LIFE European City Facility: Launch of the Fifth Call for Applications
News publ. 17. May 2023
Given the weight of the residential sector in industrialised countries' energy end use and greenhouse gas (GHG) emissions, the promotion of energy efficiency investments in the existing building stock is a major task in climate and energy policy. Consequently, incentives such as income tax credits have been introduced in many countries (e.g. Italy, USA) to encourage households to invest in energy-efficient refurbishment of their dwellings. An essential part of France’s decarbonisation strategy in the building sector is a tax credit scheme for expenditures related to energy-efficient renovation work, the so-called CITE scheme. Between 2005 and 2011, more than six million of the 34 million principal residences in France benefitted at least once from this income tax credit.
In Germany, current funding schemes have so far not been able to provide sufficient incentives for investments in the energy-efficient modernisation of residential buildings. The present renovation rate of about 1 % continues to be too low to achieve the federal government's savings targets. In order to achieve higher rates of refurbishment in Germany, additional government support measures would be helpful, since the energy-efficient modernisation requires considerable investment, especially in the older building stock. However, to date such investments can often only be amortised on the market in the course of decades. In this respect, tax incentives could improve the profitability of energy-related renovations and - at least partly - trigger the investments needed.
The present study forms part of a series of publications within the project “Bridging European and Local Climate Action (BEACON)”. As part of this project, scientific analyses were conducted of national policy instruments that successfully led to GHG emission reductions in European countries in the building, transport, agriculture and small-industry sectors. The analyses particularly focused on the instruments’ effectiveness and their potential transferability to the German context.
Further publications in this series