countdown to low carbon homes- research report

Countdown to Low Carbon Homes Delivering community scale retrofit of home energy improvements

October 2014

RESEARCH REPORT

The Countdown to Low Carbon Homes project is a partnership of:

Severn Wye Energy Agency

An independent charity and not-for-profit company established in 1999 to promote sustainable energy and affordable warmth through partnership, awareness-raising, innovation and strategic action. With a focus on local and regional action, it works from its two office bases, in Gloucester in South West England and Llandrindod Wells in mid Wales.

Catrin Maby ([email protected]) Sam Evans ([email protected])

The Aristotle University of Thessaloniki

The largest University in Greece and in the Balkans with 95,000 students, 2,300 teaching and research staff and 1,800 technical and administrative staff. Founded originally in 1926, it is highly recognised internationally, participating in more than 35 international academic associations and collaborating with more than 1,200 Universities worldwide.

Grigoris Papagiannis ([email protected]) Dimitris Tampakis ([email protected])

Cyprus Energy Agency

A non-governmental, non-profit organisation established in 2009 with co-financing from the European Commission through the Intelligent Energy for Europe programme and the Cyprus Union of Communities. The objectives of the Cyprus Energy Agency are to promote renewable energy, energy efficiency and sustainable transport and mobility. It is based in the capital, Lefkosia.

Anthi Charalambous ([email protected]) Maria Ioannidou ([email protected])

LEGAL NOTICE:

Neither Severn Wye Energy Agency nor any person acting on behalf of Severn Wye Energy Agency is responsible for any use which might be made of the following information.

AUTHORS

December 2014

Anthi Charalambous

Audrey Healy

Maria Ioannidou

Catrin Maby

Gregoris Panayiotou

Grigoris Papagiannis

Dimitris Tampakis

CONTENTS

Table of contents continued over...

www.countdowntolowcarbonhomes.eu | 1

1. INTRODUCTION 3

1.1 What are home energy improvements? ................................4

1.2 Benefits of making home energy improvements ..................4

1.3 Issues and challenges .................................................................5

1.4 Project aims and objectives .......................................................6

1.5 Acknowledgements .....................................................................8

2. BACKGROUND 9

2.1 The European policy context .................................................. 10

2.2 Wider benefits of home energy improvements .................. 14

2.3 Drivers and barriers .................................................................. 16

2.4 Financing home energy improvements ............................... 20

2.5 Energy user behaviour ............................................................. 23

2.6 The background in each country ........................................... 24

2.7 Summary of background ......................................................... 43

2 | www.countdowntolowcarbonhomes.eu

CONTENTS

3. METHODOLOGY 45

3.1 The common approach ........................................................... 46

3.2 The approach in Cyprus ........................................................... 48

3.3 The approach in Greece ........................................................... 52

3.4 The approach in the UK ........................................................... 59

3.5 Research limitations ................................................................ 68

4. RESULTS 71

4.1 Cyprus.......................................................................................... 72

4.2 Greece ......................................................................................... 87

4.3 United Kingdom ...................................................................... 112

5. CONCLUSIONS 191

5.1 Considering retrofit reasons and triggers ....................... 192

5.2 Considering retrofit obstacles ........................................... 194

5.3 The role of impartial advice ................................................. 196

5.4 Planning works ....................................................................... 197

5.5 Undertaking improvements ................................................. 199

5.6 Maximising the savings ......................................................... 201

5.7 The community scale delivery model................................. 203

1.INTRODUCTION


1.1 What are home energy improvements? ................................4

1.2 Benefits of making home energy improvements ..................4

1.3 Issues and challenges .................................................................5

1.4 Project aims and objectives .......................................................6

1.5 Acknowledgements .....................................................................8


1.INTRODUCTION

1.1 What are home energy improvements?In this research report the term home energy improvements is used in a general sense to describe a range of possible physical improvements that may be made to the fabric and services of an existing home, with a beneficial impact on energy use or utility, such as improved thermal comfort, increased energy efficiency, or a reduction in energy costs, energy consumption or associated carbon emissions.

The measures that might be involved include thermal insulation, more efficient appliances or improved controls for heating, cooling, hot water and lighting, a switch to a lower carbon fuel or household scale renewable heat or power.

The term retrofit is used to describe adding such measures to existing buildings, and has become a standard term in the energy efficiency industry.

1.2 Benefits of making home energy improvementsBuildings account for 40% of total energy demand across the European Union1. Improving the energy efficiency of the existing stock is a valuable opportunity to reduce collective emissions and represents at least 17% of the EUs energy saving potential2. Residential buildings comprise 75% of the total stock across Europe. Of the entire building stock, homes are the biggest consumers of energy: in 2009, they were responsible for 68% of the total final energy use in buildings3. Over 40% of Europes entire housing stock was built before the 1960s, before some countries started introducing building standards4. Widespread retrofit offers the opportunity to improve a significant proportion of the overall housing stock and bring it closer to current and future standards.

The energy performance of homes has a role to play in the achievement of several policy objectives: mitigation of the risk of climate change, reduction in levels of fuel poverty, and increased energy security. Associated benefits of improved energy performance of homes include occupant health and comfort, consumer ability to spend money saved from energy bills on other things, and the social and educational benefits of having more usable living space.

Making the necessary improvements increases economic activity within building trades and supplies. Catalysing retrofit on a wider scale has the potential to invigorate the green economy and create new employment as well as offering new and expanded markets to sustain existing jobs.

1 Energy efficiency: delivering the 20% target, Commission of the European Communities (2008) http://eur-lex.europa.eu

2 Policy Report: Contribution of Energy Efficiency Measures to Climate Protection within the European Union until 2050 (2012), Federal Ministry for the Environment, Nature Conservation and Nuclear Safety: http://www.isi.fraunhofer.de/isi-media/docs/e/de/publikationen/BMU_Policy_Paper_20121022.pdf

3 Europes Buildings Under the Microscope: A country by country review of the energy performance of buildings, Buildings Performance Institute Europe (BPIE) 2011

4 Ibid

1.INTRODUCTION


1.3 Issues and challengesDirect experience of working with owner-occupiers and installers indicates growing concern about energy costs and climate change, and interest in improving energy efficiency. However, in practice, there are both opportunities and barriers, including practical, financial, aesthetic and regulatory factors.

To date, government programmes and commercial markets have tended to focus on measures delivering the quickest financial and carbon returns, resulting in selective delivery of mainly single measures. These tend to be the measures that involve the least time and labour, typically those that require little additional building work or finishing and which are also generally the least disruptive for the homeowner. Achieving carbon and fuel poverty targets requires a more comprehensive approach, including the full range of thermal insulation, and efficient heating, cooling, water heating, lighting and domestic appliances as well as renewable heating and home generation technologies. It also requires specific attention to the details of older buildings.

Given the costs and disruption involved for homeowners and the need to access finance for refurbishment this will not happen overnight. An important contribution is likely to come from ensuring that trigger point opportunities to incorporate energy improvements offered by general home repairs, maintenance and improvements are realised in practice. Homes are often a work in progress and improvements can be part of an ongoing process. When households wish to improve their homes they will typically contact (generally small) local companies or sole traders providing home repairs and improvements. These local businesses tend to be the first port of call for homeowners, so are well placed to identify opportunities to include energy improvements; they are key actors and influencers in the process. Adopting new technologies may carry risk for small businesses, however, and building their knowledge base and learning new skills (and in particular gaining accreditations that may be required) incur time and expense; this can be a barrier to being able to offer energy related improvements as part of their general portfolio of services and products.

As such, a starting point for the project was an awareness that practical delivery of deep carbon cuts through retrofit is complex and primarily delivered on a bespoke level by a localised supply chain. Scaling up might be achieved by starting at this level and building on it, overcoming practical barriers step by step. This also has the benefit of supporting the local economy and increasing capacity, as opposed to cherry-picking profitable measures by larger companies with no long term local presence.

Current thinking on cost reduction and scaling up retrofit tends to focus on area-based approaches (a limited area, street by street) as the solution, to ensure logistical benefits and economies of scale. These approaches depend on being able to carry out substantial works within a relatively short time. Applying this type of approach to private sector housing is difficult though, as it requires leverage of investment by property owners, as well as willingness to accept the disruption of building works which is common to all tenures. For high deprivation areas there may be enough subsidy provided and benefits in improvement in living conditions to overcome these barriers, but this is unlikely to be the case elsewhere.


