CELEX: 51987PC0401
Language: en
Date: 1987-09-09
Title: Proposal for a COUNCIL DIRECTIVE on information on the energy efficiency of buildings (presented by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (87) 401
Vol. 1987/0215
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Verschlusssachen als herabgestuft angesehen.
 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                            COM(87 ) 401 final
                                            Brussels , 9 September 1987
                               Proposai for a
                             COUNCIL DIRECTIVE
          on information on the energy efficiency of buildings
                      ( presented by the Commission )
  C0MC87 ) 401  final
 ---pagebreak---                                 CONTENTS
SUNNARY
EXPLANATORY HENORANDUN
      Introduction
      Need for information
      Expected results
      Options retained
      I mp lenient at i on
      Annex : justification of options
PROPOSAL FOR A COUNCIL DIRECTIVE
 ---pagebreak---                                      S U N N A R Y
1 . Following the Council resolution of 15 March 1985 ,         the Commission in
    consultation with experts from the Member States , has examined questions
    relating to the placarding of the energy consumption of buildings by a
    process of certification :
        - The results of two surveys carried out in the only Member State where
          an information procedure is compulsory have been presented and
          discussed ;
        - the actions carried out or planned in other Member States have been
          speci fi ed ;
        - the possible actions at the Community level have been examined .
2 . As a result of these initiatives, the Commission considers it necessary to
    submit the attached proposal for a directive to the Council for adoption in
    accordance with the following general principles :
        - when they are put up for sale , an energy audit will be carried out and
          the resulting report supplied to every potential purchaser in order to
          inform him / her of :
          . the energy consumption of the premises as they stand ;
           . possible improvements , their cost , their impact on energy  consumpt­
             ion and the return on the investment .
        - when they are put up for rent , informing every potential tenant of the
          energy consumption .
        - with recent buildings ( which were built to certain standards with
          regard to heat ) comparison with an equivalent new building against an
          appropriate scale .
3 . The Commission believes that an information procedure of this kind will :
        - remove a major obstacle to investment designed to improve the energy
          efficiency of buildings , and
        - speed up investment decisions and guide them towards       those actions
          with the highest return .
        - improve the transparency of the property market ,
4 . In addition to the main effects mentioned above a procedure of this kind is
    expected in practice :                                                     A
        - to create jobs ( the investment needed to save 1 million toe / year    in
          the building sector generates about 5 0 00 man-years of employment and
          reduces the social cost of unemployment by some 50 million ECU );
        - in the longer term ( 15-20 years ) to cause the greater part of the
          building stock to be covered by energy auditing ; and
        - to lead to the build-up of data bases on the state and real potential
          for improvement in the sector .
*
   Million tonnes of oi l équivalent a year .
 ---pagebreak---                                    EX PLANA TORY MEMORANDUM
I. INTRODUCTION
1 . The building sector ( residential and tertiary )            is the one which consumes
     the most energy :       more than      38 %   of   final  energy consumption    in the
     Community , i.e. some 260 million toe ( EUR 12 ) in 1985 .
     The potential    for energy      saving in this sector is considerable :           in a
                         1
     previous document     ,    the Commission estimated ( for EUR 10 )      the potential
     energy savings by improving existing buildings at 35 million toe / year,             and
     that   which  could    be    saved   in   the    construction   of  new  buildings    at
     20 million toe / year    .
     The overall energy efficiency of the Community has improved by 20 % since
     1973 ,  and a further improvement of at least 20 % has recently been adopted
     by the Council as the objective for 1995 \ The housing sector must play
     its part in the general effort to attain this objective .
   " Towards a European Policy for the Rational Use of Energy in the Building
   Sector ",    a Communication from the Commission to the Council ( C0M(84)614 ,
   13 November 1984 ).
   Compared with the pre-1974 reference situation .              This figure includes the
   effect of legislation on heating in new buildings plus that of new measures
   to be ' introduced .
   Council    Resolution   of    16 September 1986       concerning new   Community   energy
   policy objectives for 1995 and convergence of the policies of thi Member
   States ( 0J N° . C 241 , 25.9.1986 , p. 1 ).
 ---pagebreak---                                            - 2 -
2 . This document is in response to two resolutions and a declaration of the
              4
    Council     in which it   :
        - invited Member    States to    pursue and where necessary increase their
          efforts to promote the more rational          use of  energy by the further
          development of integrated energy-saving policies,
        - noted that    these    policies   should  in   particular  have   recourse   to
          standards    where    the   forces   obtaining    on   the  market    and  its
          transparency are not sufficient to guarantee efficient use of energy ,
       - also noted that the Commission ,       in consultation with experts from the
          Member States ,    would examine questions relating to the placarding of
          the energy consumption of buildings by a process of certification ,          in
          order to improve the flow of information to the parties concerned on
          the state of the real estate market and to give credit to the efforts
          made by the bui Iders /owners,
       - agreed that     the Community     and the    individual   Member States would
          publicize the needs for greater energy efficiency ,          making available
          full information and advice on how this can be achieved .
