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Abstract
In 2002, the European Union Energy Performance of Buildings Directive (EPBD) was ratified. This paper uses the lens of one policy measure triggered by the EPBD – Display Energy Certificates (DECs) for non-domestic buildings – to describe the difficulties experienced in capitalizing on a policy intention to use transparency about actual energy performance to drive better energy management and focus energy efficiency investment on things that really work in practice. It reviews the history and precedents of UK Building Regulations and European building energy efficiency policies to identify what helped and hindered progress towards buildings that use less energy in operation; and compares and contrasts building energy certificates based on asset and operational ratings. It also looks at the development paths of operational rating schemes in the US and Australia. It identifies a tendency of regulators to focus on one part of the problem, the so-called ‘regulated loads'; an unhelpful split of government ownership of the topic between various ministries and agencies; a neglect of follow-through, enforcement and feedback; and a political rhetoric that favours an abdication of central government responsibilities to market forces. Based on this evidence, it identifies a number of lessons for improvements to future policy outcomes.
Disclosure statement
No potential conflict of interest was reported by the authors
Notes
1 It was ‘welcomed by the UK government for the impetus it gave to building energy certification [and in particular] the challenge the Directive presents to extend certification to all buildings’ (DTI, Citation2003).
2 The implementation of the EPBD in Scotland and Northern Ireland was the responsibility of their respective devolved administrations. Where this paper cites the UK's implementation, it is usually referring only to England and Wales. In practice, the transposition in Northern Ireland has been virtually identical to that in England and Wales, whilst the transposition in Scotland has incorporated many notable differences.
3 ‘[I]n the non-residential sector, emissions have been fairly flat, with not much sign of significant energy efficiency improvement’ (Committee on Climate Change, Citation2013); across commercial buildings, ‘overall progress has been slow, with little evidence of uptake of cost-effective abatement opportunities, particularly for reducing electricity consumption [which account for 79% of emissions]’ (Committee on Climate Change, Citation2014).
4 In the UK, taxes on non-domestic energy use were introduced by the Climate Change Levy (CCL) in 2001 and the Carbon Reduction Commitment Energy Efficiency Scheme (CRCEES) in 2010. The imposition of the CCL was accompanied by incentives for companies to invest in energy efficiency: Enhanced Capital Allowances (ECAs) were made available for businesses to invest in designated energy-saving plant and machinery, whilst voluntary Climate Change Agreements (CCAs) allowed eligible energy-intensive industries to receive up to 90% reduction in the CCL if they signed up to stretching energy efficiency targets agreed with government.
5 The evidence for the research findings is acknowledged to be extrapolated from other topics.
6 The NCM allows the calculation for non-domestic buildings to be carried out either by approved simulation software or by simplified software called SBEM – Simplified Building Energy Model. SBEM, based on CEN standards (the European Committee for Standardization), calculates monthly energy use and CO2 emissions given a description of the building geometry, construction, use, HVAC and lighting equipment. The development of SBEM and the CEN standards took account of the Dutch methodology NEN 2916:1998 (Energy Performance of Non-Residential Buildings). SBEM determines compliance with Building Regulations by calculating annual energy use and comparing it with that of a comparable ‘notional' building with default fabric and servicing characteristics. A similar process produces an ‘asset rating' for a new or existing building for use in Energy Performance Certificates (EPCs).
7 Belgium, France, Italy, Luxembourg, the Netherlands and West Germany.
8 Programmes can include laws, regulations, economic and administrative instruments, information, education and voluntary agreements whose impact can be objectively assessed.
9 The Department of the Environment's (DoE) Energy Efficiency Best Practice Programme was launched by the UK Government Energy Efficiency Office in 1989 (Mallaburn & Eyre, Citation2013) to stimulate the take-up of energy-efficient good practice throughout the economy. The programme was jointly managed on behalf of the DoE by the Building Research Energy Conservation Support Unit (BRECSU) at Watford and the Energy Technology Support Unit (ETSU) at Harwell. BRECSU was responsible for energy efficiency in buildings whilst ETSU was responsible for the programme's industrial component.
10 The UNFCCC defined the principle of ‘common but differentiated responsibility' to tackle climate change but does not contain commitments in figures, detailed on a country-by-country basis, in terms of reducing greenhouse gas emissions.
11 Under the ‘Maastricht Treaty' (1992) the EEC was renamed the European Community (EC).
12 Eventually to become one of the ‘20–20– 20' by 2020 targets set by EU leaders in 2007.
13 Under subsidiarity, member states can transpose EU Directives to complement their national regulations.
14 Even a new building can be given a tentative operational rating before it is occupied, e.g. the NABERS Commitment Agreement in Australia involves new buildings disclosing their targeted operational rating, modelled in accordance with certain protocols.
15 EPBD recital 16 recommended public authority buildings and buildings frequently visited by the public should set an example by applying energy certification on a regular basis.
16 Such optional adjustments would only be permitted if they were examined rigorously using accredited procedures, e.g. with the ‘special’ items sub-metered and accompanied by a report on their energy efficiency and potential for improvement.
17 By December 2014, about 220 000 DEC records had been lodged (see https://www.ndepcregister.com/lodgementStats.html).
18 ‘Given the importance of information, and limited roll-out to date, we recommend mandatory roll-out of EPCs and DECs to all non-residential buildings by 2017.’
