Brno: Half of Europe’s energy consumption goes into making buildings and industrial processes warmer or cooler, and roughly seventy percent of that demand still runs on fossil fuels, mostly gas. The sector accounts for about 27 percent of the bloc’s carbon dioxide emissions. It also generates a fraction of the political attention that power generation attracts, which is the problem the Commission’s forthcoming Heating and Cooling Strategy is meant to fix.
The strategy is due in the third quarter of this year. It follows the Electrification Action Plan the Commission published in July, and the two documents are designed to work together. The action plan identified heat pumps as a core decarbonisation technology for buildings and proposed measures on electricity affordability, demand-side flexibility and faster permitting. It also went after the price ratio between electricity and gas, which is the variable that actually determines whether a household switches.
That ratio has undermined heat pump adoption across much of the continent. Electricity carries levies, network charges and taxes that gas often does not, so a technology roughly three times more efficient at the point of use can still cost more to run. The Commission proposed reforming energy taxation to narrow the gap and floated an EU framework permitting member states to cut value added tax on electrification technologies, covering heat pumps, electric vehicles and household batteries. Both proposals require unanimity on tax, which is where similar ideas have died before.
Money exists, at least on paper. The Social Climate Fund became available to all member states this year with 86.7 billion euros earmarked for energy efficiency and clean heating, targeted at vulnerable households and micro-enterprises. It pairs with the emissions trading extension to buildings and road transport, and its political purpose is transparent. It compensates the households the carbon price will hit hardest, before they vote on it.
District heating occupies an awkward middle position. Networks in Denmark, Sweden and parts of central Europe already deliver low-carbon heat at scale and absorb industrial waste heat that would otherwise vent. Researchers at Aalborg University argue full decarbonisation needs district systems to reach a 55 percent market share by 2050, far above today’s figure in most member states. Building networks takes a decade and municipal balance sheets many cities lack. The Commission keeps its electrification material here and its heat pump work here.
Installers raise a quieter obstacle. REPowerEU committed to doubling the heat pump installation rate, but the trade has not doubled its workforce, and badly specified installations produce poor performance and unhappy customers who tell their neighbours. Several national schemes now require certified installers, which improves quality and lengthens waiting lists.
The strategy will succeed or fail on whether it moves the electricity to gas price ratio. Targets and platforms do not change a homeowner’s bill. Taxation does, and taxation is the one lever the Commission cannot pull alone.