   . Council resolution of 15 January 1985 on the improvement of energy-saving
     programmes in the Member States ( OJ N° . C 20 , 22.1.1985 , p. 1 ).
   . Council resolution of 15 March 1985 on the rational use of energy in the
     building sector ( OJ N° . C 78 , 26.3.1985 , p. 1 ).
   . Council declaration of 26 November 1986 on energy efficiency .
 ---pagebreak---                                          - 3 -
3 . The Commission has therefore examined questions concerning the placarding
    of the energy consumption of buildings in greater detail .
    In particular, it has :
        - investigated in detail the operation and results           of   the  only
          compulsory procedure so far in force in the Community
        - convened an ad hoc working group of experts designated by the Member
          States, in which :
          . the results of the studies mentioned above have been presented , and
          . similar actions already initiated or in preparation in the Member
            States have been reviewed .
    The Commission has concluded that it was relevant to submit a proposal for
    a directive on information on the energy efficiency of buildings to the
    Council for adoption .
II . THE NEED FOR INFORMATION
4 . The lack of information is rightly seen as a major obstacle to investment
    in improving the energy efficiency of buildings notably during the periods
    of low energy prices .    A rational approach to the capital outlay required
    demands   that  not  only  the   current   energy performance,   but  also  the
    possibilities for improving that performance should be identified , and that
    the cost of and return on each possible improvement should be known with
    sufficient accuracy .
^ . "Labelling of the energy efficiency in buildings by a process of
     certification : the Danish experience " ( 19 August 1985 ).
   . " Cost-benefit efficiency of energy reports for buildings :     the impact of
     the' heat survey reports in Denmark since January 1 , 1985 " (1 October 1986 )
     ( Consultant : Birch & Krogboe, DK - Virum ).
 ---pagebreak---                                            - 4 -
    Those Member States which have given encouragement to ,           or even rendered
     compulsory ,  the use of information procedures on the energy efficiency of
    buildings have generally found that this gave a significant stimulus to
    economic    operators'    efforts :      investment    decisions   were   not  only
     accelerated , but also guided towards the most profitable action to take .
5 . Furthermore,     such a lack of information constitutes a serious obstacle to
    the mechanism of market forces :        the theory of free choice assumes that a
    person   buying    or renting   property    makes  his  or   her decision   in  full
    knowledge of the facts , and in particular on the basis of the true state of
    supply . However , in the absence of appropriate information the criterion of
    energy efficiency is hardly ever taken into account , although in most cases
    expenditure on energy makes up a          significant proportion    of the  cost of
    using the property .
III . EXPECTED RESULTS
6 . An information procedure on the energy efficiency of buildings should :
    - stimulate investments ,
    - create or preserve jobs ,
    - improve the overall energy balance sheet , and
    - reduce pollution .
    The Commission believes that ,      through a modest increase in expenditure
    the financial outlay undertaken by potential investors can be stimulated
    very substantially , while complying strictly with the laws of the market .
τ
   See Annex , paragraph 3 below .
 ---pagebreak---                                             - 5 -
     Regarding job creation , previous studies have estimated that the investment
     required to save one million toe / year creates 2000 man-years of employment
     ( average ratio across all sectors ).        Building ( as a  sector of    economic
     activity ),   being much more labour-intensive than industry ,       shows a much
     higher ratio,    perhaps of the order of 5000 man-years       .  Since the social
     cost   of an unemployed person       is of the order of     10 000 ECU / year,  the
     benefit to society of one toe saved in the building sector may be estimated
     at 50 ECU .
     As a significant proportion of buildings are sold every year ( some 5 to
     7 % ),   it may be expected that over a period of 15 to 20 years,          the vast
     majority of the building stock constructed before the oil crisis will have
                                  ... 8
     been covered by energy audits      .
I
t
I
  ^ "Jobs and energy conservation", Association for the Conservation of Energy ,
    London,    February 1983 . The study " Employment effects of energy conservation
    in EC countries " ( EUR 10199 )   mentions ,    for building insulation      in four
    Member States,     ratios of from 3100 to 84 00 man-years of employment per
    million toe saved .
  8
    Except for publicly owned buildings ( which are outside the scope of property
    transactions ) and property passed on by inheritance .
 ---pagebreak---                                             - 6 -
7 . Furthermore, various knock-on effects could show appreciable benefits :
       - demonstrating the profitability of the investments recommended in an
         energy audit report should make it easier to obtain bank loans ;
       - where   no  transaction     ( sale   or   letting )   takes    place,   a  parallel
         procedure   should   develop     spontaneously     at   the   initiative  of  joint
         owners or managers of buildings ( bandwagon effect );
       - in the medium term ,      Member States' Governments could have at their
         disposal   data   on the     overall    energy   efficiency      of their building
         stocks , together with their current potential for improvement .
IV . OPTIONS RETAINED
8.   In the   light of   the above the Commission submits this               proposal for a
     directive for adoption by the Council .            Given the various possibilities
                                                                   9
     and the criteria and constraints mentioned below                ,   the Commission has
                                10
     opted for the following       :
^ gThe justification of those options is given in Annex .
