More stringent regulation is a national interest

A new Government Decree is to tighten the energy performance requirements of buildings within the next few years. Model calculations demonstrate that the current national requirements are far below the cost-optimal level.

On April 30, 2013, the Government has adopted Decree No. 1246/2013 which tightens the energy performance requirements of public buildings by 2015 and in all other buildings by 2018. The new, more stringent regulations will apply for all types of buildings related to energy efficiency support schemes by 2015. Furthermore, the Decree requires relevant ministers to develop financial programs to compensate for the extra initial investment cost that may occur for complying with tighter regulations.

The precursor of the Government’s decision was Directive 2010/31/EU, which requires Member States to set minimum energy performance requirements for new and existing buildings subject to major renovation. The regulation’s purpose is that Members States minimize both the number of new buildings that waste energy and improperly renovated buildings. In Hungary, the Ministry of Interior has assigned Energiaklub to perform the technical and financial analysis — in consistence with relevant legislation on methodology — required by the EU. The country report was submitted to the European Commission earlier this March.

The report confirms that for all 15 types of buildings analyzed the results were better, if more strict regulations would be in effect in comparison with the current Hungarian regulations (TNM Decree No. 7/2006). In other words, taking into account both the initial investment costs and the annual energy costs, more stringent requirements yield a “cheaper” solution for the users. For example, the global cost of a typical Hungarian family home — built 50-60 years ago from brick in the so-called “Kádár’s cube style” — without renovation is approximately 13 million Forints for the next 30 years (in present value). On the other hand, if a renovation following more rigorous requirements is performed, the global cost for the same period adds up to no more than 7 million Forints.

The calculations clearly substantiate that the current national requirements are far below the cost-optimal level. The report submitted to the Commission had to justify the difference and, if they could not be justified, a separate action plan had to be submitted outlining the steps that a country plans to take in order to reduce the gap within 5 years when the next review is scheduled to take place. The recently adopted Government Decree serves as an action plan towards tightening the requirements, which can be considered as a progress in comparison with the situation before.

It must be noted, however, that according to the EU regulation, all Member States must ensure that new buildings are “nearly zero-energy” buildings by 2020. Tightening the requirements sooner would have been important, since less efficient technologies could have been gradually squeezed out of the market resulting in a price drop of more efficient technologies, so even the more stringent requirements were to reach cost-optimal levels within a few years. Tightening the requirements as soon as possible is both a private and a national interest.

(Photo: Thorben Wengert, pixelio)