Energy efficiency of buildings has been adopted as a major option on “saving primary energy and reducing greenhouse gas emissions in Germany.”301 Building stocks utilizes 40% of the final energy consumption302 with 80% of energy used in heating water and buildings.303 Germany’s ambition is to reduce emissions from buildings by 66-67% by 2030.304 Germany’s energy efficiency movement like Finland and UK can be traced back to the mid-1970s as an energy security response strategy following the 1973 oil embargo. The Energy Saving Act of 1976 became the first law on energy efficiency in buildings with the main objective to achieve energy security but recently the focus has shifted towards the protection of the environment and climate change mitigation.305Germany’s energy efficiency success story has been supported by three main pillars, namely a “clear legal framework and tight regulation at federal or regional government level, a strong financial incentive through subsidies and loans,”306 and “energy‐conservation information and advice.”307 Germany has complex institutional arrangements, however, the primary responsibilities on energy efficiency of buildings falls under the jurisdiction of the Federal Office of Energy efficiency.308
Germany transposed the EED and EPBD through updating several key national laws. It is an important player in EU environmental policies for its most ambitious national CO₂ emission
300 Annunziata Energy 2013. p.125.
301 Schimschar Energy Policy 2011. p.3346.
302 Amecke Energy Policy 2012. p.4.
303 Power et al.. Brookings Institution 2011.
304 Wri.org/blog Section Germany Becomes First Country to Release a 2050 Emissions-Reduction Plan.
305 Hubertus 30 IW-Positionen 2007. p.1.
306 Power et al.. Brookings Institution 2011.
307 Power et al.. Brookings Institution 2011.
308 Eusterfeldhaus Journal of Energy & Natural Resources Law 2011. p.465.
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reduction commitments.309 Germany is regarded as a ‘front-runner’ on energy efficiency of buildings310 for its ambitious ability in “facilitating both local experimentations and national enforcement of high environmental and energy efficiency standards.”311 Energy efficiency law in Germany is located in several acts and regulations dealing with construction, minimum energy performance standards (MEPS), labelling, energy services and renewables. This mixture of regulatory instruments has been “criticised for being unconcerted, but they give energy efficiency a strong, formally expressed place” in the legal framework312 of the federal government and the EU. Its regulatory framework of energy efficiency of buildings is primarily under the scope of the Energy Conservation Act (EnEG),313 Energy Conservation Ordinance (EnEV), Heating Cost Ordinance, Energy Efficiency Measures (Energiedienstleistungsgesetz, EDL-G) 2015, Renewable Energy Sources Act (EEG) and the Renewable Energies Heat Act 2009 (EEWärmG, amended in 2012)314 that promotes the uptake of renewable energies in buildings.315 Germany is working on harmonising and simplifying the existing legislation and introducing the Buildings Energy Act.316
4.1.1 Energy Performance Certification regulation
EPCs in Germany are a legal requirement. They have been issued since 1995 but strengthened by the adoption of the EPBD. Germany has been way ahead of the EU indicating its long-term ambition on energy efficiency of buildings. The legal basis for issuing and using the EPCs is outlined in the Energy Conservation Act (Energieeinsparungsgesetz [EnEG]).317 The EPBD calls
309 Andersen et.al.. Manchester University Press.
310 Rosenow Energy Efficiency 2013. p.219.
311 Power et al.. Brookings Institution 2011.
312 Eusterfeldhaus Journal of Energy & Natural Resources Law 2011. p.465.
313 Germany Report on the long-term strategy for mobilizing investment in the renovation of the national building stock
314 bmwi.de/Redaktion/EN Section Energy Conservation Legislation.
315 Germany Report on the long-term strategy for mobilizing investment in the renovation of the national building stock.p.36.
316 bmwi.de/Redaktion/EN Section Energy Conservation Legislation.
317 Germany Report on the long-term strategy for mobilizing investment in the renovation of the national building stock. p.36.