    In order to take into account local specif it ies it is planned to let the
    competent authority in each Member State to determine - in consultation
    with the Commission Services - the relevant sizes ( Article 2 ,                     last
    paragraph and Article 3 , last paragraph of the proposal for a directive ).
 ---pagebreak---                                           - 7 -
    Recent bui Iding :
                                                             i
    ( a) sale or renting of the building (or of part of the building) :
          indication by means of a suitable scale of comparison of the energy
          efficiency    compared  with  the  level   laid   down  in   the most recent
          regulation in force .
    Old building :
    ( b) sale of the entire building : production of an energy audit .
    ( c ) renting of the entire building :      indication of the theoretical energy
          consumption , where the building is above a certain size
    (d ) renting of part of the building :         indication of the observed energy
          consumption ,    where the building     is  above a    certain size and the
          building has at least collective central heating or is connected to a
          district heating system .
V. IMPLEMENTATION
9.  As this proposal for a directive defines only the general principles of an
    information procedure,       Member States will retain a degree of latitude in
    applying national implementing measures .        These measures must in no event
    disrupt programmes already started :         implementation must be as practical
    as possible and based largely on the various procedures already in use
    ( calculation methods ,     heating regulations for new constructions ,     energy
    audits,     coordinated programmes for the upgrading of existing buildings,
    etc .).
 ---pagebreak---                                                 - 8 -
10 . Various points must , however , govern the preparation of the measures :
     The cost of surveys must be reasonable :
         - économies     of     scale    are   possible,      given   a   minimum      degree   of
                                           11                                    12
           codil icat ion of methods          and presentation of results           ;
         - the prospects of a rapidly expanding market justify the invoiced price
           of   services     being    regulated   or   at  least    governed    by a     voluntary
           agreement with the trade .
     The information must be credible and impartial : precautions must be taken
     to    ensure    that     the    experts   authorized     to  provide     it    meet   certain
     requirements (qualifications ,           experience ,    in-service training , etc .) and
     are indeed impartial ,          in particular with regard to the technical options
     ( forms    and  sources      of  energy ,    materials ,    equipment )    and builders or
     bui Iding managers .
     Estate agents ,      being the direct users of the information procedures , play
     an important part in the process :               they must be closely associated with
     the preparation of regulations .
    At the very least ,          survey methods and several basic parameters must be
    defined .     The Eurocode " Rational use of energy in buildings ",                   which is
    currently being prepared ,          will provide a useful basis for the codification
    of methods .
    A standard form should be drawn up ;            in addition ,    a standardized financial
    table     laying down,       for several investment amounts and several              levels of
    taxable income ,        the repayment schedule for a bank            loan ,     would provide
    valuable additional information .
 ---pagebreak---                                   - 9 -
An information compaign must make the public aware of the procedures ;      it
is particularly important to draw attention to the dates of entry into
force once they are laid down .
Different deadlines are scheduled for national implementing measures to
take effect,     these being respectively three years ( sale ) and five years
( rent ).   This  time difference will  allow  the experts   to " run in " the
procedure before it becomes widespread .
          1
                                                                               J• e
 ---pagebreak---                                             А1
                                        ANNEX
                                JUSTIFICATION OF OPTIONS
1 . The first step must be to decide the BASIC DATA AND DEFINITIONS .
    The CIRCUMSTANCES in which such an information procedure might be applied
    induce :
        - sales;
        - letting ;
        - at the initiative of the owner , co-owners or building manager ;
        - at the request of the tenant ( s );
        - at regular intervals .
    The CONTENT OF THE INFORMATION can be expressed in various fashions :
                                                    1          . . 2
    a ) observed consumption ,    whether specific    or overall     , corrected to the
        normal number of degree-days and expressed in one of three different
        ways  :
        - as physical quantities ( meter readings and / or quantities supplies );
        - as    total quantity    in   standardized   units ( sum     of    the  physical
          quantities after applying the appropriate conversion factors );
        - money cost ( bills ).
   Per unit of surface area or volume .
    For the immovable property covered by the transaction             e. g.   a bui ldi ng
    flat , or one or more floods ) of offices .
 ---pagebreak---                                           - A2 -
  b) thermal properties :       insulation coefficients ,     heat losses per unit of
      surface area or volume,       natural infiltration rate,     installed capacity ,
      efficiency of systems , and heat gains .
  c ) theoretical consumption         whether specific or overall , in :
      - physical quantities;
      - total quanti ty , in standardized units ;
      - money cost of use .
  d ) comparison with a reference situation , i.e. with either :
      - the average consumption of premises of the same type ( average specific
        consumption multiplied by the surface area or volume of the premises );
        or
      - the energy efficiency of an equivalent standard new building              This
        comparison takes the form of a scale ^ and applies whatever form the
        heating and insulation standards take .
^ Obtained by calculation for the building and its systems as they stand,
  under standardized occupation condi tions .
