Sector Deep dive

Buildings

Energy consumption in the building sector is mainly driven by heating and hot water in private households and in trade, commerce and services. In addition, there is energy consumption for lighting, information and communication technology (ICT) and mechanical energy, for which mainly electricity is used (BMWK, 2022).

To reduce greenhouse gas emissions in the building sector, two strategies are central: First, a reduction in energy demand must take place by renovating buildings to improve energy efficiency and reversing the trend of increasing living space per capita. Second, renewable energy sources must replace fossil fuels in order to meet the remaining energy demand without emissions. To this end, heat pumps and district heating, in particular, must be used for heating instead of oil and gas boilers (Ariadne, 2021).

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Annual GHG emissions of the buildings sector

119% on track Compared to the scenario Technology Mix
One-off effect
Energy crisis

Annual GHG emissions resulting from the direct combustion of fossil fuels such as natural gas or light fuel oil in residential and commercial buildings for heating or hot water. Emissions from the construction sector, district heating or electricity generation are not included.

The Federal Climate Protection Act (KSG) sets annual permissible emission levels for the building sector. They are thus an essential benchmark for classifying the transformation of the sector. CO₂ emissions account for the majority of GHG emissions in the building sector. Compared to 2015, emissions have reduced by around 7% by 2021.

Key points

  1. GHG emissions from the building sector are a key metric for measuring the progress of the energy transition.
  2. In 2020, 2021, and 2022, the sector has missed the statutory targets of the KSG, requiring political follow-up through immediate programs.
  3. The trend to date shows significant gaps to the political targets, as well as the target paths from the Ariadne scenarios: the speed of decarbonization of the sector must increase significantly.

CO₂ emissions of residential buildings per floor space

84% too slow Compared to the scenario Technology Mix
One-off effect
Energy crisis

The indicator shows the CO₂ emissions in the building sector, resulting from the combustion of fossil fuels, like natural gas or light heating oil, for heating or hot water generation, per floor space in Germany.

The floor-specific CO₂ emissions of residential buildings have not shown a clear trend in recent years. After a reduction in 2015-2018, a significant increase was observed in 2019 and 2020, followed by another significant decrease in 2021 and 2022.

Key points

  1. CO₂ emissions per floor area show no clear development in recent years, and in particular there is no clear progress in emission prevention. - Based on the longer-term trend since 2015, there is a clear gap to the Ariadne target paths.

Annual final energy demand of the buildings sector

64% too slow Compared to the scenario Technology Mix

Annual final energy demand of the buildings sector (private households and trade, commerce and services), in particular for space heating and hot water, but also for lighting, information and communication technology, for example.

Since 2015, there has been an almost constant trend in final energy demand in the buildings sector. While there has been a slight decline in final energy demand in the trade, commerce and services sector - especially during the energy crisis in 2022 - the final energy demand of private households has increased slightly.

Key points

  1. The final energy demand of the buildings sector has remained almost constant since 2015, but to achieve the climate targets, it must fall relatively quickly and significantly according to the Ariadne scenarios.
  2. Energy-efficient refurbishment, efficient new construction and more efficient heating systems (e.g. heat pumps) are the main means of reducing final energy demand for buildings.

Annual final energy demand of residential buildings per floor space

29% far too slow Compared to the scenario Technology Mix

The final annual energy demand of private households in relation to floor space serves as an indicator for the development of the energetic quality of buildings.

In recent years, an almost constant trend in final energy demand per floor space has been observed. However, the Ariadne scenarios give an indication that the specific final energy demand has to decrease significantly for target compatibility (by about -20% by 2030 and by about -50% by 2045).

Key points

  1. Final energy demand per floor space has stagnated in recent years.
  2. The Ariadne scenarios indicate a significant necessary reduction of -20% by 2030 and -50% by 2045, which is achievable through more efficient heating systems as well as an increased energetic quality of buildings.
  3. The efficiency of heat pumps can be further increased by reducing the specific final energy demand and switching to low-temperature systems.

Share of renewables in final energy demand of the buildings sector

91% too slow Compared to the scenario Technology Mix

The share of renewables in final energy demand in the buildings sector primarily includes renewably generated electricity, renewably generated district heating, and biomass.

The share of renewable energies has increased slowly but steadily in recent years. The provision of electricity and district heating is being switched to renewables, just as the share of renewables in the heating of buildings is increasing (BMWK, 2022).

Key points

  1. The share of renewables in final energy demand is slowly increasing, but the development will have to be accelerated significantly.
  2. Therefore, buildings must switch more quickly from gas heating and oil boilers to heat pumps and district heating.
  3. In addition, electricity and district heating must be provided renewably with wind and PV or large-scale heat pumps.

Sales of heat pumps per year

80% too slow Compared to the scenario Technology Mix

The indicator shows the absolute number of heat pumps sold per year. It does not include heat pumps for process heat in industry or large heat pumps for district heating.

The historical development of heat pump sales shows that the technology is at the beginning of market penetration. While sales in new buildings were around 50% in 2022, heat pumps account for only around 3% of the existing building stock in 2022 (bdew, 2022), so overall the share of heat pumps is only 25-30% of all heating installations.

Key points

  1. Thanks to high efficiency and the possibility of direct use of renewable electricity, heat pumps play a central role in decarbonized heat supply.
  2. With a slump in sales figures in Q1 2024 to 46,000 heat pumps, the political target of 500,000 new appliances per year from 2024 seems currently unattainable.
  3. While heat pumps already have a share of around 50% in new buildings, penetration in existing buildings still needs to increase significantly (currently only around 3%).

