Putting a stop to energy waste: How building insulation can reduce fossil fuel imports and boost EU energy security

This study shows how improving insulation can reduce energy demand and drastically cut Russian oil and gas imports for heating in buildings. Investing in building renovation can reduce the use of fossil fuels for heating in buildings, reaching 44% in gas savings, save 45% of final energy demand and substantially contribute to securing the EU’s energy needs.

This study provides a quantitative analysis of the energy savings potential through better insulation in eight selected Member States (France, Germany, Italy, Poland, Czechia, Slovakia, Slovenia, and Romania). Our analysis focuses on residential buildings, due to the low data availability of non-residential buildings.

It shows the benefits of improving insulation in terms of reducing the energy demand and drastically cutting Russian oil and gas imports in those countries. Improving insulation in the selected countries can achieve up to 44% gas savings and reduce final energy demand by 45%. With the current high and volatile energy prices, building renovation projects have become an even more attractive and strategic investment.

It is essential to recognise that the economics of energy efficiency have changed dramatically in its favour, more than ever before. High and volatile energy prices mean that technical energy efficiency potentials which earlier seemed too costly have become attractive investments. The importance of lowering energy demand has a new geopolitical meaning and must lead to a paradigm shift in energy policy.

It has now become obvious that buildings are part of the EU’s vital infrastructure as they are critical to sustainably reduce energy dependence. Buildings must be treated as a critical factor in Europe’s strategic decisions on energy and security policy exactly because they can provide the same services with lower energy consumption if their energy efficiency performance is improved and their energy demand minimised.

For these reasons, this paper investigates how improving the energy performance of the building envelope would lower fossil fuel consumption in selected Member States.

The cost of missed opportunities to improve the energy performance of the EU building stock is all too apparent. This study shows how improving insulation of residential buildings can reduce energy demand and drastically cut oil and gas imports for heating. Diversifying gas imports should not be considered the only way to quickly get rid of Russian gas. Reducing demand to allow a steady increase of renewable energy supply as an alternative to fossil fuel imports is the solution the EU should pursue.

REPowerEU and the EU Save Plan must treat lowering energy demand as an essential prerequisite to achieve energy independence and a just energy transition. To this end, the EU Save Plan should:

  • Recognise that the best way to decrease the EU’s energy dependency is to make lasting reductions to energy consumption and apply the ‘efficiency first’ principle.
  • Acknowledge reducing energy demand as an absolute priority by fast-tracking policies to accelerate energy efficiency improvements and renewable energy supply in the Fit for 55 package, and recognise the value of pursuing them in parallel, not as alternatives to each other.
  • Direct short- and long-term investments to improve building envelopes and insulate roofs and walls as a priority. Some funding already available under the Recovery and Resilience Facility could be reallocated by renegotiating national recovery plans, boosting and front-loading their building renovation component. To achieve the 2030 and 2050 climate goals, such investments must be sustained over time.
  • Recognise that reducing energy demand and securing investments in building renovation are prerequisites to switch from fossil fuels to renewable heat and manage the increase in electricity use which may ensue.
  • Urge Member States to update their national renovation strategies and support their implementation with dedicated long-term financing instruments to speed up renovation.
  • Stop subsidies to fossil-fuel-based equipment to accelerate its phase-out from the EU market and accelerate financial support to replace fossil fuel heating systems with renewables.
  • Help the building supply chain by boosting upskilling activities to have a workforce ready to renovate and install quickly.
  • Roll out building renovation passports, one-stop-shops and renovation services, while fostering skills to make sure every renovation is aligned with the long-term climate and energy targets and all buildings are ready for future upgrades.
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BPIE supports evidence-based policy making by providing data and knowledge through its reports, as well as partnering in several European projects.

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