4
  " Standard  new   building "    means     a  building  just  achieving   the energy
  efficiency called for by the heating and insulation standards in force for
  new buildings .
  Ratio ,   coefficient ,   index ,   etc .   The lower the ratio,   the more energy-
  efficient the building . In one Member State , the extra energy-efficiency of
  recent buildings is marked by a star rating,           from one star for a ratio of
  0.85 to two for 0.75 , three for 0.65 and four for 0.55 .
 ---pagebreak---                                                 A3
    e ) energy audit r eport : this is the most detailed form of information , not
        only taking account of some of the parameters mentioned above but also
        describing possible improvements , including their nature , the investment
        cost ,   the energy saving        compared    with   the original   situation ,      the
        financial savings and profitability .
2 . The options ,     i.e.  combinations of the basic data , choices are dictated by
    the need to satisfy a number of FUNDAMENTAL QUALITATIVE CRITERIA :
    First ,    THE INFORMATION MUST BE MEANIN6FUL and representative of the real
    energy efficiency of the building .
    Consequently ,      it is  essential       to  neutralize    the effect    of   the   " user
    behaviour "    parameter ,      which     can   considerably      alter   actual     energy
    consumption .     Generally ,    observed consumption alone is unsuitable as an
    indicator ;     nevertheless ,     it   provides    a means    of  pinpointing abnormal
    behaviour and / or defective equipment          ( by comparison with the theoretical
    consumpti on ).
    However ,    user behaviour makes little difference in fairly                large multi-
    occupant     buildings   with    a   single    shared     central-heating   system    ( e.g.
    buildings containing at        least ten flats )       or in buildings connected to a
    district heating network .        In both cases the observed consumption ,          deduced
    from the total observed consumption for the entire building ,                gives a good
     idea of what the prospective tenant can expect .            Of course , the calculation
    must follow the relevant cost-sharing formula .
 ---pagebreak---                                      - A4 -
Another consideration    is that    reference to the " average       consumption of
premises of the same type " presupposes the existence of a data bank from
which significant ratios can be worked out .          Which would be complicated ,
costly and subject to chance ;    what is more,       the ratios would need to be
constantly updated to keep up with changes in the building stock .
Finally ,  various factors ( ageing of the building and,              even more so ,
declining  equipment   efficiency     and   technological     progress )  render  the
information  obsolete   sooner   or     later :  the     period   of  validity   must
therefore be   limited to ,   say ,    ten years   ( about   the useful    life of  a
boiler ).
THE INFORMATION MUST BE COMPREHENSIBLE to all parties concerned :
From this point of view,     taken by itself the " thermal properties" option
precludes explicit comparison of competing premises .
By the same token,   expression of energy consumption solely in standardized
units is abstract and could create confusion because of the differences in
the unit costs of various fuels and changes in them over time .
 ---pagebreak---                                         - A5
 THE INFORMATION MUST SATISFY THE EXPECTATIONS OF ALL PARTIES CONCERNED .
  Their hopes will differ completely , depending on the circumstances :
 - Prospective tenants must be able to make a firm estimate of the running
    cost of competing sets of premises .        At the very least ,     the information
    must    therefore    specify    the    theoretical     consumption     in   physical
    quantities ^ and the installed capacity ( for calculating fixed costs), so
    that the would-be tenant can easily calculate the total money cost from
    the tariffs in force .      The only exception will be large multi-occupant
    buildings ( see above ).
 - Prospective buyers need to know more than just the consumption figures
    alone : the only way to quantify the market value lost due to poor energy
    efficiency or ,   conversely ,    added by high energy efficiency ( and , in the
    process,    to enhance market transparency ) is to produce an energy audit
    report    giving   precise   details     of   any  ways    of    increasing   energy
    efficiency , complete with pay-back calculations
    Above all,     changes   of ownership are       usually  a   prime opportunity    to
     improve a property :     supplying the new owner with information like this
     is a unique opportunity to guide and speed up investment .
i.e. the units employed in the tariffs in force .
  It would also be helpful to state the pay-back time for certain types of
  investment which are clearly uneconomic strictly            from the energy saving
 point of view,      if only to show the owner the financial implications of
 certain choices .     However,    other considerations sometimes         influence the
 choi ce .
 ---pagebreak---                                           - A6 -
                         8
  - Recent buildings       ,  whether for sale or to let ,     are a special case .    In
     theory ,   they are energy efficient enough already .        All that needs to be
     done to improve market transparency is to compare the energy efficiency
     of the building under consideration with that of an equivalent standard
     new    building.      Devising    a   scale   for    such   comparisons    ( ratios,
     coefficients ,    indexes , star , ratings , etc .) should be no problem and the
     words " high energy efficiency ” could be added to give credit to any
     extra-efficient building . Since more often than not extra spending on the
     new   building    will    produce   very   good   returns   in  terms   of    energy
     efficiency ,    there   is all the more reason to encourage investment by
     builders .
  - In the case of an existing building renovated after an energy audit,              the
     main task is to check that the jobs have been done properly and to update
     the report,      by entering the new theoretical consumption and,             if the
     building is for sale , listing the improvements yet to be made ( it is very
     rare for all the improvements suggested to be made ).
