The Renovate Europe Campaign addressed letters to the Finance Ministers of the 27 EU Member States and Croatia, highlighting the multiple benefits of investing in energy efficient renovations and their positive impact on public finances, as shown by the Copenhagen Economics study. Each letter was personalised to its Minister and written in the national language; the letter to the Irish Minister for Finance is below as an example.
Subject: Energy Efficient Renovation Programmes Boost Public Finances
Dear Minister,
There is an overlooked and highly cost-effective way to boost public finances in Ireland that will also lead to social and environmental benefits, namely investment in ambitious energy efficient renovation programmes that address the existing building stock. It is encouraging to note that the Sustainable Energy Authority of Ireland has already prepared the groundwork for Ireland in the form of a series of Roadmaps, including one on Residential Energy that addresses the housing sector – the segment of the buildings sector that uses the highest proportion of energy.
I write to you on behalf of the Renovate Europe Campaign and its 21 partner companies and associations. We are working to create the conditions in which it will be possible to reduce the energy demand of the EU building stock by 80% by 2050 as compared to 2005 levels. If you and your government colleagues take account of the information that we are now sharing with you, it will be an important step on the path towards our goal and an important step in stimulating economic activity in Ireland.
Our experience of existing ambitious energy efficiency programmes shows that for each €1 invested by government, up to €5 returns to public finances in a short period, sometimes within just a year. In particular, this has been demonstrated in Germany and in Ireland. Building on such results, an important new Study that was carried out for the Renovate Europe Campaign by Copenhagen Economics, has monetised the multiple benefits of investing in energy efficient renovation and the key findings are that a significant increase in public revenue, coupled with a boost to GDP, will accrue in the coming years, if more countries adopt ambitious plans for the renovation of their existing building stock. You can find more detail in the attached brochure.
The report also identifies four no-cost actions that your government can take in order to stimulate this promising new market as follows:
- Modernise rent regulation to allow landlords and tenants to split the gains from energy efficient renovation of buildings.
- Reform budget management of publicly owned buildings to allow for a longer term focus in investments and renovation of buildings. This will reduce longer term operating costs in the publicly owned building stock.
- Remove or reduce favourable tax treatment of heating and electricity in buildings to render energy efficient renovation of buildings more attractive and provide direct net revenue gains to public budgets.
- Develop well-designed risk-sharing programmes to help government as well as private building owners to realise cost savings with very limited budget costs.
We believe that the current weak economic situation across most of the EU makes it timely to decide to put such programmes in place now, especially as the report concludes that it will be another 4-5 years before Europe gets back to its structural GDP level. This means that the conditions for investment in deep renovation of the building stock are ideal with under-capacity in the labour market to draw upon and with the cost of financing in most Member States at an all-time low. The hard facts brought to the surface by the Copenhagen Economics Study show that the resulting energy savings from renovation will be a net benefit to stretched public finances.
Aggregating the calculated benefits to EU level, Copenhagen Economics estimates that an ambitious programme of energy efficient renovation of the existing building stock could create up to 1,480,000 jobs, boosting GDP in the period to 2017 by up to €291 billion and delivering permanent annual benefits to public finances of up to €39 billion. We attach to this letter a PDF version of the full report, but we would also be ready to send, upon request, some printed copies of the Study to you.
Finally, we would like to suggest that a meeting be arranged in order to further discuss the best way for Ireland to benefit from this opportunity and to share more of our understanding of the issues at stake with you and your services.
Yours sincerely,
Adrian Joyce
Campaign Director
The letter came with an annexe setting out the key facts from the Copenhagen Economics study; it is included in the PDF.