1.INTRODUCTION

The complex and often fragmented nature of the retrofit process can be a challenge for the private homeowner, comprising several basic elements for which they may need to go to different providers: bespoke energy advice, installation of measures and/or upgrade of existing ones, and raising the finance to pay for such works. Another crucial element of retrofit is post installation user behaviour; that is, ensuring the improvement actually saves the energy and/or delivers the improved comfort it is meant to.

Finance, time and disruption to everyday life often prevent households from making lots of improvements at once; many households incorporate improvements step by step when resources allow. Ensuring that changes made over time are holistic and complementary is a challenge for any household.

In an era of increasing financial austerity, grant funding for home energy improvements is on the decline and the emphasis is increasingly shifting towards loan finance. A key aspect of making retrofit a more joined-up, straightforward process involves being able to signpost households to trustworthy sources of finance as well as grant funding. Flexibility and choice are important for homeowners, both in terms of measures that can be financed and the repayment terms on offer.

1.4 Project aims and objectivesThe Countdown to Low Carbon Homes project (2012-14) was set up to research, develop and communicate an integrated practical delivery approach to community scale retrofit of energy improvements to buildings, with a particular focus on homes and delivery by Small and Medium Enterprises (SMEs).

This research report forms one of three project outputs, the other two being a set of case studies charting the journeys of households in Cyprus, Greece and the UK that made energy improvements to their homes, and a guidance toolkit for community scale delivery of home energy improvements.

Potential audiences for outputs from his project include those with an interest in effective delivery of home energy improvements, and achievement of energy efficiency and carbon emission reduction targets, such as policy-makers at all levels, local and regional authorities, energy agencies, housing providers, energy efficiency and building industry trade bodies, community and environmental organisations.

By exploring the whole retrofit journey from planning stage, to implementation and post installation energy use, the Countdown to Low Carbon Homes project aimed to find ways to make domestic retrofit easier, more mainstream and attractive, in ways that benefit local businesses. To do this, the project partners worked with households, installers and other key decision makers involved in domestic retrofit in their communities to gather evidence on the situation at a local level.

By working in three diverse regions in Europe, the partnership gained a broader perspective as well as scope for exchange of knowledge and experience.

This work informed the development of practical delivery models for the retrofit of buildings. One of the three project partners developed and trialled a model that could be rolled out at a community scale, linking in with local businesses.

1.INTRODUCTION


Planning, building control

Intermediaries:community groups, local media, local authorities,

health and social care agencies

Energy advice Installers

Home owners

Finance for

measures Suppliers of energy efficiency

materials and products

Diagram 1: Key elements in the community scale retrofit delivery model


1.INTRODUCTION

1.5 AcknowledgementsThe Cyprus Energy Agency would like to express gratitude and thanks to the members of the Focus Group and the Installers Group who supported the implementation of the project in Cyprus. The Cyprus Energy Agency is also thankful to the homeowners for their collaboration.

Aristotle University of Thessaloniki would like to thank all homeowners who participated in the research for their collaboration and all those who contributed to the research.

Severn Wye Energy Agency would like to thank all the households, installers, tradespeople, suppliers, local authority personnel and advisors that participated in this project, and to extend particular thanks to the following contributors:

Aniko Dobi-Rozsa at Global Environmental Sustainable Business;

Dr Alice Owen at the University of Leeds;

Dr Gavin Killip at the University of Oxford;

Paul Ciniglio at First Wessex;

Sian Ferguson at the Sainsbury Family Charitable Trusts;

Heather Watts at Scottish Power;

Maria Hickman, Barry Wyatt, Dan Shoesmith, Emma Quest and Susie Phelps at Stroud District Council;

Vincent Albano at Wiltshire Council;

Lorraine Drew at Forest of Dean District Council;

Debby Paice, Colin Martin and Calum Allan at South Gloucestershire Council;

James Clapham;

David Cheffings;

Dez Rolfe;

Jane Leigh;

Simon Pickering;

Vicky Redding;

Perdita Dawson;

Caspar Helmer;

Jackie and Ian Tuckett;

Jane Laurie;

Richard and Mary Spears;

Angie Bennett;

Linda Bailey;

Jackie and Stan Sims;

Peter Fox;

Brian Jordan;

Bob Dale;

Gary Twist;

Pauline Winstanley.

Finally, Severn Wye would like to thank the staff that worked on Countdown to Low Carbon Homes and helped to develop the local delivery model:

Sam Evans;

Neil Towler;

Jemma Stephenson;

Paul Sheridan;

Matt Williams.

2. BACKGROUND


2.1 The European policy context .................................................. 102.1.1 European carbon reduction targets ...................................................................................10

2.1.2 Targeting homes ....................................................................................................................10

2.1.3 Targeting homeowners .........................................................................................................12

2.1.4 The Energy Performance of Buildings Directive ..............................................................12

2.1.5 Energy Performance Certificates ........................................................................................13

2.2 Wider benefits of home energy improvements .................. 142.2.1 Tackling fuel poverty .............................................................................................................14

2.2.2 Local employment .................................................................................................................15

2.3 Drivers and barriers .................................................................. 16

2.4 Financing home energy improvements ............................... 20

2.5 Energy user behaviour ............................................................. 23

2.6 The background in each country ........................................... 242.6.1 Cyprus ......................................................................................................................................24

2.6.2 Greece ......................................................................................................................................29

2.6.3 The UK ......................................................................................................................................34

2.7 Summary of background ......................................................... 43

2. BACKGROUND


2. BACKGROUND

2.1 The European policy context

2.1.1 European carbon reduction targetsThe European Union has committed to reducing overall levels of carbon dioxide by 20% by 2020 from 1990 levels1. This target is one of several which make up the climate and energy package, a set of binding legislation which aims to ensure the European Union meets its climate and energy targets for 2020. Known as the 20-20-20 targets, they set three key objectives:

A 20% reduction in EU greenhouse gas emissions from 1990 levels. Raising the share of EU energy consumption produced from renewable resources to 20%. A 20% improvement in the EUs energy efficiency2.

It is estimated that meeting the 20% EU renewable energy target could have a net effect of creating around 417,000 additional jobs, whilst achieving the 20% energy efficiency improvement by 2020 is forecast to boost net employment by around 400,000 jobs3.

2.1.2 Targeting homesBuildings are a target for carbon emissions reduction targets because they are a prime source of carbon dioxide (CO2) the major greenhouse gas (GHG) responsible for climate change and the depletion of the atmospheric ozone layer. In 2006, 77% per cent of total CO2 emissions in buildings across the EU-154 were generated by homes while 23% were generated by commercial buildings5. In 2011, emissions of CO2 from residential buildings accounted for 8.9% of Europes total GHG emissions6. These figures may differ from country to country depending on the fuel and method used for the production of energy7.

In 2010 the total number of homes in the EU-27 was around 204 million:

19.6 % in Germany 13.2 % in Italy 13.2 % in France 12.3 % in UK 8.2 % in Spain 6.5 % in Poland 3.6 % in the Netherlands

1 Eurostat http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Consumption_of_energy#Consumption

2 European Commission, Climate Action http://ec.europa.eu/clima/policies/package/index_en.htm.

3 European Commission http://ec.europa.eu/clima/policies/package/index_en.htm

4 The number of member countries in the European Union prior to the accession of ten candidate countries on 1 May 2004. The EU15 comprised: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, United Kingdom. Source: OECD http://stats.oecd.org/glossary/detail.asp?ID=6805

5 Petersdorff, Carsten, Thomas Boermans, and Jochen Harnisch. Mitigation of CO emissions from the EU-15 building stock. Beyond the EU directive on the energy performance of buildings (9 pp). Environmental Science and Pollution Research 13.5 (2006): 350-358.

6 EEA. Annual European Community greenhouse inventory 1990-2011 and inventory report 2013, EEA technical report no. 8, Submission to the UNFCCC Secretariat, Luxembourg: European Environment Agency, 2013

7 Ding, Y. D. J. G., et al. Climate change 2001: the scientific basis. Vol. 881.

2. BACKGROUND


The remaining 23.4 % of total homes are spread among the remaining European countries8. Diagram 2 compares the number of dwellings with the total amount of energy consumed by households across the EU.

