The effectiveness of energy labels in improving sustainability of the building stock

From 2006, all European member states will be required to run a compulsory energy-labelling scheme which will come into effect whenever a building changes hands. In its current form this energy label, as prescribed by the EC Directive on Energy Performance of Buildings, is merely a communicative instrument which is designed to provide the owner with information on the energy consumption of the building. It will not impose standards or requirements for energy efficiency. The effectiveness of communicative instruments as a means of changing behaviour is, however, often disputed, the argument being that they only work if they fill a gap in the knowledge needed for decision-making. This paper aims to ascertain how far knowledge about the energy efficiency of a building influences purchase and rental decisions and how far the information on the energy label contributes to decisions to renovate the building. Besides providing a theoretical analysis, we shall quote experience from Denmark, where compulsory energy labelling for buildings was introduced in 1997, and from the Netherlands, where a voluntary energy-labelling scheme was introduced at the end of the 1990s.