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for voluntary accreditation of EPC certifiers and in Germany there is no official government accreditation procedure and accreditation is only done byprofessional associations and third-party bodies that also oversee independent quality control since 2014.318 The German Institute for Building Technology (DIBt) and regional governments also monitors the EPC quality. Germany EPCs are considered time and cost effective since the certifiers can issue one without on-site visits in the presence of sufficient data.319 Through enforcing the EPCs the EnEG creates the legal framework to promote energy transition in the building stocks by focusing on the implementation of the EU laws. With a 30% reduction in energy use target and an increase of 30% share of renewable energy by 2020, EPCs have been adopted as important tools to map and monitor the national building stock320 to address key legal elements of the EPBD.
Energy Conservation Ordinance (EnEV) is another key legislative instrument in energy efficiency of building stocks in Germany addressing EPCs. It obliges developers to abide by higher energy efficiency standards for new buildings, with “new buildings required to have a 25% primary energy consumption reduction alongside a 20% heat transfer loss.”321 The 2016 EnEv amendment was projected to bring 25% increase of energy efficiency which is an important step towards NZEB as established by the recast EPBD Article 9. The key legal elements of the “EnEV stipulate requirements for the minimum energy performance of buildings as well as building components and regulates all necessary framework conditions such as the obligation for energy performance certificates.”322 EnEv focuses on increasing the rate and scope of buildings retrofit which is a key objective to be achieved through EPCs. The EPCs as enforced by the EnEv incorporate cost-effective recommendations of thermal retrofits. Germany views EPCs as important tools for modernizing old buildings to become 30% more energy efficient and increase the uptake of renewable energy sources.323
318 Arcipowska, Buildings Performance Institute Europe (BPIE) (2014). p.20.
319 Arcipowska, Buildings Performance Institute Europe (BPIE) (2014). p.24.
320 Arcipowska, Buildings Performance Institute Europe (BPIE) (2014). p.20.
321 bmwi.de/Redaktion/EN Section Energy Conservation Legislation.
322 Schimschar Energy Policy 2011. p.3347.
323 Arcipowska, Buildings Performance Institute Europe (BPIE) (2014). p.24.
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The display obligation for real estate and public buildings to disclose energy information on properties for sell or rent is strongly implemented pursuant to the Energy Conservation Ordinance (ECO) requirements. EPCs should be made available to potential buyers or tenants and displayed in public buildings. The new tenants or buyers have the right to possess the energy certificates in line with the ordinance and the EU laws. Compliance is sanctioned by fines. To strengthen the implementation of the laws and enforcement, the ECO introduced an obligation to “spot check energy performance certificates.”324
Although EPCs have been strongly implemented in Germany, they play a minor role in property purchasing or renting decision. This does not support energy efficiency of buildings since inefficient properties may end up getting first preference due to other buyer or renter preferences.
Their role is also weakened since property developers are not legally obliged to invest in energy efficiency as a product quality that can be used as a negotiation instrument in the purchasing process.325 The effectiveness of the EPCs in Germany is also limited by the lack of helpful information on understanding the financial implications of energy efficiency.326 In order to make a more meaningful and ambitious impact, there is need to redesign Germany’s EPCs and making them more understandable.
4.1.2 Metering and billing
Germany introduced the Heating Cost Ordinance 2009 (HCO) in order to “create incentives for the economical use of energy through metering and user-based billing of heating and hot water costs.”327 This is a direct regulation targeting energy savings and GHGs emission reduction in building stocks. The HCO pursues the obligations of the EED Article 10 to enhance transparency and comprehensibility on metering and billing covering cooling, heating and hot water services obligations. The installation of technical equipment for metering is mandatory dating back from
324bmwi.de/Redaktion/EN Section Energy Conservation Legislation.
325 Amecke Energy Policy 2012. p.4.
326 Amecke Energy Policy 2012. p.5.
327Germany Report on the long-term strategy for mobilizing investment in the renovation of the national building stock. p.36.
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1981 when the ordinance was adopted into law. The ordinance drives energy saving by ensuring that tenants are billed based on their energy consumption levels (Section 6-9 of the German HCO).
