Energy Efficiency Governance in buildings: a multi-level

perspective

Thesis presented by:

Eleonora Annunziata

to

The Class of Social Sciences

for the degree of

Doctor of Philosophy in the subject of

Management – Innovation, Services and Sustainability

Tutor: Prof. Marco Frey

Scuola Superiore Sant’Anna

A.Y. 2012-2013

2

“Sustainable energy is a global priority…, because it is central to everything we do,

and central to everything we want to achieve”. (UN Secretary-General's remarks at Davos 2012)

3

Acknowledgements I am glad to thank all people who supported this research work. First of all, I would

like to show my gratitude to my tutor Professor Marco Frey for all the

encouragements and guidance over the years which have made it possible for me to

continue all the way. I am also grateful to Francesco Rizzi, Francesco Testa and

Professor Fabio Iraldo because they have given me the opportunity to develop my

research ideas. I make special thanks to all people who responded to my

questionnaire surveys, because they were very precious for my research work. I also

thank all my colleagues and friends at the SUM and at the Institute of Management.

My “super” thanks to Cecilia, Mayla, Benedetta, Consuelo, Barbara, Federica and

Emilia for their continuous support. Finally, I would like to thank my parents, there

are no words that can express how grateful I am to them.

4

Contents

Chapter 1 .................................................................... 10

Introduction .......................................................................................................................10

1.1 Background ............................................................................................................................... 10

1.1.1 Brief introduction: the concept of energy efficiency related to buildings 10

1.1.2 Socio-technical system and multi-level governance in energy efficient

buildings ........................................................................................................................................ 12

1.2 Aims.............................................................................................................................................. 15

1.3 Methodological approach .................................................................................................... 18

References ......................................................................................................................................... 19

Chapter 2 .................................................................... 22

Literature review on energy efficiency in buildings...............................................22

2.1 Energy consumption in buildings ..................................................................................... 23

2.2 Buildings: a complex socio-technical system ............................................................... 28

2.3 Barriers to energy efficiency improvements ............................................................... 33

2.4 Policies to promote energy efficiency ............................................................................. 36

2.4.1 Residential buildings ..................................................................................................... 38

2.4.2 Non-residential buildings ............................................................................................ 40

2.5 Conclusions ............................................................................................................................... 41

References ......................................................................................................................................... 43

Chapter 3 .................................................................... 49

Towards nearly zero-energy buildings: the state-of-art of national regulations

in Europe.............................................................................................................................49

3.1 Introduction .............................................................................................................................. 50

3.2 Background Literature.......................................................................................................... 52

3.2.1 Integration of energy efficiency and renewable energy requirements ..... 53

3.2.2 Translation of investments in energy saving into economic value ............. 54

5

3.2.3 Commitment towards “nearly zero-energy” target ........................................... 56

3.3 Methodology and results ..................................................................................................... 56

3.3.1 Integration of energy efficiency and renewable energy requirements ..... 57

3.3.2 Translation of investments in energy saving into economic value ............. 60

3.3.3 Commitment towards “nearly zero-energy” target ........................................... 61

3.3.4 Overarching vision ......................................................................................................... 64

3.4 Discussion .................................................................................................................................. 68

3.5 Conclusions ............................................................................................................................... 71

References ......................................................................................................................................... 72

Chapter 4 .................................................................... 79

The Role of Eco-design in the development of energy efficiency in buildings

...............................................................................................................................................79

4.1 Introduction .............................................................................................................................. 80

4.2 The Survey Design .................................................................................................................. 83

4.3 Data description and variables construction ............................................................... 86

4.4 Results ......................................................................................................................................... 91

4.4.1Eco-design........................................................................................................................... 91

4.4.2 Strategic supporting factors for Eco-design ......................................................... 92

4.4.2.1 Energy and environmental strategy and performance ............................ 92

4.4.2.2 Cooperation with supply chain .......................................................................... 94

4.4.2.3 Training ...................................................................................................................... 95

4.4.2.4 Certification schemes ............................................................................................ 97

4.4.3 Barriers to Eco-design .................................................................................................. 98

4.5 Discussion and conclusions ..............................................................................................102

References .......................................................................................................................................105

Chapter 5 .................................................................. 113

The contribution of Green Public Procurement to Energy Efficiency

Governance in buildings .............................................................................................. 113

5.1 Introduction ............................................................................................................................114

6

5.2 The uptake of GPP in Europe and Italy .........................................................................116

5.3 Governance of energy efficiency and GPP in buildings ..........................................120

5.4 Theory and Propositions....................................................................................................122

5.4.1 Technical and organizational support to the adoption of GPP practices 122

5.4.2 Energy efficiency and environmental strategy and EMS ...............................124

5.5 Research design and methodology ................................................................................126

5.5.1 Sample ...............................................................................................................................126

5.5.2 Model and variables .....................................................................................................127

5.6 Results .......................................................................................................................................130

5.7 Discussion and Conclusions ..............................................................................................133

References .......................................................................................................................................137

Chapter 6 .................................................................. 147

Conclusions ..................................................................................................................... 147

6.1 The outline of research work ...........................................................................................147

6.2 Concluding remarks .............................................................................................................149

6.3 Limitations...............................................................................................................................150

6.4 Managerial implications .....................................................................................................151

6.5 Future research .....................................................................................................................153

References .......................................................................................................................................154

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List of Tables Table 2.1 – Drivers of energy use in buildings .......................................................................... 26

Table 2.2 - Characterization of energy-saving building technologies .............................. 27

Table 2.3 – Major barriers to energy efficiency in the building and construction sector ........................................................................................................................................................... 35

Table 2.4 – The most important policy instruments to promote energy efficiency in the building and construction sector .............................................................................................. 36

Table 3.1 - Hierarchy of energy efficient measures in the 27 European Union Member States............................................................................................................................................................ 59

Table 3.2 - Targets for renewable sources in the 27 European Union Member States ........................................................................................................................................................................ 59

Table 3.3 - Incentives for sale of energy efficient buildings in the 27 European Union Member States ......................................................................................................................................... 61

Table 3.4 - Incentives for rent of energy efficient buildings in the 27 European Union Member States ......................................................................................................................................... 61

Table 3.5 – Penalties for energy performance requirement non-compliances in the 27 European Union Member States ....................................................................................................... 63

Table 3.6 - Minimum threshold for the mandatory communication about the effects of the refurbishment in the 27 European Union Member States ......................................... 64

Table 3.7 - Incentives for the diffusion of nearly zero-energy buildings in the 27 European Union Member States ....................................................................................................... 64

Table 3.8 - Summary of regulatory and policy instruments adopted by the 27 European Union Member States in their national regulatory framework ....................... 65

Table 4.1 – Summary statistics ........................................................................................................ 89

Table 4.2 – Designer characteristics: type of profession, type of registration, legal form of design firm, project type and type of main clients ..................................................... 90

Table 4.3 – Spearman test between Eco-design variables and designer characteristics ........................................................................................................................................................................ 92

Table 4.4 – Spearman test between environmental strategy variable and designer characteristics and between environmental strategy and performance variables and Eco-design variables .............................................................................................................................. 94

Table 4.5 – Spearman test between collaboration with supply chain and designer characteristics and between collaboration with supply chain and Eco-design variables ........................................................................................................................................................................ 95

Table 4.6 - Spearman test between training variable and designers characteristics and between training variable and Eco-design variables ....................................................... 97

Table 4.7 – Spearman test between certification variable and designer characteristics and between certification variable and Eco-design variables ............................................... 98

Table 4.8 – Spearman test between barriers variables and designer characteristics and between barriers variables and Eco-design variables ...................................................101

Table 5.1 – Sample’s details.............................................................................................................127

Table 5.2 – Descriptive statistics ...................................................................................................129

8

Table 5.3 – Results of logistic regression analysis for GPP adoption in the building and construction sector ......................................................................................................................132

Table 5.4 – Results of ordered logistic regression analysis for the level of GPP adoption in the building and construction sector ....................................................................132

9

List of Figures Figure 1.1 – Three interrelated analytic dimensions associated with transition towards energy efficiency improvements in buildings ............................................................ 14

Figure 2.1 – The interaction among stakeholders of building and construction sector ........................................................................................................................................................................ 32

Figure 4.1 – Designer characteristics: organization size ....................................................... 90

Figure 4.2 – Classes of average Eco-design project value in EUR, number of respondents .............................................................................................................................................. 92

Figure 4.3 – Classes of training hours per person, number of respondents................... 96

Figure 4.4 – Barriers to Eco-design approach during building design activity ...........100

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Chapter 1

Introduction

1.1 Background

1.1.1 Brief introduction: the concept of energy efficiency related to buildings

By the early 1970s, most developed countries had exploited low energy prices and

plentiful fuel supplies, with a consequent high and growing per capita use of energy

(World Bank, 1993). After world energy crises, such as the 1973 oil shortage caused

by Yom Kippur war or the 1991 increase of the price of oil during the First Gulf war,

governmental concerns were raised on supply of and access to worldwide energy

resources. Therefore, the concept of energy efficiency - reduction in energy

consumption for a given service (heating, lighting, etc.) or level of activity - is

introduced in energy policy discussion.

Improving energy efficiency is the fastest and most cost-effective way in order to

provide solution to energy security, economic goals, but also climate change

(Intergovernmental Panel on Climate Change, 2001; Productivity Commission, 2005;

International Energy Agency (IEA), 2006; European Commission, 2006).

Consequently, policy makers and scholars have tried to implement strategies for

obtaining more energy efficient services in all end-use sectors (buildings, tertiary,

industry and transportation).

The building and construction sector can support the implementation of energy

efficiency improvements in order to achieve the transition to a low-carbon economy.

Looking at some figures, in most countries buildings currently account for up to 40%

of energy use, qualifying them among the largest end-use sectors. For instance, the

European building and construction sector accounts for 37.1% of total final energy

consumption (i.e. 1157.7 million tonnes of oil equivalent (Mtoe) in 2007) in the

European Union (EU-27) of which 284.6 Mtoe in residential buildings and 145.2 Mtoe

in non-residential buildings (European Union, 2010). Therefore, the IEA considers the

building and construction sector as one of the most cost-effective sectors for reducing

11

energy consumption, with estimated possible energy savings of 1509 Mtoe by 2050.

Moreover, by reducing the overall energy demand, improving energy efficiency in

buildings can significantly reduce carbon dioxide (CO2) emissions from this sector. In

particular some projections estimates possible mitigations of 12.6 Gigatonnes (Gt) of

CO2 emissions by 2050 (IEA, 2010). Several studies highlight the role of energy

efficiency in the building and construction sector in order to achieve the reduction of

CO2 emissions and co-benefits associated (Wiel et al, 1998; Mirasgedis et al, 2004;

Georgopoulou et al, 2006; Ürge-Vorsatz et al, 2007; Gaglia et al, 2007; Uihlein and

Eder, 2010). In fact, the worldwide building and construction sector has a high CO2

mitigation potential which is associated with many co-benefits such as the creation of

jobs and business opportunities, increased economic competitiveness and energy

security, social welfare benefits for low income households, increased access to

energy services, improved indoor and outdoor air quality, increased comfort and

health, and quality of life (Ürge-Vorsatz et al, 2007). A great contribution to energy

efficiency can derive from old buildings stocks with a poor energy performance

(Mirasgedis et al, 2004; Georgopoulou et al, 2006) assuming conventional energy

efficient technologies (Wiel et al, 1998; Gaglia et al, 2007; Uihlein and Eder, 2010).

Then, Wiel et al (1998) argue the importance of cooperation between developed and

developing countries in order to achieve energy efficient buildings and reduce CO2

emissions.

As a result, many countries consider the improvement of the energy efficiency of

buildings as a priority of their policy agendas. This commitment entails a great

challenge not only for policy makers, but also for firms and individuals related to

buildings and their components. Thus, the challenge of improving the energy

efficiency of buildings concerns not only building science, which consists of a

“growing body of knowledge about the relevant physical science and its application”

to buildings (Hutcheon and Handegord, 1983), but also a multidisciplinary approach

including economics, organizational theory, sociology, geography and political science

(Guy, 2006). In fact, the potential of technological solutions is crucial but not

sufficient to progress towards energy-efficient buildings (Golubchikov and Deda,

12

2012) and it is necessary to draw on policies, efficient markets and changes in

consumption patterns (Karlsson-Vinkhuyzen et al, 2012). These considerations

underline that it is important to investigate the influencing factors and actors of the

implementation of energy efficiency in the building and construction sector by

integrating the concepts of socio-technical system and multi-level governance.

1.1.2 Socio-technical system and multi-level governance in energy efficient buildings

The process of developing energy efficient buildings has to tackle the complexity of

the building and construction sector (Lovins, 1992), because it is influenced by

technological solutions but also by several actors, rules and institutions (Rohracher,

2001). For this reason, the building and construction sector can be identified as a

specific socio-technical system.

The concept of socio-technical system indicates “a relatively stable configuration of

techniques and artefacts – as well as institutions, rules, practices and networks – that

determine the ‘normal’ developments and use of technologies in a particular area of

human needs” (Brown and Vergragt, 2008). A socio-technical system encompassing

production, diffusion and use of technology can provide a complete vision of

transition processes (Geels, 2004). Socio-technical systems are characterized by

stability and resilience which produce a slow change related to technology

innovations and institutions, professional norms, practices and others (Brown and

Vergragt, 2008).

This slowness of socio-technical systems to change affects also the system of the

building and construction sector which deals with an urgent transition towards more

sustainable practices and satisfaction of human needs (Brown and Vergragt, 2008).

As Boden argues (1996), sustainability issues, such as energy efficiency

improvements, influence not only technological practices in the building and

construction sector, but also its structure, its communication tools and its constituent

actors. Therefore, a more rapid and effective change in the socio-technical system

associated with buildings has to be supported by professions, actors and institutions

linked to building design, construction, maintenance and use (Rohracher, 2001;

13

Brown and Vergragt, 2008). Thus, the adoption of a socio-technical analysis can

investigate the role of designers, developers, governments, investors, manufacturers,

retailers and consumers in the development of energy efficiency improvements in

buildings.

To better understand transition processes, such as energy efficiency improvements in

buildings, Geels (2004) suggests an analytic distinction between socio-technical

systems, actors and institutions/rules. Figure 1 describes interactions between the

three identified dimensions. Therefore, the analysis of the role of actors in the

building and construction sector has to be associated with the understanding of

energy efficiency governance in buildings. Then, it is necessary to explain the

meaning of energy efficiency governance. In broader terms, governance refers to “any

of the myriad of processes through which a group of people set and enforce the rules

needed to enable that group to achieve desired outcomes” (Florini and Sovacool,

2009). Jollands and Ellis (2009) define energy efficiency governance as “use of

political authority, institutions and resources by decision-makers and implementers

to achieve improved energy efficiency”. This definition involves multiple scales (local,

regional, national and international) and a wide range of actors (government

institutions, firms, civil society, individuals and households). Generally, a governance

system consists of two components: resources and structures for governance and

governance activities (Jollands and Ellis, 2009). The former ones are identified as

institutional structures, human and financial resources, human capacity and training,

and political support/mandate. The latter ones are depicted by actions associated to

the governance system such as: energy efficiency strategies, policy development

processes, funding mechanisms, monitoring programmes, compliance and

enforcement, and R&D activities. This framework needs a multi-level governance,

which considers interactions between different levels and systems of governance

(Bulkeley and Betsill, 2005; Smith, 2007). Accordingly, an energy efficiency

governance with a multi-level perspective contributes to the success of energy

efficiency policy efforts (International Institute for Energy Conservation, 2007;

Laponche et al., 1997; Limaye et al., 2008). In particular, a multi-level approach in

14

energy efficiency governance is fundamental to develop energy efficiency in buildings

because of the complexity of the building and construction sector and its high energy

efficiency potential (Lovins, 1992).

Taking a multi-level governance perspective for energy efficiency in buildings entails

the involvement of “the multiple tiers of government and spheres of governance”

(Bulkeley and Betsill, 2005) which affect the development of energy efficiency in the

building and construction sector. On the other hand, the integration of multi-level

governance perspective for energy efficiency in buildings with the concept of socio-

technical system allows to take into account the role of actors belonging to the

building and construction sector associated with rules and institutions.

Figure 1.1 – Three interrelated analytic dimensions associated with transition towards energy efficiency improvements in buildings (Source: Geels, 2004)

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1.2 Aims

This thesis investigates the influencing factors and actors related to energy efficiency

governance in the building and construction sector. Since all countries are committed

to the development of energy efficiency improvements, the implementation of energy

efficiency is a worldwide challenge which has to take into account the peculiarities

and complexity of the building and construction sector. This sector is a complex

system where several actors interact regarding rules and institutions. For this reason,

this thesis adopts the concept of socio-technical system in order to identify and

understand components and actors of the building and construction sector

(Rohracher, 2001; Geels, 2004). The influence of regulations and

international/national energy saving targets in the building and construction sector

requires the introduction of a multi-level governance perspective. The concept of

multi-level governance perspective allows to analyse the adoption of actions, tools

and policies to develop energy efficiency improvements in buildings concerning

different levels (Bulkeley and Betsill, 2005; Smith, 2007; Jollands and Ellis, 2009) and

to appraisal the deployment of energy efficiency targets from international to local

institutions.

This thesis aims at providing an exploratory insight into the development of energy

efficiency improvements in buildings by filling the literature gap related to multi-level

governance perspective for energy efficiency in buildings and its interaction with

socio-technical system embodied by the building and construction sector. The

investigation of this interaction aims at providing managerial implications for policy

makers and practitioners from the perspective of organisational and inter-

organisational learning using the exploration/exploitation paradox (Andriopoulos

and Lewis, 2009). The exploration/exploitation paradox is adopted in order to

understand the challenges which policy makers and practitioners have to face in their

knowledge management for the development of energy efficiency in buildings.

To shed light on this research field, i.e. energy efficiency governance in buildings, this

thesis is structured as follows.

16

Chapter 2 offers a literature review of the main characteristics associated with the

implementation of energy efficiency in buildings. This review describes firstly energy

consumption in buildings and related technical solutions. Secondly, it identifies actors

in the building and construction sector, their role and related issues. Finally, the

review analyses studies on energy efficiency barriers and policies in the building and

construction sector. It concludes that it is necessary to integrate the efforts to

implement energy efficiency including key actors at all levels (i.e. international,

national and local) in order to develop an energy efficiency governance in buildings.

Chapter 3 aims at providing an overview of the current national regulatory

framework in the EU Member States. Since the European Union (EU) has taken charge

of achieving high energy performances in buildings, this commitment requires efforts

from all Member States. In fact, each Member State contributes to energy efficiency

governance in the building and construction sector through the adoption of suitable

regulatory and policy instruments. It investigates the efforts to develop an energy

efficiency governance from EU to national/regional level focusing on three specific

aspects which constitute the complex energy efficiency issue: 1) integration of energy

efficiency and renewable energy requirements, 2) translation of investments in

energy saving into economic value, 3) commitment towards “nearly zero-energy”

target. The study was carried out using primary data obtained by an online

questionnaire survey. The questionnaire was sent to 169 experts in regulations

concerning the 27 EU Member States and received 47 responses. The qualitative data

of the questionnaire were completed and confirmed with a review of publicly

available literature and legislation dealing with energy efficient buildings. The results

show that European countries have adopted different approaches in the design of

their national regulatory framework identifying four influencing factors. These

different approaches highlight the importance to understand how each European

country is addressing European Union’s energy saving targets and how to make these

efforts effective.

Chapter 4 focuses on the design phase of a building and consequently on designers

since the design can strongly influence the most significant environmental

17

performances, such as energy used in buildings for heating, cooling and lighting.

Designers are also key actors in socio-technical system related to the building and

construction sector. In particular, this section aims at investigating the factors that

favour and/or hinder the adoption of Eco-design in the building and construction

sector. By focusing on the design phase, this chapter wants to gain a better view on

how environmental concerns are really being integrated in the “core” process of the

building supply chain, the most operational and effective leverage that can be

activated to achieve more energy-efficient buildings. The data, collected by an online

questionnaire survey covering a considerable number of designers in the region of

Tuscany in Italy, were analysed with a correlation analysis method. The results reveal

that designers have a high environmental sensitivity, but there is a high potential for

a systematic adoption of the Eco-design approach. Furthermore, the analysis shows

the presence of the “internal” key factors to foster the inclusion of energy and

environmental criteria in the building design and highlights the crucial interaction

between designers and policy makers.

Chapter 5 introduces the role of public purchase as driver for the development of

energy efficiency in buildings. In particular, this chapter analyses public authorities,

such as municipalities as another key actor belonging to socio-technical system

associated with the building and construction sector. These authorities may provide a

great contribution to achieve energy efficiency improvements in the building and

construction sector, i.e. by carrying out energy efficiency governance at local level.

The analysis aims at investigating which factors impact on the development of Green

Public Procurement (GPP) practices in the building and construction sector as

supporting instrument for energy efficiency governance by the municipalities in

Tuscany. The data were collected by conducting a survey through an online

questionnaire run among a random sample of 81 municipalities and were analysed by

an econometric model. After the description of benefits regarding GPP and its uptake

in Europe and in Italy, the analysis highlights the relationship between energy

efficiency governance in buildings and GPP. Then, the GPP practices in the building

and construction sector can contribute to the energy efficiency governance at local

18

level if municipality undertakes a path which integrates increasing energy and

environmental awareness and technical know-how and expertise.

Chapter 6 contains final remarks, research limitations and implications.

1.3 Methodological approach

The thesis is conceived according to a multi-level perspective because it investigates a

phenomenon, i.e. the governance of energy efficiency in buildings, which can be

articulated from micro- to macro-level. Furthermore, the governance of energy

efficiency in buildings includes technical but also regulatory and organizational

issues. Accordingly, this thesis adopts a mix of inductive and deductive approaches in

order to learn from theory and empirical observations.

This mix of approaches is necessary to identify the key actors and governance levels

through theory and to observe them providing indications related to multi-level

governance perspective. During the analysis qualitative and quantitative methods are

used. After the literature review (Chapter 2) where main characteristics associated

with the implementation of energy efficiency in buildings are described, Chapter 3

carries out a qualitative analysis of EU Member States regulatory framework to

develop energy efficiency in buildings, Chapter 4 employs a quantitative method

through a correlation analysis in order to investigate influencing factors related to the

adoption of Eco-design in the building and construction sector and Chapter 5 uses

also a quantitative method testing an econometric model that analyses factors

associated with the development of GPP practices in the building and construction

sector as the supporting instrument for energy efficiency governance at local level.

19

References

Andriopoulos, C., Lewis, M., 2009. Exploitation-exploration tensions and

organizational ambidexterity: managing paradoxes of innovation. Organization

Science 20, 696-717.

Boden, M., 1996. Paradigm Shift and Building Services. The Service Industries Journal

16 (4), 491-510.

