Building Envelopes

Countries and regions making notable progress to advance on building envelopes include: 

• The European Union adopted a new revision of the Energy Performance of Buildings Directive (EPBD) in 2023 (pending trilogue approval) that stipulates higher Minimum Energy Performance Standards for existing buildings, timelines to achieve them, and earlier deadlines for buildings to become zero-emissions: for all new public buildings from 2026, and for all new buildings from 2028. 
• The European Union’s REPowerEU initiative, one of a wide range of measures for clean energy transition, promotes energy-efficient building retrofits to support rapid reduction of dependence on Russian fossil fuels. 
• Türkiye, Japan, China, India and Australia updated their buildings regulations, adding more stringent energy efficiency requirements.  
• The United Kingdom Department for Energy Security and Net Zero (DESNZ) announced GBP 1.8 billion in 2023 to upgrade the energy efficiency of homes and public buildings through the Social Housing Decarbonisation Fund, Home Upgrade Grant and Public Sector Decarbonisation Scheme. 
  

Good building design, integrating high-performing envelopes, is the most effective way to reduce the thermal needs of buildings and ensure occupants’ thermal comfort. Compared to other solutions in buildings, the selection of envelope structure and materials is particularly important, given the long lifetime of buildings and the associated cost of the envelope.  

Since 2015, more widespread and stringent building codes, as well as increased retrofit rates, have helped decrease space heating intensity by 7% on average globally. Efficiency gains have decreased global space heating service demand by about 4% in advanced economies since 2010, but were not sufficient to offset floor area growth in emerging and developing economies. 

Global space cooling service demand has increased across the world by more than two-thirds since 2010, driven by increased floor area, growth in equipment ownership, and rising temperatures, but also because cooling-oriented envelope solutions are often neglected during building design. 

Building envelope performance improvements are critical to getting on track with the majority of the NZE Scenario milestones in heating and cooling intensity (energy use per total m²). To align with the NZE Scenario, the final energy intensity of space heating and cooling needs to fall considerably, by at least 35% and 25% respectively in 2030 compared to today. Progress in space cooling efficiency from improved envelope performance and air-conditioning equipment is particularly needed due to growing demand. 

Although all countries need to implement mandatory building energy codes within this decade to align with NZE Scenario milestones, many have yet to make them an explicit policy priority.  

Constructed floor space worldwide has increased by about 70% since 2000, to reach around 260 billion m² in 2022, of which nearly 80% is residential. At the same time, however, average energy use per m² has declined by only around 20%, meaning advances in energy efficiency have only partially offset floor area growth. 

In addition to the lack of building energy codes in certain countries, the average retrofit rate of the building stock is currently around 1% per year, with retrofits generally delivering average energy intensity reductions of less than 15%. To get on track with the NZE Scenario, retrofit rates must jump to at least 2.5% by 2030, and retrofits need to be deep – or extensive – retrofits. All new buildings and retrofits are zero-carbon-ready by 2030 in the NZE Scenario.² 

² This means that a zero‐carbon‐ready building will become a zero-carbon building by 2050, without any further changes to the building or its equipment, thanks to decarbonisation of the power grid.

Building envelope solutions are well known, such as energy-efficient insulation and fenestration. But innovation is also taking place in building envelope materials and components, for instance to reduce the thickness of insulation, resulting in a product five times more efficient than traditional insulation. Use of super insulating materials, such as vacuum insulation panels and silica aerogel, can offer additional economic benefits by creating additional usable space and hence increasing the financial value of the building. This solution is particularly interesting for areas that previously would have remained uninsulated due to insufficient space. 

Ongoing research is taking place in the area of supercool and smart materials, which can stay several degrees cooler than ambient temperature even in direct sunlight, thereby reduce cooling needs inside the building, with particularly promising results in hot and dry climates.  

Adaptive building envelope systems, including control and automation technology, are on the rise. Among the building envelope technologies that enhance the envelope’s function through solar energy gains, “climate-adaptative building shells” offer the opportunity to activate buildings against climate change. The façade's adaptation to climate conditions creates changes in the building's energy balance through convection flow, radiation and energy storage.

