Support actions and regulatory instruments, an overview among selected European countries

This document was produced to provide an overview of existing EU energy efficiency legislation, which can be separated into two major groups of tools: supporting actions and regulatory policies. The analysis focuses mainly on support actions policies (including predominantly financial and fiscal policies) and aims to determine potential gaps in the legislation and local enforcement that, if overcome, could support market development. The report is divided into three parts.

In the first part, we introduce the importance and role of energy efficiency policies, especially how these policies have developed in the EU and how they contribute to energy conservation. The analysis then concentrates on the different types of measures used, support actions and regulatory instruments and their peculiarities. It is specifically detailed with references and demonstrates the variations between the two methods and the results they are capable of generating. As a result, supportive instruments are rather market-oriented tools aiming to provide economic incentives allowing to promote positive actions, whereas regulatory instruments focus on achieving specific objectives. 

Further, the analysis shows how the various countries in the data set implement their respective policies. It is noteworthy to stress that while the adopted strategies at the EU level are quite balanced, there are significant variations among individual nations. Germany, Spain and France have the highest number of policies and show a majority of regulatory instruments in absolute terms. In relative terms, the Czech Republic, Poland and the Netherlands have the highest support policies compared to regulatory ones. Furthermore, we proceed to a more in-depth distinction between fiscal and financial policies since they both constitute supporting actions. After a brief description of the specificities of this group, we propose an evaluation of their reputation among EU members. The observed findings reveal a notable variation in the application of the two types of policies. The most outstanding information is the majority of financial tools (90%) over fiscal ones; furthermore, Germany, Spain and the Czech Republic have the highest concentration of supportive action. In terms of fiscal policies, Italy, Sweden, and France have the highest concentrations. While these countries have the majority of fiscal tools, they are still in the minority compared to financial policies. In the second part of the report, we adopt rather a qualitative approach to the study of energy efficiency policies. For this purpose, we elaborated a survey, completed by a pool of 43 experts belonging to the lending institutions participating in the EEM initiative. The questionnaire aims to evaluate not only the degree of awareness of financial institutions with regard to the implemented EE policies in their respective countries but also the degree of adaptation of their financial products to the specific regulation. Thus, the survey is structured first to determine the experts’ knowledge of energy policies in general, but also their use. Namely, it tests the preferences among the different policy types (support actions or regulatory instruments), and sectors (residential, non-residential or both). Unsurprisingly, the surveyed sample is aware of at least some of the policies on energy efficiency. Residential and non-residential sectors and supportive policies are also shown to be preferred. 

Furthermore, the study focuses on EPCs (Energy Performance Certificates), one of the main EE pillars, allowing to certify and monitor buildings’ energy use. The entry into force of the Energy Performance of Buildings Directive (EPBD) required the application of EPC labels to all residential properties that are for sale or rental (European Union, 2010). The transposition of this directive to the national regulation framework was under the responsibility of each member state which led to a highly diverse interpretation and contributed to complex national-specific EPCs structures that are difficult to compare. Based on our survey, however, we can proceed to a limited comparison (in the countries under review) of the use of EPCs among lending institutions’ products. While the majority of institutions offer energy efficiency products through EPCs, there is a minority that offers the same products internationally. 

Finally, the report concludes its analysis of energy efficiency policies by specifically reporting two case studies of national support actions: the Superbonus 110% in Italy and the KfW program in Germany. The report strives to provide a more detailed and precise understanding of Europe’s current energy network through two recent examples in European territory. The Italian support action incentive enacted in 2020 presents important insights and gives room for several reflections; in general, there was a high demand for obtaining the benefits of the Superbonus 110% and in two years there were 338,950 applications. Among these, just 28,7 % did not complete all the stages of implementation, mainly due to the complex bureaucratic process. Different are the achievements and considerations of the KFW program. A notable aspect of the German initiative program is its size, scope, longevity, and focus on deep renovations; at the same time, retrofits must not only be applied to private homes but also to public facilities.