EU Renovation Wave

On January 23rd, the European Parliament is set to vote on the rules surrounding the green renovation of homes across the EU. Innovative instruments to unlock the necessary finances to achieve the EU’s building energy efficiency goals are on the table. MEPs must vote to...

On January 23rd, the European Parliament is set to vote on the rules surrounding the green renovation of homes across the EU. Innovative instruments to unlock the necessary finances to achieve the EU’s building energy efficiency goals are on the table. MEPs must vote to keep them there.

With the cost of living crisis escalating, and the EU falling far short of both its building renovation and net zero targets, this is a crucial opportunity to ensure banks play their part in helping families slash their energy bills and fight climate change.

Mortgage Portfolio Standards are among the innovative tools being put to the vote in the upcoming ITRE deliberation on the Energy Performance of Buildings Directive. These standards would require banks to improve the energy performance of buildings covered by their mortgages by offering more attractive loan products and support to their customers in order to encourage them to undertake renovation work.

If made mandatory, banks would have to reach energy performance targets set by each national government. This would make the tool highly effective, by creating a binding obligation on EU member states to set targets and ensure they are met.

Members of the European Parliament (MEPs) Pierre Larrouturou (S&D), Radan Kanev (EPP), Sean Kelly (EPP) and Martin Hojsík (Renew Europe), met a coalition of campaigners, including Positive Money Europe, Renovate Europe and WWF as they demonstrated in front of the European Parliament.

They are demanding the inclusion in the Energy Performance of Buildings Directive (EPBD) of so-called Mortgage Portfolio Standards,  a tool that would require banks to increase the energy performance of buildings covered by their mortgages by offering more attractive loan products designed to encourage renovation work.

If made mandatory, banks would have to reach energy performance targets set by each national government. This would make the tool highly effective, by creating a binding obligation on EU member states to set targets and ensure they are met.

The demonstration comes ahead of the vote by the EU Parliament’s Committee on Industry, Research and Energy on the reviewed text of the directive, happening on January 23rd.

MEP Pierre Larrouturou said: “Having EU financing mechanisms to renovate buildings is a concrete way to fight climate change, but it is also an effective way to fight energy poverty and inequalities while getting out of our imported fuels dependency and creating green jobs” –

MEP Radan Kanev said: “The transformation of the EU building stock will only succeed if EU citizens are supported with the right financial instruments. To make renovations more attractive through affordable lending tools is a priority to achieve the EU renovation challenge”.  

Peter Sweatman, Chief Executive of Climate Strategy & Partners, said: “European homes are all in net-zero emissions committed economies. Mortgage portfolio standards just help banks help owners see this and be able to act on time and when it makes good economic sense”.

Serena Di Luccio, Campaigner at Positive Money Europe and Coordinator of the Unlock campaign, said: “The EU Parliament has the opportunity to put on paper the commitment that banks must take on to help people renovate their homes. There is an annual financial gap of 275 billion euros to meet the EU’s building renovation targets – banks must do their part to cover this gap. We urge MEPs to make this happen in the next phases of the negotiation”.

Mathilde Nonnon, Sustainable Finance Policy Officer at WWF European Policy Office, said: “As the energy and environmental crises are raging, most people in Europe live in leaky houses, powered by fossil energy. This is no longer acceptable – The EU has pledged to renovate 35 million buildings by 2030 in order to meet its climate objectives, yet it is currently falling behind schedule. EU institutions must help people renovate their homes. We can only achieve that with a very ambitious combination of both public and private funding”.

To reaffirm their commitment, Unlock activists handed to MEPs an open letter, signed in December by 36 experts and NGOs, urging EU institutions to make the proposal of Mortgage Portfolio Standards mandatory.

You can read the full open letter here – https://drive.google.com/file/d/16Bt1tLcF9LhGpglld6h50hihbjxwY0XM/view