Diagram 2: Final energy consumption and number of dwellings in EU-27 countries

As diagram 2 shows, the countries with the highest final energy consumption in residential buildings (in million tonnes of oil equivalent or Mtoe) are:

Germany (60.3 Mtoe)

France (41.5 Mtoe)

UK (40.6 Mtoe)

Italy (27.9 Mtoe)

Poland (18.2 Mtoe)

Spain (15.2 Mtoe)

The Netherlands (9.2 Mtoe)

The countries with the highest energy consumption are those with the largest numbers of homes.9 Using the year 2000 as a baseline, it is estimated that Europes total residential building stock will increase by 2.5 times by 206010. Although new homes are generally built to much higher energy performance standards, ways still need to be found to significantly reduce emissions produced by existing buildings in particular, homes. Without addressing the existing housing stock, this projection has alarming implications for meeting future carbon reduction targets.

8 Dol, Kees, and Marietta Haffner. Housing statistics in the European Union 2010. Delft University of Technology (2010).

9 Uihlein, Andreas, and Peter Eder. Policy options towards an energy efficient residential building stock in the EU-27. Energy and Buildings 42.6 (2010): 791-798.

10 Ibid


2. BACKGROUND

2.1.3 Targeting homeownersTenure is crucial for retrofit as it greatly influences the ability to invest in energy improvements. Homeowners are a key target group as they not only have a greater ability to implement retrofit measures but they also comprise the largest tenure group across Europe. In 2012, 70.6% of people across Europe lived in an owner-occupied home. Greece has one of the highest owner-occupier rates in Europe, with 75.9% of the population owning (either outright or with a mortgage) their home11. In Cyprus the proportion of owner-occupiers is 73.3%. Of the three countries the rate is lowest in the UK at 66.7%, which is also lower than the European average12. However, the owner-occupier rates of all three nations are around the European average, highlighting the potential transferability of lessons from this project to other EU countries.

2.1.4 The Energy Performance of Buildings DirectiveA key instrument for improving the energy performance of buildings is building energy codes or regulations. These form the main mechanism through which energy-related requirements are incorporated into the design of new buildings, and potentially also the retrofit of a building.

The primary European policy driver for improving the energy efficiency of buildings is the European Energy Performance of Buildings Directive (EPBD)13. First published in 2002, the Directives main aim is to encourage the improvement of the energy performance of buildings across the EU through cost-effective measures. It requires:

A common methodology for calculating the energy performance of buildings.

Minimum standards on the energy performance of new buildings and existing buildings that are subject to major renovation.

Systems for the energy certification of existing and new buildings and for public buildings prominent display of this certification and other relevant information. Certificates must be less than five years old.

Regular inspection of boilers and central air-conditioning systems in buildings and an assessment of heating installations in which the boilers are more than 15 years old.14

That when a building or building unit is offered for sale or for rent, the EPC must be included in advertisements in commercial media.

That when buildings or building units are constructed, sold or rented out, the certificate is shown and then transferred to the new tenant or prospective buyer.15

Although some Member States had minimum requirements for the thermal performance of building envelopes, the EPBD is the first major attempt to introduce a general framework for establishing building energy code requirements based on a whole building approach.

11 Eurostat: http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Housing_statistics

12 Eurostat: http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Housing_statistics#Database

13 2002/91/EC (revised in 2010 -2010/31/EU)

14 http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32002L0091

15 European Commission legislation: http://eur-lex.europa.eu

2. BACKGROUND


Furthermore, the re-cast Energy Performance of Buildings Directive (EPBD) stipulates that from 2019 onwards all the new buildings occupied and owned by public authorities are nearly zero-energy buildings (nZEB) and by the end of 2020 all new buildings are nearly zero-energy buildings.16

Widespread adoption and application of stricter building codes has huge potential for achieving significant carbon reductions. In Denmark, three quarters of the building stock was built before 1979, when national building codes were introduced. A Danish study produced a series of energy saving measures with a financial methodology for assessing them and applied them to two typical buildings. The results identified potential for a reduction in space heating of around 80% over 45 years (until 2050)17. If applied to the wider building stock, this could result in considerable energy and carbon savings.

Similarly, in Greece around three quarters of the existing building stock was also built before 1979. This proportion has little or no insulation and consequently, comprises the most poorly performing buildings. During the first decade of the implementation of the Greek Buildings Thermal Insulation Regulation (GBTIR) in the 1980s, most buildings were insufficiently insulated due to a range of factors including poor building practices, little experience of insulating correctly, a shortage of materials and higher costs. The situation improved during the 1990s; however, buildings constructed during this decade can only be considered as partially insulated. Buildings constructed after 2000 are well insulated according to the requirements of GBTIR. These buildings have an average yearly energy consumption of 260 kWh per square metre, 65% of which is for space heating21.

EU Member States are required to put the necessary measures in place to ensure that when buildings undergo major renovation, the energy performance of the building (or the renovated part) meets minimum energy performance requirements aligned to the EPBD where feasible18. When a significant part of a building (or a technology affecting the energy performance of the building) is retrofitted or replaced, Member States have to ensure the energy performance of the building element meets minimum energy performance requirements where technically, functionally and economically possible.

The 2010 update to the EPBD included an emphasis on the long term energy consumption of buildings. Each European Member State is tasked with defining the term major renovation. It can be defined either in terms of a percentage of the building envelope or in terms of the buildings value.

2.1.5 Energy Performance CertificatesArticle 4 of the EPBD requires that Member States ensure that an Energy Performance Certificate (EPC) is made available to the owner or prospective tenant when a building is built, sold or rented out. The main purpose of the EPC is to provide useful information on the cumulative energy performance of the building. The ratings of buildings are based on calculated consumption (the asset rating) of primary energy use per year (kWh/m/year) for typical use

16 Buildings Performance Institute Europe (BPIE): http://www.bpie.eu/nearly_zero.html#.VCp3EE0tDIU

17 Tommerup, Henrik, and Svend Svendsen. Energy savings in Danish residential building stock. Energy and Buildings 38.6 (2006): 618-626.

18 European Commission http://www.epbd-ca.eu/


2. BACKGROUND

of the building and according to the building type. The energy label classifies the buildings on an efficiency scale ranging from A (high energy efficiency) to G (poor efficiency). The EPC also provides information about the estimated CO emissions resulting from the calculated energy consumption, and the calculated energy that comes from renewable sources. The EPC has to be accompanied by the recommendations report, which includes a list of suggested measures and their costs.19

2.2 Wider benefits of home energy improvements

2.2.1 Tackling fuel povertyScaling up levels of domestic retrofit also offers the opportunity to improve the condition of the existing housing stock. Living in cold, damp conditions can pose health problems for the frail and vulnerable, especially during the winter period. In general, more people die in the winter than the summer. Called excess winter mortality, this phenomenon is common across countries even those with hot summer temperatures and can range from 5% to 30% additional deaths over the winter period20. A 2003 study found that excess winter mortality was highest in southern Europe, Ireland and the UK, with Scandinavia and other northern European countries relatively unaffected.21

Although different factors contribute to excess winter mortality rates, the same study found that available data on cross country thermal efficiency standards in housing indicate that those countries with the poorest housing (Portugal, Greece, Ireland, the UK) demonstrate the highest excess winter mortality.22 The author claims that If the ability of a population to protect themselves from cold spells is a key factor in such pronounced seasonality in Southern and Western Europethen it would seem that improving the thermal standards of housing could be an effective preventative intervention in curbing excess deaths.23

Using retrofit to address fuel poverty offers the opportunity to improve living conditions for people on low incomes (who are increasingly likely to live in poor quality housing) and increase the efficiency of the poorest quality housing stock, thereby saving carbon emissions. Certain groups are also more vulnerable to the health impacts of fuel poverty, so improving the energy efficiency of the housing stock also offers opportunities to reduce rates of excess winter mortality and healthcare costs.

