Percentage distribution of primary energy (Ep) values in the Italian national building stock

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The European Union is pursuing ambitious climate change targets aligned with the 2015 UN 2030 Agenda and the Paris Agreement. Achieving these targets requires substantial investments, primarily in energy-efficiency renovations of buildings, which are currently lagging across Member States. The EU recognizes that the public sector alone cannot meet these financial demands, hence private finance has become a focal point in transitioning to a sustainable economy. Since 2018, the EU has developed a comprehensive regulatory agenda for Sustainable Finance to facilitate this transition, centering on the EU Taxonomy and its technical screening criteria (TSC) established in the April 2021 Delegated Act on Sustainable Activities.

The TSC are crucial for determining compliance with energy-efficient financing, specifically regarding the construction, renovation, and ownership of buildings. The Energy Efficient Mortgage (EEM) Label initiative, alongside the Energy Efficient Mortgage Initiative (EEMI) National Hubs, has been analysing the implications of these criteria. A significant challenge in Italy has been identifying the top 15% of the existing building stock based on Primary Energy Demand (PED), as there is currently no clear function to link PED to Energy Performance Certificates (EPCs). This has introduced uncertainty in the market.

To address this issue, the EEMI mandated the Comitato Termotecnico Italiano (CTI) to develop a methodology for identifying compliance thresholds for various building types and climate zones. CTI’s findings enable banks to accurately benchmark energy efficiency, originate new energy-efficient mortgages, and align their bond frameworks with the EU Taxonomy. For instance, analysis shows that, among buildings constructed before 2020, significant discrepancies exist between prior eligibility criteria and the new EU Taxonomy standards.

The results from the CTI’s analysis serve as vital guidance for Italian banks in improving their loan portfolios and achieving EU Taxonomy compliance. The intent is to adapt and share this methodology across other jurisdictions to facilitate similar progress in energy efficiency financing.