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April 17, 2025
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Welcome to ASHRAE's European Policy and Funding Update! This monthly publication features information on policy and funding-related activities of interest to ASHRAE members in Europe. Archives of previous updates are available from the
ASHRAE European Policy and Funding Updates webpage.
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EU Renewable Energy for Heating and Cooling Reaches 26%
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According to the latest report by Eurostat, the share of renewable energy in heating and cooling across the EU reached 26.2% in 2023, marking the highest level since records began in 2004 (11.7%) and a 1.2% increase from 2022. This growth is primarily driven by biomass and heat pump technologies. Directive 2023/2413, adopted on 18 October 2023, requires member states to increase their annual average share of renewables in heating and cooling by at least 0.8 percentage points from 2021 to 2025 and 1.1 percentage points from 2026
to 2030.
Sweden led the EU with a 67.1% share of renewables in heating and cooling, followed by Estonia (66.7%) and Latvia (61.4%), all relying heavily on biomass and heat pumps. In contrast, Ireland (7.9%), the Netherlands (10.2%), and Belgium (11.3%) recorded the lowest shares. Between 2022 and 2023, 21 EU countries reported increases, with Austria (+8.1%), Malta (+7.5%), and Greece (+4.9%) showing the largest gains, while declines were observed in Sweden (-2.7%), Poland (-2.2%), and Slovakia (-1.1%).
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European Commission Launches Public Consultation on the Minimum Energy Performance Requirements for Buildings
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The European Commission has opened a feedback period, running from 9 April 2025 to 7 May 2025, on the revised methodology for calculating minimum energy performance requirements for buildings within the Energy Performance of Buildings Directive (EPBD). This initiative updates the rules for determining cost-optimal levels of energy performance for new buildings, existing buildings undergoing major renovations, and individual building elements, as mandated by Article 6(1) of the recast Directive 2024/1275/EU on the Energy Performance
of Buildings. The revision aims to align these requirements with the EU’s energy efficiency goals and contribute to the broader objective of achieving a fully decarbonized building stock by 2050. Stakeholders are invited to review the draft delegated act and provide input during the feedback period. The methodology is being developed with support from the Expert Group on the Energy Performance of Buildings Directive (E03689), and the European Commission plans to adopt it in the second quarter of
2025.
| European Commission Approves Amendment with €2 Billion Budget Increase of Czech State Aid Scheme to Promote Green District Heating
| On 11 April, the European Commission approved an amendment to a Czech scheme promoting green and more efficient district heating, primarily based on renewable energy. The original scheme, approved in December 2022, has now been expanded with an additional €2 billion, bringing the total budget to €3.2 billion. The amendment was assessed under EU State aid rules, specifically Article 107(3)(c) of the Treaty on the Functioning of the EU and the 2022 Guidelines on State Aid for climate, environmental protection, and energy (CEEAG). The Commission
found that the amended scheme remains necessary, proportionate, and aligned with the REPowerEU Plan, as it continues to meet all conditions of the original approval.
| EHPA Webinar “From Policy to Projects: Strategies and Tools for Europe’s Green Transition” Takeaways
| At a recent European Heat Pump Association (EHPA) webinar, EU-funded projects
CoolLIFE,
PLAN4COLD,
and
REDI4HEAT
showcased policy and innovation efforts to decarbonise heating and cooling. Key takeaways include:
- Policy framework:
An updated EU Heating and Cooling Strategy is due in 2026. Under the Energy Efficiency Directive (EED), municipalities with over 45,000 inhabitants must develop local plans – a requirement that so far only Germany has fully adopted into national law.
- Technology and pilots:
Heat pumps continue to be seen as a key solution. Pilot projects in Italy, Portugal, and Greece (with Spain and Croatia preparing to follow) aim to test renewable integration, despite facing regulatory and funding hurdles.
- Implementation challenges:
- Renewable energy uptake in heating/cooling remains insufficient despite RED targets.
- A fragmented approach persists – many National Energy and Climate Plans (NECPs) still treat heating and cooling separately.
- Local governance needs strengthening to implement EU objectives effectively.
- Data gaps persist; the
CoolLIFE
platform is helping by providing training, technical assistance, and a knowledge-sharing network.