Q
  " Recent building" means one for which building permission was granted while
  the heating and insulation standards for new buildings were in force,
  irrespective of whether they still are or have since expired . Generally ,
  this means buildings constructed after the first oil crisis . Even though
  they may not be up to today 's standards ( assuming that the standards have
  been tightened up is the mean time ),        it is still dubious whether an energy
  audit would      pinpoint any     worthwhile investments     apart from normal 10-
  15 yearly replacement of boilers , etc .
 ---pagebreak---                                               - A7 -
3 . Next the COST OF SUCH AN INFORMATION PROCEDURE must be calculated 9, as
    fol lows :
     - a full     energy audit      costs less than 300 ECU for a           house selling at
        between 30 000 and 120 000 ECU and between 1              and 11 / 2 ECU per square
       metre    of   floor   space    for   a   block  of  offices   or   flats .    These  are
       extremely      small   sums,    in relation     to other letting       or conveyancing
        costs      ;
     - a simple calculation of the theoretical energy consumption is only an
        intermediate stage to a full energy audit ,             yet the cost saving over a
        full audit is relatively small .          This imposes certain limitations on the
        procedure as a whole ( see paragraph A );
     - stating the observed energy consumption of the rented part of a large
       mult i-oc cu pant building adds only a negligible amount to the costs : all
        that needs to be done is           to pick    out the   relevant details      from the
        agent 's general accounts and correct the figures by the number of normal
       degree-days ;
     - use of a scale for these comparisons adds nothing to the cost                     is the
        case of recent buildings,         since the application for building permission
       must    include    evidence    that    the building    satisfies    and    perhaps  even
        surpasses certain standards .
    Assuming     that   there   is   a   fully-fledged    energy    audit    market   with  the
    concomitant economies of scale .
    What is more, very often a large proportion of the cost of the audit can be
    recouped from the cash savings generated by                improvements which       pay for
    themselves almost immediately .
 ---pagebreak---                                            - A8 -
4. Finally ,   various practical considerations impose certain LIMITATIONS ON
   THE INFORMATION PROCEDURE :
   Exclusi ons : Certain categories         of   building must   be  exempted from the
   procedure because of their nature, use or geographical location :
   - industrial or farm buildings ;
   - buildings of little intrinsic value;
   - buildings not used very regularly ;
   - buildings in climates where the peak season for using heating and / or
     air-conditioning systems is unusually short ;
   - buildings sold for démolition .
   Impract icabi l ity :    ( sale or rent of part of a building,           e.g. a single
   flat,   floor of offices ,      etc .) : energy audits can be carried out only on
   the entire building .       The same holds true of estimates of the theoretical
   consumption,      which are based on a calculation for the whole building .
   Nonetheless ,     the  information procedure        could  still  be    practicable   in
   certain cases :
     . in recent buildings ,        a ratio can be calculated to allow comparison
       with a new building, whether for sale or to let ;
     . in buildings with a shared central heating system or connected to a
       district heating network ,         the observed consumption can be calculated
       ( for prospective tenants ).
   Prohibitive cost ( renting of small buildings ): the cost of calculating the
   theoretical     consumption      rises     disproportionately    as     building    size
   decreases .   Consequently ,     depending on building size ,        rent levels and ,
   where appropriate,      climate,     beyond a certain threshold the cost becomes
   unreasonable for the lessor ,         in relation to the rent collected .        This is
   why   small  buildings      for  let    are   been  exempted  from    the   information
   procedure .
 ---pagebreak---                                      Proposât for a
                                  COUNCIL DIRECTIVE
               on inforaation on the energy efficiency of buildings
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community ,         and
        in particular Article 235 thereof .
                                                       1
Having regard to the proposal from the Commission ,
                                                             2
Having regard to the opinion of the European Parliament ,
Having regard to the opinion of the Economic and Social Committee ,
Whereas   in its resolution of      15 January 1985 on the    improvement of energy-
                                                           4
          saving    programmes   in    the   Member States     the   Council  invited
          Member States to pursue and where necessary increase their efforts to
          promote the more rational use of energy by the further development of
          integrated energy-saving policies and whereas in that resolution also
          the Council noted that these policies should in particular make use
          of  standards    where  the    forces obtaining   on   the market  and   its
          transparency are not sufficient to guarantee efficient use of energy ;
  OJ No C       ,          , p.
  OJ No C       ,          , p.
  OJ No C       ,          , p.
  OJ No C 20 , 22.1.1985 , p.1 .
