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Revisiting the KfW and Green Deal programmes: it's not all about finance!

Panel: 2. Energy efficiency policies – how do we get it right?

This is a peer-reviewed paper.

Authors:
Jean-Sébastien Broc, IEECP (Institute for a European Energy and Climate Policy), The Netherlands
Elodie Trauchessec, ADEME, France
Christophe Milin, ADEME, France

Abstract

Dealing with energy efficiency in existing buildings, the attention has increasingly been focused on financing issues in the recent years. Two emblematic programmes have been frequently emphasised in this matter: the German KfW CO2 Energy-Efficient Renovation programme and the UK Green Deal scheme.

The former has been established as one of the most successful worldwide, if not the most successful (e.g. by the IEA), programme in the field. The latter, after being expected as a true revolution, has faced strong criticism first in UK, or for example at ECEEE2013.

This paper looks beyond preconceived ideas or ideological views, to examine the practical implementation details coming along the financing mechanisms, and how they have affected the outputs and outcomes of both programmes. Their exposure has indeed led to many publications, providing the pieces of the puzzle making possible to understand what devils are hidden in the details.

The analyses point out that even if the financing mechanisms form the core and public face of these programmes, their implementation raises many other technical, organisational, etc. issues and/or assumes that certain contextual conditions are met (e.g., technical solutions well identified, qualification of professionals, quality of works, transaction costs induced). These conditions are examined for both programmes, questioning whether and how they affect their actual achievements.

The related experience feedback reminds that if financing is a necessary condition to any kind of economic activity, it is not sufficient by itself. Even more, the other conditions are often more critical for achieving a sustainable market transformation. These conclusions support the need to enrich the national strategies for building renovation, in order to integrate the energy dimension in the common renovation markets and not to create specific but separate (and much smaller...) energy renovation markets.

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