Performance

Energy performance certificates – a blunt instrument

Anyone planning to sell or let a building in Germany must produce an energy performance certificate, or “energy passport”, for the property. The energy passport provides useful information on the expected heating costs, but is not detailed enough to serve as a benchmark for evaluating energy efficiency upgrades.

Since 2009, energy performance certificates have been compulsory for all residential and non-residential buildings in Germany. Only a limited number of properties are exempt, such as buildings with very small usable areas (less than 50 sq m), holiday homes and protected historic ensembles. These certificates are intended to create transparency in the market and provide potential purchasers and tenants with an easy way of assessing the heating and hot water costs they are likely to incur. With regard to landlords and owners, the aim is to help them identify potential energy savings and upgrade their properties accordingly.

Stricter rules and monitoring of certificates

Following the amendment of the German Energy Saving Ordinance (EnEV), the regulations were tightened with effect from 1 May 2014. The energy performance certificate must now be produced no later than when a property is being viewed. Upon completion of contracts, the tenant or purchaser must be given a copy of the energy performance certificate. In addition, advertisements for commercial property must always include the energy efficiency rating.

Similarly, tougher requirements were imposed on public and commercial properties. Public authorities occupying buildings with a usable area of more than 500 sq m (from 8 July 2015: 250 sq m) and significant public footfall are now obliged to clearly display the energy performance certificate. The same applies to non-official buildings with a high level of footfall, such as hotels, banks and retail units with an area of 500 sq m or greater. The amended legislation also introduced random checks on energy performance certificates.

Performance

Green light for energy-saving buildings

German energy performance certificates use a scale of nine efficiency ratings from A+ to H. These are highlighted in different colours, like the labels on electrical appliances. Dark green (A+) indicates a particularly efficient building, while dark red (H) denotes very wasteful use of energy.

There are actually two types of energy performance certificate used in Germany. Consumption certificates are based on the heating and electricity bills of recent years. As such, the behaviour of previous occupiers is a key determinant. Energy requirement certificates, meanwhile, involve analysis of all relevant structural data by an energy consultant, who then uses this information to calculate the theoretical energy requirement. This process is significantly more time-consuming and therefore more expensive.

Whether the results are actually more meaningful is debatable. Although the figures are not influenced by the individual behaviour of previous occupiers, the calculations are based on DIN values and assumptions that frequently bear little resemblance to typical scenarios. The results are often correspondingly unrealistic.

Energy performance certificates based on the European Energy Performance of Buildings Directive (EPBD) are also found in a number of other European countries. However, implementation of the regulations varies in practice.

Industry players require more detail

From the perspective of property investors and building operators, an energy performance certificate provides only a first insight into the energy efficiency of a building. The information it contains is not detailed enough to allow in-depth evaluation and comparison of properties. In most cases, the data is also insufficient for planning energy optimisation of an existing building.

The data systematically recorded and evaluated by Union Investment Real Estate in relation to its own portfolio, and also when analysing potential investments, goes far beyond the requirements of the energy performance certificate. The use of proprietary analysis and reporting tools enables the company’s experts to define relevant benchmarks for the portfolio’s energy efficiency. These proven tools are valuable instruments for sustainable optimisation of individual properties and also of the overall portfolio.

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