In May 2023, a study by The Institute for European Energy and Climate Policy (IEECP) and commissioned by Greenpeace Central and Eastern Europe examines the implementation of the Energy Efficiency First principle in the residential sector of Bulgaria, Croatia, Hungary, Poland, Romania, Slovakia, and Slovenia. The study simulates different policy measures to compare supply-side and demand-side energy investments, focusing on fossil gas investments.

Four scenarios for demand-side investments were analyzed, comparing to the baseline scenario where an improvement of existing fossil fuel boilers was considered. The four scenarios consist of: energy retrofitting of building envelopes, installation of heat pumps, a combination of retrofitting and heat pumps, and finally the combination of the two with the addition of solar photovoltaics for zero-energy buildings. Economic and social cost-benefit analyses were conducted to compare the scenarios.

Results reveal that fossil fuel infrastructure support has the lowest cost-benefit ratio, indicating the least economic benefit and greatest losses in all countries. On the other hand, zero-energy buildings emerge as the most cost-efficient option. When considering social cost-benefit analysis, energy efficiency upgrades along with heating decarbonization measures show positive cost-benefit ratios.

The study highlights the economic and social advantages of renovating buildings and encouraging the adoption of heat pumps and photovoltaics. Renovations are proven to be cost-effective compared to investing in fossil fuel networks.

Read the full study.