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The majority of Bucharest’s two million inhabitants live in aging self-owned multi-storey apartment buildings. In a bid to reap energy savings and modernise housing, the EIB is supporting the rehabilitation of some 1 000 buildings, comprising 66 380 apartments, through loans to four district authorities in the capital city totalling EUR 282m.
Residential buildings account for more than one third of total energy consumption in Romania.
Almost 3.7 million apartments were built between 1950 and 1990 in the country, 650 000 of these in Bucharest, and few have been renovated to reduce energy consumption since construction. The demand for thermal rehabilitation projects in Romania is thus enormous, with an estimated investment cost of EUR 12bn. To save heating costs and reduce CO2 emissions while increasing the quality of living, the government has launched a national thermal rehabilitation programme for residential buildings.
The first funding was granted in 2010, for a total amount of EUR 70 m, to rehabilitate 273 buildings, comprising 23 000 apartments, in Sector 6 of the capital. Three other loans have followed, adding up to some EUR 282m. EIB loans will finance up to 75% of the programme’s investment costs, providing insulation of walls, windows, roofs, and cellars. The programme has the additional advantage of contributing significantly to job creation in the area.
An attractive investment plan for resident owners
90% of Bucharest residents own their apartments, but many cannot afford the EUR 6 000 to 8 000 refurbishment costs. Under these circumstances, most of the city authorities have decided to fund 100% of the investment, including the 20% contribution that would normally be covered by the apartment owners.
In addition, apartment residents benefit from heavily subsidised heating tariffs. Authorities are, however, planning to phase out these subsidies over the next couple of years, when heating costs in refurbished buildings are expected to fall by up to 50%.
State of progress
As of today, much progress has been made: 580 buildings comprising 38 572 apartments have been finalised. Out of four districts in the capital city where works are on-going, Sector 1 is the most advanced in implementation. 222 new buildings in the same district are due to be finalised by the end of the year, comprising 13 536 additional apartments.
The overall impact of the project in terms of housing quality for the citizens of Bucharest and energy savings has been positive. Nonetheless, there have been a number of minor problems along the way, especially concerning delays and construction quality. These have been resolved by additional quality control.
Before works started, most buildings in Sectors 1, 4 and 6 were classified with a D energy performance rating. Today, their performance has significantly improved as most have passed from D to B and are below the energy consumption threshold of 100 kWh/sqm per year, set by the programme requirements. This represents between 37% and 49% of energy savings.
Increasing energy efficiency is the most cost-effective way of reducing emissions and energy demand. In July 2013, the EIB adopted new guidelines to reinforce its support for investment in energy efficiency, renewable energy and energy grids. EIB
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