Practices to overcome split incentives in the EU building stock

摘要

Split incentives are typically regarded as a major barrier toinvestments in energy efficiency upgrades in the building sector.Stemming from a transaction whose benefits do not accrueto the person who pays for it, they affect a large share ofEurope’s buildings: privately rented homes, multi-apartmentbuildings, social housing units and leased commercial orpublic premises. As the Energy Efficiency Directive calls forMember States to take appropriate measures and address thisbarrier, increased interest is drawn on how to design policiesand measures that successfully resolve this long-lastingproblem.Our paper focuses on how various regulatory measures,contractual solutions and financial mechanisms can effectivelymitigate this barrier. A broad overview of the split incentiveproblem across Europe is first outlined, by identifying thedifferent groups affected, most vulnerable groups and extentto which the building sector is exposed to this problem indifferent parts of Europe. It is then shown that current solutionsaddressing split incentives in the building sector vary innature, ranging from revised rent acts, green leases, on-billfinance mechanisms, minimum energy performance standards,use of inclusive rents and others. Each solution and itsapplicability for each segment of the building sector are discussedand a set of common principles upon which successfulstrategies are drawn is provided. Current and planned effortsby the EU Member States outlined in the recently publishedNational Energy Efficiency Action Plans are reviewed. Thepaper concludes with a number of policy recommendationsfor stimulating energy efficiency investments in the affectedsegments of the building sector.