Brown, H.S., Vergragt, P.J., 2008. Bounded socio-technical experiments as agents of

systemic change: The case of a zero-energy residential building. Technological

Forecasting and Social Change 75, 107-130.

Bulkeley, H. , Betsill, M., 2005. Rethinking sustainable cities: multilevel governance

and the urban politics of climate change. Environmental Politics 14 (1),42–63.

European Commission, 2006. Action Plan for energy efficiency: realising the potential.

COM(2006)545 final. Brussels. Available from:

http://ec.europa.eu/energy/action_plan_energy_efficiency/doc/com_2006_0545_en.

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Luxembourg: office for the Official Publications of European communities, 2010.

Florini, A.E., Sovacool, B.K., 2009. Who governs energy? The challenges facing global

energy governance. Energy Policy 37(12), 5239-5248.

Gaglia, A., Balaras, C.A., Mirasgedis, S., Georgopoulou, E., Sarafidis, Y., Laras, D., 2007.

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consumption, emissions and potential energy savings. Energy Conversion and

Management 48 (4), 1160-1175.

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Georgopoulou, E., Sarafidis, Y., Mirasgedis, S., Balaras, C.A., Gaglia, A, Lalas, D.P., 2006,

Evaluating the need for economic support policies in promoting greenhouse emission

reduction measures in the building sector. Energy Policy 34, 2012-2031.

Golubchikov, O., Deda, P., 2012. Governance, technology and equity: An integrated

policy framework for energy efficient housing. Energy Policy 41(0), 733-741.

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Guy, S., 2006. Designing urban knowledge: competing perspectives on energy and

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Hutcheon N.B., Handegord G., 1983. Building Science for a Cold Climate. JohnWiley,

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sustainable energy: The contribution of a global public goods approach. Ecological

Economics 83(0), 11-18.

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Sustainable World. International Conseil Energie, Paris.

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Chapter 2

Literature review on energy efficiency in buildings

Abstract

Buildings play a crucial role in the socio-development of national energy and resources, including its use. Accordingly, the implementation of energy efficiency in buildings is a key target. Therefore, this literature review gives an overview of multi-disciplinary studies on the current state of the analysis of energy efficiency improvements in the building and construction sector. In doing so, it highlights the characteristics, policies and barriers that have an impact on energy performance in buildings. This analysis concludes that it is necessary to integrate the efforts to implement energy efficiency by involving the key actors of the building and construction sector at all levels (international, national and local) in order to develop an energy efficiency governance in buildings.

Keywords: energy efficiency improvements, building and construction sector, barriers, policies

23

2.1 Energy consumption in buildings

Buildings are constructed for residential1 and non-residential2 purposes all over the

world. They are major contributors to socio-economic development of a country and

employ a large part of energy and natural resources (Ramesh et al, 2010). Therefore,

it is important to know the relative importance of different uses of energy during all

phases of the building life cycle.

A building life cycle consists of the following phases: manufacture, operation and

demolition. Manufacture phase includes manufacturing and transportation of

building materials and technical installations used in erection and renovation of the

buildings. Operation phase considers all activities related to lifespan use of buildings.

These activities include maintaining comfort, condition inside the buildings, water

use and powering appliance. Finally, demolition phase includes destruction of the

building and transportation of dismantled materials to landfill sites and/or recycling

plants. A review of 73 international life cycle energy analyses3 of residential and

office buildings shows that the life cycle energy use of building depends on the

operation (80-90%) and manufacture phases (10-20%) (Ramesh et al, 2010).

Therefore, building’s life cycle energy demand can be reduced by controlling its

operating energy through the use of energy efficient technologies, although it slightly

increases energy utilized during manufacturing phase of building. Furthermore,

operation and maintenance practices strongly influence energy consumption in

buildings. In fact, the improvement of these practices can be defined as “no cost or

low cost retrofitting” (Yan-ping et al, 2009).

To develop energy efficiency improvements, it is crucial to know what the breakdown

of energy use in residential and non-residential buildings during operation phase is.

The largest use of energy in residential buildings in the US, Canada and the EU is for 1 The residential buildings consist of those structures such as single-family houses, multi-family houses and high-rise buildings occupied by households (both families and unrelated individuals) (Hirst, 1980). This sector encompasses a wide variety of structure sizes, geometries and thermal envelope materials (Swan and Urgusal, 2009). 2 The non-residential buildings are those structures which accommodate the service sector of economy such as retail and wholesale trade, finance and insurance, and government enterprises i.e. office buildings, schools, hospitals, museums (Hirst, 1980). 3 Life cycle energy analysis is an approach that accounts for all energy inputs to building in its life cycle (Ramesh et al, 2010).

24

space heating, followed by water heating and lighting and appliances. In non-

residential buildings space heating and lighting are the largest uses of energy in US,

Canada and the EU (Ürge-Vorsatz et al, 2007a).

Unfortunately, final energy consumption is usually depicted as split into three main

sectors: industry, transport and “other” including agriculture, services sector and

residential. For instance, energy consumption in buildings other than dwellings forms

part of the services shared within the “other” key sector. The term “other sector” is

ambiguous, because many international, national and regional sources encompass

different uses within this concept. This classification underlines the difficulty to

collect information about building energy consumption (Perez-Lombard et al, 2008).

As shown by IEA work on in-depth energy indicators, the information about energy

demand at end-use level support better energy efficiency policy making and

evaluation (Taylor et al, 2010).

Moreover, the analysis of energy consumption in buildings has to consider the factors

that are driving energy use such as the building type, the climate zone and the level of

economic development of a given area. Table 2.1 summarizes and describes the

possible factors which drive and influence energy consumption in buildings.

As described above, there are several factors which drive energy use in buildings.

Therefore, it is necessary to take into account all components that work together to

create an energy-efficient building. The World Business Council for Sustainable

Development (WBCSD) (2008) has identified five broad categories of products or

services that can influence a building’s energy efficiency (Table 2.2):

Design (shade, orientation, ventilation, “envelope”)

Materials

Equipment

Energy generation

Services

This categorization confirms the presence of several technological solutions in order

to achieve energy efficiency in buildings. Consequently, efforts can be addressed to

adopt single energy efficient technologies or a system of energy efficient technologies.

25

The first approach considers building’s individual parts, whereas the latter considers

the whole building. Furthermore, it is also possible to split technologies into the

“visible and portable technologies” which consumers can modify (e.g. HE-boilers,

solar energy, lighting and climate control technologies) and “less visible and non-

portable technologies” which can be adopted by the builders during the

construction’s process (Noailly, 2012).

The implementation of energy efficiency in buildings needs suitable technological

solutions, but also cooperation from actors belonging to the building and construction

sector. For this reason, the next section examines the actors of the sector.

26

Table 2.1 – Drivers of energy use in buildings (Modified from World Business Council for Sustainable Development (WBSCD), 2008) Driver Description Building type Buildings are constructed for different purposes and functions. Therefore,

each type of building has specific characteristics such as number of occupants, hours of operations, space and equipment needs. Consequently, these characteristics influence energy intensity and the breakdown of energy use.

Climate conditions The climate conditions influences the nature of buildings and their energy consumption. In fact, the climatic conditions affect the demand of energy needed to heat and cool a building because heating and cooling requirements are calibrated by outside air temperature. Therefore, climate influences space heating and cooling one of the largest use of energy in overall building sector. Climate strongly influences design, for example colder climates already tend to have better air tightness and insulation.

Demographics Growth in population has raised building energy consumption (Perez-Lombard et al., 2008). But other changes such as the age profile and migration can also influence energy needs, especially in developed economies. For instance, several European countries have a growing proportion of older people, which tends to lead to an increase in residential floor space per person because there is a higher proportion of single occupancy.

Economic Development Development is typically associated with increasing energy use due to industrialization and the growth of the service sector. Subsequently, a shift from manufacturing to services can reduce energy intensity in developed countries. Higher incomes incite people to spend more on residential energy, and development is associated with a shift from rural to urban centres. This shift creates demand for new housing in urban centres, which impacts on energy demand, and especially electricity demand.

Lifestyles Energy demand is determined by the use of buildings as well as the numbers being built. Growing prosperity means that people expect to live in larger buildings with higher comfort levels having air conditioning to combat heat and central heating to fend off the cold. Moreover, communications equipments and appliances increase energy use in buildings.

Energy sources The mix of energy sources for buildings varies widely from country to country. Electricity is much more diffused in developed countries, while countries such as China and India use especially biomass at site. Coal is also a significant site energy source in China. This mix of site energy use will change in China and India in the next years. Nowadays, the most of primary energy sources derive from fossil fuels and cause global carbon emissions. If energy demand from buildings increases without “decarbonising” the primary energy supply, greenhouse gases will rise. According to a study of Raupach et al. (2007), CO2 emissions from fossil fuels burning and industrial process have a growth rate of greater than 3% per year at a global scale. This study observes nearly constant or slightly increasing trends in the carbon intensity of energy in both developed and developing regions and no region is decarbonising its energy supply. CO2 emissions increase strongest in rapidly developing economies, particularly China.

Technology Technological development has introduced building management equipment, but also more affordable and energy-hungry IT equipments and appliances, e.g., broadband “always-on” Internet connections; data centres with increasingly dense servers. Therefore, the technology is available to achieve much greater efficiencies.

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Table 2.2 - Characterization of energy-saving building technologies (Modified from WBSCD, 2008) Category Description Technologies

Design These factors affect the extent of heating from sunlight, the air-tightness of the building, and therefore the internal cooling or heating requirements, and the need for artificial ventilation.

Integrated design and modelling tools Favourable building siting Natural and mixed-mode ventilation

Thermal mass, trombe walls, and passive solar heating

Materials Structural materials affect the building’s thermal mass and therefore its ability to store heat and moderate temperature swings. Other construction materials affect the air-tightness and insulation of the building and the extent to which it absorbs heat from sunlight.

Building air-tightness

Cool roofing Electro-chromic windows High performance windows Improved insulation

Radiant barriers Phase change materials (PCM) Thermal energy storage materials (TES)

Equipment Improved equipment such as heat pump dryers, and improved use of equipment, such as power management on office equipment and metering, can save substantial energy during a building’s use, as well as more efficient equipment and appliances.

Lighting Compact Fluorescent lamps (CFL) Occupancy sensors for lighting control

Photosensor-based lighting controls Appliances and office equipment

Electronics with low standby power Enabling power management for office

equipment Heat pump dryer

Horizontal axis washing machines Non-biomass cooking, space heating, and

water heating

Energy generation

Heat pumps, combined heat and power systems, solar panels and wind turbines can generate energy on-site, possibly with the potential to feed unused energy into an intelligent grid.

Heating, ventilation and air conditioning (HVAC) Air-source heat pump Condensing boilers and fornace Condensing water heater

Dedicated outdoor air systems (DOAS) Displacement ventilation (DV) Electric heat pump water heater (HPWH) Heat and energy recovery ventilation

(ERV) Heating-only absorption heat pump Modulating (variable speed/capacity)

compressors Radiant ceiling panels

Commercial combined heat and power (CHP)

Residential combined heat and power (micro-CHP)

Variable-speed / ECPM

Water-cooled condensers Clean energy

Geothermal heat pumps Solar thermal heating

Solar photovoltaic Wind turbines

Services New approaches such as retro-commissioning can ensure that a building’s potential energy efficiency is achieved through fine-tuning building systems so they perform effectively.

Retro-commissioning

Ongoing-commissioning Duct sealing

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2.2 Buildings: a complex socio-technical system

The building and construction sector often is characterized by fragmentation within

sections of the value chain and non-integration among them. There are many

stakeholders involved in this sector as follows:

Public authorities

Capital providers

Developers

Designers

Agents

Owners

Users

Material and equipment suppliers

Public authorities can influence the building and construction sector not only as

regulators, but also as building owners, tenants, developers and financiers in order to

implement energy efficiency in buildings (UNEP, 2007). In particular, local authorities

influence the value chain through building policies for their area setting codes and

standards for buildings. These policies are typically layered over national regulations

and embrace high levels of energy performance and cost considerations (WBCSD,

2008). The public sector could have an important impact on the market. In particular,

it could push more efficient products and building practices in the whole market

(Yan-ping at al., 2009).

Capital providers, as lenders or investors, take short-term decisions and according

to financial criteria. Moreover, energy efficiency is not sufficiently significant to

influence decisions.

Developers are the primary actors in commercial construction. They make large

financial commitments on speculative basis: they “want fast, cheap buildings” (Lovins,

1992). Speculative developers have only a short-term interest and want to sell

quickly to an owner or investor. They try to “maximize the net present value of the

building’s net income during the holding period and of potential resale value” (Lovins,

29

1992). The developer considers energy efficiency as a significant factor only if that is

taken into account by the potential buyers.

If developers have a long-term view, energy-saving investments become potentially

attractive. It is difficult for developers to reap the benefits of such investments due to

lengthy payback periods and because the energy savings goes to the user and the

developer incurs the investment cost. This situation prevents adequate investments

in energy efficiency (Jaffe and Stavins, 1994a).

Developers are conservative and naturally reluctant to take technical risks given the

scale of commercial risk involved in major projects and the perceived conservatism of

potential occupiers. For this reason the designers are inhibited to innovate in many

developments (WBSCD, 2008).

Designers (architects and engineers) have the most expertise in technical aspects of

construction and refurbishment, including energy efficiency, but usually have only

limited influence on key decisions (WBSCD, 2008). Architects and engineers work in

relative isolation, even when working for the same project. Financial and time

pressures can influence the elimination of proposed enhancements such as energy-

efficient features in a value-engineering exercise in later design stages, especially

because projects are typically carried out as a sequence of separate segments rather

than as an integrated process (Lovins, 1992). However, there is great potential in

multi-disciplinary work, especially by bringing together architects, engineers and

others responsible for projecting the building (WBSCD, 2008).

Construction contractor and subcontractor can have an important role in the

development of energy efficiency of a building. They are selected through

competitive tender on the basis of lowest-price offers. Therefore, contractors have to

cut costs in order to win (Winch, 2000). Moreover, fixed budget and schedule

discourage innovation and energy efficient improvements, but encourage well-

established practices. They have a practical approach and solve problems in ways

that satisfy their own needs and not always the designers’ or clients’ needs (Lovins,

1992). Moreover, the contractors very often work with small firms. An OECD’s report

(2002) states that the proportion of firms employing less than 10 persons was 81% in

30

the US (U.S. Census Bureau, 2000), 93% in EU countries (Commission of the European

Communities, 1993) and 75% in Japan (Japan Management and Co-ordination

Agency, 1996)

Agents often operate between developers and tenants, and between owners and

occupiers. Their interests are typically short-term and financial. For example, the

agents who act for developers and tenants in a commercial transaction are interested

primarily in the lease agreement, focusing mainly on price. Their intermediation

could obstruct the communication between developers and potential tenants about

longer-term, non-financial aspects of buildings, including energy efficiency (WBSCD,

2008).

Owners do frequently not correspond with end users in residential or non-

residential buildings. The owners may have different objectives and consequently

perspectives. Some owners buy to sell on (and make a capital return), others buy to

lease (as an investment), and some buy to occupy. The latter group is in the best

position to consider energy efficient investments that may have lengthy paybacks.

Owners of investment properties are in a similar position to long-term developers.

They may be able to consider investments with lengthy payback periods, but may be

inhibited by split incentives, which means that they cannot reap the benefit of the

investments (WBSCD, 2008). The literature defines this mechanism as the principal

agent problem, also called the landlord/tenant or investor/user dilemma. Therefore,

either actor is inhibited from investing in energy efficient improvements (IEA, 2007).

Users are likely to be in the position to benefit from energy savings, but may not be

able to make the necessary investments (the reverse of the owner/developer

position). More significantly energy costs are likely to be a small proportion of their

total occupancy costs, and may therefore not receive enough attention to drive

energy-saving activity (WBSCD, 2008). It is crucial to highlight that users can strongly

influence energy consumption in buildings not only by their behaviour and their

choice of tenant-finish specifications, but also by their choices of equipment for the

building (Lovins, 1992). Moreover, the choice of energy technologies is based on their

physical invisibility or visibility. For example, a survey of 400 homes in Michigan

31

showed that the average resident wrongly believes that “she/he could save twice as

much money by reducing lighting than by using less hot water”. This belief is based

on the overestimation of the energy consumed by household lighting which is visible

and the underestimation of the energy used by water heaters since their consumption

occurs without human intervention (Stern, 1984).

Material and equipment suppliers encompass all firms and vendors which supply

materials and equipments for contractors in order to construct and refurbish

buildings. In particular, vendors tend to be conservative and to sell what they have

and know. Moreover, purchasers care about price, delivery time, familiarity, perhaps

warranty, because they are responsible for a capital budget and not operating budget

or comfort (Lovins, 1992). Consequently, there is the risk that energy efficient

products are not promoted and spread.

The description of these stakeholders highlights the complexity of interactions in the

building and construction sector, as shown in the Figure 2.1. Ryghaug and Sǿrensen

(2009) argue that the issue of energy efficiency in buildings is “a complex socio-

technical system where diverse actors act at the interaction of industry and market

structure, institution of governance, innovation systems, evaluation practices,

supplier-user chains, designer and engineering practices, etc.”. Thus, the analysis of

the actors of this socio-technical system helps to understand the variables and the

challenges ahead related to the improvement of building’s energy efficiency.

32

Figure 2.1 – The interaction among stakeholders of building and construction sector (Source: Modified from WBSCD, 2008)

33

2.3 Barriers to energy efficiency improvements

As Ürge-Vorsatz et al (2007a) show, even if several studies support and highlight the

crucial role of the building and construction sector in the reduction of energy use

demand and carbon dioxide emissions, there are some barriers to energy efficient

improvements. A barrier is represented by a mechanism that inhibits investment in

technologies that are energy and economically efficient (Sorrell et al, 2000). There is a

sizeable body of literature on the nature and operation of barriers to energy

efficiency, which is partly based on overlapping concepts from neo-classical

economics, institutional economics, behavioural economics, sociology and psychology

(Schleich, 2009; Stern, 1986; Howarth and Andersson, 1993; Jaffe and Stavins, 1994b;

Howarth and Sanstad, 1995; Brown, 2001; Sorrell et al, 2004). Moreover, there is a

wide discussion about the classification of barriers to energy efficiency. In 1997,

Weber argued that “each barrier will have economic, behavioural and organisational

aspects”.

According to some estimates, the number of barriers to energy efficiency is higher in

the building and construction sector than in any other sector (IPCC, 2007). Thus, it is

useful to identify and categorize these barriers. Carbon Trust (2005) has classified the

barriers to energy efficiency as follows: real market failures; financial costs/benefits;

behavioural/organizational non-optimalities; and hidden costs/benefits. Then, this

classification was integrated by IPPC’s report (2007). Table 2.3 defines and describes

these barriers.

Several studies identify mechanisms hampering the implementation of energy

efficiency in buildings. Some studies investigated the presence of barriers related to

the overall building and construction sector in different countries identifying more

frequently information barriers among practitioners, behavioural/organizational

non-optimalities and financial barriers (Intrachooto and Horayangkura, 2007; Nässén

et al, 2008; Ryghaug and SØrensen, 2009; Karkanias et al, 2010). Other studies are

focused on issues related to energy efficiency in residential buildings. The adoption of

energy efficiency in residential building is influenced mainly by information barriers,

economic/financial barriers and real market failures (Brechling and Smith, 1992,

34

1994; Scott, 1997; Elias, 2008; Meijer et al., 2009). Among real market failures, the

problem of principal-agent is widespread (Gillingham et al, 2009, 2010; Levinson and

Niemann, 2004; Davis, 2010): the builder (the agent) takes decisions on the energy

efficiency level of a building, while the occupant in the building (the principal) is the

one actually paying the energy bill. The incomplete information of the occupant about

the energy efficiency of the building does not foster the builder to invest in energy

efficiency technologies according to social optimum. Moreover, these studies show

the need to involve the actors of residential buildings in order to collect information

about energy performance of dwellings and cooperate in the implementation and

development of energy efficiency measures. Studies about the identification of

barriers in non-residential buildings highlight the importance of knowledge and

information in the organizations, mainly public authorities, which take energy

management decisions in order to overcome and remove the barriers identified, but

also the presence of organizational and financial barriers (Sorrell, 2000, 2003;

European Union, 2005; Thunselle et al, 2005; Rezessy et al, 2006).

These studies have identified a system of barriers which hinders the implementation

of energy efficiency in the building and construction sector. Therefore, it is not

sufficient to find solutions relating to practitioners only or other actors. All

stakeholders have to be involved and coordinated. In this context policy instruments

can drive this transition towards more energy efficient and sustainable buildings. The

next section gives an overview of policies to promote energy efficiency in buildings.

35

Table 2.3 – Major barriers to energy efficiency in the building and construction sector (Source: Carbon Trust, 2005; IPPC, 2007) Barrier categories Definition Examples

Real market failures Market structure and constraints that prevent the consistent trade-off between specific energy-efficient investment and the societal energy-saving benefits

Limitations of the typical building design process

Fragmented market structure Landlord/tenant split and

misplaced incentives Administrative and

regulatory barriers (e.g. in the incorporation of distributed generation technologies)

Imperfect information Unavailability of energy

efficiency equipment locally Economic/financial barriers Ratio of investment cost to value of

energy savings Higher up-front costs for

more efficient equipment Lack of access to financing

Energy subsidies Lack of internalization of

environmental, health, and other external costs

Behavioural/organizational non-optimalities

Behavioural characteristics of individuals and companies that hinder energy efficiency technologies and practices

Tendency to ignore small energy saving opportunities

Organizational failures (e.g. internal split incentives)

Non-payment and electricity theft

Tradition, behaviour and lifestyle, Corruption

Transition in energy expertise: Loss of traditional knowledge and non-suitability of Western techniques

Hidden costs/benefits Cost or risks (real or perceived) that are not captured directly in financial flows

Costs and risks due to potential incompatibilities, performance risks, transaction costs etc.

