Improvement of energy efficiency of public buildings not going well

Toomas Mattson | 6/4/2018 | 10:10 AM

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TALLINN, 4 June 2018 - In the opinion of the National Audit Office, it is unlikely that Estonia can comply with the requirement set in the Energy Efficiency Directive of the European Union, which is to renovate 3% of the area of central government buildings every year to make it energy efficient, if it continues on the same course. Also, the Estonian construction sector, the persons ordering buildings or local governments may not be ready to transfer to nearly zero-energy buildings by the deadline set.

Although Estonia has complied with the requirement of the Energy Efficiency Directive successfully so far, the Ministry of Finance estimates that only 10,000 m2 of floor area of the necessary 25,000 m2 per year will be renovated on the basis of the investments decided for the period from 2017 to 2021. No plan or budget has been prepared for meeting the 3% requirement and according to the Ministry of Finance, political and sectoral policy priorities are more important in decision-making than construction criteria.

The Ministry of Finance made a proposal to the government to plan 70 million euros from the state budget and the budget of Riigi Kinnisvara AS for reducing the renovation debt of central government buildings. However, the 70 million is also used to finance investments in the construction of new buildings, memorials (e.g. the memorial to the victims of communism) and to invest in the central government and other public buildings not covered by the definition of central government provided in the Energy Sector Organisation Act. The state has more property as a result of that, but not enough money for improving its existing property.

Neither does the state have a comprehensive overview of the energy consumption and condition of public buildings, which means that making informed decisions about renovation and funding is difficult. Firstly, the data related to public buildings is kept in the State Register of Construction Works, whose controller is the Ministry of Economic Affairs and Communications. Secondly, the data are also in the Public Property Register, which is managed by the Ministry of Finance. Although the Public Property Register covers data about the majority of the buildings owned by the central government, there is no data about the buildings of local governments at all. Thirdly, there is information in the Land Register, which is in the area of responsibility of the Ministry of Justice. The technical data of public buildings can be found in the State Register of Construction Works, the buildings owned and occupied by the central government within the meaning of the Energy Sector Organisation Act can be found in the Public Property Register and the Land Register includes data about the owners of buildings. In addition to this, data about land survey results and the natural status, value and actual use of the land is stored in the Land Cadastre of the Land Board.

In the opinion of the National Audit Office, the State Register of Construction Works could be the register from which all kinds of information about all buildings could be obtained without duplicating the other registers.

At present, there are gaps in the State Register of Construction Works in respect of the information concerning energy performance certificates and the renovation of buildings. Obtaining a comprehensive overview is also made more difficult by the fact that many public buildings don’t have an energy performance certificate, even though having one is mandatory for public buildings larger than 250 m2 and necessary for obtaining an overview of the energy consumption of buildings. In 2017, 38% of central government and 49% of local government buildings didn’t have the mandatory energy performance certificate required for the assessment of energy consumption.

Local governments have planned 680 million euros for investing in the renovation of buildings in the budget strategies prepared for the period from 2017 to 2021. However, the actual investment capacity of local governments is smaller in the opinion of the National Audit Office: approximately two-thirds of the planned amount. Local governments hope to receive support from the state for the renovation of the buildings in an amount that exceeds the support measures planned by the Ministry of Finance for the period by almost 100 million euros. When planning investments for streamlining buildings, local governments should first decide which buildings they plan to use in the long term, and optimise the use of the buildings before making any investments.

Proceeding from the positions of the European Commission, the Ministry of Economic Affairs and Communications brought the deadline for the issue of building permits for nearly zero-energy buildings closer by a year, i.e. the deadline for the transfer to nearly zero-energy buildings is now 2020 instead of 2021. Although a plan for transferring to nearly zero-energy buildings must be prepared according to the directive, the Ministry of Economic Affairs and Communications has not prepared one. However, the Ministry has supported the development of standard designs for nearly zero-energy buildings and the construction of example buildings. In the opinion of the National Audit Office, the Estonian construction sector, the persons ordering buildings or local governments may not be ready to transfer to nearly zero-energy buildings by the deadline set. The persons interviewed by the National Audit Office have pointed out that bringing the deadline of the requirement to construct nearly zero-energy buildings closer by a year has a significant impact on the business plans of entrepreneurs and this decision should not have been made light-handedly. The plans and projects that have already been approved may have to be redone.

The advice of the National Audit Office is to develop measures for making public buildings more efficient, including options for including private financing, on the basis of comprehensive information. The National Audit Office advises the Minister of Public Administration to make sure when planning the state’s property investments that the requirement to renovate 3% of the area of central government buildings is complied with, and to plan investments in the energy efficiency of central government buildings regularly and as a priority in the system of public property management.

  • The investments decided for the period from 2017 to 2021 are only sufficient for the renovation of 10,000 m2 of the area of buildings instead of the 25,000 m2 per year, which would be necessary to meet the requirement of making 3% of the area of central government buildings energy efficient every year.
  • There is no comprehensive overview of the energy consumption and condition of public buildings, which means that making informed decisions about renovation and funding is difficult. The data in registers are incomplete and data exchange between different databases is not working well.
  • The transfer to the construction of nearly zero-energy buildings sets stricter requirements to the construction of new buildings. The Estonian construction sector, the persons ordering buildings or local governments may not be ready to transfer to nearly zero-energy buildings by the deadline set.

Background:

Energy saving, which is aimed at reducing the emissions associated with the use of fossil fuels and dependence on imported fuels, and increasing the competitiveness of the economies in the Member States, has become one of the most significant building blocks for the climate and energy policy of the European Union (EU). The EU has set the target of achieving 20% energy savings by 2020 and 30% for 2030.

The public sector in Estonia uses more than 9 million square metres of building area, which is more than 6.7% of the area of all buildings located in the territory of Estonia.

The use of energy efficient solutions is economically feasible considering the life cycle of a building as a whole, but the readiness of building owners for reconstruction is rather small due to the large initial investment required. At the same time, improving the energy efficiency of buildings promotes technological development and innovation on the construction market. This is why requirements for the energy efficiency of buildings have been set and an example-setting role has been provided for states with European Union directives in order to the improvement of the conditions of buildings. Only the construction of buildings that need very little energy, i.e. nearly zero-energy building, will be permitted as of 2020 and states are obliged to renovate at least 3% of the area of central government buildings every year to make it energy efficient.

The audit of the National Audit Office was a part of the joint audit organised by the EUROSAI (European Organisation of Supreme Audit Institutions) Working Group on Environmental Auditing. Eight European Union states participated in the joint audit. Estonia as the head of the EUROSAI Working Group on Environmental Auditing is the coordinator of this international audit. The report of the joint audit will be published in autumn 2018.

 

Toomas Mattson
Communication Manager of the National Audit Office
+372 640 0777
+372 513 4900
toomas.mattson@riigikontroll.ee
press@riigikontroll.ee

  • Posted: 6/4/2018 10:10 AM
  • Last Update: 6/4/2018 11:01 AM
  • Last Review: 6/4/2018 11:01 AM

The EU has set the target of achieving 20% energy savings by 2020 and 30% for 2030.

Scanpix/ PantherMedia / Francois Poirier

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