The role of European municipalities and regions in financing energy upgrades in buildings

Energy efficiency in buildings has a central role to play in reaching the climate neutrality goal set by the European Green Deal. With detailed knowledge of their building stock and the profile of their occupants, regional and local authorities can forge an important link between financiers, industry professionals and homeowners to ensure the successful deployment of financial schemes that support the uptake of energy efficiency upgrades. This paper provides a first assessment of the role of regional and local authorities by reviewing relevant initiatives and programmes on energy efficiency. Based on a questionnaire completed for more than 150 schemes, it explores how European municipalities and regions stimulate energy upgrades in residential, commercial and public buildings through public financial support. It is found that 60% of the examined schemes are offered in the form of grants and subsidies, and 45% of them targeted residential upgrades. The use of EU cohesion policy funds in supporting regional schemes, and promotion of energy efficiency investments at local level through the European Covenant of Mayors initiative are also explored. In spite of possible resource limitations at this level of governance, regional and local authorities are in a good position to utilise European structural or research funds to develop financial schemes, as standalone programmes or blended with national ones, thus providing additional support and funds for deep renovations. The results suggest that energy efficiency in buildings has become an important part of local and regional strategies in several European countries, but could be further enhanced.