Transatlantic Energy Efficiency Insights: How North America Can Learn from Europe’s Real Estate Innovations

December 9, 2024

Share
Transatlantic Energy Efficiency Insights: How North America Can Learn from Europe’s Real Estate Innovations

 

As climate change concerns intensify, the European Union (EU) continues to lead by setting ambitious sustainability goals aimed at reducing carbon emissions and creating energy-efficient urban environments. The European Green Deal remains a central pillar, with updated objectives to reduce net greenhouse gas emissions by 55% by 2030 and achieve carbon neutrality by 2050. Buildings, responsible for approximately 40% of the EU’s total energy consumption and 36% of its CO₂ emissions, play a crucial role in this initiative. For North America, which faces similar environmental challenges, studying the EU’s innovative approaches to energy efficiency in real estate provides valuable insights for sustainable urban transformation.

Through regulatory frameworks, funding mechanisms, and innovative standards, European countries are reshaping urban landscapes and redefining building performance. While North America has also made progress, particularly in adopting green building standards and smart technologies, gaps remain in terms of consistency and large-scale implementation. Adopting and adapting Europe’s best practices could help North America accelerate its energy transition and create more resilient, energy-efficient cities.

 

Key European Innovations in Building Energy Efficiency

Building Energy Performance Standards

The EU’s Energy Performance of Buildings Directive (EPBD) sets strict requirements for the energy efficiency of buildings, establishing a binding standard for new and renovated structures. Since 2020, all new buildings in Europe must meet near-zero energy building (NZEB) standards, which require combining high-performance insulation, airtight construction, and on-site renewable energy sources whenever possible. The EPBD also encourages deploying smart technologies to optimize real-time energy management.

In North America, several regional initiatives are emerging to establish similar standards. States like California have implemented net-zero building goals for new constructions, although this has yet to become a national requirement. However, continent-wide uniform standards, like those in Europe, could drive broader adoption of energy-efficient construction techniques across residential, commercial, and industrial sectors.

 

Integrated Urban Design and Smart Zoning

European cities are global leaders in sustainable urban design, emphasizing energy-efficient zoning, public transit accessibility, and green spaces to reduce urban energy demand. In cities like Copenhagen and Amsterdam, mixed-use developments encourage pedestrian- and bicycle-friendly environments, reducing reliance on energy-intensive personal vehicles and fostering community cohesion.

While some North American cities, such as Vancouver and Portland, have adopted similar approaches to urban densification and improved public transit, these practices are not yet widespread. Greater integration of these urban design elements could help North American cities develop compact, transit-oriented communities, reducing heating, cooling, and transportation energy needs.

 

The Renovation Wave Strategy

Launched as part of the European Green Deal, the EU’s Renovation Wave strategy aims to double renovation rates by 2030, focusing on improving the energy performance of existing buildings. This initiative targets both public and private buildings, encouraging energy-efficient upgrades that reduce operating costs and improve indoor comfort. The Renovation Wave includes various financial incentives—subsidies, tax credits, and low-interest loans—making large-scale retrofitting accessible to property owners across Europe.

In North America, similar programs are emerging, such as Canada’s energy retrofit program and local initiatives like RetrofitNY in New York. However, these programs often lack the funding levels and national coordination observed in Europe. Expanding these efforts could help modernize aging infrastructure while reducing its carbon footprint. Given that many North American buildings are also aging and energy-inefficient, a comparable renovation initiative could address a significant source of energy waste.

 

Case Studies of Successful European Projects

Copenhagen’s Carbon-Neutral Building Initiatives

 Copenhagen, Denmark, stands out for its ambitious plan to achieve carbon neutrality by 2025. The city has heavily invested in district heating and cooling systems, a centralized energy distribution model that provides buildings with low-carbon thermal energy. This approach minimizes the need for individual heating systems, which are often inefficient and carbon-intensive. Additionally, Copenhagen emphasizes energy-efficient building standards and widespread renewable integration, setting a global example of sustainable urban development.

Comparable initiatives, though less widespread, are emerging in North American cities such as Toronto, which uses deep water cooling systems, demonstrating the potential for broader adoption.

 

Passive House Standards in Germany

Germany’s Passive House standard represents one of the most rigorous energy efficiency benchmarks in the world. Passive Houses, designed with superior insulation, airtight construction, and minimal thermal bridging, achieve heating and cooling energy savings of up to 90% compared to conventional buildings. This approach minimizes the need for active heating or cooling systems, resulting in energy-efficient, comfortable indoor environments. Adopting similar standards in North America could have a transformative effect, especially in colder regions where heating demands are high.

(Image credit: Alloy Development / Photography: Richard Barnes)

 

The Netherlands’ Circular Economy Initiatives

The Netherlands has embraced circular economy principles, particularly in the construction sector, to reduce waste and maximize resource efficiency. By reusing construction materials and promoting sustainable building practices, the Netherlands minimizes environmental impact while reducing the demand for new materials. Circular construction projects not only lower a building’s carbon footprint but also contribute to resource conservation, a crucial factor in sustainable development. In North America, similar initiatives are emerging. For instance, Brique Recyc, a Quebec-based company, has developed a technology to restore bricks from building facades. This innovation not only reduces construction waste but also extends the lifespan of existing materials, while being distributed across Canada and the United States. Adopting such principles, combined with innovations like this, could help North American cities reduce construction waste and promote sustainability throughout the building lifecycle.

 

Lessons for North America

The potential for North America to adopt European best practices in energy efficiency within the real estate sector is significant. Establishing stricter regulatory frameworks, such as energy performance standards for buildings, could help close the energy efficiency gap across North America. While some regulations exist, they are often not strict enough to act as major drivers of energy transition. For example, France’s Décret Tertiaire is a key regulatory driver, mandating significant reductions in energy consumption for commercial buildings. This approach has been highly impactful in France’s energy transition, as evidenced by industry feedback. North America could benefit from implementing similarly ambitious regulations to ensure energy savings become a priority for developers and property owners.

Additionally, cities could explore policies and incentives encouraging developers to use sustainable materials and prioritize energy-efficient designs in new constructions and renovations. By fostering community and industry engagement, North American municipalities could build broad support for sustainable urban practices, further accelerating the transition to energy-efficient cities.

European models of urban design and zoning also present significant potential for North America. By adopting smart zoning practices that encourage compact, mixed-use developments, North American cities could create accessible and energy-efficient communities that prioritize public transit and reduce the need for energy-intensive travel. However, to ensure these initiatives are truly effective, building codes must become more prescriptive to guarantee high-performing buildings from the outset. This would allow cities to rely on a robust regulatory framework to require buildings that meet high energy efficiency standards. Financing mechanisms similar to those in Europe could provide property owners and developers with the support needed to prioritize sustainability and long-term energy savings in their projects.

 

Conclusion

Europe’s best practices in energy efficiency provide North America with a clear pathway to reduce carbon emissions, achieve energy savings, and enhance property values. However, it is also important to acknowledge North America’s progress, particularly in adopting smart technologies and local efforts to reduce energy consumption. By building on these foundations and drawing inspiration from Europe’s successes, North American real estate leaders can accelerate their transition to more sustainable and resilient cities.

 

References:

Share
Back to Articles

Book a Demo