Poor power quality, particularly in some developing countries

Information barriers Lack of information provided on energy saving potentials

Lacking awareness of Consumers, building managers, construction companies, politicians

Political and structural barriers Structural characteristics of the political, economic, energy system which make energy efficiency investment difficult

Process of drafting local legislation is slow

Gaps between regions at different economic level

Insufficient enforcement of standards

Lack of detailed guidelines, tools and experts

Lack of incentives for EE investments

Lack of governance leadership/ interest

Lack of equipment testing/ certification

Inadequate energy service levels

36

2.4 Policies to promote energy efficiency

Literature argues that policy instruments are important tools in order to support and

facilitate the implementation of energy efficiency improvements, but also to

overcome the barriers described above (Table 2.3). In particular, some studies tend

to favour the adoption of a mix of policy instruments (Ürge-Vorsatz et al, 2007a;

Chidiak, 2002; Rietbergen et al, 2002; Georgopoulou et al, 2006). Therefore, the

classification of policy instruments is useful in order to support policy makers in the

design of the suitable mix of policies considering the complexity of overall building

and construction sector. It is possible to classify policy instruments to promote

energy efficiency in buildings in four categories (Ürge-Vorsatz et al, 2007b), as shown

in Table 2.4:

Regulatory and control mechanisms

Economic/market-based instruments

Fiscal instruments and incentives

Support, information and voluntary action

Table 2.4 – The most important policy instruments to promote energy efficiency in the building and construction sector (Ürge-Vorsatz et al, 2007b) Control and regulatory instruments

Economic and market-based instruments

Fiscal instruments and incentives

Support, information and voluntary action

Appliance standards Building codes Mandatory labelling and certification programme Procurement regulations Energy efficiency obligations and quotas Mandatory demand-side management programme (DSM)

Energy performance contracting (EPC) or Energy service companies (ESCOs) Cooperative procurement Energy efficiency certificate schemes Kyoto protocol flexible mechanisms

Taxation (on CO2 or household fuels) Tax exemptions/reductions Public benefit charges Capital subsidies, grants, subsidised loans

Voluntary certification and labelling Voluntary and negotiated agreements Public leadership programmes Awareness raising, education, information campaigns Mandatory audit and energy management requirement Detailed billing and disclosure programmes

37

The adoption of effective policy instruments is crucial in order to achieve energy

saving targets, therefore they should be well-designed. In fact, any policy can fail if its

design, implementation and enforcement are compromised (Gann et al, 1998).

Therefore, social planners and policy-makers should know the parameters which can

influence the outcome of energy efficiency policies. Oikonomou et al (2009) identify

the effects of parameters that determine energy saving behaviour. They concludes

that policies can be targeting both use and investments; taxing individuals is not

enough for long-run energy saving, but it is also necessary to introduce information

campaigns and market instruments; policies stressing the moral obligation to

conserve energy can increase their acceptability; financial compensation for savings

must take place in the short-run in order to induce end-users to monitor their daily

energy use; behavioural change can be triggered in the medium-run by self-

monitoring policies; and enabling financing options through policy schemes can

overcome substantial market barriers of consumers towards energy efficiency

investments.

Furthermore, to support policy makers in the design of a policy framework, some

studies assess the effectiveness of policy instruments. A study appraising worldwide

policies demonstrates that the effectiveness of many policy tools is influenced by the

right economic, political and social conditions. This study concludes that it is

necessary to combine all policy instruments into policy packages in order to

overcome the several and diverse barriers in the building and construction sector to

exploit the advantages of synergistic effects (Ürge-Vorsatz et al, 2007b). Lee and Yik,

(2004) confirm the difficulty of finding a consensus on which policy approach is the

most effective in reducing greenhouse gas emissions and minimize any negative

impact on economic development. Moreover, Lee and Yik argue the need to use a mix

of regulatory and voluntary approach in order to achieve more ambitious targets. The

studies cited argue that it is important to analyse the economic, political and social

context which influences the effectiveness of policies to promote energy efficiency,

but it is important to take into account the characteristics of residential and non-

residential buildings.

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2.4.1 Residential buildings

Analyses from a number of countries argue that governments have to be involved in

the creation and implementation of a suitable policy framework for energy efficiency

improvements in dwellings (Amstalden et al, 2007; Owen, 2006; Tommerup and

Svendsen, 2006). Moreover, there is high agreement on the necessity to realise the

potential of energy efficiency in the residential sector through a diverse portfolio of

policy instruments associated with good enforcement (IPCC, 2007). Although the last

few decades have seen growing policy attention for the existing residential stock

(Kohler and Hassler, 2002; Thomsen and van der Flier, 2002; EuroACE, 2004; Kohler,

2006; Sunikka, 2006; Thomsen and Meijer, 2007; EURIMA, 2007), building

regulations and other instruments are still mainly focused on newly built dwellings.

Overall, the analysis of policies in order to encourage energy efficiency measures in

residential buildings has to be applied and considered according to different level of

governance (international, national and local/regional). National governments can

commit themselves to international target, but they have to cooperate with local

governments. Local authorities have several policy instruments for energy efficiency

in residential sector. In particular, local governments can try to encourage the

housing owners and other actors who have a stake to adopt energy efficient measures

using mainly fiscal instruments and incentives but also support, information and

voluntary action4 such as subsidy schemes, promotion campaigns, advertisements

and energy auditing in the residential sector. In practice, local authorities have legal

instruments in order to constrain homeowners to retrofit their property if its physical

status is below acceptable standards, but these instruments are only seldom used

(Hoppe et al, 2011). Therefore, it is interesting to analyse the capacity of local

governments to influence the energy efficiency level of existing dwellings in

residential sector. Hoppe et al (2011) run a multivariate regression analysis using 33

urban renewal projects on residential sites in the Netherlands. The analysis considers

as independent variables the local authority characteristics (motivational factors and

resources) and local actor networks. The outcome of the analysis shows that the most

4 see categorization in Ürge-Vorsatz et al (2007b)

39

significant explanation for a high level of ambition for energy efficiency is given by a

poor energy quality of the housing stock at the start of the project. Then, the ambition

of energy efficiency is weakly influenced by the variable “local authority efforts to

collaborate with local actors”. Thus, this correlation produces an indirect effect: the

more collaboration efforts a local authority engaged into, the greater the probability

the sites are chosen with a low initial energy value, which in turn means that a higher

level of ambition could be formulated.

Joelsson and Gustavsson (2008) show that policy instruments in order to encourage

homeowners to implement energy efficiency measures in accordance with the goals

of decision makers should be assessed considering the economic and perceptive

house-owner aspects related to societal economic perspective. Moreover, Adua

(2010) argues that the design of policies has to consider the role of lifestyle and other

human factors.

Furthermore, energy policies should encourage innovation in energy-saving

technologies in residential buildings. Beerepoot and Beerepoot (2007) consider

whether energy performance regulations has pushed innovations in Dutch residential

buildings. This study demonstrates that energy performance policy in the

Netherlands did not support the diffusion or development of really new innovation in

energy techniques (hot water production technologies) in residential buildings

during the 1996-2003 period. Therefore, the “designer” of policy instruments should

take into account the nature and features of residential buildings and overall building

and construction sector. Meijer et al (2009) highlight the need to use a mix of policy

instruments to improve the energy efficiency of the residential stock. In Europe, the

main instruments applied are subsidies, tax reductions and publicity campaigns.

Unfortunately, there is a lack of data on policy effects.

The studies reviewed show the importance of designing policies to promote energy

efficiency by considering the features of residential buildings and analysing the

effectiveness of policies implemented. The role of public authorities is crucial in order

to drive and implement energy efficiency in residential buildings.

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2.4.2 Non-residential buildings

The adoption of policies to foster energy efficiency in non-residential buildings has to

consider different aspects compared to residential buildings. Firstly, public

authorities, which often constitute principal actors in the building and construction

sector, can contribute to the implementation of the energy efficiency measures in

non-residential buildings mainly as building owners, tenants, developers and

financiers (UNEP, 2007). Among public authorities, particularly local authorities have

a crucial role in the employment of end-use energy efficiency measures and in the

markets for energy services and energy efficient equipment (Rezessy et al, 2006). In

fact, local authorities can adopt several measures to support markets for energy

services: improving the efficiency of energy consumption in their buildings by

measures related to heating and lighting systems, and thermal insulation, and the

efficiency operation of district heating; improving the efficiency of street lighting

systems; enforcing and monitoring building codes (Rezessy et al, 2006). Therefore,

local authorities should be supported by national governments through suitable

regulation and funds.

Moreover, the policy initiatives to increase energy efficiency in non-residential

buildings should take into account the building and exogenous environmental

characteristic impacts on the intensity of energy utilization in non-residential

buildings. Buck and Young (2007) show a great potential for policy instruments in

order to improve energy efficiency in non-residential buildings using the stochastic

frontier approach. In particular, this analysis highlights two distinct factors which

have significant impacts on the efficiency of energy use: building ownership and the

main type of activity undertaken in non-residential building. These findings underline

that energy efficiency measures are effective if they are undertaken in buildings

owned by non-profit groups and catered to a customer-base who spend significant

amounts of time on-site (Buck and Young, 2007).

The design of policy for energy efficiency in non-residential buildings has to consider

the great impact of public buildings in this category of building and other technical

characteristics.

41

2.5 Conclusions

The building and construction sector plays a crucial role in the development of energy

efficiency improvements in order to achieve the transition to a low-carbon economy.

Thus, this chapter gives an overview of multi-disciplinary studies on the current state

of the analysis of energy efficiency improvements in the building and construction

sector and highlights the characteristics, policies and barriers that have an impact on

energy performance in residential and non-residential buildings. Firstly, the

literature review considers the characteristics related to energy consumption and

energy efficiency options in buildings. Then, it examines the actors of the building and

construction sector highlighting the complexity of interactions in this sector and

suggesting a deeper analysis of its actors.

The analysis of the literature on barriers to energy efficiency shows that lack of

information, behavioural/organizational non-optimalities and economic/financial

barriers represent significant barriers in the overall building and construction sector,

as well as in residential and non-residential buildings. Moreover, the results of

analysis confirm the importance of designing a suitable mix of policies in order to

promote energy efficiency by considering the features of overall building sector, but

also residential and non-residential sectors, and related barriers. The effectiveness of

policy instruments is mainly influenced by the role of public authorities as building

owner, tenant, developer and financier.

The key conclusion is that the energy efficiency improvements in buildings should be

achieved by a suitable governance framework and information system. According to

Jollands and Ellis (2009) energy efficiency governance can be defined as the “use of

political authority, institutions and resources by decision-makers and implementers

to achieve improved energy efficiency”. This definition includes local, regional,

national and international levels and encompasses decision-makers including

government and non-governmental organisations as well as addressing cross-cutting

issues such as: energy efficiency strategies, funding mechanisms, research and

innovation, monitoring energy efficiency programmes, compliance and enforcement,

political support/mandate, institutional structures, human capacity and training,

42

resourcing (finance and people) and policy development processes. Therefore, future

investigations should choose the level of analysis (international, national and

regional/local) in order to identify which public authorities and stakeholders are

suitable for the development and implementation of policies and system information

to promote energy efficiency in residential and non-residential buildings in the

related level of analysis. Finally, we can conclude that it is necessary to integrate the

efforts for energy efficiency improvements in buildings involving the key actors of the

building and construction sector.

43

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49

Chapter 3

Towards nearly zero-energy buildings: the state-of-art of national regulations in Europe5

Abstract

Energy efficiency in buildings is an important objective of energy policy and strategy in Europe. A survey questionnaire was conducted among the 27 European Union Member States. This study aims to provide an overview of the current national regulatory framework focusing on three aspects: 1) integration of energy efficiency and renewable energy requirements, 2) translation of investments in energy saving into economic value, 3) commitment towards “nearly zero-energy” target. The study shows that European countries have adopted different approaches in the design of their national regulatory framework. This heterogeneity consists of four main factors: different authorities involved in energy regulations, traditional building regulations and enforcement models, different contextual characteristics, and maturity of the country in the implementation of energy efficiency measures. These differences are important to take into account country’s profile in order to improve the sharing of best-practices and energy efficiency governance among European Union Member States.

Keywords: buildings, energy efficiency, regulations, comparative analysis, European policy

5 This paper has been accepted for publication in journal “Energy”: Annunziata, E., Frey, M., Rizzi, F., 2013. Towards nearly zero-energy buildings: The state-of-art of national regulations in Europe. Energy, in press.

50

3.1 Introduction

Buildings account for around 40% of total final energy use and are responsible for

36% of European Union’s total carbon dioxide emissions (European Commission,

2008). Reducing the energy consumption and increasing the use of energy from

renewable sources in the building sector are fundamental measures in order to

reduce the European Union’s dependency on energy imports, fossil fuels and

greenhouse gas emissions. Consequently, European legislation has set out a cross-

sectional framework of ambitious targets for achieving high energy performances in

buildings. Key parts of this European regulatory framework are the Energy

Performance of Buildings Directive 2002/91/EC (EPBD) (European Commission,

2002), and its recast (European Commission, 2010). The recast of EPBD has

established several new or strengthened requirements such as the obligation that all

the new buildings should be nearly zero-energy by the end of 2020. The transposition

of these Directives into national legislation influences the achievement of energy

saving targets.

Since EPBD came into force, the European Commission expected that European

regulation on buildings has been implemented in different ways in the European

Union Member States. Therefore, the European Commission has set up a range of

programmes in order to support Member States during the implementation (Ekins

and Lees, 2008).

Despite the European Commission’s support, some studies highlight the large

differences among results achieved by the European Member States in improving

energy efficiency in the building and construction sector. Among these, a study

examines different situations regarding the implementation and scope of application

of energy certification in buildings in each European country (Andaloro et al, 2010)

and an analysis of current barriers and instruments for the improvement of energy

efficiency in European buildings shows also significant differences in term of

commitments, financial potential and market conditions (Economidou, 2011).

Moreover, these differences are restated by the recast of EPBD. These results show

that all Member States have to put their efforts into the achievement of energy saving

51

targets exploiting the great unrealised potential for energy saving in buildings. In

particular, European countries have to encourage the retrofit of existing buildings,

the use of renewable energy in the building and construction sector (Höhne et al,

2011; Li et al, 2012), but also the transition towards “nearly zero-energy” buildings

(European Commission, 2010).

The commitment of each Member State should be supported not only by some

isolated policy instruments, but also by a wider holistic regulatory and policy

framework which composes energy efficiency governance (Jollands and Ellis, 2009)6,

because different regulatory and policy instruments need to be coordinated with each

other (Klinckenberg Consultants, 2010). Therefore, the importance and complexity of

policy makers’ choices among available regulatory and policy instruments encourage

the analysis of regulatory settings developed by each European Member State. The

paper concerns the spontaneous design of national regulatory framework on energy

efficient buildings regarding three specific aspects which so far have been

investigated distinctly: 1) the integration of energy efficiency and renewable

technologies targets (Georgopoulou et al, 2006; Gann et al., 1998; Beerepoot and

Beerepoot, 2007; Hejimans et al, 2010; Beerepoot, 2006), 2) the translation of energy

saving investments into economic value (Lorenz and Lützkendorf, 2008; Lützkendorf

and Speer, 2005; Lützkendorf and Lorenz, 2005), and 3) the commitment towards

“nearly zero-energy” buildings (Klinckenberg Consultants, 2010; Boermans et al,

2011). An integrated analysis of these aspects sheds light on policy instruments

adopted by Member States in order to achieve energy efficiency in the European

Union building and construction sector.

The paper is structured as follows. Section 2 makes an overview of the literature on

energy building regulatory and policy instruments and presents the objectives of the

analysis. Section 3 describes the methodology and results. Section 4 comments the

results. Finally, Section 5 concludes with some recommendations for the transfer of

best-practices to promote energy efficiency in the building and construction sector.

6 We use Jollands and Ellis’s definition of energy efficiency governance (2009): the “use of political authority, institutions and resources by decision-makers and implementers to achieve improved energy efficiency”

52

3.2 Background Literature

Each Member State has to regard all available instruments in order to achieve an

effective design of a national energy building regulatory and policy framework. The

most important regulatory and policy instruments to promote energy efficiency in

buildings are identified in the general literature on policy instruments for energy

efficiency (Ürge-Vorsatz et al, 2007a; Grubb, 1991; Crossley et al, 1999; Crossley et al,

2000; Vine et al, 2003), but also on environmental policy instruments (Bürger et al,

2008; Fischer et al, 2003; Rizzi et al, 2011; Kuik and Osterhuis, 2008; Ürge-Vorsatz et

al, 2007a). Depending on the degree of strictness they are usually grouped into the

following three categories: direct regulation (command and control), economic

instruments and soft instruments (Bürger et al, 2008; Fischer et al, 2003; Rizzi et al,

2011; Kuik and Osterhuis, 2008).

Direct regulation includes standards as well as commands and prohibitions and can

be classified into: input regulation, process regulation, and output regulation.

Economic instruments consist of duties, tradable emission permits, environmental

liability (Kuik and Osterhuis, 2008), tax reduction and grants (Ürge-Vorsatz et al,

2007a). Environmental duties can be taxes, charges, dues, or extra duties. Their

function is either to increase State income, to give an incentive to the change of the

behaviour of the regulated subject, or to support the implementation of another

environmental and energy regulation.

Soft instruments include voluntary industry agreements, communication and

information measures as well as voluntary certification and labelling.

Within individual Member States, policy makers are expected to make choices

regarding the mix of instruments to increase adaptive flexibility and to reduce risk in

pursuing sustainability (Rammel and van den Bergh, 2003) and in particular energy

efficiency in buildings (Ürge-Vorsatz et al, 2007b; Chidiak, 2002; Rietbergen et al,

2002). Any regulatory and policy instrument can fail if its design, implementation and

enforcement are compromised (Gann et al, 1998). It is necessary to combine all

regulatory and policy instruments into policy packages in order to exploit the

advantages of synergistic effects and maximize the positive impact on energy

53

performance in buildings (Ürge-Vorsatz et al, 2007a). In doing so, policy makers have

to consider priority dimensions which constitute energy saving targets and to analyse

economic, political and social context where regulatory and policy instruments are

applied.

After a general categorization of regulatory and policy instruments, the following

paragraphs provide an overview of literature on the priority dimensions of the

European Union’s energy saving targets.

3.2.1 Integration of energy efficiency and renewable energy requirements

Looking at the energy deployment life cycle, technologies have to overcome various

types of barriers that shift from the technical to the economic and institutional

dimension. These barriers require the development of a strategic approach to

deployment (Shum and Watanabe, 2009). Existing energy policy has mostly relied

upon financial subsidies, market-based instruments such as energy efficiency or

renewable portfolio standards, and production tax credits to stimulate the

installation and use of equipment. By orienting financial fluxes, national energy

strategies have the responsibility to favour not only the adoption of one technology or

the other, but also the development of a national industrial supply chain (Gross and

Foxon, 2003). This can lead energy regulation and policies to impact on specialization

or diversification trends for national technologies development and create a

hierarchy for energy technologies, but also to encouraging innovation in energy

saving technologies (Beerepoot and Beerepoot, 2007). From this perspective, it is

important to assess the existence of a hierarchy for energy efficiency measures in

buildings defined by the national regulation. A hierarchy could build a stable and

consistent policy framework which helps to create a national innovation system

aimed at improving risk/reward ratios for demonstration and pre-commercial stage

technologies (Jacobsson and Johnson, 2000).

The hierarchy for energy efficiency measures might also support the development of

technologies related to renewable sources. This feature highlights the possible

synergies between the targets for renewable energies and energy efficiency

54

technologies in the building and construction sector. This integration is desired by the

European Commission as stated by the recast of EPBD and the Promotion of the Use

of Energy from Renewable Sources Directive 2009/28/EC (European Commission,

2009). To this date, unfortunately, the calculations of the contribution of renewable

energy equipment in building energy performance should be embedded in the

general energy performance calculations to ensure that equal attention is paid to

renewable and conventional energy systems (Beerepoot, 2006). Moreover, the share

of renewable energy in the energy consumption of buildings must be explicitly

calculated in the output of the energy performance calculations (Beerepoot, 2006).

In this context, further research on national regulatory and policy instruments is

necessary to assess the hierarchy of the adoption of energy efficiency measures and

the level of integration between renewable sources and energy efficiency targets

through the presence of quantitative targets for integrating renewable energy

sources in buildings.

3.2.2 Translation of investments in energy saving into economic value

Theoretically, the real estate markets are expected to support the implementation of

energy efficiency improvements in buildings recognizing investments in energy

efficiency as added value. Therefore, market forces can strengthen the effectiveness

of energy policies and legislation (Lior, 2011). Unfortunately, the Energy Performance

of Buildings Directive 2010/31/EU underlines “the inability of the national housing

markets to adequately address the challenges of energy efficiency”. In fact,

sustainable buildings or building projects are not yet provided and/or requested by

the majority of market agents (Lützkendorf and Lorenz, 2005). Market participants

should be more aware of sustainable development and building performance, but also

of their potential effect on property valuation (Lützkendorf and Lorenz, 2005). On the

contrary, very often property markets are affected by information asymmetries which

produce market failures. A comprehensive building information system could enable

an effective information change between market participants leading to a win-win

situation for the whole construction and property industry in general (Lützkendorf

55

and Speer, 2005). In this context, a study highlights the importance of a quantitative

risk analysis in order to correctly support the investment decision making process

(Mills et al, 2006) and remove “energy efficiency gap” which inhibits investments in

energy efficiency improvements (Hirst and Brown, 1990; Jaffe and Stavins, 1994;

Sanstad and Howarth, 1994; Levine et al, 1995; Van Soest and Bulte, 2001; Sorrell et

al, 2004). Other studies try to develop methods that can quantify the increase in the

value of energy efficient buildings (Popescu et al, 2012; Entrop et al, 2010; Sayce et al,

2010) and the economic benefits associated with energy efficient investments

(Audenaert et al, 2010).

There is also a literature on the economic implications of energy efficiency and

energy labels in the real estate sector. In particular, a paper gives the first evidence on

the adoption of energy performance certifications and related market implications in

the Dutch residential market. This study shows that, even though the adoption rate of

energy performance certificates is low, energy labels create transparency in the

energy performance of dwellings and are an effective market signal in the residential

sector (Brounen and Kok, 2011). Another paper provides the first empirical evidence

of the impact of the European Union energy performance certificates on the Dutch

commercial property market. The analysis shows that energy efficient office buildings

are rewarded with a higher rent than less efficient similar buildings. These findings

highlight that corporate tenants start to integrate information on energy efficiency

into their decision-making process (Kok and Jennen, 2011). On the other hand, a

study identifies the lack of effect on property prices as the most common barrier to

energy efficiency improvements (Tuominen et al, 2012).

These studies suggest the presence of an untapped potential in the implementation

and valorisation of energy efficiency improvements in real estate sector. Therefore,

the European Union Member States have to foster their national real estate markets

towards the offer of energy efficient buildings for sale and for rent establishing

economic and/or procedural incentives.

56

3.2.3 Commitment towards “nearly zero-energy” target

According to the recast of EPBD all Member States address the objective of the

enhancing of energy performance of buildings. Therefore, each Member State could

consider market-based instruments as an option in order to achieve ongoing energy

efficiency improvements in buildings. A survey carried out in 2008 among 3000

Swedish owners of detached houses concludes that economic and information policy

instruments can be more useful than regulatory instruments in order to influence

owners to adopt building envelope measures (Nair et al, 2010). These findings are

supported by the numerous financial and fiscal measures adopted by European

countries to promote energy efficiency improvements in the building and

construction sector (Klinckenberg Consultants, 2010). Some studies analyse

economic measures adopted in order to reduce energy consumption in buildings and

carbon dioxide emissions in European countries (Georgopoulou et al, 2006;

Klinckenberg and Sunikka, 2006; EuroACE, 2009). These measures should be

coordinated with each other (Jollands and Ellis, 2009) and targeted to specific

dilemmas and issues (Klinckenberg and Sunikka, 2006).