19 The Aldersgate Group is an alliance of leaders from business, politics and civil society that drives action for a sustainable economy. Members include some of the largest businesses in the UK with a collective global turnover of over £300 billion and politicians of all parties (see http://www.aldersgategroup.org.uk/).
20 Letter to the House of Commons Public Bill Committee on the Energy Bill 2010–11: cc Ministers Mark Prisk and Grant Shapps: ‘I am writing to reaffirm the CBI's support for the Energy Bill (2010–11), and to endorse its use as the enabling legislation to mandate the extension of Display Energy Certificates (DECs) to the commercial sector. […] We believe that DECs are a powerful tool for helping businesses better understand their energy use from buildings […] companies can not only improve their bottom line by reducing overheads, but will also cut carbon emissions and gain reputational benefits. Once primary legislation is in place, a number of parameters must be clarified to ensure that DECs are fit for purpose. It will be crucial that the labels are measured using appropriate methodology, and are suitably tailored to commercial properties. […] Much of this detail will require business input and we would be very happy to work with officials to ensure that the regulation is workable.'
21 In November 2009, DCLG ceased the site-based DEC ‘Transitional Arrangements' for a school, university or hospital campus, undermining a key principle of the TM46 benchmarks: the floor area of the subject building(s) should coincide with the metered energy boundary.
22 ‘The lack of actual performance data continues to capture significant attention within the property sector and has led to large numbers of organisations (including UK-GBC and Aldersgate Group, as well as developers, property companies, NGOs and corporates), supporting campaigns for the roll-out of DECs to commercial buildings. This has secured widespread support within Cabinet and led to Government signalling its commitment to their statutory implementation by October 2012 in its draft Carbon Plan published in March 2011. The expectation was that the Energy Act 2011 would provide the primary legislation for such a move, but in the lead up to the Act receiving Royal Assent, the Government reneged on the commitment. Whilst a number of leading property companies is now pushing them out voluntarily in recognition of their benefit, they are doing so on an inconsistent basis. The Aldersgate Group supports entirely the principle of mandating operational energy ratings for commercial buildings and encourages Government to revisit this at the next legislative opportunity. We also recognise that DECs in their current format have some significant limitations, in that they contain insufficient normalisation metrics to account for the impact of building type and use intensity on the energy consumption profile. In preparing plans for the roll out of operational ratings to commercial buildings, Government should work closely with industry to define the scope and the basis for ensuring comparable application to different building uses' (Aldersgate Group, Citation2012).
23 Preparatory activities were in train with the entertainment, hospitality and retail sectors. For example, the expert group was providing guidance to Julie's Bicycle and Theatres Trust who had collected data for entertainment venues, and demonstrated a clear need for the TM46 benchmarks to be revised.
24 Many if not most of these sub-1000 m2 buildings are on multi-building sites where their energy use is rarely directly metered. If that is the case, these misleading DECs will be based on site energy use prorated by floor area and can remain on show for 10 years as the statement of energy performance, even if sub-metering was installed in the intervening period.
25 Hansard (Citation2013b): Minister for Housing (Mr Mark Prisk): ‘I wish to inform the House of spending that the Government have been forced to undertake as a result of poor decisions made by the last Administration. As a result of low transaction volumes, due to the economic down turn under the last Administration following the financial turmoil in 2008 and 2009, and a number of enhancements to register services, the revenue from fees for entering documents onto the registers has not been sufficient to meet the full cost of operating the registers. This has left the current Government with a contractual obligation to meet the cost of services that had been delivered through the register contracts but which had not been covered by revenue from fees for entering documents on to the registers. As a result, the Department has reluctantly agreed to make a payment of £5.7 million to cover these costs to April 2013.'
26 It is notable that the EED repeals and supersedes its precursor the Energy Services Directive (2006/32/EC), which itself repealed the SAVE Directive of 1993, which can now be fully appreciated as the forerunner of all the EU's efforts at promoting energy efficiency in buildings.
27 See www.les-ter.org/.
29 Partly because in many jurisdictions landlords were required to include energy costs within the rent.
30 The Australian Buildings Greenhouse Rating system (ABGR) was developed by SEDA, the Sustainable Energy Development Authority for New South Wales, with technical advice and in consultation with leading players in office property. In 2008, it was rebranded NABERS Energy to recognize its incorporation into a national scheme.
32 The DCLG oversees EPCs, DECs and Building Regulations; the DECC, the Energy Savings Opportunities Scheme, and, with HM Treasury, the Carbon Reduction Commitment Energy Efficiency Scheme; the Department for Environment Food & Rural Affairs (DEFRA), mandatory greenhouse gas reporting; and the Department for Business, Innovation and Skills (BIS) hosts the Green Construction Board (which has a remit of energy and carbon saving) and Innovate UK, which sponsors related research. Further fragmentation is introduced by Ofgem, the Office of Gas and Electricity Markets, the government regulator for the electricity and downstream natural gas markets.
33 A further difficulty was that the Carbon Trust (which took over the ‘curation' of the EEBPp's benchmarking publications in 2002) saw itself unable to develop an improved benchmarking system for DECs, as its remit was to go beyond what government was obliged to do, not to subsidise the implementation of a statutory measure, the EPBD.