A 2007 study investigated the relationship between the energy performance and the socio-economic characteristics of homes using a sample of about 1,110 households across the Athens city-region. The study found that when oil prices rose, this sparked an increase in the number of

19 http://www.epbd-ca.org/Medias/Pdf/country_reports_14-04-2011/Cyprus.pdf

20 Healy J D (2003), Excess winter mortality in Europe: a cross country analysis identifying key risk factors, J Epidemiol Community Health 2003; 57 :784789 http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1732295/pdf/v057p00784.pdf

21 Cyprus was not part of this study. Healy J D (2003), Excess winter mortality in Europe: a cross country analysis identifying key risk factors, J Epidemiol Community Health 2003; 57 :784789 http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1732295/pdf/v057p00784.pdf

22 Healy J D (2003), Excess winter mortality in Europe: a cross country analysis identifying key risk factors, J Epidemiol Community Health 2003; 57 :784789 http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1732295/pdf/v057p00784.pdf

23 Ibid

2. BACKGROUND


households in fuel poverty. Not surprisingly, it also found that the income of the occupants was instrumental to the quality of the dwellings, their thermal efficiency and energy consumption and that low income families were more likely to live in old, poor quality buildings24.

However, improving the energy efficiency of the homes of households at risk of or in fuel poverty may not necessarily result in lower overall energy consumption. This is because benefits of increased efficiency include the ability to afford to heat the home to a more comfortable level. Therefore those in fuel poverty may benefit in non-financial ways from a more energy efficient home that is, they can keep themselves warmer, so energy consumption may not reduce. There are other, potential rebound effects that mean that the complete expected reduction in consumption from energy efficiency is not always realised in practice25.

2.2.2 Local employmentAny increase in retrofit activity among homeowners presents business opportunities for the trades involved with retrofit, with the potential to benefit the many small building trades companies that are primarily active at local level, and which are often the first port of call for homeowners wishing to improve their properties. A 2010 study of the potential impacts of a large scale, deep26 retrofit programme on employment in Hungary showed that up to 131,000 new jobs could be created by 202027.

However, the sometimes complex nature of sustainable energy retrofit can also work against trades and micro businesses. Existing homes draw on a wide range of technologies and measures, requiring different areas of expertise, and SMEs may need to have specific accreditations to install these, which require time and money to obtain. Smaller firms also need to market their services to the public which in a crowded marketplace with large companies offering one stop shop retrofit services also requires additional resource.

On a practical level, retrofit becomes more complex when multiple technologies and trades are involved. This can be a challenge for both the installer and the homeowner. However, there is scope for trades to work together effectively. A 2011 study on the Flemish construction sector, found that despite acknowledged gaps in knowledge trades expressed a willingness to collaborate, providing a suitable platform could be developed for this purpose28.

Countdown to Low Carbon Homes aimed to develop a replicable delivery model for retrofit, in which small businesses and trades play a key role, including seeking ways to link home owners to local businesses to install measures, and facilitate exchange of knowledge and experience of products, training and achieving accreditations.

24 Santamouris, M., et al. On the relation between the energy and social characteristics of the residential sector. Energy and Buildings 39.8 (2007): 893-905.

25 The Rebound Effect An Assessment of the evidence for economy-wide energy savings from improved energy. UK Energy Research Centre (UKERC) (2007)

26 Refers to retrofits that have the potential to save 75 90% of heating and cooling energy consumption of a building

27 Employment Impacts of a Large-Scale Deep Building Energy Retrofit Programme in Hungary, Centre for Climate Change and Sustainable Energy Policy Central European University and European Climate Foundation (2010) http://3csep.ceu.hu/sites/default/files/field_attachment/project/node-6234/englishexecutivesummary.pdf

28 Cre et al: Developing an integrated offer for sustainable renovations (2011)


2. BACKGROUND

2.3 Drivers and barriersIn addition to directives, regulations, building codes and incentives encouraging households to improve the energy performance of their homes, homeowners themselves also need to be willing and able to undertake such improvements. Regardless of country, large scale retrofit depends on human factors, which on a basic level include:

Recognising that improvements are actually needed.

Knowledge and understanding of what improvements are required.

Ability and willingness to invest in such improvements.

Capacity to deal with any short term upheaval and change while the work is being done.

A growing body of literature examines why households choose to invest in energy efficiency improvements. The studies are too numerous to cover in detail here, but they encompass a wide variety of factors. The following list is not exhaustive but includes some of the most commonly cited factors.

Retrofit is more likely to happen whether to a home or a non-domestic building if the infrastructure or choice architecture is in place to do it. Retrofit relies on a few core elements:

Impartial energy advice to:

identify relevant measures for each situation quantify potential savings to set against the initial cost of works and impact on energy

performance rating help and encourage homeowners through the steps to getting works done support the homeowners understanding of how their behaviour can be adapted to

maximise the benefits of improvements.

Access to trades and installers capable of carrying out the work. Access to finance for the cost of carrying out works.

Motivation is described as the reason for a behaviour or a strong internal stimulus around which behaviour is organised.29 Motives can be hidden, visible, unconscious or conscious. Three strands of motivation have been identified; care for ones own needs, care for the needs of others and care for the needs of the non-human world30. People tend to value their own needs above those of others and the environment31. This may help to explain why improving comfort is a reason often cited for making energy improvements. A survey for the UKs network of Energy Efficiency Advice Centres found that the main reasons for installing energy efficiency measures were to save money and increase comfort32.

29 Wilkie W L (1990), Consumer Behavior 2nd edition, quoted by Agyeman J and Kollmuss A (2002)

30 Stern, P.S., Dietz, T. & Karlof, L. (1993) Values orientation, gender, and environmental concern, Environment and Behavior, 25(3), pp. 322348.

31 This is not always the case though; people have varying levels of care for others and the environment.

32 Improving the energy performance of UK households. Results from surveys of consumer adoption and use of low and zero carbon technologies. Caird, Roy and Herring (2008). The British Social Attitudes Survey (2009) found that peoples main reason for making energy efficiency improvements to their homes was financial with 71% saying they would consider doing this to reduce their energy bills. Ibid.

2. BACKGROUND


However, at a wider level, a recent study by the Royal Society of Arts in the UK on public attitudes towards climate change found that while two thirds of the UK population accept the reality of anthropogenic climate change, they deny some or all of the feelings, responsibility and agency required to deal with it. One crucial motivation for retrofit taking personal responsibility for the carbon footprint of ones home and acting to reduce it is relatively weak among the wider public. The study argues that part of the problem lies in the mis-framing of climate change as an external, primarily environmental issue when in fact it runs through every aspect of human life and if allowed to escalate at current levels will have multiple negative impacts for society. Interestingly, just over a third of respondents (36%) said they would do more to tackle climate change if they knew how. The authors identify this segment of the population as an audience receptive to tangible, practical ways to take responsibility for and reduce their carbon emissions. 33

A household will not invest in energy improvements if it does not perceive a need for them. In the 2011 national survey of public attitudes to housing, 37% of UK owner occupiers said they did not think anything needed to be done on their home to make it more energy efficient34. Obviously this cannot be verified and no further questions were asked requiring the respondents to qualify their response.

A 2013 study found that certain background conditions can help to explain why households start considering retrofit. They include: competing pressures on space in the home and how it is used, a misalignment of how they envisage their home compared to how it actually is, whether the household is receptive to ideas on changing their home, if anyone in the household has physical needs (or is expected to in the future) which need to be accommodated, and lastly whether households are aware of a need to adapt the physical arrangement or material surroundings of their homes35.

Knowledge and understanding of, and trust in, retrofitLack of understanding is an obstacle to retrofit; in the same survey 14% of UK owner occupiers surveyed said the main reason they did not consider it was because they did not know enough about it. Lack of trust in the effectiveness of energy efficiency improvements is another factor with 5% expressing scepticism in the efficacy of such changes36.

33 Rowson (2013) Royal Society of Arts, A New Agenda on Climate Change; facing up to stealth denial and winding down on fossil fuels

34 Public attitudes to housing in England 2011 Department of Communities and Local Government. Report is based in module of British Social Attitudes Survey commissioned in 2009. http://www.communities.gov.uk/publications/housing/publicattitudeshousing

35 Understanding Homeowners Renovations Decisions: Findings of the VERD Project Wilson, Chryssochoidis and Pettifor (2013)

36 Public attitudes to housing in England 2011 Department of Communities and Local Government. Report is based in module of British Social Attitudes Survey commissioned in 2009. http://www.communities.gov.uk/publications/housing/publicattitudeshousing


2. BACKGROUND

Awareness of and attitude to financial implications of making home energy improvementsA 2009 UK survey found that 74% of owner occupiers would be willing to make their home more energy efficient in order to bring down their energy bills37. However the same survey found that the upfront cost of improvements was the main barrier with 35% of respondents citing this as the biggest obstacle.

