Energy efficiency renovations in privately rented apartment blocks: how to align policy instruments to barriers?

Abstract

Belgium, one of the top four European countries with high per capita fossil fuel usage in buildings, has allocated 332 million for improving renovation subsidy schemes in the Flemish and Brussels-Capital regions. This funding aims to accelerate energy efficiency renovations (EERs) in residential buildings. However, financial constraints are not the only barriers to EERs. Governance presents a significant challenge, particularly for non-owner-occupied buildings. In Flanders, 29% of dwellings are rented, with 66% being privately rented. More than half of the rented homes in Flanders have an energy performance certificate D or even lower. Tenants in multi-family buildings encounter difficulties in meeting socially and materially required energy service levels. Renovating privately rented apartments can play a crucial role in achieving Belgium's energy efficiency targets and reducing energy bills for tenants facing energy poverty. Existing literature primarily focuses on identifying barriers for homeowners and governance issues related to energy-efficient building stock, but little research examines aligning policy instruments with these identified barriers. This study aims to explore how policy instruments can overcome barriers and help achieve Flemish energy efficiency targets while alleviating energy poverty. The research includes a literature review and semi-structured interviews, with a focus on incorporating the tenant perspective on EERs. Recommendations will be provided to the Flemish government to accelerate EERs in the private rental sector. To reach the energy efficiency targets, policy instruments should be implemented at the regional and municipal levels, involving distribution grid managers, banks, and other organizations. The Flemish government should create a stable environment for landlords, integrate energy poverty reduction targets into their strategy, and prioritize measurable regulatory interventions. Municipalities, such as Antwerp, should adapt to regional strategies and provide educational support in collaboration with energy houses. Market parties should develop business models that demonstrate the financial benefits of energy efficiency renovations to both landlords and tenants and offer temporary dwellings. By studying Flemish and European renovation strategies, analyzing barriers and policy instruments, and considering the Flemish context, this research aims to answer the question of how policy instruments can be implemented to achieve Flemish targets for energy efficiency renovations and reduce energy poverty in the private rental sector.