As shown above, the literature is focused on the general analysis of economic

measures to promote energy efficiency in the building and construction sector, but it

is necessary to further investigate the use of economic and administrative measures

in order to punish energy performance requirement non-compliances prescribed in

building codes, monitor energy performances after the refurbishment and boost the

number of nearly zero-energy buildings.

3.3 Methodology and results

The study was carried out using primary data obtained by a questionnaire survey.

The data were collected by means of an online questionnaire from December 2011 to

July 2012. The questionnaire consisted of nine questions. It included multiple-choice

questions, but gave respondents the opportunity to provide more details in order to

improve the accuracy of answers. Before its diffusion, the questionnaire was tested

and validated by a small panel of experts in order to minimize common method bias

57

that can affect a questionnaire survey. We selected 169 experts in regulations

concerning the 27 European Union Member States. Sometimes, these experts

signalled other available colleagues to answer our questionnaire. These experts

belong to academic institutions, private companies and public authorities more

involved in regulatory process (Ministries, Energy Agencies, etc.). We achieved almost

one respondent for each European Union Member State. We received 47 responses.

The collected information from questionnaire were completed and confirmed with a

review of publicly available literature and legislation dealing with energy efficient

buildings. Thus, a comprehensive analysis of the current European regulations on

energy efficiency in buildings was elaborated regarding three specific criteria: the

integration of energy efficiency and renewable technologies targets, the translation of

investments in energy savings into economic value and the commitment towards

“nearly zero-energy” buildings. The results were presented categorizing all countries

analysed in four sub-regions. Eastern Europe (EE): Bulgaria, the Czech Republic,

Estonia, Hungary, Latvia, Lithuania, Poland, Romania and the Slovak Republic.

Northern Europe (NE): Denmark, Finland, Ireland, Sweden and the United Kingdom.

Southern Europe (SE): Cyprus, Greece, Italy, Malta, Portugal, Slovenia and Spain.

Western Europe (WE): Austria, Belgium, France, Germany, Luxembourg, the

Netherlands. Finally, the presentation of the study in SDEWES2012 conference served

the scope of strengthening the analysis through open discussions within the experts’

community.

3.3.1 Integration of energy efficiency and renewable energy requirements

As Table 3.1 shows, the majority of countries in all four sub-regions do not provide

designers with a hierarchy of energy measures in building through national

regulations. This absence of hierarchy shows a national commitment to develop all

technologies related to energy efficiency measures in order to improve overall energy

performance in buildings. In WE, only France has a national hierarchy of energy

efficiency measures confirming the 2007 programme of “Grenelle de

l’environnement” developed in order to encourage new technologies (Höhne et al,

58

2011). In EE there is just a slight predominance of absence of national hierarchy (5

out of 9). This national hierarchy could guide designers and generally building users

towards energy efficient buildings. In SE Cyprus and Slovenia have adopted a

hierarchy confirming their efforts in order to adapt their legislation to European

Union’s targets (Klinckenberg Consultants, 2010). Moreover, Italy has a hierarchy at

regional or local level.

All Member States (except for the Slovak Republic), which have a national hierarchy

of energy efficiency measures, assign high priority to roof, walls and window

insulation. Cyprus, Finland, France, Ireland, Lithuania and Slovenia assign high

priority to sanitary hot water production (e.g. condensing water heater). Finland,

France, Ireland, Lithuania and Slovenia assign high priority to renewable technologies

(e.g. geothermal heat pumps, solar thermal heating, solar photovoltaic and wind

turbines). Cooling systems (e.g. water-cooled condensers) receive the lowest score

than other energy efficiency measures. Finland, France and Slovenia assign high

priority to the majority of energy efficiency measures. These results show that

countries with an established hierarchy of energy efficiency measures focus their

efforts in order to avoid thermal losses and to supply water and space heating mainly

through renewable energies. In fact, some findings show that the insulation of

buildings is much more effective on reducing energy consumption than the

improvement of boiler efficiency (Dovajak et al, 2010).

The integration between renewable energies and energy efficiency through

quantitative targets in national regulations, with the only exception of Malta which

states a general commitment for the integration of renewable sources in buildings, is

mainly realized by SE sub-region (Table 3.2). It is important to highlight that this sub-

region has a high potential for the exploitation of solar power. Moreover, Spain was

the first European country to introduce the obligation to use renewable energies in

new and retrofitted buildings (Höhne et al, 2010). Bulgaria for EE and Germany for

WE have established national quantitative targets for renewable sources employed in

buildings. In particular, Bulgaria has set a quantitative requirement for renewable

energies in all new and refurbished buildings, but Bulgarian renewable energy act

59

does not clarify how this requirement will be implemented, monitored and controlled

(Höhne et al, 2011). Therefore, the majority of countries in EE, NE and WE entail only

general orientations for renewable energies. Sweden and Austria do not explicitly

take into account renewable energies in their national energy building legislation.

Denmark has established targets for renewable energies at regional level.

The analysis shows that quantitative targets for the integration of renewable energies

in buildings could be usefully set as the percentage of energy used for space heating

and cooling and domestic hot water covered by renewable energies or as same

measures in relation to building’s surface. These quantitative targets are applied to

new buildings or major renovations.

Table 3.1 - Hierarchy of energy efficient measures in the 27 European Union Member States Absence of national hierarchy Presence of national

hierarchy Presence of regional/local hierarchy

Bulgaria, the Czech Republic, Latvia, Poland and Romania for EE; Denmark, Sweden and the United Kingdom for NE; Greece, Malta, Portugal and Spain for SE; Austria, Belgium, Germany, Luxembourg and the Netherlands for WE

Estonia, Hungary, Lithuania and the Slovak Republic for EE; Finland and Ireland for NE; France for WE; Cyprus and Slovenia for SE

Italy for SE

Total: 17 countries Total: 9 countries Total: 1country

Table 3.2 - Targets for renewable sources in the 27 European Union Member States Absence of national targets Presence of national targets Presence of regional targets The Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania and the Slovak Republic for EE; Finland, Ireland, Sweden and the United Kingdom for NE; Malta for SE; Austria, Belgium, France, Luxembourg and The Netherlands for WE

Bulgaria for EE; Cyprus, Greece, Italy, Portugal, Slovenia and Spain for SE; Germany for WE

Denmark for NE

Total: 18 countries Total: 8 countries Total: 1 country

60

3.3.2 Translation of investments in energy saving into economic value

Our analysis shows that the majority of European countries do not state national

incentives in order to foster the offer of energy efficient buildings in their real estate

market for sale (Table 3.3). Among countries with national incentives, Estonia,

Finland, Italy, Austria, Germany and Luxembourg have introduced national incentives

in order to support energy efficiency investments in residential and non residential or

just in residential buildings such as grants, target loans and tax relief. Sweden and

Slovenia have adopted other types of incentives. Sweden has introduced procedural

incentives for residential and non residential buildings. Slovenia has defined

subsidies for buyers of passive houses. Then, Belgium and the Netherlands have

incentives set at regional/local level.

Only five countries (Table 3.4) have foreseen incentives in order to foster energy

efficient buildings for rent at national level. These countries (except for the

Netherlands) adopt same instruments for sale and for rent. Dutch legislation states

that the landlords can include retrofitting costs in rent. Moreover, Belgium and

Lithuania have defined incentives at regional/local level. The results highlight a more

concrete commitment of WE countries (Austria, Belgium, Germany and the

Netherlands) for the promotion of energy efficient buildings for rent, whereas SE

countries do not adopt any incentive. Among NE countries, Finland and Sweden have

incentives. In EE, only Lithuania has established regional/local incentives. These

findings confirm the inability of many European Member States to tackle the

“landlord-tenant dilemma” through national regulations. The “landlord-tenant

dilemma” is the conflict of interests between the landlord and the tenant that

hampers the investments in energy efficiency in existing buildings (Scott, 1997;

Schleich and Gruber, 2009).

Member States have a great potential in order to boost energy efficient buildings in

their real estate markets (for sale and for rent). The main incentives adopted by

Member States are tax relief and grants for energy efficiency investments. The

success of these instruments depends also on the quality of communication

campaigns particularly for residential schemes (Klinckenberg Consultants, 2010).

61

Therefore, national regulations try to push real estate market towards energy

performance buildings more by increasing the supply of energy efficient buildings

than by introducing new sale and rent procedures.

Table 3.3 - Incentives for sale of energy efficient buildings in the 27 European Union Member States Absence of national incentives

Presence of national incentives

Presence of regional/local incentives

Bulgaria, the Czech Republic, Hungary, Latvia, Lithuania, Poland, Romania and the Slovak Republic for EE; Denmark, Ireland and the United Kingdom for NE; Cyprus, Greece, Malta, Portugal and Spain for SE; France for WE

Estonia for EE, Finland and Sweden for NE; Italy and Slovenia for SE; Austria, Germany and Luxembourg for WE

Belgium and the Netherlands for WE

Total: 17 countries Total: 8 countries Total: 2 countries

Table 3.4 - Incentives for rent of energy efficient buildings in the 27 European Union Member States Absence of national incentives

Presence of national incentives

Presence of regional/local incentives

Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, Poland, Romania and the Slovak Republic for EE; Denmark, Ireland and the United Kingdom for NE; Cyprus, Greece, Italy, Malta, Portugal, Slovenia and Spain for SE; France and Luxembourg for WE

Finland and Sweden for NE; Austria, Germany and the Netherlands for WE

Lithuania for EE; Belgium for WE

Total: 20 countries Total: 5 countries Total: 2 countries

3.3.3 Commitment towards “nearly zero-energy” target

There are sixteen countries national regulations which have established

administrative and/or monetary penalties in case of non compliances with energy

performance requirements (Table 3.5). EE, NE and SE have the majority of their

countries with penalties established by national regulations. In WE Austria, Germany

and the Netherlands have national penalties. These results show that the majority of

62

European countries try to enforce the compliance of energy performance

requirements prescribed in buildings code through a more binding legislation.

The Czech Republic for EE, Sweden for NE, Spain for SE, France and Luxembourg for

WE have established penalties in other regulations such as regional laws or planning

and building acts.

Six countries have not defined penalties for building codes energy performance-

related non-compliances: Hungary and Latvia for EE, the United Kingdom for NE, Italy

and Malta for SE, and Belgium for WE. The lack of penalties for Hungary and Latvia is

a confirmation of their weak implementation of the European Union’s energy saving

targets.

National regulations establish a minimum threshold for the mandatory

communication about the effects of the refurbishment on energy performance in

buildings in eleven countries (Table 3.6). Regional/local regulations establish a

minimum threshold to communicate compulsorily changes in energy performance in

Lithuania, Italy and the Netherlands. The majority of western countries do not have a

minimum threshold for the mandatory communication about changes in energy

performance in case of refurbishment. The other countries without an established

minimum threshold for this mandatory communication are the Czech Republic, Latvia

and Romania for EE, Denmark, Finland and the United Kingdom for NE, and Greece,

Malta and Slovenia for SE.

Table 3.7 shows that the majority of countries have not yet established national

incentives for the diffusion of nearly zero-energy buildings, but it is worth describing

the experiences of countries which have already started to boost nearly zero-energy

buildings. WE is the more active sub-region since Austria, France and the Netherlands

have established national grants for demonstration projects for nearly zero-energy

buildings, Germany has allocated grants and reduced interest loans not only for

demonstration projects but also for realization of passive houses (standard very close

to nearly zero-energy buildings) and Belgium has established regional/local

incentives for nearly zero-energy buildings, because the implementation of the

Energy Performance of Buildings Directive is a regional responsibility. In NE

63

Denmark, Ireland and the United Kingdom have established national grants for

demonstration projects. In particular, Danish Technology Institute has carried out

“EnergyFlexHouse” project in order to develop energy efficient technologies (Danish

Technology Institute, 2011), the Irish Department of the Environment, Heritage and

Local Government has financed in 2009 ten nearly zero carbon social housing

developments (Vermande and van der Heijden, 2011) and the United Kingdom has

introduced tax reliefs for “zero carbon homes”. In EE, Latvia has set national grants

for demonstration projects, and the Slovak Republic has foreseen easier

administrative procedures for nearly zero-energy buildings at national level. In SE,

Slovenia has established incentives for passive buildings and technologies related to

nearly zero-energy concept, and Greece has established national grants for

demonstration projects such as the “Green Neighbourhoods” program for the energy

upgrade of four social building blocks to almost zero energy consumption buildings.

Table 3.5 – Penalties for energy performance requirement non-compliances in the 27 European Union Member States Absence of national penalties

Presence of national penalties

Presence of regional/local penalties

Presence of penalties established by other regulations

Hungary and Latvia for EE; the United Kingdom for NE; Italy and Malta for SE; Belgium for WE

Bulgaria, Estonia, Lithuania, Poland, Romania and the Slovak Republic for EE; Denmark, Finland and Ireland for NE; Cyprus, Greece, Portugal and Slovenia for SE; Austria, Germany and The Netherlands for WE

Spain for SE The Czech Republic for EE; Sweden for NE; France and Luxembourg for WE

Total: 6 countries Total: 16 countries Total: 1 country Total: 4 countries

64

Table 3.6 - Minimum threshold for the mandatory communication about the effects of the refurbishment in the 27 European Union Member States Absence of national minimum threshold

Presence of national minimum threshold

Presence of regional/local minimum threshold

The Czech Republic, Latvia and Romania for EE; Denmark, Finland and the United Kingdom for NE; Greece, Malta and Slovenia for SE; Austria, Belgium, France and Germany for WE

Bulgaria, Estonia, Hungary, Poland and the Slovak Republic for EE; Ireland and Sweden for NE; Cyprus, Portugal, and Spain for SE; Luxembourg for WE

Lithuania for EE, Italy for and the Netherlands

Total: 13 countries Total: 11 countries Total: 3 countries

Table 3.7 - Incentives for the diffusion of nearly zero-energy buildings in the 27 European Union Member States Absence of incentives for nearly zero-energy buildings

Presence of national incentives for nearly zero-energy buildings

Presence of regional/local incentives for nearly zero-energy buildings

Bulgaria, the Czech Republic, Estonia, Hungary, Lithuania, Poland and Romania for EE; , Finland and Sweden for NE; Cyprus, Italy, Malta, Portugal and Spain for SE; Luxembourg for WE

Latvia and the Slovak Republic for EE; Denmark, Ireland and the United Kingdom for NE; Greece and Slovenia for SE; Austria, France, Germany and the Netherlands for WE

Belgium for WE

Total: 15 countries Total: 11 countries Total: 1 country

3.3.4 Overarching vision

This section summarizes regulatory and policy instruments adopted by the 27

European Union Member States in their national regulatory framework (Table 3.8),

Firstly, those countries that have only recently committed themselves to implement

energy efficiency in buildings, are presented. These countries are then compared with

the front-runners. Finally, the peculiarities that characterise “grey” countries are

discussed

65

Table 3.8 - Summary of regulatory and policy instruments adopted by the 27 European Union Member States in their national regulatory framework Country Integration of energy

efficiency and renewable energy requirements

Translation of investments in energy saving into economic value

Commitment towards “nearly zero-energy” target

Hierarchy of energy efficient measures

Targets for renewable sources

Incentives for sale of energy efficient buildings

Incentives for rent of energy efficient buildings

Penalties for energy performance requirement non-compliances

Minimum threshold for the mandatory communication about the effects of the refurbishment

Incentives for nearly zero-energy buildings

Eastern Europe Bulgaria X X X

Czech Republic § Estonia X X X X Hungary X X

Latvia X Lithuania X R X R

Poland X X Romania X

Slovak Republic X X X X Northern Europe

Denmark R X X Finland X X X X Ireland X X X X

Sweden X X § X United Kingdom X

Southern Europe Cyprus X X X X

Greece X X X Italy R X X R

Malta Portugal X X X Slovenia X X X X X

Spain X R X Western Europe

Austria X X X X Belgium R R R

France X § X Germany X X X X X Luxembourg X § X

Netherlands R X X R X

Legend: X = national regulations, R = regional/local regulations, § = other regulations

There are two countries (the Czech Republic and Malta) which do not devise a

national regulatory framework composed by any of the regulatory and policy

instruments analyzed. Latvia and Romania have a similar national framework

because they have employed only one national instrument. Their approach is

opposite to other countries which are beginners to the implementation of energy

efficiency measures and have adopted a highly articulated national regulatory

framework such as: Bulgaria, Estonia, the Slovak Republic and Cyprus. In particular,

66

Cyprus, Malta and Estonia have set energy performance requirements for the first

time in order to implement EPBD (Economidou, 2011), but they have designed a

different regulatory framework, as displayed above. Hungary, Lithuania and Poland

have an intermediate approach because they have implemented two national

regulatory and policy instruments. Lithuania has also adopted two regional/local

regulatory instruments. Among these countries penalties and minimum threshold for

the mandatory communication about the effects of the refurbishment on energy

performance in buildings are the most common regulatory instruments in order to

monitor the trends of energy performance and promote improvements of energy

performance in buildings.

Slovenia has the most articulated national regulatory and policy framework among

new European Union members. In fact, Slovenia has designed an organic regulatory

and policy framework in order to improve energy performance in the building and

construction sector. This approach confirms the traditional Slovenian government’s

commitment to support energy efficiency measures such as regulation on building

insulation adopted in 2002 (Al-Mansour, 2011).

There are some countries which are front-runners in the adoption of regulatory and

policy instruments in order to achieve energy saving targets: Denmark, Finland and

Sweden for NE, and Germany and the Netherlands for WE. Being the front-runners,

these countries adopted, the following instruments: certification schemes,

requirements for thermal insulation/performance and low-interest loans. The

Netherlands and Denmark had already set up energy certification schemes for new

buildings at national level since 1995 and 1997 respectively. In particular, Denmark

has set up an energy certification scheme for selling existing single family houses and

owner-occupied flats. Finland has set minimum requirements for thermal insulation

since 1976 (Haakana, 2011). Germany has introduced thermal performance

requirements since 1977 (Geller et al, 2006) and since 2002 has adopted at national

level detailed requirements for the energy performance of new and refurbished

buildings and a compulsory energy certification for new buildings and major

renovations (Schettler-Köhler et al, 2011). Sweden introduced low-interest loans and

67

grants for energy efficiency investments in residential buildings in the 1970s so as to

improve energy performance in Swedish homes (Schipper et al, 1985). The

instruments described above have been set in different national regulatory

frameworks. Denmark has adopted softer national regulatory framework for energy

efficiency in buildings than the other front-runners. In particular, Denmark has not

many subsidies to carry out energy savings in buildings, and none directly connected

to the building energy performance certification scheme, but is committed to address

the challenge for a carbon dioxide emission free country by 2050 (Aggerholm et al,

2011). Germany has an articulated regulatory framework and confirms the

commitment for the ongoing improvement of energy performance in building

through grants and reduced interest loans for the realization of passive houses.

Finland, Sweden and the Netherlands have an intermediate approach related to

national regulatory framework, even though the Netherlands has also introduced

regional regulatory instruments.

The countries that have “grey” approaches to the commitment to the achievement of

European energy saving targets are described below. France and the United Kingdom

have a long tradition of attention for energy efficiency because they adopted energy

standards for new buildings in the past (Geller et al, 2006), but now they want to

increase their efforts towards energy savings boosting the nearly zero-energy

buildings. The United Kingdom has established incentives for “zero carbon homes”.

This choice confirms the British government’s commitment to reducing greenhouse

gas emissions by at least 80% below 1990 levels by 2050 (Höhne et al, 2011). France

addresses the achievement of real energy savings in buildings through the

introduction of zero percent rate eco-loan for energy efficiency investments for the

improvements of existing buildings (Roger et al, 2011) and grants for demonstration

projects for nearly zero-energy buildings.

Ireland is not traditionally judged a front-runner for the implementation of energy

efficiency in buildings but it has designed a well-defined national regulatory and

policy framework.

68

Italy has a fragmented national regulatory framework because the responsibility of

the implementation of EPBD is shared between national and regional governments

(Antinucci et al, 2011). This fragmentation could harm and delay a homogeneous

achievement of energy saving targets.

In SE Portugal and Spain have a similar national regulatory framework because both

define quantitative targets for the integration of renewable sources in buildings and

minimum threshold for the mandatory communication about the effects of the

refurbishment on energy performance in buildings. There is only one difference in the

definition of penalties for non compliances with the energy performance prescribed

in building codes, because penalties are established at regional level in Spain and at

national level in Portugal. In both these countries the command and control approach

is prevailing.

Also, Greece has a national regulatory framework based on a more command and

control approach, but foresees grants for demonstration projects for nearly zero-

energy buildings.

Belgium does not adopt any regulatory and policy instruments analysed at national

level, because regional governments of Brussels Capital, Flanders and Wallonia define

at local level the main regulatory and policy instruments in order to achieve

European Union’s energy saving targets. Luxembourg has a softer national regulatory

framework than other countries in WE (except for Belgium).

Austria has a well-defined national regulatory framework, but national regulations

have to face the efforts to harmonize regional energy regulations and buildings codes

(Jilek, 2011). This context could influence the definition of a stronger national

regulatory in order to increase energy efficient buildings.

3.4 Discussion

The results of analysis highlight that European Member States have adopted different

approaches in the design of their national regulatory framework. Almost all European

countries have employed at least one of the regulatory and policy instruments

69

analysed. There are only three exceptions: the Czech Republic for EE, Malta for SE and

Belgium for WE.

The analysis of national regulatory framework according to the three identified

aspects displays a wide employment of national penalties for energy performance

requirement non-compliances with building codes and of minimum thresholds for the

mandatory communication about the effects of the refurbishment on energy

performance in buildings. While these are instruments that are generally considered

easy-to-be-implemented, the employment of other regulatory and policy instruments

varies heavily in each European country. All countries have to strengthen their

national regulation in order to achieve European Union’s energy saving targets and

improve their contribution to energy efficiency governance. In particular, the

integration between renewable energies and energy efficient measures through

quantitative targets, the boost of energy efficient buildings in national real estate

markets and the transition towards “nearly zero-energy buildings” are in their early

stages of adoption.

This heterogeneous approach in national regulatory frameworks is also evident when

countries are categorized by four sub-regions of Europe.

This analysis suggests that such heterogeneity reflects four factors: different

responsibilities on building energy regulations, traditional building regulations and

enforcement models (Vermande and van der Heijden, 2011), contextual

characteristics (Cansino et al, 2011) and the maturity of the country in the

implementation of energy efficiency measures.

The division of responsibilities on building energy regulations can lead to a stronger

or softer regional/local regulatory system. In particular, some countries can leave at

regional and local authorities the definition of hierarchy of energy efficient measures,

penalties, energy performance requirements, economic or administrative incentives

in order to boost the offer of energy efficient buildings for sale and for rent and

increase the nearly zero-energy buildings, whereas other countries can promote the

implementation and enforcement of specific regulatory aspects at regional and local

70

level such as penalties and economic or administrative incentives (Vermande and van

der Heijden, 2011).

