EU agrees buildings directive mandating zero-emission new builds by 2030

EU lawmakers reached informal agreement on revising the Energy Performance of Buildings Directive, requiring all new buildings to be zero-emission by 2030 and phasing out fossil fuel boilers by 2040. The framework offers a reference point for India's own building energy efficiency and decarbonisation policy direction.

MEPs and the Spanish Presidency reached informal agreement on amending the Energy Performance of Buildings Directive to cut emissions and energy use in the EU building sector by 2030, targeting climate neutrality by 2050. All new buildings must be zero-emission by 2030, with public-authority new buildings by 2028. Residential buildings must achieve at least a 16% reduction in average primary energy use by 2030 and 20-22% by 2035. Buildings account for 40% of EU energy consumption and 36% of greenhouse gas emissions.

The directive affects building owners, developers, construction firms and heating system suppliers across residential and non-residential sectors. Member states must renovate the 16% worst-performing non-residential buildings by 2030 and 26% by 2033 under minimum energy performance standards. Solar installations must be progressively integrated into public and non-residential buildings by size and into all new residential buildings by 2030. Exemptions apply to agricultural and heritage buildings, temporary structures, and places of worship.

Affected entities should track the Industry, Research and Energy Committee vote scheduled for January 23 and subsequent endorsement by the EU Parliament and Council. Companies should plan for the fossil fuel boiler phase-out targeted for 2040 and the end of stand-alone fossil fuel boiler subsidies after 2025, while noting continued incentives for hybrid heating systems. Indian real estate and construction stakeholders can monitor these life-cycle and minimum-performance standards as indicators of tightening global building decarbonisation norms.

Key figure — Emissions context: buildings account for 36% of EU greenhouse gas emissions