Recent findings from the European Climate Neutrality Observatory (ECNO) indicate that progress in reducing emissions from buildings remains insufficient to align with the European Union’s climate pathway. Operational emissions have not fallen at the pace required, and the sector would need to double its annual reduction rate from 16.5 Mt CO₂e to 33 Mt CO₂e by 2030 to meet established targets. The analysis also notes that average living space per person continues to increase, adding pressure on energy demand.

The report highlights that the transition to renewable energy in buildings is advancing slowly. Although heat pump sales grew between 2016 and 2022, they declined in 2023 and 2024. The current stock would need to expand almost three times faster to reach 60 million units by 2030. Renewable energy in heating and cooling has increased by only 0.9 percentage points per year since 2018, far below the 3.8‑point annual rise needed to reach the indicative 49% share by 2030.

Energy‑efficiency trends also show limited progress. Between 2016 and 2021, energy consumption for heating and cooling decreased by 1.0 kWh/m² per year, while the required pace is roughly three times higher. Residential and non‑residential buildings follow similar patterns, with reductions of 0.9 kWh/m² and 1.4 kWh/m² per year, respectively, both well below the levels needed to meet 2030 benchmarks. The report also notes that the average floor area per person increased by 0.5 m² annually between 2018 and 2023.

European renovation rates

Renovation activity remains constrained by limited and outdated data. The last available EU‑wide figures show renovation rates of around 1% per year between 2012 and 2016, with deep renovations representing only one-fifth of interventions. To meet the Renovation Wave objectives, these rates must at least double. Investment needs are also significant, with estimates indicating an additional EUR 149 million per year required to meet the Energy Performance of Buildings Directive targets.

The policy framework adopted in 2023 and 2024—covering energy performance, efficiency, renewable energy, and the new emissions trading system for buildings—has the potential to accelerate progress once fully implemented. Measures include minimum energy performance standards, zero‑emission requirements for new buildings from 2030, and the phase‑out of fossil‑fuel boilers by 2040. However, the report stresses the need for stronger enforcement, improved national data systems, and financial support to address upfront costs for households.

The assessment shows that ‘progress towards climate neutrality in the buildings sector has been far too slow’, underscoring the importance of accelerating building renovation, strengthening data collection, and expanding renewable-based heating solutions to meet the climate objectives for 2030 and 2050.