There is a typical categorization of building regulations and enforcement which

identifies traditional building regulations and enforcement models. This

categorization distinguishes among generic or detailed regulations on construct

standards and strict control on builders and building owners or their self-regulation

and self-assessment (Vermande and van der Heijden, 2011). For instance, the United

Kingdom confirms the classical Anglo-Saxon model because this country has generic

basic requirements associated to voluntary guidance documents and standards.

Contextual characteristics can play a fundamental role in setting regulatory and

policy instruments in each country (Cansino et al, 2011). In particular, the southern

countries (except for Malta) have adopted quantitative targets for the integration of

renewable energies in buildings because they are often influenced by their high

potential of solar power.

The maturity of the country in the implementation of energy efficiency measures is

defined by two aspects. Firstly, it is the presence of a long tradition in the

development of building energy regulations (Germany, Sweden and the United

Kingdom) or the absence of energy building regulations in permit procedure and

legislative background (Hungary, the Czech Republic and the Slovak Republic)

(Vermande and van der Heijden, 2011). Secondly, it is a recent or well-established

commitment to achieve European Union’s energy saving targets. In fact, “beginner

countries” more frequently have introduced a hierarchy of energy efficiency

measures in their national regulatory framework in order to drive designers but also

building users towards energy efficient buildings.

This analysis highlights the crucial role of country’s profile in the development of

national regulatory framework in each European country. Therefore, the different

approach adopted in national regulatory frameworks is not negative, but points out

the importance of understand countries’ peculiarities. Understanding these

peculiarities helps to strengthen and improves the design of the sharing of best-

practices and energy efficiency governance among Member States.

71

3.5 Conclusions

The European Union is committed to implement energy efficiency in buildings. This

commitment requires efforts from all Member States which contribute to energy

efficiency governance in the building and construction sector through the adoption of

suitable regulatory and policy instruments. Therefore, national regulatory and policy

instruments have to address the complex energy efficiency issue in the building

sector which may be identified in three priority dimensions: the integration of energy

efficiency and renewable technologies, the translation of investments in energy

savings into economic value and the commitment towards “nearly zero-energy”

target. Traditionally, literature has distinctly regarded these three dimensions. These

dimensions and their integration are pointed out as fundamental by EPBD recast.

Consequently, national regulations should integrate these dimensions in order to

achieve energy efficiency in buildings and contribute to energy efficiency governance.

After analyzing the design of national regulatory framework on energy efficient

buildings in European countries, we can argue that national energy building

regulations adopt different approaches. These different approaches highlight the

importance to understand how each European country is addressing European

Union’s energy saving targets. Therefore, the transfer of best-practices for energy

efficient improvements in buildings and related energy efficiency governance should

be supported and improved by this analysis of each country’s profile.

Since a descriptive analysis of regulations is useful but not sufficient in order to

describe energy efficiency national regulatory frameworks, further research should

extend this study in order to carry out the impact assessment of regulatory and policy

instruments adopted in the national legislation employing quantitative data

according to a cost/benefit analysis approach.

72

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Chapter 4

The Role of Eco-design in the development of energy efficiency in buildings Abstract

The building and construction sector plays a crucial role in implementing energy efficiency and, more generally, in reducing environmental impacts. In this context, design is a key-phase for effective improvement in the whole sector. Therefore, the adoption of the Eco-design approach can be a “green” turning point for the strategies of this sector. This study aims to investigate factors and drawbacks that drive designers in the implementation of Eco-design. The data are collected by a questionnaire survey covering a considerable number of designers in the region Tuscany in Italy. The results reveal that designers have a high environmental sensitivity, but a systematic adoption of Eco-design approach is still far. Moreover, the study highlights the spreading in the sector of those “internal” key factors that normally foster the inclusion of energy and environmental criteria in the building design, e.g. training, cooperation with supply chain, certification schemes.

Keywords: Eco-design, designers, building and construction sector

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4.1 Introduction

The building and construction sector is a major contributor to the growth of many

economic systems and can play a crucial role in implementing improvements towards

energy efficiency and, more in general, in reducing the most relevant environmental

impacts in order to prompt to sustainable development patterns and to favour the

transition to a low-carbon economy. Looking at the available data, it is easy to

understand that the European Union (EU) building and construction sector

substantially affects two crucial pillars of sustainability. On the one hand, it accounts

for 37.1% of total final energy consumption (1,157.7 million tonnes of oil equivalent

(Mtoe) in 2007) in the EU-27 of which 284.6 Mtoe in residential buildings and 145.2

Mtoe in non-residential buildings (European Union, 2010), and 35% of the

greenhouse emissions (European Commission, 2007). On the other hand, the building

and construction sector in the EU represents approximately 10% of Gross Domestic

Product and is the largest industrial employer with 14.8 million employees and 3.1

million enterprises in 2007 (Schultmann et al, 2010).

The economic and environmental relevance of this sector is demonstrated by the

intense and cross-sectional EU regulatory action. For example, the Energy

Performance of Buildings Directive 2002/91/EC (EPBD) and its recast aim at

promoting energy performance improvements specifically in buildings (European

Commission, 2002, 2010a). Also, the EuP Directive 2009/125/EC (known as “Eco-

design Directive”) and the Directive 2010/30/EC establish a synergic framework for

the setting of design requirements and indications for labelling and standard product

information of energy-related products and in particular energy-related building

elements (e.g. heating systems) (European Commission, 2009, 2010b). There are also

other policy instruments that can support the reduction of environmental impacts in

the building and construction sector such as the Environmental Product Declaration

(EPD). In fact, EPD helps manufactures of building materials to provide life cycle

based environmental information on their products.

All the policies mentioned above rely on the assumption that the design of a building

can strongly influence the most significant environmental performances, such as

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energy used in buildings for heating, cooling and lighting, the toxic materials included

in the structures, and even wastes produced at the end of life (Maciel et al, 2007; Isaac

and van Vuuren, 2009; Karkanias et al, 2010). It must be noted that because buildings

have a long service lifetime of approximately 100 years, the environmental impacts

associated with the “use phase” are generally extremely important (Schultmann et al,

2010). Therefore, adopting an Eco-design approach can strongly decrease the

environmental impacts throughout different life cycle stages (Karlsson and Luttropp,

2006) and, in particular improve environmental and energy performance during the

“use phase” of a building.

The inclusion of environmental considerations in design process provides economic

and non-economic benefits to consumers and policy makers. From a consumer’s point

of view, Eco-design reduces costs during the manufacturing and use phases by

optimizing the use of raw materials including recycled materials, by improving

logistics, and reducing energy consumption (Plouffe et al, 2011). Furthermore, the

Eco-design approach also provides non economic benefits satisfying consumers with

an increasing environmental awareness (Plouffe et al, 2011). In fact, 87% of

European citizens consider themselves as important players in protecting the

environment in their countries (European Commission, 2011). From a policy

perspective, the adoption of Eco-design supports policy makers encouraging

sustainable consumption and consequently eco-innovation in a region or country

(O’Rafferty, 2008). Therefore, the integration of the traditional building design with

environmental and energy concerns through Eco-design is both a challenge and an

opportunity for EU countries.

In this context, numerous Eco-design methods and tools have been developed in the

area of the industrial product design and, then, they have been applied in the building

and construction sector (Rio et al, 2013). Life Cycle Assessment (LCA), for instance,

has been often applied to new and existing buildings’ design to enable the integratio n

of the environmental dimension with the conventional project processes which

originally had only addressed time, cost, and quality (Peuportier et al, 2013; Ofori,

1992).

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Despite the availability of Eco-design tools and its large potential for environmental

improvement and benefits (Crosbie et al, 2010; Nemry et al, 2010; Plouffe et al,

2011), there is a scarce knowledge about diffusion of the Eco-design approach in the

building design process, from a designers’ perspective. Therefore, our analysis here

does not focus on technical knowledge about the Eco-design approach, but rather

investigates the role of a key actor in the process of knowledge transfer (Guy, 2006).

Consequently, we consider buildings as “material products of competing social

practices” (Guy, 2006), thus, in order to understand how to foster and simplify the

implementation of the Eco-design approach in buildings, we must analyze the

characteristics of actors, in particular designers, and related social processes that

support the production and development of buildings (Bijker et al, 1987). Designers

(architects and engineers) are key-players by directly introducing the environmental

concerns in the building design process, by indirectly influencing the choices and

behaviours of developers, contractors, material and equipment suppliers, and even by

interacting on the market with public authorities as clients within the building and

construction sector (Chan et al, 2009). Therefore, designers take on the role of system

integrator in the supply-demand chain of the building and construction sector

(Segerstedt and Olofsson, 2010), fostering building users towards a sustainable

consumption (Lilley, 2009). In fact, the possible increase of costs entailed by adopting

an Eco-design approach in refurbished and new buildings may discourage building

users, as confirmed by a recent European survey (European Commission, 2011);

therefore designers must coordinate the needs of building users and other actors of

the building and construction sector (Rohracher, 2001).

In recent years, designers have been covering a major role in determining the

environment-oriented strategies of the building and construction sector but also in

supporting policies for sustainable buildings; in fact they have increasingly been

involved in many studies investigating designers' perception of sustainability as a

proxy for the whole industry (Chong et al, 2009), their market estimations and

forecasts for green buildings (Chan et al, 2009), and the impact of energy efficiency

and energy saving public policies on building design activities (Adeyeye et al, 2007).

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The setting chosen for this study is a specific Region (Tuscany) of Italy that well

reflects the dynamics and characteristics of the building and construction sector at

national level (negative economic trend persisting along the last 5-7 years and a

productive backbone made of small of very small firms). Because Italy is one of EU

countries with the larger building stock (Raya et al, 2011) and has an annual rate of

new constructions corresponding to European average (Meijer et al, 2009), the focus

on Italy was considered also suitable for analysing the capabilities of European

countries towards achieving EU targets for sustainable buildings. Findings of this

study also provide insights on the Italian building and construction sector field, so far

characterized by a chronic lack of data (Albino and Berardi, 2012),

Aim of our study was to investigate the factors that favour and/or hinder the

adoption of Eco-design in the building and construction sector. By focusing on the

design phase, we wanted to gain a better view on how environmental concerns are

really being integrated in the “core” process of the building supply chain, the most

operational and effective leverage that can be activated to achieve more sustainable

and energy-efficient buildings. By analysing in depth into the designers' motivations,

choices and strategic behaviour, we pursued multiple objectives:

To assess to what degree the “Eco-design approach” is actually adopted in the

building design process;

To identify what factors can boost the adoption of Eco-design in building

projects;

To highlight the main obstacles inhibiting adoption of Eco-design in building

design;

To recognize the implication of environmental policy making (that promoted

the Eco-design approach) on designers’ strategic choices and day-to-day

activity.

4.2 The Survey Design

The analysis was carried out using primary data obtained by a questionnaire survey.

The survey comprises all architects, construction engineers, civil engineers, and

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structural engineers operating across Tuscany (Italy) and enrolled in the official

registers managed by professional associations at Province level7.

Because architects and engineers that are registered in the list do not necessarily

operate exclusively within building design, a comprehensive list of designers was not

available; therefore, the targeted audience was made up with all the registered

“designers” plus some self-selection mechanisms included in the survey instruments,

as described below.

Data were collected by means of an online questionnaire. The questions were

designed based on a review of literature relating to Eco-design and design process for

sustainable buildings. The questionnaire aimed to collect seven categories of

information: 1) general information about designers and their activities, i.e. name,

legal form and size of building design firms, project type, type of main clients; 2)

motivations for adopting Eco-design in building design and sensitivity/awareness on

environmental/energy performance of building materials; 3) ability and “intensity” of

co-operation with other actors of supply chain; 4) training activities in the area of

Eco-design; 5) projects developed according to Eco-design criteria (i.e. number and

value of projects); 6) barriers to Eco-design in the building design process; 7)

opportunities and ways to implement Eco-design in the building and construction

sector.

The questionnaire consisted of nineteen questions and Likert scales were designed in

accordance with accepted empirical methods.

Because studies have shown that question formulation may alter results by as much

as 50% (Cannell et al, 1989), the questionnaire was pre-tested. Based on the pre-

tests, the survey instrument was revised for simplicity and validated by professional

associations.

The survey's mailing and data collection were managed in close cooperation with the

professional associations. Each professional association selected the most suitable

7 According to Italian Legislation architects and engineers have to register with their professional

associations. These professional associations are arranged at the territorial level. Architects and engineers have to register with the professional association where they have the place of residence. Tuscany is divided in 10 provinces. Therefore, there are 10 professional associations for architects and 10 for engineers.

85

method for sending out the questionnaire to its registered designers. In particular,

the questionnaire was distributed by the following methods:

11 professional associations sent the questionnaire with a cover letter directly

to designers by email.

2 professional associations provided the database, including complete listing

of designers' email addresses, so we could send the questionnaires and cover

letter by e-mail.

3 professional associations released the questionnaire with a cover letter

through their website or newsletter.

2 professional associations created the database with all the email addresses

of the registered designers available from their website and we directly sent

the questionnaire with a cover letter by email.

In order to focus exclusively on designers, we included some self-selection

mechanisms: in the cover letter, we clearly stated that the questionnaire was

exclusively for designers and then included at the beginning of the questionnaire a

specific question on whether the respondent usually performed “design” in his/her

professional activity.

The survey process, carried out from September to November 2011, generated a total

of 204 responses, but 16 responses were ruled out because respondents resulted to

actually not be working in building design. Then, the analysis considered 188

responses (even if some responses were incomplete, because not every question in

the questionnaire was answered, particularly the questions related to training, Eco-

design projects, and barriers to Eco-design approach).

Although there are 11,800 professionals (including architects, construction

engineers, civil engineers, and structural engineers) operating in Tuscany and

registered in regional professional associations, only a small portion works exactly

and/or exclusively in the field of building design. Hence, based on the opinions from

the professional associations interviewed, we were able to estimate that the

statistical population of designers in Tuscany accounts to date approximately 5,000

practitioners.

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As a consequence, our sample, which was randomly generated, is a representative

sample with 95% of confidence level and a sample error of 7%. This means that the

results of our survey are 95% true and the percentage of answers to the survey

questions have an error rate of 7%.

Because the study relies on data collected through survey techniques, we

preventively addressed possible limitations regarding the survey data. One issue

concerned the potential source of bias related to respondents’ apprehension that

made them less likely to edit their responses with the intent of appearing more

socially desirable, lenient, acquiescent, and consistent with how they think the

researcher wants them to respond (Podsakoff et al, 2003). This potential problem

was avoided by guaranteeing, at the beginning of the survey, complete anonymity and

no unauthorized disclosure of information associated with the data collected.

Another issue was the design of the questionnaire for which we used several

procedural remedies in order to minimize the common method bias that can affect a

questionnaire survey. Hence, we avoided use of ambiguous or unfamiliar terms;

vague concepts or complicated syntax; questions were simple, specific, and concise;

bipolar numerical scale values (e.g., –3 to 3) were also avoided, providing verbal

labels for the midpoints of scales.

4.3 Data description and variables construction

In order to analyse what factors could influence the uptake of the Eco-design

approach in the building and construction sector, we created a set of variables using

the answers to specific questions.

To measure the adoption of Eco-design we used different questions: we asked to

designers if they carried out projects relying on Eco-design criteria, how many

projects they completed, and total economic value of those projects. Then, we

calculated average value of the Eco-design projects carried out by respondents.

The conceptual framework suggests that the evolution and implementation of the

Eco-design approach in industrial product development has been supported and

affected by many factors (Roy, 1994; Handfield et al, 2001; Johansson, 2002; Lindahl,

87

2003; Boks, 2006) such as technical complexity, design expertise, commitment from

designer, financial risks, regulatory framework, organizational context, public

awareness and political concern. In particular, with respect to the adoption of the

Eco-design approach in building design, our study considered the following factors: a)

motivation of designer, b) sensitivity to energy and environmental issues and

performance of building materials and components, c) training on Eco-design

attended by the designer, d) cooperation with supply chain. Multiple-response

questions were asked to investigate the presence of these strategic factors driving

Eco-design. In detail, to measure the extent to which energy and environment-related

criteria affect respondents’ professional activity, we asked designers to indicate

through a five-point Likert scale the relevance that environmental protection and

energy efficiency had in their own business strategy.

Focusing on the operational level, we then asked designers how they considered

environmental and energy performance of building materials and component

combinations. The respondents replied using a three-point Likert scale, indicating

whether these performances were “very important”, “important like other

performance categories such as quality, safety, etc.” or “not important”.

Additionally, since the need for staff training could represent a key factor towards

adopting and applying Eco-design techniques (Knight and Jenkins, 2009), we asked

designers if they have attended training courses on Eco-design and the number of

training hours per person. Finally, since the cooperation along the supply chain has

proven to be a key determinant to improve environmental performance of product

and services (Testa and Iraldo, 2010), we asked designers if they have cooperated

with other actors along the building and construction supply chain for defining Eco-

design project.

Besides the influencing factors, we also investigated which drawbacks designers

normally encountered when introducing Eco-design principles and methods in the

building design process. Based on the main findings of the relevant literature (Lovins,

1992; Chong et al, 2009; Karkanias et al, 2010; Hakkinen and Belloni, 2011), we

investigated the extent to which specific factors (such as high costs, scarce

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collaboration along the supply chain, lack of clients’ interest in eco-friendlier

solutions, inadequacy of regulation and technical tools) were obstacles to the

implementation of environmental and energy criteria in the design process.

Literature also emphasizes that Eco-design in the building and construction sector

might be fostered by the market's increasing need to measure buildings'

environmental and energy performance and obtain reliable data on these aspects

(Ding, 2008; Cole, 1999; Crawley and Aho, 1999). To date, such information and

quantitative assessments of environmental and energy aspects of a building (and

related components) are mainly provided by the existing building certification

schemes, such as energy certification, which is the most effective way to offer credible

and guaranteed information to the real estate market on the building energy

performance (Casals, 2006). On this basis, we asked designers how they assessed a

variety of certification schemes as driver and support for the uptake of Eco-design

projects: fundamental, fairly important, and not important.

The summary statistics of all variables used in the estimation are presented in Table

4.1.

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Table 4.1 – Summary statistics

Variable Description Obs Mean Std Dev Min Max Environmental

strategy Motivation for Eco-design: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

188 3.68617 .9206021 1 5

Environmental performance

1 if energy and environmental performance of building materials and component combinations is fundamental, 2 if energy and environmental performance of building materials and component combinations is enough important, 3 if energy and environmental performance of building materials and component combinations is not important

188 1.531915 .5511704 1 3

Collaboration with supply

chain

1 if designers cooperate with supply chain during building design process, 0 if designers do not cooperate with supply chain during building design process

188 .6170213 .4874112 0 1

Training 1 if designers attend courses on Eco-design approach, 0 if designers do not attend courses on Eco-design approach.

184 .5434783 .4994651 0 1

Training hours for category

1 if number of training hours per person is less than or equal to 30, 2 if number of training hours per person is less than or equal to 50, 3 if number of training hours per person is less than or equal to 80, 4 if number of training hours per person is less than or equal to 100, 5 if number of training hours per person is less than or equal to 120, 6 if number of training hours per person is less than or equal to 160, 7 if number of training hours per person greater than 160.

80 3.725 2.104696 1 7

Eco-design 1 if designers carry out Eco-design projects, 0 if designers do not carry out Eco-design projects

183 .6174863 .4873343 0 1

Eco-design Number

Number of Eco-design projects 119 3.176471 8.357121 0 60

Eco-design Average Value

Average value of Eco-design projects for each respondents

49 1607628 5574928 200 37900000

Certification 1 if a variety of certifications is fundamental for diffusion of Eco-design projects, 2 if a variety of certifications are not the main drivers in order to carry out Eco-design projects, 3 if a variety of certifications does not boost the diffusion of Eco-design projects, but confuses clients

134 2.164179 .7377473 1 3

B1 - Uninterested clients in Eco-

design approach

Lack of clients’ interest in environmental/energy performance of building: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

133 3.593985 1.015319 1 5

B2 -Low cooperation with

other actors in the design team

No cooperation among agents of design team: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

133 2.902256 1.043484 1 5

B3 - Difficulties during project

execution

Eco-design projects cause more difficulties during project execution phase: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

133 2.75188 .9162342 1 5

B4 - Unsuitable regulations

Regulations are inadequate in order to boost the diffusion of Eco-design projects: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

133 2.879699 1.154947 1 5

B5 - Lack of suitable design

software

Design software are inadequate in order to to boost the diffusion of Eco-design projects: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

133 2.195489 .9248968 1 5

B6 - Higher project costs

High project costs: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

133 2.819549 .927971 1 5

B7 – Low cooperation with

other actors in building and construction supply chain

Lack of cooperation with supply chain: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

133 2.81203 1.008677 1 5

B8 – Lack of suitable training

Lack of adequate courses on Eco-design design: five-point Likert scale 1 indicating no influence and 5 a great deal of influence

133 2.413534 .962382 1 5

90

The questions mentioned above could be affected by some characteristics of the

designers (Table 4.2 and Figure 4.1): the majority of respondents were architects

(72%) and had a master degree in science (94.7%). These designers had a wider area

of expertise than designers with a bachelor's degree and were enrolled in a specific

section of the official register managed by professional associations8. Building design

was mostly carried out in small firms: 90.4% of designers worked in a design studio

where they were partners or owners. 59.6% of the designers operated mainly to

retrofit existing buildings, and 94.7% had private clients. Respondents represented

all ten Provinces of Tuscany .

Table 4.2 – Designer characteristics: type of profession, type of registration, legal form of design firm, project type and type of main clients

Profession Type of registration Legal form Project type Type of main clients

Obs % Obs % Obs % Obs % Obs %

Architect 136 72 Master 178 94.7 Company 6 3.2 Retrofit 112 59.6 Private 178 94.7

Engineer 52 28 Bachelor degree

10 5.3 Partnership 12 6.4 New built

48 25.5 Public 10 5.3

Design studio

170 90.4 both 15 8

other 13 6.9

Total 188 100 Total 188 100 Total 188 100 Total 188 100 Total 188 100

Figure 4.1 – Designer characteristics: organization size

8 Each official register managed by professional associations (architects and engineers) is divided in two sections (A and B). Designers, who took a master of science, can register with section A. Designers, who took a bachelor degree, can register with section B.

91

4.4 Results

4.4.1Eco-design

The concept of Eco-design is defined as the integration of design aspects and

environmental concerns in the development of product and services (Karlsson and

Luttropp, 2006) in order to decrease the environmental impact throughout different

life cycle stages. Therefore, the Eco-design approach aims to determine the

environmental impact associated to the whole life-cycle and to consider

environmental factors during the design of products, processes and activities (Sun et

al, 2003; Pujari, 2006). In particular, Eco-design has been applied to “urban design”

processes, where the life cycle of a city consists of all the stages through which it

evolves, including the architectural design and construction stage (Farreny et al,

2010).

