Authors:

Thomas Wimmer
Managing Director
Thomas.Wimmer@hkstrategies.com

 

Claudia Müller
Associate Director
Claudia.Mueller@hkstrategies.com

 

Kolja Zajicek
Kolja.Zajicek@hkstrategies.com

How will Germany’s new federal government address the climate challenges in the building and construction sector?

Greenhouse gas emissions are to be cut by 66 percent until 2030 (compared with 1990) in the German building and construction sector. Otherwise, the goals of the 2019 Federal Climate Change Act will not be met. The act contains specific emission targets for the sectors most relevant to climate protection – energy, industry, buildings, transport, agriculture, and waste management. By failing to meet the sectors’ targets, Germany will not be able to become climate neutral by 2045.

The building and construction sector has turned out to be a real headache. In spring 2020, an analysis showed that the sector is not reducing emissions as envisaged. In response, the German Federal Ministry of the Interior, Building and Community and the Federal Ministry for Economic Affairs and Energy put together a 5.8 billion Euro immediate action programme. This set a precedent: for the first time, the control mechanism of the Federal Climate Change Act was triggered. If the caps set for the most climate-relevant sectors are breached, the responsible ministries must draw up immediate action programmes to compensate for the missed targets.

After the federal government proposed its immediate action programme in July, the Council of Experts on Climate Change (Expertenrat für Klimafragen) rebuked it in August. This was a disaster for the CDU/CSU-led ministries, as the government’s appointed experts doubted the effectiveness of the measures. The Greens, a member of the opposition at that time, stated that “the federal government has no answers to the climate protection gap in the building sector.”

New political landscape, new political ideas? – Analysis of coalition agreement

Since August, Germany’s political landscape has shifted. After the federal elections in September, the Greens, the Social Democrats, and the Liberals (the only three parties that gained voteshare compared to 2017) began negotiating a coalition agreement. The agreement was presented on November 24th. It will now be the turn of the new coalition partners to implement new ideas to address the various climate policy challenges.

Rather than assigning the responsibility for the building and construction sector to the Ministry of the Interior, the new government intends to create again an independent, SPD-led Ministry for Building and Construction. The upgrading of the ministry suggests that the issue will now be taken more seriously. The current Minister for Environment, Svenja Schulze, is being considered to head the ministry. The Ministry for Economic Affairs and Energy will change its name to Ministry for Economic Affairs and Climate and will most-likely be led by Robert Habeck – the most popular politician of the Greens.

And indeed, the coalition agreement contains many new ideas for the building sector. Basically, there are two ways to reduce emissions: saving emissions by making buildings use less energy and avoiding emissions in the first place by constructing buildings from sustainable resources and supplying them with renewable energy. Particularly the second point has been neglected.

But first things first. To incentivize more energy-efficient designs, the energy efficiency standards in the Building Energy Act (GEG) (which only date back to April 2020) are to be revised. Until now, those energy-efficiency standards have largely focused on the amount of energy it takes to run the building. The coalition partners want to shift that focus to the amount of emitted greenhouse gas emissions per square meter of living space. And this brings us to our second point.

Greenhouse gas emissions per square meter cannot only be reduced by more energy efficiency, but also by a change of energy supply. For example, the GEG will make it obligatory from 1 January 2025 that every newly installed heating system must be fueled with at least 65 percent renewable energy. In addition, the coalition wants to increase the amount of renewable energy by using suitable rooftop areas to produce solar energy – this will be highly recommended for residential buildings and obligatory for new commercial buildings.

The coalition partners also want to introduce a digital building resource passport. Building information modeling (BIM) should make planning processes more efficient, cost effective and transpart and navigate the sector towards circular economy model. Besides the reuse of resources, the coalition wants to promote climate-friendly building materials and construction methods. Therefore, a national strategy for wooden construction, lightweight construction, and securing raw materials will be elaborated.

Will the new ideas cure the headache? – H+K’s evaluation for the sector

Many of those ideas finally catch up with the scientific discourse. The digital building resource passport could close a long-identified data gap lamented by the scientific community. However, this idea needs to be taken further. As in all sectors, data-driven decision-making must play a greater role in building retrofits in the future. Best-practice examples need to be identified and transferred into retrofit roadmaps. The coalition agreement wants to provide free retrofit roadmaps to homeowner

associations and house purchasers, but the quality of those roadmaps must be ensured.

Also, energy lifecycle evaluation and embodied energy are promoted in the agreement. For example, if a wall is minimally better insulated by using polystyrene than by using natural insulating materials, but the production of the polystyrene produces more CO2 than the additional insulation can save in 50 years, then there must finally be decision-processes that lead to climate-friendly solutions. Such new incentives are intented to make the most climate-friendly solution also the cheapest one. The coalition agreement does not provide any concrete measures here – but the focus on greenhouse gas emissions per square meter provides a specific focus for developing new ideas.

In addition, the focus of the coalition partners on wood construction, lightweight construction, and securing raw materials is to be welcomed in light of the pressing climate crisis. The cement industry alone emits 2.8 billion tons of CO2 globally. This amounts to almost eight percent of the total global greenhouse gas emissions – more than all air traffic and data centers together. Wood, on the other hand, stores CO2. So why should we not turn our cities into CO2 storage facilities instead of emitting vast amounts of CO2 to build them? Here, too, there is widespread scientific agreement that wooden construction offers enormous potential to reduce greenhouse gas.

The higher energy efficiency standards promoted in the coalition agreement have yet to prove their effectiveness. This is because the previous increases in energy efficiency standards have not been able to bring about the promised results. However, the new focus on greenhouse gas emissions per square meter of the coalition agreement comes along with many new ideas on how to achieve the building and construction sector’s emission targets. It will be interesting to monitor over the next four years if those ideas will be a cure to the latest headache.