While the policy landscape is evolving and technological solutions are available, experts warn that Europe’s success will depend on stronger coordination across governance levels and greater private sector involvement to support infrastructure roll-out.
| Euroheat & Power to Launch New Platform to Support Funding Access for District Heating Projects
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Euroheat & Power is preparing to launch FundTrack, a new service aimed at helping DHC+ members identify and secure funding for district heating and cooling (DHC) initiatives. The platform will simplify access to EU, national, and regional funding opportunities by offering tailored, expert analysis based on project-specific needs. By streamlining the search and application process, FundTrack is expected to strengthen investment readiness across the DHC sector and support the deployment of sustainable heating systems in line with
EU decarbonization goals.
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European Commission Approves €380 Million French State Aid Scheme to Support the Production of Equipment to Foster the Transition to a Net-Zero Economy
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On 2 April, the European Commission approved a €380 million French State aid scheme aimed at supporting the production of renewable energy and decarbonization technologies, including heat pumps, under the Temporary Crisis and Transition Framework (TCTF). Running until the end of 2025, the scheme will offer direct grants and repayable advances to accelerate domestic manufacturing of key net-zero equipment such as heat pumps, batteries, solar panels, wind turbines, electrolysis, as well as carbon capture technologies. This move aligns with the
EU’s 2024–2029 priorities to scale up clean energy infrastructure and strengthen European industrial competitiveness. The Commission found the measure proportionate and compatible with EU State aid rules, emphasizing its role in supporting the green transition and reducing strategic dependencies on critical technologies and components.
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The UK Government is Considering Expanding the Boiler Upgrade Scheme to Heat Batteries
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The UK government is exploring the expansion of the Boiler Upgrade Scheme (BUS), which currently provides £7,500 grants for heat pump installations in England and Wales, to include other low-carbon heating technologies such as heat batteries. This move comes amid concerns over low heat pump adoption rates, with gas boiler installations outnumbering heat pumps by 15:1 in 2024. Despite a target of 600,000 annual heat pump installations by 2028, only 62,031 vouchers have been issued since the scheme's launch in April 2022, highlighting
the need for broader measures to meet clean energy goals. Heat batteries, which are suitable for homes where heat pumps may not be viable, are being considered for inclusion in the scheme following calls from industry experts and MPs. These systems can store heat for days and operate using cheap and green electricity, offering a practical alternative for decarbonizing heating in domestic properties.
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UK Struggles to Accelerate Heat Pump Deployment
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In the UK, only 13% of new homes were equipped with heat pumps last year, highlighting the slow transition to low-carbon heating. The Boiler Upgrade Scheme (BUS) has yet to drive significant adoption due to high upfront costs that leave poorer households excluded. Currently, only 19% of heat pumps are installed in the poorest third of areas, compared to 45% in wealthier neighborhoods. Structural issues in the UK’s energy market further hinder progress. Electricity prices remain artificially high compared to gas due to green levies placed on
electricity bills rather than gas bills, making heat pumps more expensive to operate despite their efficiency. Shifting these levies to gas could save households over £300 annually, increasing the appeal of heat pumps. Experts call for reforms to make heat pumps more accessible, including targeted top-up grants for low-income households and regulations enforcing heat pump installations in new-build homes.
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RHC-ETIP Event
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On
14 April 2025,
RHC-ETIP platform will organize an online roundtable - “How to Decarbonize Centralized Heating Systems: Finnish Perspectives on Renewable Heating and Cooling”.
More information is available here.
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EHPA Breakfast Debate at European Parliament
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24 April 2025,
EHPA will organize a breakfast debate - “Plugging Europe’s energy security gap with heat pumps” at the European Parliament.
More information is available here.
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RHC ETIP Event
| On 7 May 2025,
the European Technology and Innovation Platform on Renewable Heating and Cooling (RHC ETIP) will host the annual conference, the 100% RHC Event: Collaborative Pathways to Sustainable Heating and Cooling.
More information is available here.
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EHPA event
| On
22 May 2025,
EHPA will organize an event entitled “The Road to Sustainable Industrial Heat: A Roundtable on the Future of Industrial Heat Pumps”.
More information is available here.
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REHVA Annual Meeting 2025
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2 – 3 June 2025,
REHVA will hold its Annual Meeting in Milan, Italy. The Annual Meeting will feature presentations, workshops, and networking opportunities focused on the latest developments in the HVAC industry.
