Efficiency house model of the future — Why climate protection comes at a high price

New construction subsidy only from Efficiency House Standard 40

When it comes to climate protection, property owners play an important role. Because eBuildings account for some 35 percent of total final energy consumption in Germany. Residential buildings are particularly energy-intensive: In single-family and two-family houses, 39 percent of all energy is used, while apartment buildings account for 24 percent. The remaining 37 percent is consumed by non-residential buildings.

In order to achieve the sustainability goals, the Federal Government has therefore decided to reduce the heating requirement of buildings by 20 percent by 2020. Primary energy consumption is to be reduced by 80 percent by 2050, and the building stock should then be almost climate-neutral.

As a result, an amendment within the Federal Funding for Efficient Buildings (BEG) came into force on July 1, 2021, according to which state-owned promotional bank KfW New construction funding for Efficiency House 55 Standards will expire on February 1, 2022. The Federal Government justified the decision by saying that in future, more funding should flow to where the CO2 savings potential is highest. In other words: in building renovations and particularly efficient new buildings in accordance with Efficiency House 40 standard.

The change is met with severe criticism because, on the one hand, KfW subsidies are in high demand: In 2021, a total of twelve billion euros in funding was approved by the end of September, with Effizienzhaus 55 new buildings accounting for a third. On the other hand, the efficiency house 40 requirements make new buildings expensive. For this reason, builders are left with the time-consuming and capital-intensive rescheduling to Standard 40, the waiver of funding or the decision to only implement the minimum legal requirements, which currently roughly correspond to Efficiency House Standard 70.

An overview of efficiency house standards

Regardless of whether it is a new building or an existing building in need of renovation: The more energy efficient a house becomes, the more funding the client or owner can receive from the state. Either directly as a subsidy or via a low-interest loan in conjunction with a repayment subsidy. The amount of funding depends on the efficiency house level actually achieved, with the maximum loan amount of up to 150,000 euros, the repayment subsidy or investment subsidy up to 37,000 euros.

There are five efficiency house standards: 40 (plus), 55, 70, 85 and 100. The smaller the key figure, the lower the energy requirement of the property in relation to one of Building Energy Act (GEG) defined standard house.

• KfW Efficiency House 70

KfW Efficiency House 70 requires 30 percent less primary energy per year than the reference house.

• KfW Efficiency House 55

A KfW Efficiency House 55 may only consume 55 percent of the energy of the low-energy house (KfW 100) per square meter of living space per year.

• KfW Efficiency House 40

The primary energy requirement of a KfW Efficiency House 40 may not exceed 40 percent and the transmission heat loss may not exceed 55 percent.

Criticism of the cancellation of KfW 55 funding

So far, many project developers have been planning with KfW 55 because, in addition to cheap KfW loans, there was also a subsidy of a maximum of 26,250 euros for builders up to the deadline on February 1, 2022. From this point on, only more sophisticated and correspondingly more expensive Standard 40 efficiency houses will be funded. It may also be possible to convert ongoing plans from Efficiency House Standard 55 to Efficiency House Standard 40 — but there are also serious disadvantages here, which are causing criticism across the board.

• Criticism 1: More time and costs for builders

In order to achieve the higher energy standard 40, expensive building technology measures are sometimes necessary, which force builders to replan at short notice or implement the less climate-friendly efficiency house Standard 70. The structural efficiency house standard 40 requirements include comprehensive thermal insulation and the use of renewable energies. Pellet heating systems, solar thermal systems or heat pumps, for example, are used as heat sources.

• Criticism 2: Brakes for residential construction

The German housing industry is also criticizing the cancellation of Effizienzhaus 55 funding. Because without financial support, projects with higher climate standards are no longer affordable for many builders. Even in rental housing construction, higher energy standards can only be financed through significantly higher rents. The complete abolition of funding is therefore incomprehensible and anti-social.

Conclusion: Climate-friendly construction has entered the mainstream

Builders are faced with the decision: take more time and money into their hands and quickly aim for the 40 standard or refrain from government support, reduce energy ambitions and only implement the minimum legal requirements. If the decision is therefore increasingly in favour of a Standard 70 efficiency house, this counteracts the federal government's sustainability goals.

Despite the discussion about funding and opportunities that should contribute to the heating revolution in the German construction sector, the general development is correct: According to Data from the German Energy Agency (dena) There was a significantly higher number of efficiency houses in 2020 than in 2018 and 2019. EH 55 was built the most in the area of new construction in particular at 79 percent, followed by EH 40 Plus with 13 percent — and the trend is rising. It can therefore be assumed that more climate-friendly construction and renovation will become “mainstream” in the long term. However, it is essential that reliable framework conditions are created that social and at the same time sustainable construction projects Speed up instead of complicate.