Buildings in France, as worldwide, account for a high 40% of global energy consumption. Large and attractive opportunities exist to reduce buildings’ energy use at lower costs and higher returns than other sectors. These reductions are fundamental to support achieving the European Union’s 20-20-20 for 2020 policy and the International Energy Agency’s target of a 77% reduction in the planet’s carbon footprint against the 2050 baseline to reach stabilized CO2 levels called for by the Intergovernmental Panel on Climate Change.
Because of its importance in the national energy consumption, building sector should keep a central place within French energy and climate policies. Its economical weight, in particular in terms of employment and GDP, should make the building sector one of the first priorities of economical and social policies.
Simultaneously, Energy Efficiency has become a key issue in France: first of all, through the “Grenelle de l’environnement“; second of all, through European regulation (Energy Efficiency Directive); and, now, through the national Energy Transition debate.
Within the past 20 years, numerous reports and studies have already listed the combined required actions called for, including investment subsidies, labelling mechanisms, fulfilment controls, building energy codes, increased and trained workforce capacity, and evolving Energy Efficiency designs and technologies. All are intended to raise energy awareness globally and influence consumer and investor behaviour and choice.
However, even though many Energy Efficiency projects are feasible with today’s energy costs, it seems that the market is running late on international, European and national targets (with today’s market drivers, only one third of French defined targets should be achieved finally). The lack of capital expenditures, the low profitability of most of energy conservation measures, the shaky governmental ambitions are among strong barriers that exist in the building sector.
So, is there a profitable Energy Efficiency Building market in France? My answer is no. There isn’t one Energy Efficiency Building market in France, but several. Indeed, French Building refurbishment industry is, as many other similar industries, very polymorphous, both in terms of nature of buyers and nature of sellers. In the demand side, it includes tertiary buildings such as malls, hospitals, large offices, collective residential buildings, individual households and so on. In the offer side, it includes, among many different actors willing to lead the energy performance relationship with customers, ESCOs (DALKIA, COFELY, EXPRIMM, and so on), equipment suppliers (SIEMENS, SCHNEIDER ELECTRIC, LEGRAND, and so on), utilities (EDF, GDF SUEZ, and so on), software and cable companies (IBM, HP, ORANGE, and so on), and contractors (BOUYGUES, VINCI, EIFFAGE, and so on). Additionally, we could add thousands of SMEs and start-ups.
These offers come from different firms for different kinds of end-using buildings. As a consequence, the nascent French Building refurbishment industry gets together several parts of existing markets, such as electrical equipment market, Operations & Maintenance market, energy supply market, and so on.
In a nutshell, the Building sector is complex and diversified. It still represents a huge potential of energy savings and a profit-making field of opportunities. Consequently, national energy performance objectives on buildings, strengthened by European regulations, are ambitious. However, various barriers and lack of economical incentives lead to a dead-end situation where there is no real trigger in the industry. At the crossroads of several existing Markets, a proactive ESCO may want to choose the right Markets to break into.
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