Resilience and Recovery in Germany and Greece
Housing Europe analyses the investments planned at country level that could make a difference to the sector and citizens31 January 2023 | Published in Economy
As a follow up to our Comparative analysis of November 2021 on the Impact of the Recovery Plans on the social and affordable housing sector, 2 new country profiles are published each month. Now it is the turn of Germany and Greece. Let’s see the highlights of these Plans below:
As a follow up to our Comparative analysis of last November on the Impact of the Recovery Plans on the social and affordable housing sector, 2 new country profiles are published each month. Now it is the turn of Germany and Greece. Let’s see the highlights of these Plans below:
The German RRP will concentrate on 6 pillars, the first one being Climate policy and energy transformation (€ 11.3 billion, 40% of the Budget). Germany is expected to reach 40% of investments in the green sector.
The Relevant component is the Climate-friendly building and refurbishment which is representing in total € 2.5 billion. Under this component, planned Investments include the further development of climate-friendly construction with wood; Municipal real laboratories of the energy transition and a federal funding programme for efficient Buildings - Innovation Funding. With these, Germany addresses the country-specific recommendations for 2020 with regard to investments in ecological change, in particular housing.
Furthermore, until 2024, the Federal Government will support the Länder in the implementation of affordable housing by providing €1 billion in programme funds each year.
Beyond this investment, the plan provides also reforms. In particular, Germany is preparing its Building Land Mobilisation Act to improve the municipalities' scope for action in activating building land and securing affordable housing.
Other elements are also planned such as the introduction of Building Information Modelling (BIM) into the planning and manufacturing process, and testing with other digital solutions such as robotics or AI.
In terms of building renovation, Germany targets a 30% reduction in national primary energy consumption by 2030, compared to 2008. To achieve this, primary energy consumption must fall by an average of 1.5% per year from 2020 onwards. This would represent considerable progress, as prior to 2020, primary energy consumption decreased only by an annual average of 1.1%.
To meet the target, the government launched the ‘Energy Efficiency Strategy 2050’, which includes measures to boost energy efficiency investment across sectors. On buildings, Germany submitted a comprehensive long-term renovation strategy in July 2020 and developed an ambitious ‘Renovate’ component in its recovery plan, focussed on climate-friendly timber construction, increased energy efficiency of buildings and a higher share of renewable energy for heating and cooling in buildings, which can contribute to accelerating energy-efficient buildings renovation.
It is estimated that following an average annual renovation rate of 2.6% at the cost optimal level, the primary energy saving potential in Germany, by 2050, is 352 TWh.
‘Greece 2.0’, the Greek Economic Recovery Plan has been laid out with the European Investment Bank (EIB) agreeing to manage a total of 5 billion euros. EIB technical, financial and environmental experts identified high-impact projects, priority sectors and effective financial structures. “Greece 2.0.,” aspires to not only create 200,000 jobs but also to increase GDP by 7.0 points in the next six years. The Plan contains 170 projects.
The Greek Recovery Plan consists of four pillars: Green, Digital, Social, and Economic and Institutional reform. The Green transition focuses on energy efficiency and buildings renovation, renewables, electro-mobility, climate resilience, and environmental protection. The investments include, among others:
- Extensive renovation programmes for households, businesses, public buildings and infrastructure.
- The interconnection of Greek islands, which will significantly reduce the energy costs of households and businesses and energy storage investments.
- Promotion of strategic urban actions.
- Large investments in flood control projects, accompanied by changes in the use of irrigation networks and leak detection and smart water management.
- Investments for the elaboration of urban plans that will inform validly regarding land use for 4/5 of the country.
Component 1.2 (Renovate) introduces reforms and investments in urban and spatial planning, as well as in the renovation of residential, commercial, industrial and public buildings to improve energy performance and reduce the carbon footprint. An Energy poverty action plan and Adaptation and mitigation interventions are also planned.
The green energy transition bid aims to invest €6 billion of EU grants towards clean energy, with that sum intended to be topped up by €4.4 billion of private investment. With the EU ‘recovery and resilience facility' also offering loans, total liquidity for green power projects is expected to extend to some extra billions.
Energy efficiency improvements
The Greek recovery program will include plans for up to 1.38 GW of pumped hydro and battery storage. PV arrays will be included among plans for around €1 billion to be invested upgrading national building stock, through measures such as energy efficiency improvements and smart energy systems.
The partly operational electricity interconnector between the mainland and Cyclades islands will be expanded and the government also plans to devote cash to setting the national fund for the development of renewables on a firm footing, after previous financial travails.
Tackling energy poverty
The proposed energy poverty reform under the Environment axis, includes the development of a National Action Plan defining the phenomenon and monitoring process and will propose policies and assess their effectiveness. In particular, it will provide for the provision of financial mechanisms for the energy upgrading of households of vulnerable and other social groups with specific consumption patterns.
In addition to improving living standards to levels that are good for the health of residents, the savings from the cost of energy-intensive housing will affect positively the incomes of vulnerable households by allowing them to cover more of their energy costs.
Social inclusion of vulnerable groups (€ 166 million)
Creation of reintegration programmes and training of vulnerable social groups (homeless people, beneficiaries of minimum guaranteed income, Roma) into the labour market, digital retraining of the elderly and of the people with disabilities in new and housing programmes for vulnerable groups. The project and its sub-projects promote social cohesion and more effective delivery of social services protection services to the most vulnerable.
Please download the country profiles for more details.