Decarbonisation scenarios for the European residential sector

Abstract

The urgency to combat global climate change has prompted the implementation of many regional and national policies, with the European Green Deal standing out as one of the most significant initiatives. We use the recently developed TIMES-Europe energy system model to study the pivotal role of the residential sector in achieving the ambitious energy savings goal formulated by the EU in the broad framework of its Fit-for-55 policy package. We observe improved energy efficiency in households across a set of scenarios that differ in terms of climate policy ambition and level of collaboration between European countries. We find that, by 2030, residential buildings can realize up to 3000 PJ in overall energy savings. Cross-country collaboration may yield an additional 11% reduction in residential energy consumption, which could increase to 18% when combined with dwelling retrofitting subsidies. Our analysis of the transformation of the residential fuel mix, particularly the interplay between biomass and natural gas usage, reveals a trade-off between short-term energy efficiency gains and long-term CO₂ reduction goals. In the short run, scenarios lacking stringent climate control measures exhibit higher energy savings in comparison to those embracing ambitious climate targets. This initial difference, however, diminishes over time: energy savings from climate-compliant scenarios nearly align with those in scenarios without strict climate compliance around 2040. Scenarios lacking effective climate policy result in significant delays in decarbonizing the European residential sector. Our findings underscore the critical role of ambitious climate targets and accelerated retrofitting rates, highlighting the necessity to imminently and proactively implement directed policy interventions.