The same survey found that households on lower incomes are less likely to consider making energy efficiency improvements compared to households on higher incomes. Only 58% of those in the lowest income quartile38 said they would consider such improvements, while 71% of those in the second lowest quartile, 78% of those in the second highest quartile and 86% of those in the highest quartile39 would consider investing in improvements. This is an issue because those on lower incomes are more likely to live in poorer quality housing and be at greater risk of fuel poverty. These findings were corroborated by a 2014 German study which found that homeowners who can afford energy efficiency improvements, for whom it is financially profitable and for whom there is a favourable opportunity to make them, are more likely to invest in such improvements40.

Payback times on energy efficiency investments play a major role. Other research indicates that if choosing between an item that is energy efficient and one that is not, the person will only opt for the energy efficient item if it pays back in a short time41. Economic incentives have helped to boost take up of renewables, because they helped to shorten payback times.

A 2006 survey found that when deciding whether to install home energy efficiency measures, perceived cost significantly outweighed expected energy savings in particular with insulation, despite the fact that insulation is the energy reduction measure that can generally deliver the biggest energy savings42. The lack of awareness of the potential for energy savings is a clear barrier, and the lack of specific information as regards the individual home enabling the homeowner to assess savings against costs exacerbated by the fact that deep retrofit costs can be very high.

Even if provided with this information, the assumption that people behave in a financially rational way (the rational choice model43) is not always borne out by reality. The phenomenon known as hyperbolic discounting44 illustrates this. The term describes the way that people discount future gains and are more likely to opt for a small reward today over potentially,

37 Ibid

38 Yearly income of 12,000 or less.

39 Yearly income of 44,401 and above.

40 Achtnicht,M.,Madlener,R., Factors influencing German house owners preferences on energy retrofits. Energy Policy (2014), http://dx.doi.org/10.1016/j.enpol.2014.01.006i

41 Kollmuss A and Ageyman J (2002) Mind the Gap: why do people act environmentally and what are the barriers to pro environmental behaviour? Environmental Education Research, Vol. 8, No. 3

42 Policies for energy efficiency in the UK. Report prepared for DEFRA by Oxera Consulting. 2006

43 This is based on three assumptions: 1) decisions are made in a stable state and our preferences are fixed; 2) individuals have access to all the relevant information bearing on the decision; and 3) they are fully able to process this information in order to reach the optimal (utility maximising) decision. Adapted from Darnton A (2008) Reference Report: An overview of behaviour change models and their uses http://communitypathways.org.uk/files/docs/biblio/hmt_gsru_Bchange_refreport_ad0708.pdf

44 Ibid

2. BACKGROUND


bigger rewards in the future45. The lower the persons income, the more likely they are to opt for a reward now over larger, long-term gains. In terms of retrofit, this explains why the upfront cost of installing energy efficiency measures deters many people despite the fact that such measures are likely to accrue over a long period of time and outweigh the initial outlay46.

The perspective of homeowners and their attitude to investing in their home is also affected by the time that they expect to live there in simple terms if the time it takes to recover the cost of investment in energy saving is longer than the occupant expects to stay there, the economic arguments will tend to be a barrier rather than an incentive to make improvements. That is, unless there is a level of confidence that the improvements will be reflected in the value of the home. This equation may however be re-balanced by the addition of further financial incentives such as tax credits.

Trust is also a barrier with 8% of owner occupiers questioned saying they didnt trust the people selling me these improvements. The wording indicates scepticism towards what is perceived as commercially driven improvement advice. A 2014 German study found that energy improvement measures recommended by an independent energy adviser have a greater likelihood of being adopted47. It also found that energy advice and audits can address information gaps and issues with uncertainty, which the respondents had frequently cited as crucial barriers to retrofit48. Other barriers include lack of trustworthy information or knowledge of reliable brands (for renewable technologies)49.

Attitudes and values shape most of our intrinsic motivation. This begs the question of what shapes our values our family, culture, society? Life experiences play a part, and one Norwegian study found that factors including childhood experiences in nature, role models, family values and first-hand experience of environmental destruction, all help to shape how we relate to and value the environment50. However, they are often not an accurate indicator of behaviour due to the value-action gap; the difference between what people say and what they actually do in practice51.

One reason why attitudes often do not correlate to behaviours the action value gap is because people will generally opt for pro-environmental behaviours that are the least costly, quickest and easiest to carry out52. Cost is not purely financial; it may be cost in terms of time,

45 Behaviour change and energy use Cabinet Office (2011) http://www.cabinetoffice.gov.uk/resource-library/behaviour-change-and-energy-use

46 Ibid



49 SEA/RENUE study (2005) for the Department of Trade and Industry quoted in Improving the energy performance of UK households. Results from surveys of consumer adoption and use of low and zero carbon technologies. Caird, Roy and Herring (2008)

50 Chawla L (1999) Life paths into effective environmental action, the Journal of Environmental Education 31(1) 15-26

51 Blake J (1999) Overcoming the value-action gap in environmental policy: tensions between national policy and local experience. Local Environment, 4(3), 257-278

52 Diekmann A and Priesendoerfer P (1992) Persoenliches Umweltverhalten: Die Diskrepanz zwischen Anspruch und Wirklichkeit Koelner Zeitschrift fuer Soziologie und Sozialpsychologie, 44 226-251. Quoted by Kollmuss and Agyeman (2002)


2. BACKGROUND

upheaval and effort. Severn Wyes Target 2050 project found in its retrofit work with households that the measures that deliver the most benefit are not necessarily the same as the measures that are installed, even when the householder has received detailed advice and has considered the payback period53. The project found that potential disruption levels also play an important part in what retrofit measures people opt for.

Locus of control describes a persons perception of whether they have any ability to bring about change through their behaviour54. People with a strong internal locus of control believe they have the ability to bring about change through their actions. Those with a strong external locus of control believe that although their actions matter, change can only really be catalysed by the actions of those more powerful than them such as multinational corporations and the government. People with a strong external locus of control are less likely to make personal sacrifices to minimise their environmental impact.

Responsibility and priorities which are influenced by our values, attitudes and locus of control. People prioritise their responsibilities; for most their primary responsibility is for their wellbeing and that of their families. If environmentally positive behaviours chime with personal priorities (such as buying organic food for health reasons), this increases the motivation to do them. If making sustainable energy improvements to ones home brings down energy bills and improves the quality and comfort of the home, people are more likely to make them if they have the means to do this.

2.4 Financing home energy improvementsExternally the key factor is the availability of finance, the right amount, at the right time and on the right terms. Looking at this from the perspective of the background and current situation in Europe, it is possible to set out a handful of broad categories to describe schemes or products for financing retrofit of existing homes, within each of which there is nevertheless considerable variation.

There can be significant interaction and overlap between the different approaches, and further investigation indicates that many of the more developed programmes in themselves feature a mix of products to cover different tenures, household incomes and characteristics, and age or built form of housing. Within the mix can be found national, regional and local programmes, and public, private and third sector provision. This might in practice form a comprehensive approach within any one region or country, but can also be seen as presenting a confusing mix of policies and interactions. A stop-start approach , where sources of capital dry up or end due to policy changes, rather than because the job is done, tend to cause instability in the market and confusion and mistrust amongst potential recipients. A typical problem is where a measure with a reasonable rate of return has been grant aided previously, and loan terms look unfavourable by comparison.

From the strategic perspective, particular challenges are in sourcing sufficient finance to achieve deep retrofit at scale.

53 Target 2050 future proofing homes in Stroud District and beyond. (2011) Severn Wye Energy Agency

54 Newhouse N (1991) Implications of attitude and behaviour research for environmental conservation, Journal of Environmental Education 22(1) 26-32. Quoted by Kolmuss and Agyeman (2002)

2. BACKGROUND


The most significant divisions in terms of target group appear to be:

Whether owner occupied or rented. Owner occupied homes do not face the landlord-tenant conflict where the tenant benefits from the return of the investment made by the landlord.

Whether single or multi-family homes (more typically thought of as houses or blocks of flats in the UK). A variation on this is the two family home arrangement found in some countries an individual house purpose-built as two independent units. The legal system can make it very difficult in case of multi-family homes which might prevent refurbishments. Achieving 100% agreement between homes in a multi-family block can be challenging. There are legal systems in countries where only 50% +1 of homeowners need to be in favour of the refurbishment. However, those who were against it might challenge the implementation.