It governs the “allocation of costs for heating and hot water production in centrally supplied buildings with two or more units.”328 The consumption based billing for heating and domestic hot water supply has been projected to yield an energy consumption reduction of “3.5 – 7% translating into a CO₂ emission reduction of 1.7 to 3.3 million tons per year.”329 The evaluations conducted in 2009 indicated that the regulation has a potential to reduce CO₂ emissions by 0.23 Mt in 2020 and 0.47 Mt in 2030.330
4.1.3 Funding of energy efficiency renovation
Pursuant to Article 4 EED, Germany is obliged to mobilize investments in building stocks renovations. Germany has established a fund that finances national energy efficiency initiatives and measures. The KfW Development bank is legally mandated to provide information to and cooperate with banks and other financial institutions to distribute loans in support of energy efficiency. KfW extends assistance to other organizations “to set up their own energy efficiency support programs”331 pursuant to Article 20 EED and has been appraised for driving adoption via grants and loans.332
The downside of these subsidies and funding efforts is that there is no comprehensive “national picture because of Germany’s highly decentralized system”333 making the regional comparisons and assessments complex and legally challenging.
328 bmwi.de/Redaktion/EN Section Energy Conservation Legislation.
329 GEA. Legal Barriers to Climate protection in Palling and Construction of Buildings.2016.
330 Öko-Institut Dessau-Roßlau 2009
331 Concerted Action 2016.
332 Concerted Action 2016.
333 Power et al.. Brookings Institution 2011.
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4.1.4 German construction and renovation policies and measures
In 2011, 70% of the buildings constructed between 1900 and 1979 were in need of energy efficiency renovations indicating a high level of “undeveloped energy saving potential.”334 Germany’s refurbishment rate for energy efficiency has been 2.2% per year.335 In response to this low rate, the federal government had to introduce the tenancy law and maximize its enforcement to increase energy efficiency uptake pursuant toArticle 4 EED. The tenancy law “provides for effective incentives for energy modernization of the rental housing stock.”336 The law promotes energy efficiency uptake by landlords since it allows them to share the costs of energy related renovations with the tenants. Section 559(1) of the German Civil Code allows landlords to increase the annual rental charge by 11% to cover the costs of energy renovation.337 Both tenants and landlords benefit from the investment costs. Germany has a “tax relief on renovation work” that owner-occupiers and landlords can claim from the federal Government. This helps improve energy efficiency of building stocks. On the downside “for landlords, tenancy laws, legal standards, rent regulation, and loan repayments” all complicate decisions on energy conservation investment.338 Germany is still affected by slow rates of renovations of existing buildings, with over 20 million units339 to be renovated, making the impacts of the policies questionable. At the current rate of refurbishment, it will require 80 years to refurbish the remaining stock.340 It is estimated that the current rate of 200,000 buildings which are refurbished yearly should be doubled to complete the energy efficiency renovations in 20 years.341
334 Schimschar Energy Policy 2011. p.3346.
335 Schimschar Energy Policy 2011. p.3351.
336 Germany Report on the long-term strategy for mobilizing investment in the renovation of the national building stock.p.38.
337Germany Report on the long-term strategy for mobilizing investment in the renovation of the national building stock.p.38.
338 Power et al.. Brookings Institution 2011.
339 Power et al.. Brookings Institution 2011.
340 Power et al.. Brookings Institution 2011.
341 Power et al.. Brookings Institution 2011.
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4.1.5 Germany legislation impacts
Germany has made great achievements in energy efficiency considering the €1 billion per year in reduced heating costs experienced between 2006 and 2009 by residents and landlords.342 Energy efficiency regulations are credited for reducing into half the energy use of buildings since 2002,
“from approximately 120kWh per square meter per annum to 60 kWh/sqm/p.a. in new buildings and 80 kWh/sqm/p.a. in existing buildings following retrofit.”343 The buildings stocks emissions fell from 209 million tonnes of CO₂ to 119 in 2014 with projections between 70-72 million tonnes of CO₂ by 2030.344
As more ambitious energy saving measures for the building stocks are introduced, Germany requires further action in monitoring compliance and ensuring uniformity across all regions despite many achievements. Over the years it has managed to put in place many important policies and measures,345 but the system has a complex legal framework with limited enforcement and support.346 Germany needs to consolidate its laws and regulations into a single heating and energy conservation Act for easy monitoring, enforcement and avoiding overlapping. Germany has proposed the Buildings Energy Act to effectively legislate energy efficiency in buildings and this is still work in progress.