Thermal upgrades of existing homes in Germany: The building code, subsidies, and economic efficiency

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in ISSN 0967-8875 AbstractOne of the cheapest ways to reduce CO2 emissions is thermal renovation of existing homes. Germany is a world leader in this project, with a strict building code, generous state subsidies, and an advanced renovation infrastructure. The effects of its policies are explored here in the light of progressive tightening of the building code, and the strict criteria for subsidies. Data on costs and outcomes of residential building renovations are presented from published reports on renovation projects, and cross-checked with projects investigated directly. Comparisons are made in terms of euros invested for every kilowatthour of heating energy saved over the lifetime of the renovations, for standards ranging from 150 (the lowest standard) to 15 (the highest) kilowatt-hours of primary energy use per square metre of floor area per year. It is found that the lowest standard is an order of magnitude more cost-effective than the highest, in terms of both energy saved per euro invested, and return on investment over the lifetime of the renovations, regardless of fuel prices. It is argued that this throws into question Germany's policy of progressively regulating for higher renovation standards, and offering subsidies only for projects that go beyond the minimum standard.

Exceeding the Ontario Building Code for low-rise residential buildings: Economic and environmental implications

“…The trend shown here for new homes is similar to trends noted in empirical studies of home retrofit economics where more intensive energy efficiency measures show a less favorable economic efficiency [3], adhering to a law of diminishing returns. Thus, it is usually more economical to retrofit homes with poor energy performance, than to retrofit a home that is already energy efficient.…”

“…A similar program targeted at new construction could provide the financial incentives needed to encourage home builders to exceed the OBC. In order to maximize GHG reductions given limited financial resources, as noted by Galvin [3] in his analysis of Germany's retrofit subsidies program, the merits of such a program need to be analyzed to ensure that any funding dedicated to the program would be used in the most economically efficient manner. As with the green mortgages, the mandatory EPC would be a great starting point for such a program because the energy audit portion of the grant application would already be complete after an EPC directive had been phased in.…”

“…Gamtessa [11] gave an overview of the residential energy efficiency retrofit behavior in Canada in conjunction with government incentives, and found that retrofits are more likely to be carried out in older less efficient homes, and that the likelihood of undertaking an energy retrofit was directly related to the expected cost savings and upfront financial incentives. Galvin [3] took a critical view of the generosity of Germany's financial incentives for single residential retrofits, citing the declining economic efficiency with more aggressive energy retrofits as the reason.…”

“…The building sector is often cited as one of the most cost effective areas to reduce energy use and GHG emissions [3], [4]. With the vast majority of Ontario's building stock in the form of residential housing, there exists significant potential in the residential sector to reduce carbon emissions province-wide.…”

Evaluation of Energy Efficiency Strategies in the Context of the European Energy Service Directive: A Case Study for Austria

“…Schiellerup (2002) for example shows in a case study for Great Britain, that the introduction of minimum standards for cold appliances let to considerable savings on the consumers' side. In contrast, Galvin (2010) calculate that raising the minimum standard that needs to be reached in the thermal insulation of an existing house to be eligible for subsidies may prevent renovation activities among low-income households significantly. Concerning the firms that are subject to European and international competition, the cost shifting that is possibly associated with the proposed energy efficiency measures can negatively influence their cost structure.…”