Household economic status either in terms of income and ability to make repayments, or eligibility for public sector support. Those who would benefit from the energy cost savings the most are often the ones who cannot afford it.

The mortgage value of the home against which lenders can provide financing. There are certain types of properties which are available only for cash buyers and against which a mortgage cannot be taken out. They include pre-fabricated buildings built after 1945 originally constructed to provide temporary accommodation for families which then were not demolished and are still used today, or homes that cannot be insured, for example homes at risk of flooding. The mortgage value is calculated by the lender and usually represents the lowest possible market value of the house in case of emergency sale were the bank to repossess it.

Broad categories of types of financial support are:

Grants: typically tailored to fit the needs of different income groups and/or set at levels designed to incentivise matching private investment.

Loans or advances: which may take the form of personal loans, mortgages or mortgage extensions, or advances for example against savings in fuel bills.

There is a very wide range, from a mortgage right through to microcredit (avoiding the administrative cost and bureaucracy of conventional loans). Critical issues affecting who can use these and what they can use them for in practice include the costs to the ultimate beneficiary (for example for set-up, administration, interest applied), maxima and duration of loan. On the finance provider side, securitisation and guarantees are highlighted.

The challenge is to develop and sustain a product which is attractive to both lenders and borrowers and covers the needs of deep retrofit, not just the quick return measures. However, financing deep retrofit measures with long payback times can be difficult for private lenders as they cannot raise long term financing from the capital market to match the payback time, or the cost of funding becomes too expensive.

Tax Credits: for example against income tax, local or property taxes, value added tax (VAT)


2. BACKGROUND

Third party finance/energy performance contract: where a third party provides the capital finance for an energy performance improvement and takes (all or part of) the resulting income stream as repayment; for example through energy savings or payments for (sale of supply from) on-site generation. Third party finance is not common in the housing market, mainly because the end-users are large number of small entities, therefore spreading the energy cost savings.

Feed in tariffs: the provision of guaranteed feed in tariffs for on-site renewable energy generation, or the provision of a similar payment for renewable heat (as in the UK Renewable Heat Incentive). Whether financed through the public purse or the fuel suppliers themselves, this offers an income stream to the investor and so features as a specific financial product.

The most commonly used policies within the EU to encourage private sector investment in energy efficiency refurbishments are preferential loans where the government subsidises the interest rate (this can be done in various ways) and credit risk guarantees where a loan guarantee fund is available to share the risk of energy efficient investments with the investor. The Revolving Retrofit Guarantee Fund (RRGF) is an example of the credit risk guarantee approach.

There are many examples of soft loans with subsidised interest rates, such as the German CO-Building Rehabilitation Programme, administered by KfW (KfW Bankengruppe). Globally, Germany is one of the few countries with a large scale, long term energy efficiency refurbishment programme for housing. The KfW programme is the governments flagship policy and a nationally recognised brand. KfW issues loans below market rates and in some cases grants are also provided, with the programme currently providing loans of up to 75,000 per property. The policy has evolved over time and until 2011 the programme was funded 100% from federal sources. KfW also offers a reduction of the loan repayment if the project meets the criteria promoting complex measures with higher savings so incentivising a more ambitious approach by home and building owners, to achieve deeper carbon and energy savings.

There are fewer examples of guarantee schemes. RRGF has been successfully implemented in Hungary and in various other new member states including Estonia (where the credit risk guarantee is coupled with an interest rate subsidy).

Key elements of the RRGF are:

0 10% own equity from homeowner, 90 100% loan from the bank. 5 20% portfolio guarantee to mitigate risk. Not based on mortgage or personal income, relies on energy cost saving potential. Available for town houses and blocks of flats. Loan is attached to the property and paid through the maintenance charges, but not the

energy bill. Low cost of borrowing. Simple loan application forms. 5-10 days decision time on loan eligibility.

2. BACKGROUND


There are important lessons to learn from these and similar programmes. Large scale and long term energy efficiency programmes rely heavily on public funding. The changing policy environment can be confusing and prevent the market from developing schemes leveraging available subsidies. Available funding schemes usually do not provide 100% of the funding required for the refurbishment. Households tend to rely on the cheapest available funding and are reluctant to raise additional finance from more expensive sources in order to undertake whole-house refurbishments. Easy access to funding is important for end-users. Complicated and long application procedures can deter homeowners from applying for funding. Furthermore, traditional finance schemes such as personal loans and mortgage loans are not always suitable for energy efficiency refurbishments. This means high street banks are essentially locked out of that market, unless they develop specific finance products, which can ideally be attached to public subsidies and programmes.

2.5 Energy user behaviourIn 2010, households across Europe generated 25% of energy related greenhouse gas emissions. They also consumed nearly 13% more energy than 20 years ago55. These high emissions are partly a consequence of old and inefficient building stock and ever increasing numbers of households. Although building design and energy efficiency standards have risen, People use energy, not buildings (Janda, 2009)56. To a large extent, a buildings energy performance depends on the behaviour of its inhabitants: Housing occupants can use three or more times as much energy for heating as their neighbour, while living in exactly the same type of home57.

Often, energy use in the home is invisible and many energy consuming behaviours are based on habit and routine. Using appliances, switching on lights and heating the home is often carried out without considering where the energy comes from or what the environmental consequences are. These behaviours are driven by a multitude of factors making them challenging to change. Energy behaviour around the home is partly driven by the buildings characteristics and the appliances within it. It is also influenced by a range of internal and external factors, such as beliefs, values and attitudes, other peoples behaviours, the cultural settings we live in, and various economic incentives and constraints.

The performance of residential buildings in relation to user behaviour is an area that in relative terms is poorly understood. The field known as Post Occupancy Evaluation (POE) has emerged in response to this knowledge gap. There are practical reasons for this knowledge gap: the different typologies of housing, the demographic range of inhabitants, the invasive nature of measuring and monitoring how a home is used, and the usability of the home that is, how the design and layout of the home and its energy systems lend themselves to energy efficient behaviour58.

55 European Environment Agency http://www.eea.europa.eu/highlights/can-we-save-energy-by

56 Janda K B (2009) Buildings dont use energy, people do, Proceedings of the of the 26th International Conference on Passive and Low Energy Architecture (PLEA), pp 9-14

57 Gram-Hanssen K (2010) Residential heat comfort practices; understanding users. Building Research & Information 38(2), p 175-186.

58 Stevenson F and Leaman A, Evaluating housing performance in relation to human behaviour: new challenges, Building Research and Information (2010), 378(5), 437-441


2. BACKGROUND

By working with a small number of households, this project strives to understand the common issues that arise in relation to energy saving behaviour around the home and attempt to address them through a programme of support, information and advice.

Breaking old habits and creating moments of changePrevious behaviours play a significant role in day to day practices, including how energy is used around the home. Often, energy is used in the home unconsciously; it is a by-product of doing other things and tends not to be considered in itself. Other variables including the habits of other members of the household, their personalities and energy use patterns, all impact on a homes overall energy use.

A 2013 study found that so-called moments of change are when a household is much more likely to adopt new practices (and form new habits). These moments of change may be around moving house, having a new kitchen fitted or when a member of the household leaves or someone else moves in. Events like these offer valuable opportunities to introduce more sustainable behaviours59. This could be a one-off behaviour, such a investing in energy saving technologies and appliances when fitting a new kitchen, bathroom or bedroom, for example, or having an extension added to the house. It could also include introducing new repetitive behaviours such as turning appliances off after use.

Previous research suggests that providing households with feedback on their energy use can influence how they use energy around the home. Households that receive regular and effective feedback on their energy use with the costs and environmental impacts are increasingly likely to alter their behaviour, especially if their existing behaviour is not compatible with their beliefs and values. Feedback can also change peoples attitudes by making them aware of their bad habits, break them and form new, better ones. Research has found that feedback on energy consumption can encourage households to reduce their energy consumption by an average of between 5% and 15%, depending on the measure60.

2.6 The background in each country

2.6.1 Cyprus

National targets Cyprus has a national target to cut overall energy consumption by 10% by 2016 on 2005 levels.

