The European Union (EU) strives to meet its ambitious climate goals by 2050, aiming for a climate-neutral economy. A significant challenge lies in transforming the energy-demanding building sector, which currently accounts for 40% of the EU's total final energy consumption and contributes 36% of greenhouse gas (GHG) emissions.
Addressing the inefficiencies in this sector is critical for achieving a net-zero economy, as outlined in a recent study using the High-Efficiency Building (HEB) model, which evaluates various energy demand scenarios up to 2060.
Around 75% of the EU’s building stock is energy inefficient, with over half of the buildings being over 50 years old. Renovation efforts, such as those promoted under the EU’s “Renovation Wave Strategy,” aim to address these inefficiencies. However, the rate of building renovation—currently below 1% annually—needs significant acceleration to meet climate targets. The HEB model outlines four scenarios that assess how varying degrees of efficiency measures and policy implementations could shape the future energy demand of the sector.
The study also projects that the EU's total floor area will increase by 17% by 2050 and 22% by 2060. This growth will primarily come from the tertiary (commercial) building sector, which is expected to expand by 53% and 74% by 2050 and 2060, respectively.
The HEB model evaluates four scenarios:
Under the Towards Net-Zero scenario, the total energy demand for the building sector could be reduced by 97% by 2060 compared to 2022. Space heating, which accounts for the largest share of energy demand, could see reductions of up to 99% by 2060. On-site renewable energy, such as rooftop solar panels, will be critical in reaching this near-zero demand level.
Space heating remains the most energy-intensive end-use in buildings. Under the Towards Net-Zero scenario, the demand for space heating across the EU could be reduced by 99% by 2060. In contrast, the Frozen Efficiency scenario would see a 24% increase in space heating demand by 2060, highlighting the importance of policy action.
Space cooling, while a smaller portion of total energy demand, is expected to rise due to climate change. However, by adopting best practices and incorporating on-site energy generation, cooling demand could be reduced by 92% by 2060.
To achieve such reductions, renovation rates must increase significantly. The study suggests that renovation rates must reach 3% annually after 2027 to meet the ambitious targets. Currently, many EU countries are lagging behind this figure, and without accelerated renovation efforts, energy demand could rise.
In addition to renovations, all new buildings constructed after 2027 must meet nearly zero-energy building (nZEB) standards. To achieve the projected energy reductions, 100% of both new and retrofitted buildings must be advanced low-energy or net-zero buildings by 2060.
The findings of this study emphasize the urgent need for more aggressive energy efficiency policies. The Towards Net-Zero and Deep Efficiency scenarios show that deep renovations and advanced efficiency measures are essential to reducing energy demand. Without significant policy interventions, the EU is unlikely to meet its long-term climate neutrality targets.
The HEB model provides a clear roadmap for policymakers: accelerated renovation, strict enforcement of high-efficiency building standards, and widespread adoption of renewable energy technologies are necessary. Only through these measures can the EU’s building sector transition to a sustainable, net-zero future by 2060.