 ---pagebreak---                                         - 2 -
Whereas  in its resolution of 15 March 1985 on the rational use of energy in
         the building sector ^ the Council noted that the Commission in
         consultation with experts from Member States would examine questions
         relating to the placarding of the energy consumption of buildings by
         a   process  of   certification,     in order  to  improve   the   flow  of
         information to the parties concerned on the state of the real estate
         market and to give credit to the efforts made by the builders / owners ;
Whereas  in   its  declaration of    26 November 1986  on  energy   efficiency   the
         Council agreed that the Community and the individual Member States
         would publicize    the need for greater energy efficiency        by making
         available full information and advice on how this can be achieved ;
Whereas  the building sector accounts for over 38 % of the Community 's total
         final energy consumption;     whereas the potential for improving energy
         efficiency in this sector is still insufficiently exploited ;
5
  OJ No C 78 , 26.3.1985 , p. 1 .
 ---pagebreak---                                           - 3 -
Whereas expenditure on energy generally constitutes a significant proportion
        of the financial cost of using a building and whereas appropriate ,
        profitable      investments    to    reduce    such    expenditure     should   be
        stimulated;
Whereas lack   of    information  on     the   energy   efficiency   of   buildings    and
        possible ways of improving         it is a major obstacle to investment to
        that end , notably during           periods of low energy prices ;
Whereas when property is put up for sate or rent the builder or owner should
        be given credit for his financial endeavours and in particular
        . during     the   construction     of   a  new   building,     any   incremental
           investment designed to achieve a level of energy efficiency above
           that required by the regulations in force,
        . any     investment    expenditure      designed    to   improve    the    energy
           efficiency of an existing building during its renovation ;
Whereas such    endeavours    cannot    be   given    credit   in  the   absence    of  an
        appropriate procedure for providing information on the actual level
        of energy efficiency of the building put up for sale or rent and
        whereas ,    conversely ,   the obligation to provide such information for
        any prospective purchaser or tenant makes a significant contribution
        to stimulating the decision to invest on the part of the seller or
        lessor ;
 ---pagebreak---                                              - 4 -
  Whereas , since the purchase of immovable property is a prime opportunity for
             improving   its  quality ,    the    new  owner    should   be   provided  with
            appropriate information on the energy efficiency of that property ,
            the possibilities of improving its energy efficiency and the return
            on   the related    investments ,    in order to guide and expedite the
            decision to invest in this respect ;
  Whereas   such information procedures improve the transparency of the property
            market ;
  Whereas   improvement    of  the    energy   efficiency    of   buildings    is  generally
            beneficial to the environment and provides a significant stimulus to
            economic activity in general and employment in particular ;
  whereas   the Treaty has not provided the necessary             powers ,
\
  HAS ADOPTED THIS DIRECTIVE :
                                          ARTICLE 1
       Member States shall take all necessary           measures to ensure that every prospective
  purchaser or tenant of a building ( or of part of a building ) is informed by
  the  seller    or  the   hirer   of  the   energy   efficiency    of   that   property  in
  accordance with the provisions of Articles 2 and 3 the practical           codes included
  in the Annex .
 ---pagebreak---                                           ARTICLE 2
Scope of the Directive
( a) "Building " means the building as such             ( shell ) and all fixed equipment
     intended to :
      -   heat ,   air-condition and ventilate rooms , including the heat and cold
          distribution , storage and recovery networks;
      -   produce , store and distribute domestic hot water ;
      -   manage the use of energy ( regulation ,            control,    automatic devices ,
          etc .);
      - ‘iiore generally, permit the utilization of rooms, when the equipment (such as lighting,
           lifts,    coldstores,     etc .) consumes        significant proportion of the
          total energy used .
( b) This Directive covers all          buildings    for    residential   or   services    use ,
     whether occupied on a permanent or intermittent basis,                   except for the
     bui Idings referred to under point ( c ) and buildings (or parts of buildings) which do
     not reach the thresholds referred to in Article 3(d) and (e).
(c ) This Directive does not cover :
      -   buildings for industrial or agricultural use ,
      -   buildings of low intrinsic value,
      -   buildings used very intermittently ,
       -  buildings in climatic zones where intensive use of energy for heating and / or
           air conditioning is made                    for particularly short periods ,
       -  buildings sold for démolition .
In each Member State ,      the competent authority shall draw up,           in consultation
with the Commission,                    a      list   of buildings not covered by this
 ---pagebreak---                                          - 6 -
                                       ARTICLE 3
Characteristics of the procedures relating to infomat ion on the energy efficiency of
bui Idings
( a) For the purposes of this Directive :
        -  " regulation " means any provision made by the competent authority to
           render it obligatory for a building to be constructed to a minimum
            level of energy efficiency ;
        -  " recent bui Iding " means any building for which the building permit
           was issued during the period of validity of a regulation ;
        -  "old building " means any building for which the building permit was
           issued while no regulation was in force .
( b) Where a recent building ( or part of a recent building ) is sold or rented ,
      the energy efficiency relative to the level laid down by the regulation
      currently in force must be indicated by means of a scale of comparison
      drawn up by the competent authority .      Where the energy efficiency of the
      building in question is significantly higher than the regulation minimum
      the distinction " high energy efficiency " is to be awarded .