Stock of heat pumps

98% on track Compared to the scenario Technology Mix

The indicator shows the total number of heat pumps in the stock of all heating systems.

The historical development of heat pump sales shows that the technology is at the beginning of market penetration. While sales in new buildings were around 50% in 2022, heat pumps account for only around 3% of the existing building stock in 2022 (bdew, 2022), so overall the share of heat pumps is only 25-30% of all heating installations.

Key points

  1. Thanks to high efficiency and the possibility of direct use of renewable electricity, heat pumps play a central role in decarbonized heat supply.
  2. With a slump in sales figures in Q1 2024 to 46,000 heat pumps, the political target of 500,000 new appliances per year from 2024 seems currently unattainable.
  3. While heat pumps already have a share of around 50% in new buildings, penetration in existing buildings still needs to increase significantly (currently only around 3%).

Share of electricity in final energy demand of the buildings sector

13% far too slow Compared to the scenario Technology Mix

The indicator shows the share of electricity in the final energy demand of the buildings sector. In addition to consumption for lighting and electrical appliances, this increasingly includes electricity for heat pumps.

The share of electricity in final energy demand of the buildings sector has stagnated or declined slightly in recent years. However, since direct electrification of the end-use sectors is one of the key steps for a successful energy transition, the Ariadne target paths assume a significant increase in the share of electricity in final energy: from currently around 26% to around 35-45% already in 2030 and 60-80% in 2045.

Key points

  1. The share of electricity in final energy demand must increase significantly in the future and reduce the use of fossil fuels, especially natural gas and heating oil.
  2. The indicator shows a clear transition gap: At present, instead of an increase in electrification, there are signs of stagnation.
  3. In existing buildings in particular, fossil heating systems must no longer be replaced by new fossil systems; instead, heat pumps will play a key role.

Sales of oil- and gas-fired heating systems per year

−117% step back Compared to the scenario Technology Mix

This indicator describes the annual new installations of oil and gas heating systems for the provision of space heating and hot water in the building sector.

Sales of oil and gas heating systems have increased significantly in recent years, with more gas heating systems being sold in particular. In contrast, a transformation of the building sector requires a rapid switch from fossil-fuelled heating systems to heat pumps and district heating.

Key points

  1. Contrary to the necessary development, sales of fossil-fuelled heating systems continue to increase, in particular due to the continuously high share of gas boilers in new buildings.
  2. For a successful transformation, the share of heat pumps and district heating in newly installed heating systems must increase rapidly.

Annual oil, coal and gas demand in the buildings sector

78% too slow Compared to the scenario Technology Mix
One-off effect
Energy crisis

Annual demand for the fossil energy sources natural gas, oil and coal in the building sector only includes direct use in the building. If gas, oil and coal are used to generate electricity or district heating, this is accounted for in the energy sector.

The absolute demand for the fossil energy carriers natural gas, oil and coal has remained constant in the buildings sector over the past years, although a rapid reduction would be necessary for a successful transformation: In the Ariadne scenarios, the use of fossil energy is already reduced to about 50% by 2030 compared to 2021.

Key points

  1. The demand for natural gas, oil and coal in the buildings sector is stagnating, although it should be reduced rapidly in line with the Ariadne target paths.
  2. For a faster reduction, overall final energy demand must be reduced by energetic retrofitting of buildings and reversing the trend of increasing per capita living space.
  3. In addition, fossil fuel demand has to be reduced by consistently switching energy sources from natural gas and oil to electricity and district heating.

Share of oil, coal and gas in final energy demand of the buildings sector

91% too slow Compared to the scenario Technology Mix

In addition to the direct use of fossil fuels in the building sector, this also includes the fossil-generated share of electricity and district heating used in buildings. Environmental heat for heat pumps is not included in the final energy consumption.

In order to reduce CO₂ emissions in the building sector, firstly, final energy consumption must decrease overall, and secondly, the remaining energy demand has to be met with renewable rather than fossil fuels (Ariadne, 2021). This indicator is a measure of the second strategy, which is primarily an energy source shift from gas and oil to renewable electricity and renewable district heating.

Key points

  1. The demand for fossil fuels must be reduced rapidly in order to cut emissions and become independent of fossil imports.
  2. The accelerated switch from gas and oil boilers to heat pumps and district heating is a central component of the transformation of the building sector in all scenarios.
  3. Above all, the availability of skilled labour is currently an obstacle to the replacement of heating systems.

Share of district heating in final energy for space heating and hot water

100% on track Compared to the scenario Technology Mix

This indicator describes the share of district heating in the final energy demand of the buildings sector for space heating and hot water. Environmental heat for heat pumps is not included in the final energy consumption.

The share of district heating in final energy demand for space heating and hot water is a measure of the expansion of district heating, which is an important component of the energy transition in Germany.

Key points

  1. District heating has to be greatly expanded in the future and provide a greater contribution to heat supply, especially in urban areas.
  2. For years, district heating has accounted for only just under 10% of the final energy demand for space heating and hot water. There is no sign of a significant increase yet.
  3. The expansion of district heating requires high and long-term investments. An equally long-term planning is central. Municipal heat planning is the crucial tool in the local context.