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The Climate Cabinet will be holding its first meeting this week. This newly created body’s remit is to come up with draft legislation whereby Germany will be able to meet its climate targets for 2030 and 2050. What new legislative initiatives the new Climate Cabinet will actually bring about remains doubtful. Similarly doubtful is whether the federal government will finally make climate protection a priority and swiftly get the necessary measures off the ground. That will also take time. As the Environment Ministry’s climate protection report revealed on publication in February, Germany is not doing enough to achieve the 2020 climate protection targets. To push ahead with ambitious climate protection targets, legislative action will be indispensable.
Legal initiatives like the EED were designed to help limit climate change and promote more efficient use of energy. The amended EU Energy Efficiency Directive (EED) was passed by the EU Council of Ministers at the end of last year. A key component of the new directive is the provision of all-year-round consumption information for residents and the requirement to use radio metering technology for consumption recording. What will the ambitious targets set by the amended version of the EED mean for the housing industry? Is there a need to act? Stephan Kiermeyer, CEO of the noventic subsidiary KALO, answers the most pressing questions.
Mr Kiermeyer, what obligations and challenges do the housing industry and KALO face after the amendment?
The amendment to the EED means that radio metering technology will be obligatory in the housing industry. When the EED is adopted into national law on 25 October 2020, any meters and heat cost allocators newly installed in a property must be remotely readable, provided doing so is technically feasible, cost-effective and proportionate in terms of the energy savings achieved. If non-radio meters or heat cost allocators are already installed, these must be retrofitted or replaced by 2027. A further challenge for the real estate industry is that, from 2022 onwards, tenants must also be provided with all-year-round information about their energy and water consumption, assuming that the necessary metering technology has been fitted in the building. Thus the EED will trigger far-reaching changes for the housing industry, and only a digitalised building infrastructure will be able to meet the directive’s requirements. Conventional metering and billing systems are no longer up to the job. As a result, every portfolio holder will have to convert to radio-based remote reading and billing of consumption sooner or later. To avoid having to replace new devices before the end of their useful lives, it makes sense to opt for radio technology right now if meters will need replacing soon, because as a rule heat cost allocators have a lifetime of ten years. Cold water meters have a calibration period of six years, and hot water and heat meters of five. However, meeting these regulatory requirements opens up new opportunities, as the infrastructure can form the starting point for the digitisation of the housing industry. New opportunities, for example, to put in place more efficient processes, make greater energy savings and establish more direct landlord-tenant communications.
What are the legislators’ expectations of the new regulations and the resultant digitisation of European housing stock?
In the first case the new EU regulations are intended to assist in achieving the climate targets by promoting efficiency increases. The aim is to exploit additional energy saving potential. In order to achieve these climate targets, EU-wide energy consumption must be brought to a level 32.5 per cent lower than the consumption level forecast in 2007. An additional aim is to ensure that the housing industry too exploits the opportunities afforded by digitisation: Digitalised infrastructures streamline housing industry processes, while all-year-round consumption billing makes energy consumption more transparent and encourages residents to save energy. Furthermore, digitisation will allow interoperable systems to be introduced into buildings. For the housing industry this would mean greater freedom in the choice of service providers and safeguarding control over the building data.
Does all-year-round consumption information really have any advantages for the tenants?
The purpose of providing all-year-round consumption information is to support residents in saving energy, because if they only receive their consumption data once a year in the form of a bill, it is already too late to adapt their own consumption behaviour for that period. Individual consumption can be shared directly with the tenants via consumption viewing app. Tenants can use the app to view their energy consumption and reflect with greater awareness on their own behaviour in the event of consumption peaks. In addition, radio-based metering systems allow the remote reading of consumption without having to visit people’s homes, and that too is much more convenient for residents. Incidentally, the fact that taking personal responsibility for consumption behaviour plays a central role in energy saving was demonstrated in Germany by the heating costs ordinance when it came into force in 1981. Since the introduction of individual billing of heating costs in residential buildings, the CO2 emissions of those buildings has fallen markedly
You mentioned additional added value generated by digitisation. Can you be more specific? How do the obligations to introduce radio metering technology and provide all-year-round consumption information yield benefits for portfolio holders?
Yes, the obligation to introduce radio-based metering systems also opens up opportunities for portfolio holders going beyond those of pure metering: the installation of digital and remotely readable infrastructure involving interoperable devices technology secures future decision-making freedom for portfolio holders. Integrating further innovations into an interoperable system is straightforward, regardless of the manufacturer involved. A further practical benefit is that there will no longer be any need to arrange meter-reading appointments. Radio-based (AMR) and interoperable (OMS) systems of the type used in QUNDIS devices provide an infrastructure from which further added value can be generated. For example, the Cards app produced by the noventic subsidiary KeepFocus permits the prompt viewing of consumption data. An application like Cards also offers further advantages for portfolio holders. For example, intelligent algorithms allow warnings about mildew or leaks to be issued, thereby providing long-term protection for the building fabric. A networked infrastructure also lays the cornerstone for the bundling of submetering and smart metering over a smart meter gateway: as a full-service metering provider, KALO employs a CLS device to connect the radio technology used in a smart meter gateway to collect and evaluate consumption data centrally. The packages thereby produced are the key to the establishment of more efficient processes for the housing industry.