( c ) Where an old building is sold ,,    any prospective buyer must be presented
      with an energy audit describing :
        -  the physical properties of the building and its equipment :             type ,
           size , power , coefficents of heat transmission , efficiencies , losses;
        -  the   theoretical   annual  energy  consumption   expressed     in   physical
           quantities and based on standardized utilization ;
        -  possible measures and the anticipated cost of each of them ;
        -  the energy     saving  from  each  possible   measure    ( with  mention   of
           possible interactions of a possible combination of measures );
        -  the corresponding financial savings;
 ---pagebreak---                                                - ? -
         -   the   profitability    of     each   potential   measure     or   combination      of
             measures .
(d ) Where an old building is rented ,            provided it exceeds a size threshold laid
      down by the competent authority ,          any prospective tenant must be informed
      of   the   theoretical    annual     energy   consumption    based    on       standardized
      utilization and expressed in physical quantities and cost                cf utilization .
( e ) Where part of an old building is rented ,           provided it exceeds a size threshold
      laid down by the competent authority and the building is equipped with
      collective     installations     ( central   heating   or  connection      to    a district
      heating system ) any      potential tenant must be          informed of       the observed
      annual energy consumption expressed in physical quantities and cost of
      utilization and corrected for the normal number of degree-days .
( f ) Ten-year limit on the period for which the information is valid .
In each Member State the competent authority shall              determine,      in consultation
with the Commission services , the thresholds             mentioned in points d ) and e ).
                                             ARTICLE 4
The information procedure provided for in the event of sale shall take effect
within     a period     not  exceeding      three years    and the     information procedure
provided for       in the event of      rental    shall  take effect within a period not
exceeding       five    years    from     the    date   of    adoption     of     the    national
implementing measures .
 ---pagebreak---                                      - 8 -
                                   ARTICLE 5
     Member States shall notify the Commission regularly of the measures taken
in the field covered by this Directive and the actual or expected effects of
those measures .
                                   ARTICLE 6
    Member States shall take the measures necessary to ensure compliance with
this Directive not later than 1 July 1989.
                                   ARTICLE 7
This Directive is addressed to the Member States .
Done at
                                                       For the Council
                                                       The President
 ---pagebreak---                                          ANNEX
                                      Practical codes
1 . Requirements for the activity of approved expert
    a ) appropriate qualification and experience as a heat engineer ,
    b ) attendance at continuing training courses ,
    c ) cover by " limited liability " professional-activity insurance ,
    d ) neutrality and impartiality with respect to any establishment
       . producing , converting or distributing energy ,
        . constructing , renting , selling or managing buildings ,
       . producing , marketing , installing , managing or maintaining installations
          and facilities .
2 . Information requirements
    a ) Codification of methods for assessing the energy efficiency of buildings
         and in particular the following parameters :
         - thermal    properties  of   the  building  products   ( losses per  unit  of
           area / liner measure ) and equipment ( power,  efficiencies,   distribution
            losses ),
         - areas and volumes .
         - rate of air renewal and loss through ventilation ,
         - overall losses in W / K ,
         - free gains ,
         - normal degree-days .
         - standard conditions of use ,
         - energy requirements ,
         - theoretical consumption .
 ---pagebreak---                                                - 2 -
      b) Forma l      codification    of   the    information   provided   to   prospective
           buyers / tenants ( see below illustrative examples of forms for           the dif­
           ferent cases ).
  3 . Examples of information forms on the energy efficiency of bui Idings
      a ) Part common to all forms :
          . Administrative information
                  address of the building
                  land registry
                  name and address of the owner
                  name , address and stamp of the expert
                 date of valuation
          . Description of the building
                 utilisation             :               residential / commercial / mixed
!                year of construction :
                                                year                nature
                 modifications with
                 an energy impact
                 heated parts                  private              shared
                 volumes                                 m3                           m3
                 surfaces                                m2                           m2
             Building equipments               nature        power         fuel
                 heati ng
                 cool ing
                 dornes ti c hot water
                 lighti ng                                               electricity
                 control
 ---pagebreak---                                         - 3 -
b) Sale or renting of a recent building (or of part of a recent building ) :
     This building has been erected under a thermal regulation .
     The  energy    efficiency   of    this  building    is   characterized      by    the
     coefficient           (*), as compared with the efficiency of an equivalent
     new building strictly conforming to the regulation in force (**) as of
     the day when this document is issued .
     (*)   the lower the coefficient , the higher the
           energy efficiency of this building .
     (**)  reference of the régulation : ...
c ) Sale of an old building :
                  Summary and conclusions of the energy audit
      n°
           Possible improvements   Estimated     Energy savings        Financial    Pay
    (*)                              cost                               savings     back
           nature  -  quantities   ind . AVT
                                              nature   unit   quantity    (** )     period
      1
     2
      3
    1+3
     4
     (*)   classification according to increasing pay back periods .
     (**)  unit energy prices taken into considération : ...
 ---pagebreak---                                       - 4 -
d ) renting of an old building :
                          Theoretical consultions <*)
                                   Unit (**)         Quantities
    heat ing
    cooling
    domestic hot water
     light ing
    • · · ·
    (*)     calculated under standard conditions of utilisation .