More information is available here.
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CLIMA 2025
| On 4 – 6 June 2025,
REHVA will hold its 15th HVAC World Congress in Milan, Italy. The theme of this Italian edition is "Decarbonized, healthy, and energy-conscious buildings in future climates".
More information is available here.
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19th International Symposium on District Heating and Cooling
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On
7 – 10 September 2025,
VITO and EnergyVille will organize the 19th International Symposium on District Heating and Cooling in Genk, Belgium.
More information is available here.
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Heat Pump Forum & Award 2025
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23 – 24 September 2025,
EHPA will host its flagship heat pump forum.
More information is available here.
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EU
EUROPEAN COMMISSION: The European Commission is made up of 27 Commissioners, 1 for each Member State, and represents the interests of the EU as a whole. Every Commissioner is in charge of a Directorate-General (DG) that can be compared to a Ministry at national level. The European Commission proposes legislation in the form of Regulations and Directives and submits them to the Parliament and Council for discussion and adoption.
EUROPEAN PARLIAMENT:
The European Parliament is made up of 705 MEPs (see below) that are directly elected by EU citizens in 27 Member States.
MEP: Member of the European Parliament, a co-legislator within the EU that is made up of representatives from political parties throughout Member States.
COUNCIL OF THE EU:
Co-legislator, made up of representatives from Member State Governments. Has a six-month rotating presidency, currently held by the Czech Republic until the end of 2022.
EUROPEAN COUNCIL: The European Council is made up of the leaders of the EU member states, commonly known as EU27. It defines the EU’s overall political direction and priorities but does not pass laws.
REGULATION:
EU legislative act that is binding in its entirety and is to be applied in its entirety across the EU by all EU Member States.
DIRECTIVE:
EU legislative act that sets out a goal that all EU Member States must achieve. However, it is up to the EU Member States to adopt their own laws on how to achieve the EU goals enshrined in the Directive.
HORIZON EUROPE:
is the EU’s main and biggest Research and Innovation programme for the period of 2021-2027. The programme has an overall funding of €95,5 billion. The program is divided into three pillars: open science, global challenges & industrial competitiveness and open innovation.
INVESTEU:
The InvestEU Programme builds on the successful model of the Investment Plan for Europe, the Juncker Plan. It brings together, under one roof, the European Fund for Strategic Investments and 13 EU financial instruments currently available. Triggering at least €650 billion in additional investment, the Programme aims to give an additional boost to investment, innovation and job creation in Europe.
EUROPEAN GREEN DEAL:
is a set of policy initiatives by the European Commission with the overarching aim of making Europe climate neutral in 2050. The plan is to review EU’s energy and climate laws to bring them in line with this ambition. Green Deal also introduces new legislation on the circular economy, building renovation, biodiversity, farming and innovation.
FIT-FOR-55-PACKAGE:
The European Commission’s work program for 2021 included the revisions and initiatives linked to the European Green Deal climate actions and in particular the climate target plan’s 55 % net reduction target are presented under the Fit for 55 package. The package is compiled of two parts, released on 14 July 2021 and 14 December 2021.
REHVA:
is the
association of European heating, ventilation and air-conditioning associations, based in Brussels.
You can find all relevant EU building policy related information in this useful document.
UK
BILL: A bill is a proposal for a new law, or a proposal to significantly change an existing law. A bill may start in either the Commons or the Lords and must pass a series of stages in each Houses. Once the bill has been agreed by both Houses, it receives Royal Assent and becomes an Act of Parliament.
HOUSE OF COMMONS: the House of Commons is the lower house and de facto primary chamber of the Parliament of the United Kingdom. Like the upper house, the House of Lords (see below), it meets in the Palace of Westminster. The Commons is an elected body consisting of 650 members known as members of Parliament (MPs). Members are elected to represent constituencies by the first-past-the-post system and hold their seats until Parliament is dissolved.
HOUSE OF LORDS: The House of Lords scrutinises bills that have been approved by the House of Commons. It regularly reviews and amends Bills from the Commons. While it is unable to prevent Bills passing into law, except in certain limited circumstances, it can delay Bills and force the Commons to reconsider their decisions.
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