Our Chief Product Officer Andreas Procopiou, performed in the PV Magazine about the new urban policy environment.

Here are the main points:

  • Since the beginning of 2021, all new buildings constructed in the European Union must be “nearly” zero energy. This is a complex task requiring synergies among various stakeholders and technologies. Ilias Tsagas provides insight into the drivers and challenges toward this set goal, and shines a light on solar’s most significant role.

Image: Ilias Tsagas

As feed-in-tariffs for small PV systems disappear, there is a growing need for the clear communication of policies to support the segment, whether by promoting self-consumption or net-metering.

EU directives comprise the bloc’s legal toolbox and therefore must be implemented by member states. They do not comprise a voluntary, horizontal policy transfer tool among member-states. Policy learning and transfer might indeed occur via a plethora of initiatives and schemes, however, all member-states need to transpose the directive into their national laws.

Member state plans, and their revisions, as well as routes for the adoption of NZEBs, have been submitted to the commission through 2021. To help national administrations learn from each other, in 2016 the commission also published guidelines for the promotion of NZEBs, while a number of progress reports and studies funded by the EU have also provided transparent, up-to-date information.

  • One of the most complete studies regarding the uptake of NZEBs in the European bloc was prepared for the commission in 2019. It examined the renovation activities that took place in each member state from 2012 to 2016.

The EC study considered all levels of renovations relating to non-renewable primary energy savings achieved in a specific calendar year. Both energy and non-energy renovations were considered, and solar PV comprised part of the energy renovations. The study came up with the following four broad levels of renovation: below the threshold for less than 3% savings, light for energy savings up to 30%, medium for savings up to 60%, and deep renovations concerning larger than 60% energy savings.

  • In its study, the EC also looked at the triggers and barriers, either boosting or halting energy renovations respectively. The results are enlightening for the solar PV industry, given such renovations include solar systems.

It is striking that the most widespread triggers for renovations turned out to be necessary maintenance, the replacement of defective components, and budget becoming available to carry out the renovations. “The most relevant aspects of energy renovation for consumers are not the energy savings, but the cost savings and making their home more comfortable and healthier,” aiming to tackle energy poverty and improve the quality of a dwelling.

  • Key role

The change is crucial because according to the study published by the EU Commission, the influence of intermediaries such as architects and installers is largely underestimated. “These intermediaries … are the persons [that] consumers listen to when deciding about the extent or depth of energy efficiency measures,” said the authors of the study.

However, a common challenge is that often energy efficiency measures are too complicated and even many architects find it hard to select the most suitable measures.

  • Lost in translation

The need for the clear communication of policies is becoming all the more important, given that the market for small PV systems is no longer supported by stable feed-in tariffs, but rather through self-consumption and net-metering schemes. Such financial drivers are more complex and best achieved through energy management within the home and concepts such as the smart home.

A paradox hampering the adoption of NZEBs and the business of smart energy companies is that while often national policies subsidize the purchase of smart energy devices, like behind-the-meter energy storage, the same countries do not have a regulatory framework in place to define the role of such devices in the electricity market. This is the case in Greece and Cyprus for instance, where governments say energy storage policy frameworks are under way.

  • Finding their way

Policy complexity and miscommunication of the measures across different states provide additional hurdles to companies that are looking to enter certain markets. So, an emerging question is how they can push forward, find their way to apply their ideas, and sell their products in different energy markets.

Andreas Procopiou provided clues. Watts Battery, which a few months ago moved its headquarters from Cyprus to California, serves the EU, the United States, Russia, Asia, and Africa. The company also targets any market with an interest in energy storage systems. However, where in Russia and Africa it focuses on backup power solutions, in the EU market it provides opportunities around end-users who aim to gain energy self-sufficiency and provide services to the grid, such as via virtual power plants (VPPs).

Procopiou said that most often, “market growth is defined by government incentives or law-enforced policies.” While the company takes into account the EU’s NZEB policies, most people who are not in the space of property development and energy integration are not aware of the NZEB information, and therefore specifically in the EU, Watts Battery will rather approach customers offering other solutions. Such solutions concern the best use of a customer’s self-generated energy or VPP applications.

“Energy storage is the key to accelerate the transition to NZEBs,” Procopiou told pv magazine. “Of course, many systems can help to increase a dwelling’s energy efficiency, but still a lot of energy is needed from the grid during the day. Fitting PV panels can help reduce the need to use energy from the grid, but only a part of the self-generated energy is locally consumed and the rest is fed back to the grid.

“At times when the PV systems do not generate power, this is supplied by the grid, often generated from fossil fuels,” Procopiou added. “If we balance those two power flows, we can call the building ‘net-zero’. The case becomes stronger in the future because if the NZEB policies materialize and most or all of the buildings self-generate solar power, then the excess generating power during daylight becomes more of a pressing issue. So, I would argue, that unless we can store the excess clean and carbon-free solar power and use it later in the day, the efforts of creating NZEBs will not be fully achieved.”