    (**)    if relevant : breakdown into day / night tariffs or other tariffs .
e ) Renting of part of an old building :
                           Observed consumptions (*)
                                   Unit (**)         Quantities
    heat ing
    cooling
    domestic hot water
    light ing
    • · · ·
    (*)     data set up from consumptions actually recorded .
    (**)    if relevant : breakdown into day / night tariffs or other tariffs .
 ---pagebreak---                    COMPETITIVENESS AND EMPLOYMENT IMPACT STATEMENT
   Subject : Proposal for a Council Directive concerning
              information on the energy efficiency of buildings
 I.  REASON FOR INTRODUCING THE MEASURE :
     Aims :
     - to remove a major obstacle to            investment geared      to  improving the
         energy efficiency of bui Idings ;
     - to speed up and direct            investment      decisions   towards     the   most
         profitable projects .
     - to make the property market more transparent ;
     Reason :
     The only Member State which has imposed an information procedure on
     energy efficiency of buildings has noted the positive effect of a
     measure of this type on both the level of activity in the trades
     concerned and the energy efficiency of buildings .
     The Commission considers that         the other Member States should formally
     commit themselves to making          a  procedure     of  this  type   mandatory    by
     adopting the Directive .
     If not adopted :
     In the absence of a mandatory procedure , " voluntary " information systems
     might well develop spontaneously , but :
          - their effect would probably be marginal ; and
          - there    is    a  danger   that   the    information    provided     would   be
            heterogenous ( at Member State level ) or not very reliable because
             of the absence of controls .
II . FEATURES OF THE PROJECT
     In     so   far    as   the   information     procedure     stimulates     investment
      ( particularly in refurbishing old buildings ), the investment will create
     jobs in various trades ( builders ,              carpenters,     joiners ,     heating
      installation fitters,       etc .) in which there are many SMEs .              A big
     expansion in the refurbishing market , which would stimulate the setting
     up of SMEs, is a likely result .            Also, pilot experiments in several
     cities ( joint projects to diagnose energy efficiency in buildings ) have
     highlighted the need for the tradesmen concerned to be well qualified in
     their profession .
 ---pagebreak---                                         - 2 -
      Upstream of this market another one , that of the expertise involved^will
      have to be created .     Many SMEs mainly involving heating engineers will
      have to be set up to meet the demand .
      Where geographical distribution is concerned,       some EEC regions which
      enjoy a less severe climate (Greece , southern Italy , Portugal , parts of
      Spain ) will be less affected by the procedure .
III . DIRECT OBLIGATIONS
      Anyone selling or letting a building will have to provide potential
      purchasers or tenants with information .          This will also apply to
      builders who sell their product direct to the consumer .
      Compared with other administrative costs the additional cost will be
      minimal .     An energy diagnosis of a detached house costs less than 300
      ECU whilst that of a building used foij tertiary sector activities,    or a
      block of flats is some 1 to 1.5 ECU/ in   of floor space .
 IV . INDIRECT OBLIGATIONS
      Member State governments wi ll have to :
          - work out a detailed information procedure ( the Directive sets out
            only the principles );
          - enact national implementing measures ;
          - ensure adherence to the procedure .
      Working out the procedure in each Member State will require consultation
      between the authorities and building industry experts .
  V.  SPECIAL MEASURES IN RESPECT OF SNEs
      The type of       investment this measure       is intended   to  stimulate
      ( refurbishing of existing buildings ) mainly concerns SMEs .
 VI . EFFECT
      ( a) Employment : the main aim of the proposal is to channel investment
           towards work aimed at improving the energy efficiency of buildings .
           It is impossible to anticipate the likely effect of the procedure
           provided for in the Directive .
           Nevertheless it should be remembered that the investment required to
           save 1 million tonnes oil equivalent in the building industry should
           create some 5 000 jobs a year .
 ---pagebreak---                                                 3
      ( b ) Compet it i veness : the information procedure provided by the proposal
            must ensure greater transparency in the property market .
VII . CONSULTATIONS
      ( a ) An  ad    hoc    working    party   made   up  of   representatives   of  the
            Member States has been consulted .          Experiments already carried out ,
            particularly in Denmark (" building certificates ") and other Member
            States (" pilot cities "), were examined .        The members of the working
            party were unanimous in emphasizing the great advantages of these
            experiments .
      ( b) The   Danish     experiment    involved   two   studies  which  examined ,   in
            particular, the points of view of the trades concerned ( building
            firms , tradesmen , estate agents , experts ).         The conclusion of the
            survey was generally very positive .
      ( c ) The " pilot city " experiments ( in France , Belgium, the Netherlands ,
            Germany and the United Kingdom ) are currently being evaluated .          The
            eldest   of    them   ( City  of  Conf lans-Sai nte-Honorine ,   France ) was
            evaluated separately in 1984 and the verdict was generally positive .
            Some 60 Z of the town 's housing was subjected to an energy diagnosis
            and 60 Z of the dwellings diagnosed , i.e. 36 Z of the town 's total
            housing stock has been refurbished .