Sweden unveils initial energy standards for commercial buildings

Boverket, the Swedish National Board of Housing and Buildings, in October published its preliminary assessment on the impact of EU renovation policy, the Energy Performance of Buildings Directive (EPBD), on commercial buildings in Sweden. It included the energy thresholds above which buildings need to be renovated, the so-called Minimum Energy Performance Standards (MEPS). It set the 2033 MEPS at 174kWh/m² per year, but warned that today’s energy declarations may not be directly comparable to these MEPS.

In April, we ran an analysis of the EPBD’s impact on the universe of companies covered by Nordea Equity Research. Back then, we estimated that around 25% of companies’ portfolios would require renovation. Now, we’ve taken a look at how the analysis would change by simply plugging in Boverket’s MEPS. We find that the renovation need would be more benign, with a smaller share of companies’ building portfolios in need of renovation than our previous estimate.

Swedish preliminary MEPS out

The EPBD aims to renovate the bottom-ranking 16% of the EU’s commercial building stock by 2030 and the bottom 26% by 2033. EU countries now have to define at what energy level the 16% and 25% thresholds fall – the MEPS. Boverket has published the preliminary MEPS for Sweden:

This means that if someone owns, for example, an office with an energy consumption of 250kWh/m2 per year, it is likely that this will need to be renovated as early as by 2030, although Boverket warns that today’s energy declarations may not be entirely comparable with the thresholds presented above.

What is the impact on the Swedish commercial building stock?

Based on Boverket’s analysis, around 14,000 commercial buildings will need to be renovated by 2030, and almost 23,000 in total by 2033. Note that its analysis does not cover residential buildings.

The majority of the buildings that need renovation are heated using electricity (not a heat pump) or fossil fuels, which means that such heating solutions will largely have to be phased out. These buildings also make up the majority of the buildings that end up above the limit values.

Source: Boverket, Nordea

Boverket also estimates that the majority of buildings that will need renovation are currently held by commercial owners and have a fairly even age distribution, although a higher share of those built between 1976-90 will require renovation compared to those built after 1990.

Source: Boverket, Nordea

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