According to this view, we analysed the adoption of the Eco-design approach in

building design by asking designers whether they had considered energy efficiency

and environmental criteria over the past three years (2008-2011).

By analysing of results, it emerges that the majority of designers (113 out of 183) had

considered energy efficiency and environmental criteria during design process but

Eco-design did not represent the “core” of their professional activity. In fact, 60% of

the “eco-designers” indicating the number of Eco-design projects carried out in the

last three years (33 out of 55) stated that no more than three Eco-design projects had

been completed.

Moreover, the analysis of the economic value of these projects also showed that the

current application of the Eco-design approach in the building and construction

sector was still very low. Although only 49 out of 113 “eco-designers” provided more

detailed information, Figure 4.2 clearly shows that 28.6% of designers (14 out of 49)

carried out projects with an average value between 100,000 and 300,000 Euros and

18.4% (9 out of 49) with an average value between 300,000 and 500,000 Euros.

By focusing on the several designer characteristics (type of profession of designer,

organization size, project type and type of main clients) the Spearman test shows that

there is no correlation between these and the adoption of the Eco-design approach.

92

On the contrary, large design firms and designers working mainly on new buildings,

new and retrofitted buildings and other categories are positively related to average

value of Eco-design projects (Table 4.3).

Figure 4.2 – Classes of average Eco-design project value in EUR, number of respondents

Table 4.3 – Spearman test between Eco-design variables and designer characteristics

Profession Organization size Project type Type of main clients

Eco-design -0.047 0.050 0.016 -0.041 Eco-design Number -0.149 0.072 0.008 0.061 Eco-design Average

Value 0.080 0.279* 0.260* 0.117

***, ** and * indicate the significance at the 1%, 5% and 10% level, respectively.

4.4.2 Strategic supporting factors for Eco-design

4.4.2.1 Energy and environmental strategy and performance

The adoption of Eco-design is certainly influenced by the environmental “sensitivity”

of designers, and by their ability to catch the opportunities connected to energy

efficiency improvements and reduction in environmental impacts of buildings and of

the related materials (Chong et al, 2009). Our survey confirms that both energy and

93

environment are regarded as key-aspects of the design activity. In detail, 60% of

respondents considered energy efficiency and environmental protection as (at least)

an important objective of their projects.

This strategic relevance of energy and environmental-related issues is reflected also

at operational level. Half of the designers interviewed actually deemed environmental

and energy performance of building materials as the most important attributes that

influence their choice at the design stage.

These results highlight that designers have a high environmental awareness and

consciousness which is positively related to the adoption of Eco-design criteria. The

correlation analysis confirms that there is a strong positive relation between

“environmental strategy” (measured as relevance that environmental protection and

energy efficiency have in their business strategy) and two variables used to measure

the adoption of Eco-design (Table 4.4).

On the other hand, the level of importance of energy and environmental performance

of building materials and design solutions is not correlated to the adoption of Eco-

design. This is probably due to the fact that these performances are commonly

considered a crucial characteristic by designers, but it does not necessarily imply that

the designer who believes they are important adopts environmental criteria in the

building design process. Furthermore, the adoption of energy efficient and

environmentally friendly building materials and related design solutions is influenced

by an effective communication towards public and private clients (Sodagar and

Fieldson, 2008; Hakkinen and Belloni, 2011).

This means that only those designers that operate on the market by relying on strong

communication skills towards their clients and through effective and consolidated

marketing channels, are able to “go green” and launch a new strategy based on the

environmental and energy excellence of their projects.

Furthermore, correlation analysis shows that big design firms assess energy and

environmental performance of building materials and design solutions more

important (Table 4.4).

94

Table 4.4 – Spearman test between environmental strategy variable and designer characteristics and between environmental strategy and performance variables and Eco-design variables

Designer characteristics Eco-design variables Profession Organization

size Project

type Type of

main clients

Eco-design

Eco-design Number

Eco-design Average

Value

Environmental strategy

-0.012 -0.035 -0.019 0.019 0.297*** 0.392*** -0.102

Environmental performance

0.0219 -0.226*** 0.003 -0.009 -0.009 -0.027 0.167

***, ** and * indicate the significance at the 1%, 5% and 10% level, respectively.

4.4.2.2 Cooperation with supply chain

The building and construction sector is characterized by a complex supply chain

composed by several key actors having competing and different interests (Hakkinen

and Belloni, 2011). In particular, the demand pressures on designers and trades is

relevant and influences also all the actors of the supply chains (e.g. service and

material suppliers) (Lönngren et al, 2010; Mentzer et al, 2001).

Literature on supply chain management in the building and construction sector, since

the 1990s, has emphasized the importance of engaging and co-operating with the

actors that operate upstream and downstream (Segerstedt and Olofsson, 2010). Some

studies suggested a more integrated supply chain among contractors, suppliers and

clients (Dubois and Gadde, 2002) and argued that there is a tight relation between

supply chain management and market structure (Cox and Townsend, 1998). Other

studies highlighted the key-role of communications between different actors of the

supply chain during the design process (Dong, 2005; Hassan, 1996). A possible

solution to communication barriers is the partnering which improves social

collaboration in the design process and, consequently, the quality of the design

outcomes (Xie et al, 2010).

Elaborating on these findings of the relevant literature, one can argue that an effective

interaction among actors of supply chain can be a factor that favours the adoption of

an innovative approach as the Eco-design.

95

First of all, our study confirms that designers tend to network with their partners in

the supply chain: 61.7% of respondents stated they are used to cooperate within

supply chain, even if there is still a wide potential for improvement. Moreover, our

study shows that a strong collaboration with the supply chain fosters the adoption of

several Eco-design solutions embodied by more valuable Eco-design projects (Table

4.5).

Table 4.5 – Spearman test between collaboration with supply chain and designer characteristics and between collaboration with supply chain and Eco-design variables

Designer characteristics Eco-design variables Profession Organiza

tion size Project

type Type of

main clients

Eco-design

Eco-design

Number

Eco-design Average

Value

Collaboration with supply

chain

0.1244* 0.0523 -0.0552 0.0892 0.0515 -0.001 0.2745*

***, ** and * indicate the significance at the 1%, 5% and 10% level, respectively.

4.4.2.3 Training

Designers need to be considerably supported in the adoption of the Eco-design

approach during their activity. Vakili-Ardebili and Boussabaine (2005) highlight that

“the lack of knowledge about technologies and environmental aspects at the design

stage might lead to creation of a design not adapted to circumstances and project

surrounding environment”. Therefore, it is important to develop and improve the

know-how and competences of designers through suitable educational and training

programmes, as a pre-condition for them to develop the Eco-design approach, as a

pre-condition for them to develop the Eco-design approach (Howarth and Griffith,

1998; Iyer-Raniga et al, 2010; Hakkinen and Belloni, 2011; Santiago Fink, 2011).

In our study, 54.3% of respondents (100 out of 184) declared they had attended

training courses on Eco-design specifically for building design. Figure 4.3 shows

detailed information about training hours per person: 22.5% of designers attended

more than 30 and less than 50 hours, 17.5% less than or equal to 30 hours and

16.25% more than 160 hours. Based on the experience in other training areas, we can

96

conclude that designers require both professional training courses and more

structured training programmes on Eco-design.

These findings, however, are not validated by our study, which shows how training is

irrelevant in driving the uptake of Eco-design. The Spearman test shows that

engineers are more likely to attend at training courses than architects and that there

is a negative correlation if designers work mainly on retrofit. First of all, these

correlations emphasize that training needs are influenced by designer characteristics.

Furthermore, the results of our study clearly say that the attendance at training

courses is not correlated to Eco-design (Table 4.6). This strengthens the idea that

designers attend training courses on Eco-design because they want to become better

qualified, but this choice does not contribute to increasing the diffusion of the Eco-

design approach.

Figure 4.3 – Classes of training hours per person, number of respondents

97

Table 4.6 - Spearman test between training variable and designers characteristics and between training variable and Eco-design variables

Designer characteristics Eco-design variables Profession Organization

size Project type Type of

main clients

Eco-design

Eco-design

Number

Eco-design

Average Value

Training 0.1759** -0.1213 -0.1536** -0.070 0.087 0.150 -0.003

***, ** and * indicate the significance at the 1%, 5% and 10% level, respectively.

4.4.2.4 Certification schemes

Some studies show that rating systems and labelling programs, such as LEED,

BREEAM or Energy Star, have a crucial role in promoting sustainable buildings (Lee

and Yik, 2004; OECD, 2003; Ofori and Ho, 2004). These instruments, though, have to

be coordinated and mutually consistent, otherwise the presence of too many eco-

labels for green products and the lack of coherence between them may have the

counter-effect of restraining the diffusion of Eco-design projects (Fisher and

Rothkopf, 1989; OECD, 2003; Vine et al, 2006; Lee and Rajagopalan, 2008). In our

survey, 43.3% of designers (58 out of 134) considered the variety of certification

schemes moderately important to foster Eco-design projects, but for only 20.1% (27

out of 134) this was fundamental. On the contrary, 36.6% of respondents (49 out of

134) judged it useless to support the diffusion of sustainable buildings and related

materials, since clients can be confused by too many certification schemes and do not

understand the differences in the guarantees or information they provide and in the

level of accuracy, reliability and independency of the certification source (i.e. third

party). In the current scenario, the certification instruments and their level of

assurance are difficult to compare (Haapio and Viitaniemi, 2008).

The ineffective role of certification scheme is also confirmed by Spearman's test. In

fact, a positive correlation emerges between a good Eco-design performance and the

designers’ opinion that certification schemes do not provide a real support to design

sustainable buildings (Table 4.7). This therefore indicates the need for innovative

instruments that can provide clear and comparable information on environmental

98

performance of materials and equipment (Ding, 2008; Sodagar and Fieldson, 2008;

Hakkinen and Belloni, 2011).

Table 4.7 – Spearman test between certification variable and designer characteristics and between certification variable and Eco-design variables

Designer characteristics Eco-design variables Profession Organization

size Project

type Type of

main clients

Eco-design

Eco-design

Number

Eco-design Average

Value

Certification

0.076 -0.094 0.036 0.130 0.175** 0.199** 0.026

***, ** and * indicate the significance at the 1%, 5% and 10% level, respectively.

4.4.3 Barriers to Eco-design

Relevant literature provides several categorizations of the existing barriers to energy

efficiency and more environmentally-friendly practices in the building and

construction sector (Carbon Trust, 2005; Ürge-Vorsatz et al, 2007; IPCC, 2007).

Overall, the most outstanding studies identify information, behavioural-

organizational and financial barriers to the energy efficiency improvements in

buildings (Chan et al, 2009; Ryghaug and Sørensen, 2009; Nässén et al, 2008;

Intrachooto and Horayangkura, 2007).

According to our study, the highest perceived barrier to Eco-design is the scarce

market demand. In fact, 56.4% of designers (75 out of 133) perceived clients as

uninterested in the application of environmental or energy-related design criteria

(Figure 4.4).

The several public incentives (i.e. fiscal incentives) recently introduced to stimulate

the private demand have achieved good results in the starting phase, yet a more

incisive action is needed, especially in times of economic crisis.

The other barriers are evaluated as much less significant for the uptake of Eco-design:

unsuitable regulations (27.8%), low cooperation with other actors in the supply chain

(27.1%), low cooperation with other actors in the design team (24.8%), higher

project costs with respect to traditional solutions or materials (23.3%).

99

Lack of suitable design software and lack of effective training are even less important

barriers, probably because nowadays there is a wide supply of these services on the

market.

Our correlation analysis shows that “low cooperation with other actors in the design

team” particularly influences in a negative way the adoption of Eco-design because of

the typical way of carrying out design projects is a sequence of separate segments

rather than in an integrated process (Lovins, 1992). This barrier leads to prefer

financial and time-effectiveness criteria over environmental ones during design

process (Lovins, 1992). Therefore, the adoption of the Eco-design approach could be

empowered by fully exploiting the great potential in multi-disciplinary work, bringing

together architects, engineers and others functions responsible for building design

(WBCSD, 2008).

As expected, low cooperation with other actors in the design team and with other

actors in the supply chain are perceived as barriers mostly by designers who do not

cooperate with other actors of the supply chain. These results confirm the importance

for designers to change their traditional way of working relatively alone (WBCSD,

2008). Architects, more than engineers, perceive unsuitable regulations, lack of

suitable design software, and high project costs as barriers. Unsuitable regulations

and difficulties during project execution increase their negative effects on adopting

the Eco-design approach when design firms are small and designers work mainly on

retrofitted buildings with private clients. Moreover, small design firms appear to be

more influenced by lack of suitable training, while designers working on retrofit feel

as relatively higher barriers the lack of suitable design software, high project costs

and lack of suitable training (Table 4.8).

100

Figure 4.4 – Barriers to Eco-design approach during building design activity (where: B1 - uninterested clients in Eco-design approach, B2 - low cooperation with other actors in the design team, B3 – difficulties during project execution, B4 – unsuitable regulations, B5 - lack of suitable design software, B6 – higher project costs, B7 – low cooperation with other actors in building and construction supply chain, B8 – lack of suitable training)

101

Table 4.8 – Spearman test between barriers variables and designer characteristics and between barriers variables and Eco-design variables

Designer characteristics Eco-design variables Profession Organization

size Project

type Type of

main clients

Eco-design

Eco-design

Number

Eco-design Mean Value

B1 - Uninterested

clients in Eco-design approach

0.038 -0.016 -0.034 -0.063 -0.114 -0.132 -0.049

B2 -Low cooperation with other

actors in the design team

-0.1086 -0.093 -0.004 -0.048 -0.186** -0.158 -0.128

B3 - Difficulties

during project

execution

0.0593 -0.2188** -0.1867** -0.1943** 0.1124 0.1451 0.1022

B4 - Unsuitable regulations 0.173** -0.220** -0.165* -0.145* 0.062 0.064 0.022

B5 - Lack of suitable design

software

0.196** -0.063 -0.234*** 0.038 0.013 -0.006 -0.026

B6 – Higher

project costs

0.292*** -0.103 -0.228*** 0.106 0.093 0.024 -0.032

B7 – Low cooperation with other actors in

supply chain

-0.036 -0.121 0.002 -0.034 -0.063 -0.039 -0.020

B8 – Lack of suitable training

0.052 -0.206** -0.150* 0.015 0.016 -0.080 -0.135

***, ** and * indicate the significance at the 1%, 5% and 10% level, respectively.

102

4.5 Discussion and conclusions

The aim of this paper is to understand if and to what extent Eco-design is already

embodied in the current building design process and what factors influence its

adoption.

A first set of results emerging from our study have emphasized that designers today

have a high environmental awareness and consciousness, although a systematic

adoption of the Eco-design approach is far from being fully accomplished. Our work

demonstrates that the internal key factors to foster the inclusion of energy and

environmental criteria in building design are already quite “entrenched” in the sector.

In particular, as acknowledged in the related literature (Hamza and Greenwood,

2009; Kevern, 2011; Santiago Fink, 2011), the majority of designers are used to

attending training courses, stimulated by a strategic interest towards Eco-design, in

order to achieve more specific competencies in energy efficient and more

environmentally-friendly buildings.

The high complexity of Eco-design projects and the small size characterizing Italian

building design firms force designers to cooperate with other actors of the supply

chain, in order to make design process more effective, e.g. by means of gaining

specific knowledge from the contractors and subcontractors and developing and

exploiting a favourable environment for communication (Xie et al, 2010).

Consistently with previous studies (Humphrey et al, 2003; Love et al, 2004), our

analysis shows that cooperation between designers and supply chain positively

influences the adoption of Eco-design for bigger complex building projects. The lack

of cooperation and communication between the parties involved could determine

poor performance of the supply chain in building and construction sector, therefore, a

good cooperation should be supported by trust among actors, de-centralized

responsibility for operational processes and IT support on the entire value-chain

(Lönngren et al, 2010). Although literature attributes a crucial role to designers

(Lovins, 1992; Adeyeye et al, 2007; Chan et al, 2009; Chong et al, 2009,) their

environmental awareness, as emphasized in our study, is not enough in order to

foster the adoption of Eco-design in the building and construction sector (WBCSD,

103

2008). In other words, there is a great potential of growth in terms of number and

economic value of Eco-Design projects that should be supported, for instance, by ad

hoc policy measures. A valuable example could be incentive measures to retrofit

existing buildings, especially considering that the majority of surveyed designers

mainly work on retrofit projects, and that inefficient buildings are a large stock of the

existing buildings (Meijer et al, 2009). An incentive measure, moreover, should take

into account the small dimension of building design firms, which could hinder the

development of Eco-design projects because of their complexity.

Additionally, these measures should be able to remove the main barrier identified by

designers: the “immaturity" of the market. The market still seems to be not mature

and sensitive enough to push designers towards energy efficient and more

environmentally-friendly solutions for buildings. Building users, in particular, mainly

perceived higher risk related to unfamiliar design solutions and techniques, and a

correlated lack of performance information (Hydes and Creech, 2000; Hakkinen and

Belloni, 2011). In this perspective, public policies should also support the spreading

of valuable and verifiable information to citizens and consumers, in order to reduce

the uncertainty towards eco-friendly solutions. Certification schemes could be a

useful tool only if and when they can truly provide information about building energy

and environmental performance and, consequently, to stimulate market demand in

sustainable buildings (Mlecnik et al, 2010). On the other hand, these schemes could

be also ineffective if they do not allow an easy understanding or a clear comparison

among different options (Ding, 2008; Sodagar and Fieldson, 2008; Hakkinen and

Belloni, 2011).

As a result of this survey, a number of recommendations can be formulated. First of

all, an effective adoption of Eco-design can be achieved by implementing design

solutions which really minimize energy consumption, environmental impacts, and life

cycle-cost especially in existing buildings. This objective could be achieved if policy

makers foster major renovations through fiscal incentives such as tax relief, but also

easier administrative procedures. Moreover, policy makers have to support designers

through documents that provide practical information to design without the need for

104

further interpretation of legislative requirements. Also design team and building

supply chain can give their support employing a holistic approach in the first stages of

design process.

Finally, clients should be encouraged to commission or approve energy efficient and

environmentally friendly building materials and design solutions. Therefore, policy

makers but also designers have to provide information about economic and

environmental benefits related to Eco-design approach to clients. Governmental and

local authorities as owners and developers can affect the adoption of the Eco-design

approach and push related building market.

There are some limitations to our study that we have to consider. Even if there are no

significant differences among building design activities across Italy, the focus on a

specific area such as a central region must be taken into account in case of

generalization. Moreover, the use of survey techniques, that collect self-reported data,

is surely valuable but should be integrated by focus groups, which allow a deeper

exploration on the drawbacks and opportunities for building professionals to use

Eco-design. Future research should take into account these limitations, for instance,

performing the analysis of environmental criteria by assessing the building design

projects and accounting for the environmental benefits.

105

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Chapter 5

The contribution of Green Public Procurement to Energy Efficiency Governance in buildings Abstract

In the next years the building and construction sector will tackle the great challenge of improving its energy performance. Therefore, public authorities will play a crucial role fostering demand for energy efficient buildings through Green Public Procurement (GPP) and contributing to energy efficiency governance at local level. Using an econometric analysis, this study investigates which factors influence the development of GPP practices in the building and construction sector as supporting instrument for energy efficiency governance by the municipalities in Tuscany (Italy). The results highlight that GPP practices in the building and construction sector can contribute to the energy efficiency governance at local level if municipality undertakes a path which integrates increasing energy and environmental awareness and technical know-how and expertise.

Keywords: Green Public Procurement, local authorities, governance, energy efficiency, building and construction sector

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5.1 Introduction

The building and construction sector can contribute to sustainable development

generating social and economic benefits to society and reducing related

environmental impacts (UNEP, 2007). In fact, buildings account for about 40% of the

world’s energy use. Therefore, the building and construction sector has to face the

challenge of improving energy use in buildings and consequently minimizing

greenhouse gas emissions. This challenge involves all stakeholders of the complex

supply chain of the building and construction sector (Lovins, 1992). For this purpose,

public authorities can play a crucial role in the sector, not only as regulators but also

as building owners, tenants, developers and financiers. Then, public authorities can

foster a demand for energy efficient buildings that can have a positive impact directly

on the market. According to the United Nations Environment Programme (UNEP)

“governments should seek to explore this opportunity to influence the building sector

not only as a regulator, but also as an actor, putting up a good example for others to

follow” (UNEP, 2007).

The importance of public institutions as market players is confirmed by the great

impact of public procurement on Gross Domestic Product (GDP): between 8 and 25%

in OECD countries and 19.7% in EU-27 countries (OECD, 2000; European

Commission, 2010a). The magnitude of public purchasing power could concretely

stimulate production and consumption trends towards a demand of energy efficient

and environmentally friendly products and services (Li and Geiser, 2005, Edler and

Georghiou, 2007, Ambec and Lanoie, 2008). In particular, buildings belong to a

product group which represents one of the biggest share of GPP budget and

consequently the public procurement associated to the building and construction

sector can exert a considerable impact on the market (Kahlenborn et al, 2011).

In general, the integration of green criteria (e.g. energy saving criteria) in public

tenders could produce environmental benefits (Parikka-Alhola, 2008). For instance,

the selection of greener energy supplies in public sector could bring savings for 60

million tons of greenhouse gases, i.e. 18% of quotas assigned to the European Union

by the Kyoto Protocol. The adoption of energy-efficient computers in all EU public

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authorities could achieve the reduction of 830 thousand tons of CO2 released in the

atmosphere (Ochoa and Erdmenger, 2003). The study of PricewaterhouseCoopers et

al. (2009) estimates an average reduction of CO2 emission of 25% related to adoption

of Green Public Procurement (GPP) practices in 2006-2007 in seven European

countries (Austria, Denmark, Finland, Germany, Great Britain, the Netherlands and

Sweden) for ten product groups9 analysed. The adoption of GPP practices could also

increase the development of innovations, because it fosters the deployment of

solutions to satisfy a “new” demand for products and services (Geroski, 1990;

Marron, 2003). Consequently, GPP could be a policy instrument able to improve

environmental and competitive performance in firms (Testa at al, 2011).

Furthermore, the adoption of GPP practices could support public institutions during

their purchase decisions from an economic point of view, because a careful analysis of

initial capital costs and long-run operating costs among possible solutions would

favour the more energy-efficient and the greener one (PricewaterhouseCoopers et al,

2009; Marron, 2003).

These benefits have fostered the adoption of GPP policies and national plans in many

countries including countries in the EU (Bouwer et al, 2006; DEFRA, 2007;

Kahlenborn et al, 2011) but also the United States (McCrudden, 2004; Swanson et al,

2005), Canada (Brammer and Walker, 2011), South Africa (Bolton, 2006, 2008), Asia

(Ho at al, 2010), Australia (Chang and Kristiansen, 2006) and Japan (Brammer and

Walker, 2011). These GPP policies are more frequently focused on some product

groups and particularly on the building and construction sector (Kahlenborn et al,

2011).

