga. Photo: © fotokaleinar /

Energy savings in buildings – an untapped potential

Heating and cooling of buildings is behind a third of CO2 emissions in the EU. Less than 1% of the stock is renovated each year; member states must step up and increase the pace.

Buildings account for 40 percent of Europe’s energy consumption and are responsible for more than 33 percent of the bloc’s CO2 emissions. Inaction in the building sector in recent years has already cost the EU four years of potential progress towards the climate neutrality goal1. The current recast of the Energy Performance of Buildings Directive (EPBD) is not only vital for achieving the EU’s climate goals but is also an opportunity to create better residential and commercial buildings while reducing energy bills.

For the recast of EPBD it is important to establish a Whole Life Carbon regulatory roadmap. Buildings can be constructed on zero-emission construction sites, creating positive energy buildings. However, the standing time is the longest phase to address, as 80 percent of existing buildings will still be there in the year 2050.

Two-thirds of the buildings in the EU have poor energy performance. Under current policies, less than one percent of buildings are renovated each year, while data suggests the number of Europeans unable to provide enough heat in their homes has risen from 36 million to 50 million since 2020.2

The main priority for renovating buildings is to achieve the proposed target of three percent renovation per year, by introducing a European framework for the Minimum Energy Performance Standard of buildings (MEPS). This will make renovation mandatory for the worst-performing buildings in Europe. Recent data shows that retrofitting buildings in Europe could create 1.2 million additional jobs and increase GDP by one percent by 2050.3

Francesca Andreolli, researcher at the think tank ECCO states “Energy efficiency is a strategic key option for lowering energy prices, increasing energy security and tackling energy poverty. Although Italian fiscal supporting schemes for buildings’ renovations represent an advanced example at European level, they are affected by temporal instability, regulatory fragmentation and weak effectiveness. in order to make energy efficiency and heating decarbonization good options for economic growth and energy security, a long-term planning for building decarbonization coupled with an adequate financial support mechanism is needed.” 4

Measures at the EU level should target energy use and emission hotspots,especially heating and cooling but progress is slow at local level and is hampered by a number of obstacles. CAN Europe has released a new report on how to address the economic and non-economic barriers.

Mónica Vidal, Renewable Heating campaigner at CAN Europe states that “When it comes to the ongoing fossil fuel crisis, the elephant in the room is the heating installations running on fossil fuels, leading to rising levels of greenhouse gas emissions and energy poverty. If we are to protect the people and the climate in winters to come, clear policy objectives, more financial support, a skilled workforce and easy access to independent information for all, are essential to transform European countries’ outdated heating systems to renewable and efficient models.”5

Stronger policy and financial frameworks across Europe can overcome the barriers to renewable heating, and the report include a list of  key recommendations (see box).

These measures would transform European buildings where more than 450 million people live, study and work, into sustainable and climate-friendly buildings. Buildings urgently needs to become renewable, accessible, efficient and affordable for all. This will entail positive impacts on peoples’ everyday lives, to make them more comfortable, safe, and healthy.

Emilia Samuelsson

1 Buildings Performance Institute Europe 2022,
2Euractiv, Mike Peirce et al, Insulating the economy: why the EU must aim high on its buildings directive
 4Press release for report “Embracing a renewable heating revolution in our buildings! Overcoming barriers and going beyond fossil fuels heating”, found here
Article is based on: CAN Europe’s report “Embracing a renewable heating revolution in our buildings! Overcoming barriers and going beyond fossil fuels heating”, published 22 February 2023, found here


Wean off fossil fuels:

  • Establish 2035 as a planned phase-out date for fossil fuels consumption in buildings via EPBD. This will also provide an important signal for the Ecodesign regulation to set an end-date for the sale of stand-alone fossil fuel boilers.
  • Stop subsidies for the installation of fossil-fuel based heating systems in buildings as of 2024. This public financing should instead be redirected towards improving energy efficiency, renovating buildings and transitioning district heating systems to renewables.
  • End the flexibilities and exemptions that would enable boilers using a blended mix of hydrogen, biogas and fossil gas to be installed in existing and new buildings, since this will endanger the achievement of our climate and energy goals, and would also lock-in occupants with polluting heating technologies for many winters to come.

Clear policy objectives:

  • Provide clear objectives for heating decarbonisation, inspired by other countries that have already done so (UK, NL, DE). Such objectives could take many forms: a date by which all heating needs be decarbonised; an ambitious annual target rate for deep renovations encompassing work on the building envelope and the installation of renewable heating and cooling technologies; and an obligation to install renewable technologies or connect to (renewable) district heating networks when replacing a boiler, etc.
  • National Energy and Climate Plans (NECPs) should be updated in the revision plans to assure an ambitious level for the renewables share in the heating & cooling sector, leading to a 100 percent renewable energy system by 2040 in combination with the reduction of energy needs and with a clear phase-out of fossil fuels.

Financial support:

  • The upfront costs of renewable heating technologies can make it inaccessible for people, especially those who need it most. Financial support can help to overcome this problem. Subsidies, rebates and zero-interest and/or state-guaranteed loans can help homes overcome this initial cost. Financial support needs to be targeted at renewable heating solutions and their enablers, and take into account recipients’ age, ownership structure, etc.
  • Make the most of the Next Generation EU funds at national level, a once-in-a-decade opportunity to finance the transformation of our buildings.

Technical support:

  • Homeowners need to be guided and supported throughout the process of switching heating technology and/or renovating their homes. A network of national, regional and local one-stop shops and other sources of free-of-charge, independent information, would help homeowners and tenants, especially the most vulnerable, to identify and access financial support, refine their projects, and even check installers’ offers and the quality of the installations carried out.
  • Public authorities and other organisations providing such services should work with social services, local associations and identify and proactively reach out to people in need of support. Such schemes not only support citizens in their projects, but they also help make those providing advice more aware of citizens’ situations and needs.

Public awareness:

  • Public information campaigns can promote the opportunity for renewable heating technologies and highlight how they can benefit households and businesses. There is evidence from countries like Sweden and Germany that a successful renewable heating transition requires significant investment in strategic communications.

A skilled workforce:

  • Governments and manufacturers need to step up their efforts to promote this sector and entice a new workforce to install renewable heating systems. They first need to make current installers aware of renewable heating technologies, their importance, benefits, applications, etc. Installers will then be more likely to recommend such technologies. In addition, governments and the private sector need to team up to establish a concerted recruitment and training programme.

Stronger supply chain:

  • As a result of a strong post-Covid recovery and geopolitical tensions, resources and materials for renewable heating systems are limited. In the short-term, this issue can be addressed by installers of renewable heating equipment by diversifying their supply chain and pre-ordering key equipment to make sure there is a stock to offer clients. Long-term supply chain disruptions could lead to partial or total relocalisation of the renewable heating industry, which could be funded by the Just Transition Fund, among others.




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