CO2 reduction in the renovation of post-war housing areas: a feasibility study

In the Kyoto Protocol, governments of the industrialised countries agreed to reduce the total 1990 level of CO2 emissions by 5.2% between 2008 and 2012, thus increasing the pressure on governments to establish CO2-reducing strategies. The largest energy end-users in absolute terms are households and the tertiary sector (EC, 2001). In the EU new housing production is 1.9 million units per year, approximately 1% of the building stock, and dwellings yet to be built will constitute 15% of the total housing stock in 2020 and 5-10% of the total housing stock in the Kyoto period 2008-2012 (NOVEM, 2002). Consequently, according to the Kyoto agreements, the existing housing stock is an important sector in reducing greenhouse gas emissions. The environment, however, continues to play only a small part in urban renewal projects (Bus, 2001). From an economic point of view, a firm or a household will invest in energy conservation up to the point where the costs no longer outweigh the financial benefits (Velthuijsen, 1997). According to Sunikka and Boon (2002) and Van der Waals et al. (2003), costs are often seen as the main barrier for adopting CO2 reduction measures in urban renewal, but this concern is related to the impression of costs at face value, rather than any consideration of the actual costs and benefits. The development of operation-focused and long-term policies that support investment in energy improvements in the existing housing stock are key in the promotion of sustainable urban renewal. Successful policies require awareness of both the practical potential and the barriers. This paper has two goals. Firstly, it examines the feasibility of CO2 reduction in post-war housing in practice, focusing on the costs. The results are set in the context of relevant policy instruments, namely developments in energy pricing. Secondly, it discusses policy instruments that could make use of this potential and overcome the barriers identified in the case study. This paper aims to answer the research questions: What is the energy saving potential of post war housing renewal? What are the required expenditures and the expected receipts? Which policy developments will make investment in energy efficiency more attractive in the near future?