The Energy Performance of Buildings Directive (EPBD) in CyprusThe 2002 European Directive on the Energy Performance of Buildings (EPBD) came into force in Cyprus in 200661. This triggered the introduction of national regulations on the energy assessment methodology used in Cyprus, plus minimum energy performance requirements,

59 Unpacking the household, Coca Cola and the University of Exeter (2013) http://www.cokecce.com/system/file_resources/117/CCE_REPORT_FINAL_V10_hires.pdf

60 Affecting consumer behaviour on energy demand, Final report to EDF Energy, Mari Martiskainen (2007)

61 as the Law for the Regulation of the Energy Performance of Buildings of 2006-.142()/2006.

2. BACKGROUND


and procedures for the certification of buildings and the inspection of air conditioning systems, along with details of the relevant accreditations of the trades and inspectors involved.

As most properties in Cyprus are sold at the design stage, the best entry point for enforcing the EPBD was identified as being the national building permit and control system under the Roads and Buildings Regulations Law.

Cypriot Roads and Buildings Regulations require that all construction has a building permit. Cypriot Regulation states that a building permit can only be issued subject to the provision of an energy performance certificate and other designs relating to the home. By tapping into an established existing building permit mechanism, this approach ensures that an energy performance certificate is issued for all new buildings.

Calculating the energy performance of buildings in CyprusSimilar to Greece and the UK, the assessment of buildings in Cyprus uses a rating system based on standardised design data and it calculates the annual energy use of a designed building under standardised conditions. In the Framework law . 142()/2006 the Energy Service of the Ministry of Energy, Commerce, Industry and Tourism has to prepare a software application for the calculation of the energy performance of buildings and the issuance of an energy certificate, that will be provided free of charge to all interested parties. The only recognised software application is the one developed by the Energy Service which is a calibrated version of the SBEM algorithm-software used in the United Kingdom.

The Energy Performance Certificate (EPC) in CyprusThe introduction of the Energy Performance Certificate (EPC) in Cyprus happened in two phases. The first phase was the optional certification of all residential buildings new and existing which started in October 2009. By January 2010 certification of homes had become mandatory. The second phase was the certification of commercial, educational, office and all other buildings not classified as residential, new and existing. Certification of these buildings became mandatory in September 2010.

An Energy Performance Certificate and accompanying recommendations report can be only issued by a Qualified Expert (QE). Their qualifications and responsibilities are regulated by The Energy Certification Regulations of 2009.

To meet the European target of most new dwellings being low energy by 2020, in 2013 the Cypriot Government stipulated that the maximum primary energy use in the home does not exceed 100kWh per square metre per year and that at least 25% of that total must be supplied by renewable technologies62. In 2013 another regulation was introduced reducing the permitted maximum U-values of the structural elements of buildings63.

As diagram 3 shows, before January 2010 when EPCs became mandatory 537 were issued across Cyprus. From 2010 to 201264 10,831 performance certificates were issued.

62 Under the Amending Law N.210(I)/2012

63 K 432/2013

64 period 01.01.10 to 31.01.12 of the enforcement of the Framework law . 142()/2006


2. BACKGROUND

Energy class C D F GNumber of EPCs 4 273 140 69 35 14 2

Diagram 3: Energy Performance Certificates issued for existing buildings (pre 2010)

Energy class C D F GNumber of EPCs 25 10,497 188 70 35 14 2

Diagram 4: Total Number of Energy Performance Certificates issued between 2010 and 2012

As the tables show, making the EPC mandatory has resulted in a sharp increase in the number of EPCs issued in Cyprus. Encouragingly, most of the EPCs issued between 2010 and 2012 rated properties at B. Buildings with good and very good energy efficiency (the total of the A and B buildings in both tables) constitute around 2.5% of the total Cypriot building stock of Cyprus.

The Cypriot Housing StockIn Cyprus, 73.3% of homes are owner occupied, higher than the European average. The energy performance of the average Cypriot home is integral to the energy consumption of the entire building sector. A deeper understanding of the energy performance of the existing housing is important for policy makers, engineers and other involved parties.

The absence of comprehensive building codes in Cyprus until relatively recently has contributed to a highly varied housing stock comprising many shapes, faade structures, and using myriad building materials. This is mainly due to the fact that until 2007, building codes in Cyprus regulated only basic issues such as the distance of the dwelling from the road, building height, number of floors and the maximum useful area. In 2007, basic building controls were introduced including minimum thermal insulation levels and making the submission of designs for heating, ventilation, air conditioning and lighting systems a prerequisite for obtaining a building permit. Sun shading measures and a quota in the use of glazing, especially on western-facing facades, have yet to be enforced. Therefore, aesthetic and architectural trends, the availability and costs of building materials and individual tastes have all shaped the Cypriot housing stock.

Until recently, data on the Cypriot housing stock has been patchy. In an attempt to better understand it, in 2010 a study mapped the performance of a sample of homes across Cyprus65. It focused on the climatic zone in which the house was built, the area of the property (m2); the number of occupants per home, the year of construction, the type of house, presence of insulation on the external walls and roof, the type of main heating and hot water systems used and the use of double glazing.

65 Panayiotou et al, 2010

2. BACKGROUND


The study found that for the sample:

Most houses were between 51m2 and 200m2 with the mean area being 172.9m2.

Over 60 % of the houses had 2 to 4 occupants. The average number of occupants per house was 3.3 while the average European home has 2.5 occupants.

Around 90% of the residential building stock in Cyprus was constructed from 1971 onwards. Between 1970 and 1980 there was a surge in home building as a result of the construction of settlements to house refugees from the Turkish invasion of 1974.

The most common Cypriot building type is a house, comprising 68% of the total homes surveyed. Apartments are the second most common housing type, comprising 44% of the home surveyed.

80% of the dwellings surveyed did not have solid wall or loft insulation.

The largest proportion of the homes surveyed (37%) had oil fired boilers as their primary heating system. The second most common heating system among the sample was split use air conditioning units used for heating and cooling. These types of units cannot be considered as a central system because they comprise individual units which are used on a room-by-room basis.

The study also found that as a result of the economic crisis and the subsequent rise in the price of heating oil, the majority of households with oil based central heating systems said they did not use them, and preferred to use room specific heating such as wood burning stoves, split air conditioning units and electric heaters.

The construction sector in CyprusThe construction and the real estate sector play a significant part in the Cypriot economy, contributing 18.3% to the national GDP and employing 20.5% of the labour force66. Residential building accounts for about 55% of the total output of the construction sector, non-residential building accounts for 28% and civil engineering infrastructure projects (mainly funded by the public sector) account for 17%67. By the end of 2007 there were 357,870 homes, of which 283,000 were permanently occupied. 63.3% of those were in urban areas.

The on-going economic crisis had a major impact on the construction industry in Cyprus. During the first quarter of 2014 the rate at which new buildings were being constructed fell by 12.6% on the equivalent period in 2013. Significantly, over 2013 the rate of new build dropped by 27.6% compared to 2012. Compared to 2011, the rate of construction of new homes fell by 27.7% in 2012 compared to 2011, while in 2013 25.5% fewer new building permits were issued.

66 Statistics of constructions and housing, Statistical Service, Republic of Cyprus (2006)

67 Ibid


2. BACKGROUND

National initiativesDuring 2013 and 2014 the Cypriot Government unveiled several subsidy schemes offering financial support for low income households to install photovoltaic systems. Building on these initiatives, in early 2014 the Cypriot government started consulting all market actors and stakeholders about a new scheme to support energy renovations. Called I renovate I save energy, the scheme aims to improve the energy efficiency of housing, public and commercial buildings through grant aid. The scheme is funded by the Republic of Cyprus, through the Fund for Renewable Energy Sources (RES) and Energy Efficiency (EXE), and the European Regional Development Fund of the European Union the Operational Programme Sustainable Development and Competitiveness.

Local initiativesCyprus Energy Agency has a track record in tackling fuel poverty through retrofit. The ELIHMed68 project (April 2011 to March 2014) aimed to improve the energy performance of low income housing in the Mediterranean region by working with a pilot group of 25 Cypriot homes. This project also aimed to improve the thermal comfort of the homes and where possible, to improve them through the installation of measures including insulation for water pipes and tanks.

