The intricacies of the environmental performance of buildings

May 19, 2023 Energy

This op-ed was written with Mathias Laffont, director of usage and territory, Union Française de l’Electricité.

On April 1, 2023, the energy audit came into effect. Its purpose is to provide potential buyers of a property classified as "energy-intensive" during the energy performance diagnosis (DPE) with information on the renovation works to be carried out to improve the performance of the property for sale. Auditors and diagnosticians are thus becoming key players in the real estate sector and in energy renovation. To what extent can we trust them?


RE2020 replaces RT2012

When it comes to deciding whether to heat homes, offices, classrooms and meeting rooms with electricity, gas, oil or wood, the economic answer is based on a simple cost-benefit calculation: for a given service (a given temperature on the days and at the hours of operation for such and such a number of years), the solution to be retained is the one with the lowest installation and running costs. But the discounted cost depends on the price of the equipment to be installed, its energy requirements and the expected prices of the energy that will be consumed. While the price of the equipment (e.g. a heat pump) is easy to know, only a fortune-teller can tell what the prices of gas, electricity or fuel oil will be over the next few decades, without mentioning that externalities of fossil fuel consumption are not still adequately taken into account. As for the quantities of energy that will be consumed, they depend on the technical characteristics of the equipment, the thermal qualities of the building where they are installed, and, of course, the use that will be made of them.

To improve the performance of buildings, imposing common standards on new construction may seem simpler. But, as always, the devil is in the details, and there is no shortage of details: the decree of August 4, 2021 "on the energy and environmental performance requirements for building construction in metropolitan France" has only 50 articles, but, including annexes, stretches over 1800 pages.

The RE2020 environmental regulation, which already applied to the construction of buildings for residential use and office buildings or primary or secondary education, also applies since January 2023 to extensions of these buildings and temporary constructions. In order to generalize the constraints intended to reduce the environmental impact of buildings and energy consumption by their occupants, the date of entry into force for other buildings (shops, restaurants, hospitals...) has yet to be set. The calendar is almost finalized but it is increasingly difficult to see clearly in the maze of technical standards imposed on builders and users of buildings delivered.

Previous regulations were only thermal in nature. For example, with regulation RT2012 applicable to new buildings until 2019, the primary energy consumption per square meter per year for heating, cooling, domestic hot water production, lighting and mobility within the building should not exceed 50 kilowatt hours (see the evolution since 1974 HERE). The RE2020 is much more complex in order to meet the needs of mitigation and adaptation to global warming. Thus, in addition to the requirements to reduce energy consumption, it aims to reduce the carbon impact of buildings (during construction and during the first 50 years of their use) and to ensure internal cooling during hot weather (see HERE).


Existing buildings

The building stock is only renewed at a rate of 1% per year. More than 70% of the buildings that will be in use in 2050 are already built. In France, housing represents on average 22% of the expenses of the 20% of the poorest households; it is their first consumption item, ahead of food at home and mobility (INSEE). Given the sums involved, it is important to prevent buyers and tenants from being misled, voluntarily or involuntarily, about the qualities of use of the property purchased or rented, particularly with regard to energy consumption. Thus, the DPE, which was created in 2006, was reformed in 2021 to include the standardisation of calculation methods, compulsory display in real estate advertisements and opposability: like other real estate diagnoses, if the DPE is erroneous, the buyer or tenant who has suffered a prejudice can engage the responsibility of the seller or the lessor.

It is therefore necessary to rely on the competence of the diagnostician to ensure that real estate transactions take place under fair information conditions.


Reliability of diagnoses

Diagnostician is a priori a well-regulated profession since the one who claims this title must hold a certificate issued after training by an organization accredited by the Cofrac (for example Bureau Veritas). Why then, on the page of the Ministry of Ecological Transition, after a paragraph explaining that it is "a professional whose missions, responsibilities and obligations are regulated" and another stating the basic requirements of the profession (independence and impartiality, skills, organization and means, insurance), do we find a paragraph "How to detect the dubious practices of some providers"? And why did four professional organizations of diagnosticians, during a hearing at the Senate on April 13, ask to be more controlled? If they demand "an identified profession with representatives, a diploma, sanctions, an organization of the sector, the ability to have one's capacity to practice revoked, and continuous training", it is because none of this exists, thus leaving a space for unscrupulous actors. The DPE belongs to the category of what economists call 'credence goods': it is a service whose real quality cannot be known by its user, for example a household, neither before nor after its consumption. Only professional auditors with the appropriate skills can judge whether the diagnosis is rigorous (which excludes incompetent diagnosticians) and impartial (which excludes diagnosticians who might have interests in real estate transactions or renovation work). These reservations also apply to "energy auditors", a qualification granted under the conditions described in Decree No. 2022-780 of May 4, 2022. Therefore, there is a need for controllers of auditors and diagnosticians, and a rigorous control of controllers.


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All energy quality requirements are costly. For RT2012, the additional cost of housing would be around 10%, but it can be reduced over time by learning effects. The ban on renting out housing classified as F or G by the DPE creates very strong tensions on the real estate market for low-income households. This explains why some senators are concerned about the difficulties associated with the implementation of the new DPE and the obligations regarding the energy performance of housing (see HERE and HERE). When we revise upwards the quality requirements, we must always think about the risks of social exclusion and implement a policy of support for the most deprived households.


Published in La Tribune

Photo: Erik Mclean sur Unsplash