The role of public purchases as a stimulus for energy efficient and environmental

friendly products and services has been a recent strand of research (McCrudden,

2004; Weiss and Thurbon, 2006; Nissinen et al, 2009; Walker and Brammer, 2009).

Furthermore, studies of green procurement carried out in the public sector are only

few compared to studies on environmental and sustainable supply chain

management in the private sector (Walker and Brammer, 2012). Walker and 9 This study analyses the following product groups: cleaning products and services, construction, electricity, catering and food, gardening, office IT equipment, paper, textiles, transport and furniture.

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Brammer (2012) have made a review on existing studies of sustainable public

procurement and found that previous studies have analysed the level of adoption of

GPP in social housing (Hall and Purchase, 2006) and the development of tools to

assist the adoption of GPP in the building and construction sector (Molenaar et al,

2010; Willis, 2010; Tarantini et al, 2011). Using an econometric analysis, this study

investigates which factors influence the development of GPP practices in the building

and construction sector as supporting instrument for energy efficiency governance by

the municipalities in Tuscany, one of the Italian Region with more advanced policies

on public procurement. The analysis considers GPP practices in buildings at

municipal level because they are an effective instrument in order to achieve energy

efficiency improvements in the building and construction sector and can contribute to

carry out an energy efficiency governance at local level. As Laponche et al (1997)

argue, the implementation of energy efficiency improvement is a decentralized

activity and consequently municipalities have an essential role to support the use of

related measures.

The paper is structured as follows. Section 5.2 describes the uptake of GPP in Europe

and Italy. Section 5.3 introduce the relation between governance of energy efficiency

and GPP in the building and construction sector at local level. Section 5.4 explores

theoretical insights and presents the propositions underlying the analytical

framework. Section 5.5 addresses research design and methodology. Section 5.6

presents the main results of the analysis. Finally, Section 5.7 addresses implications of

the results for policy issues and future research.

5.2 The uptake of GPP in Europe and Italy

The European Union (EU) has promoted the adoption of GPP practices as tool in

order to decrease environmental impacts since 2001 (European Commission, 2001a,

2001b). Then, the Directive 2004/18/EC foresees the inclusion of the environmental

criteria in public procurement process (European Commission, 2004). In 2008 the

European Commission established that 50% of overall public tendering procedures

should be green by 2010 and provided information to reduce environmental impacts

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coming from public sector consumption (European Commission, 2008). Several other

European documents continue to support GPP and highlights related benefits (Testa

et al, 2012). The Communication “EUROPE 2020: A strategy for smart, sustainable

and inclusive growth” encourages the use of GPP as instrument to achieve smart,

sustainable and inclusive growth (European Commission, 2010b). The proposal for a

Directive on Public Procurement (COM (2011) 896) recommends the setting of

mandatory objectives and targets in sector-specific legislation and promotes the

development and use of European approaches to life-cycle costing for purchasing

decisions (European Commission, 2010c). Furthermore, European regulations

underline that public authorities play a crucial role through public procurement

supporting the development of efficient end-use of energy, Eco-design of products

and nearly-zero energy buildings (European Commission, 2009, 2010d, 2012).

The European Commission has concretely supported Member States in the

implementation of GPP by publishing a guidebook to include environmental criteria

in tender documents (a first version in 2004 and an updated version in 2011)

(European Commission, 2011a), establishing GPP criteria for 19 product groups10 and

promoting training and awareness events.

The effects of the EU’s efforts to spread and develop GPP practices have been

assessed in a number of studies. In 2006, a study measured the level of GPP across

EU-25 and showed that 7 countries (Austria, Denmark, Finland, Germany, Great

Britain, the Netherlands and Sweden – called as the "Green 7”) adopt more frequently

GPP practices and deploy several kind of instruments to foster GPP (Bouwer et al,

2006). PricewaterCoopers et al (2009) investigate the levels and impact of GPP

among the “Green 7” from 2006 to 2007. This study uses two indicators: percentage

green purchases of total procurement value and percentage green purchases of total

number of contracts. The best countries are the UK with 75% green purchases of total

procurement value and Austria with 62% green purchases of total number of

contracts. There is a wide difference on the level of GPP between the analysed ten

product groups: electricity, office IT and furniture attain the highest scores;

10

http://ec.europa.eu/environment/gpp/eu_gpp_criteria_en.htm

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construction, gardening and transport the lowest ones. This study estimates

economic and environmental benefits related to GPP practices: an average reduction

of CO2 emissions of 25% and an average decrease of overall costs for public

organizations of around 1% in 2006-2007. In particular, construction is one of three

product groups where the adoption of GPP produces a reduction in CO2 emissions

and related costs.

Two other recent studies investigates the uptake of GPP in the EU. Kahlenborn et al

(2011) aim at providing a comprehensive review of experiences in public

procurement not only to promote environmental, but also social and innovative

aspects. This study shows that the majority of countries have developed specific

National Action Plan (NAP) on GPP. Denmark, the Netherlands, Sweden and the UK

are front-runners on GPP with long-standing policies and programmes, but also the

high adoption for requirements in contracts. GPP targets of various Member States as

stated in their NAPs and their total budget for public procurement are used to

estimate GPP budget volumes. Three priority product groups represent the biggest

shares of GPP national budget: buildings, transport and office IT. Moreover, buildings

and transport are priority product groups for GPP throughout Europe. A second study

(Renda et al, 2012a) aims at measuring the level of uptake of core green criteria set at

the EU level by different types of procuring authorities in the EU-27 from 2010 to

2011. The results shows that public authorities in the EU-27 put significant efforts to

diffuse GPP, but have to continue working in order to reach the 50% target of

procurement for many product groups. The uptake of EU core GPP criteria varies

across countries and product groups. Despite construction is a priority product

groups, this product group still lags significantly behind with an uptake level below

20%. This study is broadly in line with the PricewaterCoopers et al (2009) and

Kahlenborn et al (2011)’ s studies, with some exceptions. Belgium, Denmark, the

Netherlands, and Sweden are top performers in terms of number of contracts. Finland

is top performer for value of procurement, followed by the Netherlands, Latvia,

Hungary, and Lithuania.

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Against this background, Italy has been committed to GPP since 2003 (Kahlenborn et

al, 2011). This commitment was confirmed firstly by the adoption of Directive

2004/18/EC and NAP on GPP and then by the carrying out of several national and

mainly regional/local initiatives in order to adopt environmental criteria for

procurement in public administrations (Iraldo and Testa, 2007; Kahlenborn et al,

2011). After the adoption of NAP, Italian Ministry of Environment has defined a set of

minimum environmental requirements for some product/service groups to support

the introduction of green criteria in public tenders (Iraldo et al, 2008). At the

moment, the Ministry of Environment is working on minimum environmental

requirements for buildings. Furthermore, in Italy GPP practices are also boosted by

awards to the “greenest” procurers (e.g. Italian Ministry of Economy has promoted a

GPP award since 200811) and the Italian government engages other levels of

government by creating working groups or similar initiatives to foster the

implementation of GPP policies (Kahlenborn et al, 2011). As stated above, there are

several regional and local experiences to develop GPP practices. In particular,

Tuscany Region has started to promote GPP practices since the nineties. Tuscany has

emanated some regional laws to foster the use of recycled materials and the diffusion

of energy efficient practices in buildings and renewable sources for hot sanitary

water in all local authorities, such as municipalities (Rete delle Agende 21 locali della

Toscana, 2007). Moreover, the regional administration has established grants to

support local authorities for the procurement of recycled plastic products since 2011.

A recent survey shows that Italian public administrations included at least one of the

EU core green criteria in 73% and all EU core green criteria in 30% of contracts

(Renda et al, 2012b). There are differences among product groups for green criteria.

Italian institutions are top “green” performers for office IT equipment, furniture, and

copying and graphic paper, and poor performers for clean service and products, and

construction (Renda et al, 2012b). Tarantini et al (2011) confirm the Italian delay for

activities on GPP of building products. Their results highlight that Italy achieved great

improvements in the adoption of GPP, but needed to develop GPP practices according 11https://www.acquistinretepa.it/opencms/export/sites/acquistinrete/documenti/PREMIO_GPP/Premio_GPP_2012/Premio_GPP_2012-Bando.pdf

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to a more holistic view. Furthermore, they argue that GPP practices should not be

judged as burden but a tool to support evaluation process to award a contract.

5.3 Governance of energy efficiency and GPP in buildings

There is a worldwide consensus on the need for energy efficiency and particularly

energy efficiency in buildings. According to European Energy Efficiency Plan (2011)

buildings along with transport have the greatest energy saving potential. Therefore,

widespread energy efficiency policies are put in place, but their implementation

proceeds very slow and energy efficiency potential is not maximized (Gupta and

Ivanova, 2009; Jollands and Ellis, 2009). Some studies argue that it is crucial to deploy

a suitable energy efficiency governance which is not only technocratic but also

integral and socially oriented (Gupta and Ivanova, 2009; Jollands and Ellis, 2009;

Golubchikov and Deda, 2012).

Drawing on the governance literature and the characteristics of energy efficiency

(Rhodes, 2000; Bulkeley, 2005; Murphy and Yanacopulos, 2005; Hisschemoeller et al,

2006; Biermann, 2007; Improvement and Development Agency for local government,

2008), energy efficiency governance can be defined as “use of political authority,

institutions and resources by decision-makers and implementers to achieve

improved energy efficiency” (Jollands and Ellis, 2009). This definition crosses many

spatial dimensions (local, regional, national and international) including a wide range

of actors (government and non-governmental organisations/subjects). Jollands and

Ellis (2009) state that a governance system consists of two components: resources

and structures for governance and governance activities. The former ones can be

identified as institutional structures, human and financial resources, human capacity

and training, and political support/mandate. The latter ones are represented by

actions associated to the governance system such as: energy efficiency strategies,

policy development processes, funding mechanisms, monitoring programmes,

compliance and enforcement, and R&D activities. This framework needs a multi-level

governance (Bulkeley and Betsill, 2005; Smith, 2007) in order to develop an effective

energy efficiency governance. For instance, energy efficiency targets established by

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national institutional structures influence local level actors and related resources and

capacity. Then, an effective articulation of energy efficiency governance framework

supports the success of energy efficiency policy efforts (International Institute for

Energy Conservation, 2007; Laponche et al, 1997; Limaye et al, 2008).

A multi-level approach in energy efficiency governance is fundamental to implement

energy efficiency in buildings, because the building and construction sector has a high

energy efficiency potential and is a complex sector (Lovins, 1992). Then, the

deployment of energy efficiency in the building and construction sector requires “a

strong institutional milieu” which stimulates the deployment of energy efficient

solutions, informs consumer choice concerning these options, foster behavioural

change and balances different interests (Golubchikov and Deda, 2012). In fact,

progress towards energy efficient buildings needs not just technical solutions but also

social and institutional support (Rohracher, 2001). Furthermore, energy efficiency

policies has to be integrated in the whole policy mix to increase energy efficiency

policy effectiveness in buildings (Hoppe et al, 2011; Golubchikov and Deda, 2012).

Gupta and Ivanova (2009) underline the importance of a global energy efficiency

governance, but the improvement of energy efficiency especially in the building and

construction sector is a decentralized activity and is supported by a network of

partners (e.g. enterprises, local authorities, government services, households, etc.)

(Laponche et al, 1997). In this context local authorities, such as municipalities, can

ensure conditions and solutions for energy efficiency improvements (Rezessy et al,

2006). Local authorities can assume several roles in order to support energy

efficiency in the building and construction sector. In particular, they can be market

initiators, buyers, borrowers and implementers for energy efficiency measures in

buildings (Rezessy et al, 2006). Consequently, local authorities can promote an

energy efficiency policy in the building and construction sector through the

deployment of GPP practices. The adoption of GPP in the building and construction

sector becomes an instrument which contributes to energy efficiency governance.

In any case, it is important to take into account that the success of energy efficiency

policy from local authorities is linked to some preconditions which can predict the

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success and effectiveness of local environmental but also energy efficiency policy

(Barrutia et al, 2007; Evans et al, 2005; Nijkamp and Perrels, 1994). These

preconditions can be identified with the following factors: knowledge mix,

employment of experts, the presence of motivated and knowledgeable people in the

municipal organisation, adequate institutional support to energy efficiency targets in

the whole municipal organisation, sustainable management approach, the presence of

favourable political parties to energy efficiency policies, an official who checks policy

agenda, support from higher levels of government, favourable supporting network

outside the municipal administration and capacity to influence local target groups

(Hoppe et al, 2011). Therefore, it is crucial to analyse the factors which influence the

contribution of local authorities to energy efficiency governance in buildings through

GPP practices.

5.4 Theory and Propositions

5.4.1 Technical and organizational support to the adoption of GPP practices

The adoption of GPP practices can tackle several obstacles. Previous studies have

identified the main barriers which may be informative (i.e. lack of information about

the real environmental impacts of the products and lack of guidelines by higher-order

authorities), organizational (i.e. lack of organizational resources, difficulty in the

preparation of call for tenders and purchasing, difficulty in finding suppliers, lack of

co-operation between authorities) and political (i.e. lack of political support) (Bouwer

et al, 2006; Parikka-Alhola et al, 2007, Walker and Brammer, 2009, Testa et al, 2012).

In particular, some studies underline the difficult implementation of GPP practices in

the building and construction sector (Bouwer et al, 2006; PricewaterhouseCoopers et

al, 2009; Renda et al, 2012a). The adoption of GPP in this sector needs technical

expertise and know-how which often are missing in the environmental and financial

department of a municipality. In fact, a recent study on practices and issues regarding

green procurement of construction contracts in Sweden reveals that the lack of

knowledge is one of the limits on the application of environmental procurement

preferences in constructions contracts (Varnas et al, 2009).

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Several studies have analyzed effective tools to support the implementation of green

procurement in local authorities such as suitable legislation and information

(Günther and Scheibe, 2006; Thomson and Jackson, 2007; Fet et al, 2011). In order to

foster the development of GPP, governments have a fundamental role consisting in

the provision of clear legislative and regulatory support in decentralised public

organizations (Lundqvist, 2001).

Many actions were adopted by European Commission and Italian Government in

order to overcome related barriers which hinder the implementation of GPP for all

product groups, but the achieved results are not fully satisfying. For instance, the

ambitious EU target of 50% of GPP by 2010 was not fully achieved. For this reason,

our study aims to verify if these instruments and tools were really effective to

stimulate GPP practices in the buildings and construction sector which is one the

most crucial and representative product group. The first proposition states that:

Proposition n. 1: The knowledge of GPP toolkit and official documents provided by

national governments and European Union policy makers increases the probability to

adopt GPP practices in the building and construction sector

The attendance of civil servants at ad hoc training sessions on GPP is a signal of the

commitment of public authorities and procurement professionals to foster the

implementation of GPP practices (Drumwright, 1994). In fact, the lack of training is

one of the most important informative barriers to GPP (Bouwer et al, 2006) and

represent a crucial factor to stimulate the adoption of GPP practices (Carter et al,

1998; Powell et al, 2006) and in particular in the building and construction sector.

The second proposition states that:

Proposition n. 2: The participation of public civil servants to ad hoc training sessions on GPP increases the probability to adopt GPP practices in the building and construction sector

The lack of internal expertise and opportunity to increase internal capabilities on GPP

was often considered a consequence of the small size of the public authorities. Some

124

studies find a correlation between the size of the public organization and the focus on

green procurement in the first years of implementation of GPP practices (Michelsen

and de Boer, 2009; Testa et al, 2012). Significant progress has been achieved in the

last years in terms of uptake of GPP also in small municipalities, therefore the

assumption that small-sized public authorities influence negatively the development

of GPP practice is not anymore convincing. This evidence leads to third proposition.

Proposition n. 3: The size of public authority does not affect the probability to adopt GPP

practices in the building and construction sector

5.4.2 Energy efficiency and environmental strategy and EMS

The adoption of GPP can belong to a broader environmental strategy of public

authorities, i.e. relevance that environmental protection and energy efficiency have in

their decisions and activities. According to some scholars public administrations tend

to overestimate their environmental strategy (Varnas et al, 2009; Ochoa and

Erdmenger, 2003). Therefore, an environmental strategy cannot be sufficient to

foster the development of GPP in a complex sector as the building and construction

one. These considerations suggest the following proposition:

Proposition n. 4: The presence of an overall environmental strategy in public authorities

does not affect the probability to adopt GPP practices in the building and construction

sector

The implementation of GPP practices in the building and construction sector can be

supported by a special tool such as environmental management system (EMS), which

can be deployed through formal standards such as ISO 14001 and EMAS (Iraldo et al,

2009). In fact, an EMS foresees the definition of a scheme for organizations in order to

manage their environmental impacts and continuously improvement of their

environmental performance. Italian public administrations adopt more frequently,

than other EU Member States and OECD countries, certified EMSs. For instance, in

June 2012 Italian public authorities were more than the 20% of total EMAS

registrations and the public sector represented the first sector for number of EMAS

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registrations. In general, public administrations choose to implement an EMS because

they are influenced by their characteristics and functions (Lozano and Vallés, 2007,

Daddi et al, 2010).

Consequently, the adoption of an EMS enable to define operative procedures to

manage indirect environmental aspects which ISO 14001 and EMAS define as “an

environmental aspect which can result from the interaction of an organization with

third parties and which can, to a reasonable degree, be influenced by an

organization”. Among all organizations, public authorities tackle several indirect

environmental aspects because of the way they provide their services and carry out

their land and energy planning and control powers (Von Malmborg, 2003; Emilsson

and Hjelm, 2007). In particular, public administrations with a certified EMS have to

manage the indirect environmental impacts associated with the environmental

performance and practices of their contractors, subcontractors and suppliers in the

building and construction sector. Then, EMS can help tenders to take into account

environmental management measures during service or work (Varnas et al, 2009).

Therefore, EMS and GPP could create a synergy supporting relative goals (Rüdenauer

et al, 2007). A recent study has not found a very significant relation between ISO

I4001 adoption and GPP, because public administrations start to focus on “direct

environmental aspects” and thus leave out the management of the “indirect” ones

(Testa et al, 2012). Starting from these considerations, and employing a sample of

Tuscan municipalities, this analysis aims at demonstrating that the stage of adoption

of a certified EMS is not a sufficient to stimulate the adoption GPP in the building and

construction sector. The last proposition states that:

Proposition n. 5: The Stage of EMS adoption in public authorities does not affect the

probability to adopt GPP practices in the building and construction sector

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5.5 Research design and methodology

5.5.1 Sample

This analysis uses primary data from a questionnaire survey conducted among

municipalities of Tuscany. Tuscany Region is traditionally committed in the diffusion

of GPP in local public administrations (Rete delle Agende 21 locali della Toscana,

2007). Therefore, Tuscany confirms the diffused and increased experiences in

supporting GPP in some Italian regions (Iraldo and Testa, 2007).

The survey was implemented between September and December 2011 by an online

questionnaire. After telephone calls in order to identify qualified department for GPP

practices in the building and construction sector, we sent via e-mail questionnaire

and cover letter to a random sample of 81 municipalities out of a total number of

287. Among these 287 municipalities of Tuscany, we considered all 10 provincial

capitals as self-representative and then we added 71 municipalities randomly

selected which are representative with 95% of confidence level and a sample error of

10%. After 15 days from the first forwarding, we called back municipalities which had

not yet filled in the questionnaire in order to know if municipalities received the

questionnaire and needed to be supported for the filling. In case of failed reception,

we sent again questionnaire and cover letter. After 30 and 45 days from the first

forwarding, we called back non-respondents to remind them to fill in the

questionnaire.

The questionnaire included 21 questions structured around five categories of

information: 1) general information of municipality; 2) awareness on environmental

issues at strategic level; 3) description of procurement function; 4) level of

implementation of GPP practices 5) identification of drivers and barriers to GPP

practices.

The survey collected 62 responses, from all Provinces of Tuscany, with a response

rate of 76.5%. The respondents were purchasing, environmental and public works

managers. More detailed information about respondent municipalities and sampled

population are summarized in Table 5.1.

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Table 5.1 – Sample’s details

Population % of population Number of municipalities

% of municipalities

Tuscany 3,749,813 287 Sampled municipalities

1,946,028 51.9 81 28.6

Respondent municipalities

1,026,114 27.4 62 21.6

5.5.2 Model and variables

In order to analyse which factors influence the GPP practices in the building and

construction sector in the Tuscany region, the study uses the following theoretical

model:

GPP in buildings = 0 1 (Knowledge of GPP toolkit) 2 (Training on GPP) 3

(Population) 4 (Environmental strategy) 5 (Stage EMS adoption) 6 (Structure

of purchasing process)

(1)

As reported by literature, the diffusion of GPP practices has been measured in several

ways: questionnaires (Ochoa and Erdmenger, 2003; Brammer and Walker, 2011;

Testa et al, 2012), interviews (Michelsen and de Boer, 2009; Varnas et al, 2009) and

tender analysis (Bouwer et al, 2006; Nissinen et al, 2009). Each method has

advantages and disadvantages (Testa et al, 2012). This study collected data by a

survey questionnaire seeking to provide an overview of the nature of engagement

with GPP practices in the building and construction sector within sample in Tuscan

municipalities.

In order to obtain more robust results, the dependent variable, defined as the level of

GPP, was measured in two ways. Respondents were asked to indicate if their

administrations have set up procedures according to GPP practices in the building

and construction sector. Therefore, we constructed a binary variable. Then,

participants were asked how many categories of application (i.e. work, service and

supply) for GPP practices they had adopted. By using four alternatives provided we

obtain a categorical variable. To avoid possible biases associated to a different

128

interpretation of green procurement, a procurement is considered as “green” if it uses

the environmental criteria identified at EU and/or Italian level in their official

guidelines and document in each stage of the tender. Thus, a methodological annex

was sent to interviewees and a sample of tenders was controlled in order to test the

reliability of answers.

This analysis used a set of binary variables to measure if public procurers were

trained to include energy efficient and environmental criteria during purchasing

process; and if procurers frequently used the GPP toolkit and official documents

provided by national and European policy makers.

The size of public authority was measured using population data from 2011 National

Demographic Balance12 published by the Statistical National Institute (ISTAT) for all

Italian municipalities.

The adoption of an environmental management system was measured considering

the stage of adoption (not adopted, in phase of implementation and adopted) of a

certified EMS (ISO 14001 standard or EMAS regulation) by collecting this information

on the official web-site of Italian Accreditation Body – Accredia for ISO 14001 and of

Italian Competent Body for EMAS registration.

Finally, the study also takes into account the level of importance of environmental

issues for municipalities at the strategic level and the structure of purchasing system

in order to capture the effect of political and organizational structure. Table 5.2

presents descriptive statistics for the key variables.