Solar thermalCyprus leads the world in terms of its market penetration of solar thermal installations69. In the sample of homes surveyed, just over 82% of Cypriot homes had solar thermal systems, a proportion close to the estimated 90% coverage of houses with such systems nationally. This high proportion is down to favourable weather conditions, a pioneering solar thermal industry and the co-ordinated efforts of relevant stakeholders. This result is confirmed by another study that has found that Cyprus has the largest mWhth per 1000 inhabitants

70.

68 Acronym for Energy efficiency in low income housing in the Mediterranean: http://www.elih-med.eu/Layout/elih-med/

69 Maxoulis, C.N. Kalogirou, S.A. Cyprus energy policy: the road to the 2006 World Renewable Energy Congress Trophy, Renew. Energy 33 (2008) 355365.

70 Weiss, W., Bergmann, I., Faninger, G. Solar heat worldwide, markets and contribution to the energy supply 2004, in: IEA Solar Heating & Cooling Programme, March 2006, 2006.

2. BACKGROUND


2.6.2 Greece

National targetsGreece is bound to the EU energy target of reducing GHG emissions by 20% on 1990 levels. According to the EU effort sharing targets for 2013 2020, Greece is committed to reduce CO emissions to 4% below 2005 levels, being 134.9 Mt CO eq. According to the national projections, with currently adopted measures a value of 105 Mt CO eq. is expected by 2020, while by implementing additional measures it can be further reduced to 103 Mt CO eq. This corresponds to reductions in all sectors, either covered by the Emissions Trading System (ETS) or not, the latter category including all building types. Adopted measures include promoting natural gas for heating and domestic hot water, promoting renewable energy sources (RES), plus measures for improving energy efficiency in industry, buildings, transport, waste and agriculture.

The Energy Performance of Buildings Directive in GreeceThe European Energy Performance of Buildings Directive (EPBD) is implemented in Greece under the national law N.3661/08; Measures for the reduction of energy consumption in buildings and other provisions. This law was first enacted in 2010 and has been accompanied by the publication of the new Regulation on the Energy Assessment of BuildingsKENAK, which outlines the approach in accordance with European standards.

The Energy Performance Certificate in Greece In Greece, EPCs must be produced for: new buildings, existing buildings that undergo major renovations and current buildings with a floor area exceeding 50m (when they are sold, rented or the ownership is transferred to another party). An electronic database was established by the Ministry for Environment, Energy and Climatic Change (YPEKA) to collect the results from the building energy audits and EPCs along with the reports from boiler inspections, heating installations and air-conditioning systems71.

According to Greek EPBD implementation, a building is ranked in one of nine classes ranging from A+ (highest performance) to G (lowest performance)according to the ratio (T) of its calculated primary energy consumption (asset rating) divided by the corresponding value of a reference building. The reference building has the same dimensions, orientation and operational characteristics as the actual building. The difference is that the reference building has a set of predefined thermal properties for the building envelope and predefined settings for the electrical and heating features that are in line with minimum national energy efficiency requirements.

71 And can be found here: www.buildingcert.gr


2. BACKGROUND

Greece is divided into four climate zones. Each zone is defined on the number of heating degree days (HDD)72 in each:

Zone A (6011100 HDD in red) covers the southern parts of mainland Greece and most of the Hellenic islands).

Zone B (11011600 HDD in Green) includes metropolitan Athens.

Zone C (16012200 HDD in yellow) covers central and northern parts of mainland Greece.

Zone D (22012620 HDD in blue) covers high elevations and small segments of northern Greece.

Diagram 5: Map depicting different climate zones in Greece

The Greek Housing StockBuildings are responsible for 35% of Greek energy consumption and their contribution to the nations total national energy consumption has been rising over the last few decades. In 1980 buildings accounted for 22% of Greek energy consumption and in 1995 this proportion had risen to 31%. In new buildings, heating and cooling account for 89% of energy consumption, while lighting accounts for 7%. Around 70% of existing Greek buildings were constructed before 1980

72 A heating degree day is a unit of measurement designed to reflect the heat demand of a building, based on outside temperatures.

2. BACKGROUND


when building regulations started to be introduced so a programme of widespread retrofit has the potential to play a significant part in helping to lower national greenhouse gas emissions while improving the standard of the overall housing stock.

A recent study provides a snapshot of the condition of the Greek housing stock by drawing on a national database containing the EPCs of 302,398 homes surveyed up to May 201373. The distribution of the homes energy ratings in the four climate zones is illustrated in diagram 7. Homes are ranked independently of the climate zones. As the diagram shows, G is the predominant energy rating; this is in line with the energy profile of the Hellenic residential building stock, which predominantly comprises old, energy inefficient buildings.

Diagram 6: Distribution of residential building energy classes in the four Greek climate zones

Closer examination of the distribution of the energy ratings per construction period in all four climate zones reveals that buildings built before 1980 have the lowest energy ratings, as diagram 7 shows. This is largely due to the fact that thermal insulation regulations started to be introduced after 1980, so most buildings constructed before then were not insulated. The majority of houses and apartment blocks built before 1980 are G rated, across all climate zones. Targeting this segment of the residential building stock for retrofit has the potential to unlock significant carbon and energy savings, besides generating employment.

Homes constructed after 2000 are predominantly C and D rated, showing that even buildings constructed in the decade before EPBD implementation in Greece, largely fail to satisfy the requirements set by KENAK. In all, these figures highlight the huge potential for improvement in the energy performance of the Greek housing stock.

73 E.G.Dascalaki, S.Kontoyiannidis, C.A.Balaras, K. G.Droutsa, Energy certification of Hellenic buildings: First findings, Energy and Buildings 65 (2013) 429437


2. BACKGROUND

Diagram 7: Energy ratings of residential buildings per climate zone and construction period74

The energy audit procedure is the first step to defining the most suitable energy saving measures for a home. In Greece, where the building is rated lower than B, the EPC will list between one and three recommendations for improving its energy performance with the estimated energy savings, reduction in emissions and pay-back period. These recommendations are generated by the detailed energy audit process, and include the most suitable energy efficiency measures that are able to improve the buildings energy performance in a cost-effective way.

Diagram 8 shows the frequency of types of recommended measures from a study of around 10,000 Greek EPCs75. The majority of the EPCs were obligatory, in that they were required to buy or sell an existing dwelling. In all these cases it is impossible to confirm the level of take up of these measures.

Diagram 8: Frequency of appearance of categories of recommended measures in obligatory EPCs

74 E.G.Dascalaki, S.Kontoyiannidis, C.A.Balaras, K. G.Droutsa, Energy certification of Hellenic buildings: First findings, Energy and Buildings 65 (2013) 429437

75 J.Gelegenis, D.Diakoulaki, H.Lampropoulou, G.Giannakidis, M.Samarakoua, N.Plytas, Perspectives of energy efficient technologies penetration in the Greek domestic sector, through the analysis of Energy Performance Certificates, Energy Policy 67 (2014) 5667.

2. BACKGROUND


Energy security also plays a big part in Greek efforts to reduce overall energy consumption. Greece depends heavily on imported energy, especially oil and natural gas. Lignite is the only major domestic fuel and is extensively used for power generation. Lignite is also a major source of CO emissions and air pollutants in Greece. As shown in diagram 9, around 64% of the total energy consumption in Greece in 2010 was based on imported oil and natural gas.

Natural gas11.4%

Renewables7.6%

Solid fuels27.8%

Crude oil and petroleumproducts53.2%

Total Mtoe: 28.84

Diagram 9: Fuel mix of Greek energy consumption in 2010 (source: Eurostat)

In terms of electricity generation in Greece, as shown in diagram 10 imported fuels contributed nearly 28% towards total electricity generation, with natural gas dominating the mix. Generally, oil is mostly used in the non-interconnected islands.

Crude oil and petroleum

products10.6%

Other0.2%

Natural gas 17.1%

Renewables 18.4%

Solid fuels 53.7%

Total TWh: 57.39

Diagram 10: fuel sources in electricity generation in Greece in 2010 (source: Eurostat)

The construction sector in GreeceThe economic crisis that has impacted Greece since 2010 has had a substantial effect on the penetration of energy efficient technologies. Since 2008, Greek GDP has shrunk by 22% and consequently, households have seen a dramatic decline in their income. This in turn has impacted the whole construction sector. Diagram 11 shows the rapid decline in the number of new building permits in Greece during the years from 2010 to 2014.


2. BACKGROUND

Diagram 11: The number of new

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