Estonia against Europe's express housing renovations plan

Tallinn's Lasnamäe District.
Tallinn's Lasnamäe District. Source: Priit Mürk/ERR

A proposal by the European Commission passing would obligate Estonia to renovate all energy inefficient buildings in under a decade. Estonia finds the plan unrealistic.

The European Commission proposed amending its buildings' energy efficiency directive to introduce mandatory energy efficiency minimum standards last December.

The proposal would see all residential buildings, such as private residences, terraced houses and apartment buildings, sport at least the D energy efficiency rating. The ultimate goal of the directive is to have a zero-emissions housing fund in the EU by 2050.

This should be attainable by completely reconstructing older buildings, heralding much greater construction volumes and investments for both the public sector and private owners.

As the new directive also plans to change the energy class scale, it is difficult to say how many buildings would need to be renovated.

"It is likely that we have eight million square meters of G, F and E energy class apartment buildings and six million square meters of small residences according to the new energy efficiency scale. The requirements will also apply to other types of buildings, Ivo Jaanisoo, head of the Ministry of Economic Affairs and Communications' (MKM) construction and housing department, told ERR.

This huge undertaking also requires colossal investments. For example, the Finns have calculated it would cost €13.7 billion in the country.

Estonia is smaller and has fewer buildings, while it would still be a notable sum. The government alone should dish out several billion for renovation of its buildings and in support.

"Compliance with the entire energy efficiency minimum standards package would cost Estonia €2-3 billion in current prices this decade. The cost-sharing component of owners would be on top of that," Jaanisoo said.

The Commission's deadline of ten years or less in some cases (public buildings) is not realistic for Estonia, the MKM department chief remarked.

"Estonia voiced its position to the Commission in March. Estonia does not support the adoption of mandatory energy efficiency standards in their proposed form as compliance is unrealistic in the given time frame and volume," he said.

Jaanisoo said the deadline should be further down the line and renovation take place more evenly to avoid adding another inflation component to the already overheating construction sector suffering from labor and material shortages.

"The construction market and owners would be better served by an even but consistent growth of the pace of renovation to be able to adjust to new volumes. This would allow us to avoid insensible price advance and make sure the work is done by professional contractors," Jaanisoo said, adding that many buildings will fall out of use in the coming decades, making it more difficult to invest in their efficiency.

Member states and the EU are currently in talks, and the directive amendment entering into force in 2023 would obligate Estonia to adopt it in 2025.

Apartment associations and private owners cannot afford renovation

Urmas Mardi, member of the board of the Estonian Union of Apartment Associations, told ERR that while he likes big plans for renovation, the Commission's proposal seems slightly utopian.

"I like it when people think big but this is not really in accordance with reality," he said, adding that rapid construction materials price hike means private owners will run into trouble coming up with own share.

Mardi said that the average price of reconstruction was €400 per square meter last year to suggest that it is closer to €500 today. "Renovating a private residence used to cost €60,000 before going up to €80,000 and possibly to €100,000 today. Where will a family get the necessary €50,000 cost-sharing component to renovate their house," he said.

He also said that availability of government funding is more often the problem than residents' reluctance regarding apartment buildings. "Financial resources allocated for apartment building renovations are insufficient," he said.

Mardi highlighted as a positive development that the government will allocate €366 million for apartment building renovations in the next five years. The instrument will pay for 30 to 50 percent of the cost of renovation depending on the region.

However, the sum falls well short of what would be needed to realize the European Commission's plans.

Estonia has a plan of its own until 2050

Estonia has its own national building fund reconstruction strategy with goals going all the way to 2050. It aims at reconstructing all buildings built before 2000 with a total area of 54 million square meters.

This covers around 100,000 residences, 14,000 apartment buildings and 27,000 non-residential buildings.

The strategy prescribes renovating 22 percent of eligible buildings by 2030, 64 percent by 2040 and 100 percent by 2050.

This would mean reconstructing over two million square meters during years when volumes are highest that would be an increase of five times compared to 2019.

The strategy notes that the annual need for funding will also grow from €200 million to €900 million.

Both the EU energy efficiency of buildings directive and the Estonian reconstruction plan are aimed at hitting long-term climate targets.

Requirements for a C energy class for a private residence:

  • Insulation of exterior walls (15-20 cm in case of mineral wool)
  • Insulation of the roof or attic (20-30 cm in case of mineral wool)
  • New windows (triple pane windows)
  • Renovation of the heating system (geothermal or air-to-water heat pump, pellet furnace etc.)
  • Heat recovery ventilation system (ventilator plus pipes)

Requirements for a C energy class for an apartment building

  • Insulation of exterior walls (15-20 cm in case of mineral wool)
  • Insulation of the roof or attic (30-40 cm in case of mineral wool)
  • New windows (triple pane windows)
  • Renovation of the heating system (new double-pipe system complete with thermostat valves for radiators in case of district heating)
  • Heat recovery ventilation system (central ventilator with pipes inside wall insulation or an exhaust air pump)


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Editor: Marcus Turovski

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