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Analysis

The Green Deal and EU reconstruction after the COVID-19 crisis

By Dirk Hudig
Thursday, 16 April 2020
The Green Deal and EU reconstruction after the COVID-19 crisis
Housing renewal gives the best payback for CO2 abatement investments, and creates employment

To achieve the CO2 reduction targets that are to be set in the new climate law means looking seriously at the energy efficiency of buildings, and most especially social housing. A big part of the EU housing stock dates from the last centuries and was built in ways that waste energy.

Of all the CO2 abatement plans, the biggest return is to reduce the 30% of total energy consumption used for heating.

That makes sense, but who pays?  The owners of social housing have less concern because the heating bill is paid by the tenant. So we are in a catch 22 situation –  the tenant will not refurbish what he does not own, and the owner will not invest to make savings he does not get.

How to beat the deadlock? One way ahead is to look at the revision of the construction products regulation (CPR) that sets the product standards.

After the crisis, a major reconstruction programme makes political and economic sense.  Many SMEs are active in the construction sector and could be got back to work.

But who has the money?  Part of the plan must be to empower the cities to be able to use the funds and even raise funds. They are the closest to social needs. Better insulated buildings have a wider social benefit since energy poverty can be alleviated by lower heating bills.

Who owns this at the EU level? Housing renewal is writ large in the Green Deal, but the CPR is the job of DG Grow. Energy efficiency is owned by yet another DG, as is employment. What we need is overall ownership for an integrated EU plan of action. Time for a champion in the Commission to step forward to lead a concerted reconstruction plan after the crisis.
Dirk Hudig

FIPRA’s Green Transition Practice

We advise clients in a variety of industries including Energy, Environment, Chemicals, Mining, and beyond towards meeting their climate, sustainability, and business goals. Learn more about this here.

Written by
Dirk Hudig
Special Advisor - Competition, Green Transition, Energy, Industrials
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Green Transition
Green Transition
FIPRA advises organisations making a green transition, helping firms redefine themselves and adapt their business strategies in sync with the inevitable transformation underway on a European and global scale.
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