Since the different nature of two dependent variables, a logistic regression analysis

was adopted to test the adoption of GPP practices in the building and construction

sector and an ordinal logistical regression appears the most suitable model for testing

the level of adoption of GPP in the building and construction sector. Another aspect to

take into account is the potential presence of common method biases that generally

affect survey data (Podsakoff et al, 2003). We have adopted several procedural

remedies to reduce biases such as: minimizing item ambiguity avoiding vague

concepts, complicated syntax and unfamiliar terms; keeping questions simple, 12 National Demographic Balance consists of last census data updated by annual births and deaths and annual changes of residence.

129

specific, and concise; avoiding the use of bipolar numerical scale values and providing

verbal labels for the midpoints of scales and by guaranteeing respondents anonymity.

Table 5.2 – Descriptive statistics Variable Description Obs Mean Std.

deviation Min Max

GPP in buildings 1 if municipality adopts GPP practices in purchasing function for the building and construction sector 0 if municipality does not adopt GPP practices in purchasing function for the building and construction sector

48 .6875 .4684 0 1

Level of GPP in buildings

1 if municipality does not adopt GPP practices in purchasing function for the building and construction sector, 2 if municipality has adopted GPP practices in only one category of application (work or service or supply), 3 if municipality has adopted GPP practices in two categories of application (work, service and supply), 4 if municipality has adopted GPP practices in all three categories of application (work, service and supply)

48 2.292 1.11 1 4

Training on GPP 1 if public procurers were trained to include energy efficient and environmental criteria during purchasing process, 0 if public procurers were not trained to include energy efficient and environmental criteria during purchasing process

45 .333 .476 0 1

Knowledge of GPP toolkit and guidelines

1 if public procurers frequently used the GPP toolkit and official documents provided by national and European policy makers, 0 if public procurers did not use the GPP toolkit and official documents provided by national and European policy makers

45 .467 .504 0 1

Environmental strategy

Level of importance for environmental issues for municipality at the strategic level: five-point Likert scale 1 indicating no importance and 5 extremely important

62 3.242 .8235 1 5

Stage EMS adoption

1 if municipality did not adopt any a certified EMS, 2 if municipality is implementing a certified EMS, 3 if municipality has adopted a certified EMS

62 1.435 .760 1 3

Population Number of residents in municipality 62 16550 28929 504 161131

Structure of purchasing process

1 if municipality has a centralized purchasing function, 2 if municipality has both centralized and decentralized purchasing function, 3 if municipality has decentralized purchasing function

48 2.458 .797 1 3

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5.6 Results

The analysis of determinants of GPP adoption and level of GPP adoption in the

building and construction sector showed that the knowledge of GPP toolkit and

official documents and the attendance of civil servants at training courses on GPP are

strong drivers to foster GPP practices in the building and construction sector. Both

confirmed the first two propositions: “Training on GPP” and “Knowledge of GPP

toolkit and guidelines” increase the probability to adopt GPP practices in the building

and construction sector (Table 5.3 and 5.4). Therefore, European and national efforts

through information and awareness campaigns about GPP advantages and related

training courses start to give positive outcomes in the public authorities (Iraldo et al,

2007; Testa el al, 2012). In particular, the lack of knowledge is an important barrier to

the implementation of GPP in the building and construction sector (Varnas et al,

2009). These results underline the urgency to provide more and more detailed

technical guidelines to support civil servants during purchasing process for a complex

product such as a building and related materials. Regarding the Italian context, a

stimulus to the development of GPP in the building and construction sector might

come from the approval of national minimum environmental requirements for

buildings. The actual level of development of GPP in the European and Italian building

and construction sector points out a great potential for the improvement of energy

performance in buildings (Meijer et al, 2009; Bouwer et al, 2006). Therefore, suitable

training programmes and toolkits can improve also the quality and effectiveness of

adoption of GPP practices in the building and construction sector. This aspect is

highlighted by the high odds ratios associated to “Training on GPP” and “Knowledge

of GPP toolkit and guidelines” in both equations (Table 5.3 and 5.4). In particular,

guidelines for GPP practices increase the probability of GPP adoption and related

quality in the building and construction sector more than training courses on GPP.

Furthermore, these instruments can increase the internal capabilities of the entire

municipal organization, because they assume an interdisciplinary role influencing

positively individual knowledge of civil servants but also decision making process of

entire local authorities (Nissinen et al, 2009).

131

The population (as a proxy of municipality’ s size) does not influence the GPP

adoption and the level of GPP adoption in the building and construction sector. We

believe that this finding is not affected by the adopted measure of municipality

dimension, since a recent study - which used the natural logarithm of the

organisation’s total purchasing expenditure as proxy of public organization

dimension - confirms that organisation’s dimension does not influence the adoption

of sustainable procurement practices (Walker and Brammer, 2012).

The two estimated equations do not find that the presence of general environmental

strategy in municipalities is a significant driver for the development of GPP practices

in the building and construction sector. These results confirm a common trend among

public authorities to overestimate the application of green choices (Varnas et al,

2009; Ochoa and Erdmenger, 2003). Probably, the adoption of an environmental

strategy needs a formalisation within organisation and time to be implemented.

The stage of EMS adoption is not significant in the two equations: the GPP adoption

and the GPP level of adoption in the building and construction sector. Probably, the

implementation of EMS is not sufficient to support the adoption of GPP practices in

the building and construction sector. Several studies emphasise the difficulty of

implementing EMSs in the construction industry since this industry has specific

characteristics which hinder the application of traditional management systems

(Gangolells et al, 2011; Ball, 2002; Griffith and Bhutto, 2008). Consequently, the only

adoption of EMS does not guarantee a successful development of GPP practices in the

building and construction sector. EMS can be rather a first step which should be

followed by training and guidelines on GPP.

Finally, this study finds that the structure of purchasing process is not significant

regarding the GPP adoption and the level of GPP adoption in the building and

construction sector (Table 5.3 and 5.4). This result suggests that GPP practices are

promoted by the expertise of civil servants in municipalities.

132

Table 5.3 – Results of logistic regression analysis for GPP adoption in the building and construction sector GPP in buildings

Coeff. Odds Ratio z

Training on GPP 4.53 93.54 2.16**

Knowledge of GPP toolkit and guidelines

4.78 119.11 2.22**

Environmental strategy .3871 1.47 0.44

Stage EMS adoption .813 2.25 0.97

Population .0000777 1.00 1.38

Structure of purchasing process

-.954 .385 -1.05

Constant -3.48 .030 -1.02

Number of observations 44

LR chi2 22.32***

Pseudo-R2 0.4054

***, ** and * indicate the significance at the 1%, 5% and 10% level, respectively.

Table 5.4 – Results of ordered logistic regression analysis for the level of GPP adoption in the building and construction sector Level of GPP in buildings

Coeff. Odds Ratio z

Training on GPP 3.54 34.51 2.72***

Knowledge of GPP toolkit and guidelines

4.20 67.12 3.32***

Environmental strategy .045 1.05 0.09

Stage EMS adoption .656 1.93 1.56

Population .0000186 1.00 0.95

Structure of purchasing process

-.560 .57 -1.44

Number of observations 44

LR chi2 25.46***

Pseudo-R2 0.2115

***, ** and * indicate the significance at the 1%, 5% and 10% level, respectively.

133

5.7 Discussion and Conclusions

This study aimed to explore factors which influence the development of GPP in the

building and construction sector as supporting instrument for energy efficiency

governance by local authorities such as municipalities.

The results underline the strong importance of qualified and well-informed personnel

on GPP practices in the building and construction sector. An increasing awareness on

GPP practices fosters the complex supply chain of the building and construction

sector to improve energy performance of buildings and related materials. Moreover,

suitable training activities and guidelines for civil servants can develop the

knowledge of overall local authorities on environmental and mainly energy efficiency

issues. Moreover, the development of GPP practices in the building and construction

sector can lead municipalities to complement the energy management of their

building stock with the promotion of energy efficiency measures also in residential

buildings (Hoppe et al, 2011). Consequently, this process of internal growth in the

municipalities might improve their contribution to energy efficiency governance in

the building and construction sector. As European legislation foresees, local

authorities have a crucial role and have to increase their efforts to implement energy

efficiency measures in buildings (European Commission, 2012).

The significance of guidelines on GPP practices in the building and construction

sector highlights the role of the EU and national governments which have to support

decentralised public authorities through clear regulations and technical guidelines in

order to raise their level of awareness and expertise, but also to create a favourable

context for the adoption of GPP (Lundqvist, 2001; Bouwer et al, 2006). Therefore, a

coordination between central governments and municipalities is needed to improve

the development of GPP practices in the building and construction sector and the

deployment of energy efficiency governance at local level (Sperling et al, 2011).

The fact that the dimension of municipalities does not influence the adoption of GPP

practices in the building and construction sector can raise some evaluations. As

mentioned above, the development of GPP in the building and construction sector

requires specialised personnel. Therefore, the support provided by training and

134

guidelines on GPP practices is decreasing possible differences among small and large

municipalities. On the other hand, strong budget constraints affect all public

authorities because of current economic crisis. Consequently, a suitable knowledge of

GPP practices for the building and construction sector might lead to shift from the

purchase cost approach to life-cycle cost approach in order to manage more

efficiently public resources (Sterner, 2002; Varnas et al, 2009).

Another relevant issue to be discussed concerns the relationship between the

presence of a general environmental strategy in municipalities and the development

of GPP in the building and construction sector. The presence of a general

environmental strategy in the local authorities might foster the adoption of GPP

practices in the building and construction sector only with a strong leadership

(Bansal and Roth, 2000). This leadership has to be able to foster the transformation of

environmental and energy awareness into effective technical solutions for buildings

and related materials. Otherwise, the implementation of GPP faces the overestimation

of green preferences and thus the plucking “low hanging fruits” related to energy

efficiency measures in local authorities (Rezessy et al, 2006; Hoppe et al, 2011).

A controversial result regards the lack of significance of the relationship between the

stage of EMS and the development of GPP practices in the building and construction

sector. As Emilsson and Hjelm (2002) state, the implementation of EMS is often

considered as a project and not as continuous and integrated processes in local

authorities in order to improve organisation’s environmental performance. Moreover,

some studies show that public authorities apply EMSs focusing mainly on “direct

environmental aspects” and overlooking the importance of the “indirect aspects”

which are associated to the environmental performance and practices of their

contractors, subcontractors and suppliers (Von Malmborg, 2003; Testa et al, 2012).

For this reason, the adoption of EMS does not necessarily foster the deployment of

GPP initiatives in the building and construction sector triggering a synergy. Then, the

municipality’ s motivation is crucial to drive an effective implementation of EMS in

order to support other municipal policies such as GPP practices (Emilsson and Hjelm,

2002).

135

These findings highlight that GPP practices in the building and construction sector

can contribute to the energy efficiency governance at local level, if municipality

undertakes a path which integrates increasing energy and environmental awareness

and technical expertise. In fact, the energy efficiency governance in buildings needs

resources and structures for governance, i.e. technical expertise and know-how, and

governance activities, i.e. energy efficiency strategies (Jollands and Ellis, 2009). Since

the public procurement decisions are complex processes where several external

stakeholders and decision makers within administration act (Günther and Scheibe,

2006), the implementation of GPP initiatives in the building and construction sector

constitutes a sort of training for municipalities in order to deploy an energy efficiency

governance at local level.

This study presents some limitations. The data were self-reported through a

questionnaire survey. Despite drawbacks associated with the questionnaire, the

study used this method in order to collect information about “green” purchase

practices, structure and characteristics of municipalities which tender analysis is

unable to provide. Despite the widespread presence of experiences to develop GPP

practices in Italian regional and local authorities decreases possible differences

among Italian regions and the focus on municipalities in Tuscany must be taken into

account in case of generalization.

There are several implications of the study for policy makers and public procurement

practitioners and for future research. Policy makers may need to be supported to

improve the level of awareness and know-how on GPP instrument and its

involvement in energy efficiency governance in the building and construction sector

within municipalities. In addition, policy makers should start to consider energy

efficiency as an overall objective which includes the development of GPP practices as

a supporting tool in their municipality. Practitioners should employ their expertise to

steer municipalities towards more cost-effective energy efficient measures in their

buildings and to improve interaction with actors of supply chain in the building and

construction sector. Finally, further research is needed to investigate the relationship

136

between energy management of municipal building stock and energy efficiency policy

in residential and commercial buildings.

137

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Chapter 6

Conclusions

6.1 The outline of research work

It is recognized worldwide that the building and construction sector can support the

implementation of energy efficiency improvements in order to achieve the transition

to a low-carbon economy. As a result, many countries assume the improvement of the

energy efficiency of buildings as a priority of their policy agendas. This commitment

entails a great challenge not only for policy makers, but also for all actors related to

buildings and their components. Thus, the challenge of improving the energy

efficiency of buildings requires a multidisciplinary approach which fosters the

adoption of energy efficient technologies but also of suitable policies and energy

efficient consumption patterns.

Therefore, this thesis has analysed the transition process which the building and

construction sector has to tackle in order to achieve energy efficient buildings and to

exploit great energy saving potential. In particular, it has investigated the influencing

factors and actors related to energy efficiency governance in the building and

construction sector. Firstly, this analysis has taken into account the complexity of the

building and construction sector where several actors interact regarding rules and

institutions. To understand the transition process towards energy efficient buildings,

the thesis has adopted the concept of socio-technical system to identify components

and actors of the building and construction sector (Rohracher, 2001; Geels, 2004).

Then, the analysis has introduced the multi-level governance perspective in order to

analyse the adoption of actions, tools and policies to develop energy efficiency

improvements in buildings concerning different levels (Bulkeley and Betsill, 2005;

Smith, 2007; Jollands and Ellis, 2009) and to appraisal the deployment of energy

efficiency targets from international to local institutions. Finally, the interaction

between multi-level governance perspective for energy efficiency in buildings and the

socio-technical system associated with the building and construction sector has

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provided useful managerial implications for policy makers and practitioners in order

to improve and accelerate the transitions towards energy efficient buildings.

Since the development of energy efficiency in building is known mainly as a technical

issue, Chapter 2 offered a literature review on main characteristics associated with

the implementation of energy efficiency in buildings: energy consumption in

buildings, energy efficiency technical solutions, the actors of the building and

construction sector, barriers and policies. The review concluded that there is the need

to integrate the efforts to implement energy efficiency including key actors at all

levels (international, national and local) in order to achieve an effective energy

efficiency governance in buildings. Then, this thesis focused on two crucial aspects

which influence the transition towards energy efficient buildings: rules/institutions

(Chapter 3) and key actors in the building and construction sector (Chapter 4 and

Chapter 5) .

Chapter 3 aimed at providing an overview of the current national regulatory

framework in the EU Member States in order to investigate the efforts to develop an

energy efficiency governance from EU to national/regional level. The analysis focused

on three specific aspects which constitute the complex energy efficiency issue: 1)

integration of energy efficiency and renewable energy requirements, 2) translation of

investments in energy saving into economic value, 3) commitment towards “nearly

zero-energy” target. This analysis showed a heterogeneous approach among

European countries which can hinder the development of energy efficiency

governance from EU to local level. Then, country’s profile assumes a crucial role in

the development of national regulatory framework in each European country.

Therefore, the different approach adopted in national regulatory frameworks is not

negative, but points out the importance of understand countries’ peculiarities.

Understanding these peculiarities helps to strengthen and improves the design of the

sharing of best-practices and energy efficiency governance among Member States.

Chapter 4 aimed at understanding if and to what extent Eco-design is already

embodied in the current building design process and what factors influence its

adoption. To understand how to foster and simplify the implementation of the Eco-

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design approach in buildings, it has analysed the characteristics of actors, in

particular designers, and related social processes that support the production and

development of buildings. The emerging results have emphasized that designers

today have a high environmental awareness and consciousness, although a

systematic adoption of the Eco-design approach is far from being fully accomplished.

The analysis stressed the role of information about building materials and design

solutions as an important driver in order to push an immature market. It identified

three main sources of information: policy makers, designers and certification

schemes. Finally, it underlined the importance of collaboration between clients, policy

makers, designers and supply chain in order to achieve energy efficiency in buildings.

Chapter 5 aimed at investigating influencing factors of GPP practices in the building

and construction sector as support for energy efficiency governance in buildings at

local level. The results underlined the strong importance of qualified and well-

informed personnel on GPP practices in the building and construction sector.

Furthermore, the analysis highlighted that GPP practices in the building and

construction sector can contribute to the energy efficiency governance at local level if

municipalities have undertaken a path which integrates increasing energy and

environmental awareness and technical know-how and expertise. From an operative

point of view, the energy efficiency governance in buildings needs resources and

structures for governance, i.e. technical expertises and know-how, and governance

activities, i.e. energy efficiency strategies (Jollands and Ellis, 2009). Then, local

authorities has to provide themselves with these components, but their efforts should

be supported by other actors of the building and construction sector.

6.2 Concluding remarks

This thesis points out the presence of heterogeneous approaches in order to carry out

international energy efficiency targets at national level. This evidence can hinder the

transition towards energy efficient buildings and more generally low-carbon

economy, but it is increasing the discussion about the development of an effective

global governance of sustainable energy and energy efficiency (Florini and Sovacool,

150

2009; Gupta and Ivanova, 2009; Jollands and Ellis, 2009). Despite the difficulty of

carrying out international energy efficiency targets at national and then local level, it

is worldwide considered a win-win option for all states to cooperate to achieve

energy efficiency (Karlsson-Vinkhuyzen et al, 2012). Thus, international institutions,

such as the EU, can establish energy efficiency targets, but then should constantly

monitor policies, actions and regulations adopted in order to implement energy

efficiency and particularly energy efficiency in buildings (Sovacool, 2011). Probably, a

multi-level governance perspective, where “multiple overlapping and interconnected

horizontal spheres of authority are involved in governing particular issues” (Bulkeley

and Betsill, 2005), might support the integration of international targets in different

countries taking into account their specific characteristics.

Furthermore, this thesis underlines and confirms the importance of cooperation

among the actors of the building and construction sector in order to carry out an

effective energy efficiency governance in buildings. Unfortunately, the lack of

information about energy efficiency measures and related benefits is a crucial issue

for practitioners and policy makers. Therefore, a first attempt of cooperation among

the actors of the social-technical system associated with the building and

construction sector might concern the exchange of information about all energy

efficiency issues. This exchange of information should develop an ongoing

communication system among all actors of the building and construction sector.

These findings shed light on the issue of change in social and institutional structures

in order to achieve energy efficiency targets. In particular, the thesis argues the

involvement of policy makers and practitioners at all levels in the transition towards

energy efficient buildings, because they belong to and are equally involved in same

socio-technical system associated with the building and construction sector.

6.3 Limitations

The overall analysis included in this thesis was carried out at two different levels:

international (Chapter 3) and regional (Chapter 4 and Chapter 5). This choice has to

be taken into account in the examination of results. The mentioned approach was

151

adopted, because the thesis aimed at articulating the analysis according to a multi-

level governance perspective in order to investigate the development of energy

efficiency at different levels. In particular, the analyses carried out in Chapter 4 and

Chapter 5 were focused on Italy, because the Italian building and construction sector

has to tackle the same next challenge for energy efficiency as other European

countries and there is a lack of studies in Italy (Albino and Berardi, 2012). Finally,

another limitation might be represented by data. The data employed were collected

by questionnaire surveys because a lack of reliable data on the diffusion of energy

efficiency improvements and related issues. To avoid common method bias, several

procedural remedies were adopted as described in the previous chapters.

6.4 Managerial implications

Despite limitations mentioned above, the thesis can provide new and useful

contributions to support the implementation of energy efficiency improvements in

buildings. In particular, this research work provides some managerial implications

regarding policy makers and practitioners from a perspective of organisational and

inter-organizational learning.

The transition towards energy efficient buildings is a great challenge for the actors of

socio-technical system associated with the building and construction sector at

international, national and local level, in particular for policy makers and

practitioners. In fact, this transition influences organisational but also inter-

organisational learning processes where policy makers and practitioners should be

able to balance the exploitation of existing knowledge and technologies and the

exploration of new knowledge and technologies (March, 1991; Andriopoulos and

Lewis, 2009; Eriksson, 2012) in order to achieve an organisational ambidexterity

(Duncan, 1976).

Policy makers have a multiple role as regulators and clients. As regulators, they have

started to make efforts at national and regional level since some years because they

are fostered by the international commitment to implement energy efficiency in

buildings. Unfortunately, there are two open issues which influence the effectiveness

152

of regulations and policies related to energy efficiency in buildings: monitoring and

enforcement. In fact, public authorities tackle the difficulty of monitoring the

effectiveness of their regulatory and policy framework and enforcing the application

of regulations. Then, policy makers have to cooperate with all actors influenced by

regulations and policies in order to improve the exchange of information which can

support monitoring and enforcement phases. It is also important to improve the

exchange of information between central and local institutions. As clients, they have

to choose technical solutions for public (new and existing) buildings, but very often

they need a suitable technical expertise and clear information about building options

and related materials. Therefore, they have to convert their environmental and

energy awareness into practices through training programs for personnel but also

collaboration with the actors of supply chain.

Practitioners, such as designers, deal with clients which need increasing information

about energy efficiency measures related to buildings. Accordingly, they have to

provide more clear information which might support clients during their decision

process. Moreover, practitioners have to intensify relationships with other actors of

the building and construction sector because these stable relations help the transition

towards the development of energy efficiency improvements in buildings. Finally,

practitioners has to adopt a long-term thinking during their work activities and in

particular during design process.

The above-mentioned peculiarities of policy makers and practitioners underline the

importance of ambidexterity perspective in the building and construction sector in

order to implement energy efficiency measures in buildings. These findings confirm

Eriksson’s argumentations (2012) about the risk of inadequate extent of exploration

and exploitation in the building and construction sector. In particular, collaborative

tools, such as teambuilding activities, integration of supply chain and joint IT-tools,

can be drivers for an ambidexterity perspective not only at organisational but also

inter-organisational level, because these instruments create a common identity and

motivate different actors to cooperate according to a long-term perspective.

153

6.5 Future research

The thesis has integrated socio-technical system concept with multi-level governance

perspective in order to investigate key actors and influencing factors for the

development of energy efficiency improvements in buildings. Firstly, the analysis

focused on a descriptive analysis of national regulations among the EU Member

States, but a next and useful step will consist of the impact assessment of regulatory

and policy instruments adopted in the national legislation employing quantitative

data. Then, the thesis examined influencing factors for the adoption of the Eco-design

approach from designers perspective. To enhance the analysis of interactions among

actors belonging to the socio-technical system associated with the building and

construction sector, it is worth investigating the role of the material and equipment

suppliers in the push of immature market for energy efficiency measures in buildings

but also examining the relationship between the material and equipment suppliers

and their clients. Finally, this thesis concerned factors related to the development of

GPP practices in the building and construction sector as supporting instrument for

energy efficiency governance at local level. To understand and improve the support of

local public authorities in the implementation of energy efficiency in the building and

construction sector, further research is needed to identify and analyse other

supporting instruments for energy efficiency governance in buildings at local level

such as energy audits in public buildings.

154

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