LIFE makes it easier to own a green home

Green homes tend to be more expensive upfront due to the additional design and building costs, meaning many house buyers cannot afford them. The LIFE project SMARTER4EU has shown, however, that combining new forms of green mortgages and certification can provide high quality, energy efficient and affordable homes for EU citizens. 

The project’s partners have been working with banks, housebuilders and municipalities to develop Green Homes and Green Mortgage programmes in Ireland, Romania, Spain, Portugal and Ukraine. The project uses a validated green homes certification scheme in each country which banks can then use to approve discounted finance products for green homes or renovations.  

Lower risk loans 

The discounted finance facilitated by SMARTER4EU is possible because the energy running costs of certified green homes are much lower than typical housing, making the total monthly cost more affordable overall. This means that house buyers are less likely to default on their mortgage loans, allowing banks to offer better rates.  

‘The lower risks for banks financing net-zero energy homes allow for a lower cost mortgage for homebuyers that – when combined with lower energy costs – provides immediate and sustained lower monthly home ownership costs for citizens,’ says Elena Rastei, Executive Director of SMARTER4EU at the Romania Green Building Council, which is coordinating the project.  

The SMARTER4EU project has unlocked finance and green home certification for more than 37 000 new homes across Europe. This has saved 1.94 GWh of primary energy per year – equivalent to the average annual household electricity use of 1 293 people in the EU. 

Green residential projects worth €3.95 billion were also registered to be certified through the SMARTER4EU project, and it triggered €597.7 million of investment. Training and tools were also provided to municipalities for ‘blended finance’ programmes that combine private investment with government support, helping lower income and vulnerable households purchase greener homes.   

But making green homes more affordable is not the only challenge facing the housing sector in Europe. Assessing a building's energy efficiency can itself be confusing for homebuyers.  

Combined energy assessments 

Since 2002, Energy Performance Certificates have been the standard tool for helping homeowners, buyers and tenants understand and compare the energy efficiency of a property. 

But more recently the EU introduced an index called the Smart Readiness Indicator to measure a building’s ability to use smart technology to save energy and adapt to variable renewable energy sources such as solar and wind. 

‘The problem is that these two tools have developed separately, with no connection between them,’ says Sophie Dourlens-Quaranta, managing partner at R2M Solution France, coordinator of the LIFE-funded Smarter EPC project. ‘This means duplicated effort, cost and added complexity for building owners and occupants.’ 

Smarter EPC aims to make energy efficiency audits easier and faster by combining the two assessment processes into one workflow. This means only a single on-site audit is needed to collect all the data. The 9 project partners have also created a digital hub that connects the software tools used for EPC and SRI evaluations into a user-friendly interface. The hub is aligned with the most up-to-date EU standards and provides a consistent, joint certificate that combines the results of both assessments into one document. This allows users to easily see where a building is on its decarbonisation journey. 

Their approach is being tested in practice, with 207 assessments being reported across 14 countries.  

‘By making energy performance policy instruments more integrated, reliable and efficient, Smarter EPC contributes to modernising the European building stock as a whole,’ says Dourlens-Quaranta. 

SMARTER4EU and Smarter EPC projects contribute to the renewed Energy Performance of Buildings Directive and the Mortgage Credit Directive.