Across Europe, 50 million households struggle with energy poverty stemming from low incomes, high energy bills, poor energy efficiency, as well as inadequate housing. The EU’s Renovation Wave, a ‘flagship’ of the European Green Deal, provides a unique opportunity to tackle Europe’s inadequate housing while contributing to EU climate targets, writes Anna Kompatscher.
Anna Kompatscher is a policy assistant at the European Federation of National Organisations Working with the Homeless.
The Renovation Wave aims to trigger massive public and private building renovation in Europe to improve energy performance and to tackle energy poverty through the revision of the Energy Efficiency Directive (EED) and Energy Performance of Buildings Directive (EPBD) this year.
It seems highly likely that the revision of the EED and the EPBD will introduce mandatory minimum energy performance standards for existing buildings. If designed and implemented well, these minimum performance standards will be a crucial tool to prioritise the worst-performing buildings and those who live in them. But they can only address energy poverty if they are accompanied by strong social safeguards, including the following.
The prioritisation of the residential sector should be paramount to target renovations for those who need them the most. Hence, the proposal of the EPBD will need to ensure a definition of “worst performing buildings” to prioritise the renovation of those- including damp, cold, owner-occupied homes, Roma settlements, homeless shelters, and other forms of inadequate housing.
Secondly, it is essential that the EU and the member states provide targeted low-income renovation programmes. There is clear evidence that energy performance gains of energy retrofits are often lower than expected. Hence, savings for reimbursement of investment (through for instance loans or on-bill financing) are not a one-size-fits-all solution.
Some of the people who would benefit most from renovation will not generate significant money savings but will be able to live in decent conditions. The Commission should therefore put forward proposals that secure targeted financing for hard-to-reach and at-risk households.
Financial support for the most excluded should go through zero-interest loans and grants for renovating.An efficient way would be the establishment of a dedicated EU “energy poverty” fund to publicly fund the renovation of worst-performing buildings and housing units of people in situations of energy poverty that can be both low-income tenants and low-income property owners.
Another important issue to tackle is the recognition of the challenge of heating and cooling systems of buildings. It needs appropriate financing of projects that support the lowest-income groups to change their heating systems or measures to prevent disconnection for households who struggle to pay their energy bills.
Also, member states need to provide technical and practical assistance to the energy-poor through outreach and by targeting low-income households and those who are facing energy poverty to provide them with the necessary knowledge and skills. Holistic one-stop shops can ensure inclusivity. These should be run by trusted local actors and not be profit-driven.
Although minimum energy performance standards can be a crucial tool to prioritise renovation efforts for those that need them, most gentrification is a real risk if such investments lead to rental price increases forcing low-income tenants out. Member states must set up regulatory frameworks to provide preventative measures such as establishing, rent caps or interdictions of ‘renovictions’.
At the EU level, monitoring the implementation of minimum energy performance standards and their impact on gentrification (e.g. who lives in the buildings before and after renovation) will be essential, and could combine the efforts of the EU Building stock observatory and the Energy Poverty Advisory Hub.
The EU could also impose that when minimum energy performance standards are implemented, there is a minimum percentage of the dwelling units that are rented at social rent. This is already happening in France, where the law imposes a percentage of social housing in cities.
Finally, the Commission can guide the Member States in creating Social Rental Agencies (SRA). In this model, renovations are covered by public funds in exchange for a commitment from the owner to rent at a low rent for 10 or 15 years.
This approach incentivises affordable rents together with energy efficiency renovation. The EU can set the direction by creating a “European SRA model” that makes funding for renovations available and facilitate the exchange of good practices.
If it hopes to “leave no one behind”, the Renovation Wave must be implemented in a way that actively prioritises hard-to-reach and lowest-income households. Only by being linked to a commitment to decent and affordable housing for all, in line with the European Pillar of Social Rights, can the Renovation Wave truly work for Europe’s most vulnerable. This year presents a fantastic opportunity to remedy dire and indecent living conditions for millions of Europeans, if the European Commission wills it.
