Energy performance certificates for single-family houses continue to be ineffective

Since 2009, all single-family houses sold in Sweden must have an energy performance certificate, which is ordered and paid for by the house owner. If the building’s energy performance can be improved, the energy performance certificate must also contain recommendations on cost-effective measures.

The system is based on an EU directive. In Sweden, municipal energy and climate advisory services play an important role in implementing the EU directive. The advice is mainly financed by central government with approximately SEK 80 million* per year.

The Swedish National Audit Office (Swedish NAO) has audited whether the system is designed as an effective policy instrument for energy efficiency in single-family houses. The audit shows that it has only little potential to live up to all expectations.

A majority of house buyers read the energy performance certificate, but are only marginally affected in their choice of house or willingness to improve energy efficiency. Few house buyers are familiar with municipal energy and climate advisory services.

“Almost half of the buyers state that they completely disregard the energy performance certificate when choosing to buy a specific house. The measures recommended in the energy performance certificates are rarely implemented,” says Emelie Lilliefeldt, project leader for the audit.

The audit also shows that the average number of recommended measures in the energy performance certificates has decreased since 2012, contrary to the ambitions of the Riksdag and the Government.

However, the system may have affected house prices: single-family houses in the worst energy class are sold for 10-11 per cent lower prices than houses in the best energy class – all else being equal.

“We do not have enough information to establish a causal link, but there is much to indicate that the energy classification can have a signal effect on the market and thus increase the value of single-family houses with high energy performance,” says Emelie Lilliefeldt.

The Government’s efforts in this area also have shortcomings. For example, the energy performance certificates are not coordinated with municipal energy advisory services, and there are no monitorable goals for the energy performance certificates and grants to the energy and climate advisory services.

Furthermore, there has been no follow-up since 2009 of how the system works and affects the single-family house market, or if the information submitted in the energy performance certificates is correct. Knowledge of results and effects, and how well the regulations work, is therefore non-existent.

“The Swedish NAO audited the energy performance certificates when they were introduced in 2009. Unfortunately, we must note that several of the deficiencies that were then identified are still relevant. The Government, the National Board of Housing, Building and Planning and the Swedish Energy Agency need to ensure that the energy performance certificates become more effective,” says Auditor General Helena Lindberg.