Building renovation often occurs over a long period and requires multiple skills, such as selecting the most cost-effective measures to implement and dealing with complex bureaucracy. Renovations on a multi-building scale can be coordinated at the local level, facilitating co-operation among multiple stakeholders and speeding up the renovation process while reducing costs (for example, for renting scaffolding and buying materials). The IEA Energy in Buildings and Communities Technology Collaboration Programme (EBC TCP) is working to highlight opportunities for district-scale renovations. 

One notable development in business models for building renovation is the expansion of the Energiesprong programme, now active in five countries in Europe, through which renovation or new build is financed by future energy cost savings plus the budget for planned maintenance and repairs over the coming 30 years. This makes use of new technologies such as prefabricated facades, insulated rooftops with solar panels, and efficient heating, ventilation and air conditioning installations. 

Building energy codes and standards are among the most widely recognised, scalable and effective policy instruments for buildings, having been implemented in more than 90 countries. Despite this, without further expansion, around 40% of the new floor area additions by 2030 will not be covered by a mandatory building code. 

Countries worldwide have strengthened energy efficiency requirements for buildings envelopes via regulations and other supporting policies in recent years: 

• The United States introduced tax credits for door and window insulation, among other energy efficiency measures for buildings. 
• The European Union’s revision of the EPBD requires zero-emissions performance from all new public buildings by 2026, and all new buildings by 2028. 
• China's new mandatory code introduced in 2022 requires a reduction of carbon emission intensity and installation of solar PV systems in all new buildings. 
• India introduced an energy conservation code for commercial and residential buildings that includes requirements for energy efficiency of building envelopes. 
• Japan has required mandatory compliance with energy conservation standards since 2022, with the aim of achieving zero-energy performance in all new buildings by 2030 and in all buildings by 2050. Energy-saving requirements are also a prerequisite for buildings to benefit from low fixed-rate mortgages via Flat 35. 
• Türkiye introduced regulations in 2023 that require all new buildings to be nearly zero energy, with increased requirements for renewable energy and insulation thickness.  
• Australia increased the stringency of energy efficiency requirements for new homes and apartments for the first time in a decade last year. 
• Several other countries in Europe offer financial support for energy efficiency improvements in building envelopes. Examples include the Czech Republic's fund for rapid insulation of residences, Finland's loan guarantee scheme for clean technology solutions including improved building envelopes, Ireland's grants for cavity wall and attic insulation, Latvia's increased funding for efficiency improvements in apartment buildings, Poland's subsidies for home thermal renovations, and the United Kingdom's fund for green finance products applicable to improving buildings insulation. 
  

The 2022 increase in investment in energy efficiency was mostly thanks to the recovery of investment in construction in western European countries, and continued growth in other large markets. More information can be found on the Buildings page.

A number of international initiatives are uniting countries, private sector organisations and cities to reduce embodied carbon, such as the World Green Building Council’s (WGBC) Bringing Embodied Carbon Upfront vision, defined in 2019 to reduce construction-related emissions per m² of new floor area 40% by 2030. This was endorsed by 80 buildings and construction value chain stakeholders.  

The Rocky Mountain Institute launched the Embodied Carbon Initiative in 2021 to “change how builders build, increasing corporate investment in embodied carbon, and enacting policies to create greater demand for, and adoption of, low-embodied-carbon products”. 

In 2022, steel, cement, and aluminium manufacturing for buildings construction accounted for 7% of global energy and process-related emissions. Steel and cement manufacturing made up 95% of that share, as new building envelopes required in total 2 Mt of cement and 0.5 Mt of steel – twice as much as in 2000. 

In the NZE Scenario, material efficiency strategies reduce global cement and steel demand by 10% in 2030 relative to baseline trends, reducing the amount of low- and near zero-emission material production that needs to be deployed, helping ease the challenge of the industry’s transition. Global demand for steel and cement therefore levels off, despite a floor area expansion of around 2% per year to 2030. 

Several companies are also responding to the need to decarbonise cement and steel production. In July 2022 the Climate Group, in partnership with the World Business Council for Sustainable Development and the WGCB, launched ConcreteZero, whereby almost 30 businesses have pledged to use 100% net zero concrete by 2050. Its sister initiative, SteelZero, has 36 members. 

• Ian Hamilton, UCL Energy Institute
• Harry Kennard, UCL Energy Institute