Achieving the goals of the Paris Agreement in the European Union is a central element of the European Green Deal. In 2020, the Union committed itself to reducing net greenhouse gas emissions across the Union economy by at least 55% by 2030 compared to 1990 levels. To this end, the Commission developed a strategy for a building modernisation programme.1 The strategy includes an action plan that envisages specific regulatory, financing and support measures with the aim of at least doubling the annual energy renovation rate of buildings by 2030 and promoting deep renovations.2 Regulation 2021/1119 of the European Parliament and of the Council establishes the objective of climate neutrality for the entire economy to be achieved by 2050, which was then announced in the European Commission’s 2021 work program ‘Towards 55%!’ supported by a wide-ranging set of policy measures. Within this framework, the previous EU regulations - with particular regard to Directive 2010/31/EU on the energy efficiency of buildings - were also revised and the revised Directive on the energy performance of buildings (EU/2024/1275) and the revised Energy Efficiency Directive (EU/2023/1791) were also adopted.3

The revised Energy Performance of Buildings Directive aims to increase the rate of renovations in the EU and allows national governments to decide on the renovation measures best suited to their specific national environment. In addition, the rules support the creation of a decarbonised, zero-emission building stock in the territory of the Union by 2050. In addition, the directive also aims at the gradual introduction of minimum energy efficiency standards for non-residential buildings in order to start the renovation of buildings with the lowest energy performance. In addition, as part of the 2023 revision of the ETS Directive, it has established a new emissions trading scheme to manage CO2 emissions from fuel combustion in buildings.4

Regulation 305/2011/EU of the European Parliament and of the Council on construction products established harmonised conditions for the distribution of construction products for the entire Union, in order to ensure the functioning of the single market. It ensured this primarily through harmonised technical regulations and required the use of the CE marking without additional markings, certifications or tests being required by the EU Member States. In addition, this regulation did not define requirements for products and imposed the responsibility on Member States for defining safety, environmental and energy requirements for buildings and other constructions. In 2016, however, the Commission identified a number of shortcomings in the implementation of EU legislation, which hindered the operation of the single market for construction products and thus the achievement of the objectives of the construction products regulation, so the revision of the regulation began in order to ensure the proper implementation of the circular measures packages and the construction products in order to carry into effect a well-functioning single market and to support the green and digital transition. The proposal defines the rights and obligations of economic operators. Thus, e.g. manufacturers must design and manufacture products and their packaging in such a way that their overall environmental and climate sustainability reaches the state-of-the-art level, prioritising recyclable materials and materials produced through recycling. They must prevent premature obsolescence of products, use reliable components, and design products in such a way that their durability does not fall below the average durability of products in the given product category, and design products so that they can be easily repaired, refurbished and upgraded.

In 2020, the European Commission laid down the foundations for an industrial strategy that supports the dual transition to a green and digital economy. The strategy was updated by the EU after the pandemic period5 and focused on the rapid green and digital transition of EU industry and ecosystems. As a condition for this, the strategy stipulated that this industrial ecosystem must transform its business models and value chains in order to become the basis of a green, digital and flexible European economy. The Transition Pathways for Construction6 describes the conditions and necessary steps to achieve a flexible, competitive, greener and more digital construction ecosystem. It also proposes measures to support the transition to safer buildings and affordable housing for all Europeans. In addition, supporting the spread of Building Information Modeling (abbr. BIM) remains one of the Commission’s main priorities.

A significant part of the administrative procedures required for construction are still paper-based, which is why one of the most important EU efforts is the digitisation of building permit systems. This requires tools that automate official evaluation processes and support the control of legal compliance.

In 2020 the Commission published the Renovation Wave Strategy along with an action plan and a document presenting available EU funding. These strategic documents primarily served the purpose of renovating 35 million buildings by 2030 by formulating measures covering the entire renovation chain. The Regulation on the Governance of the Energy Union and Action on Climate Change7 requires Member States to prepare these strategies and new strategies every ten years thereafter. These should address, among other things, the reduction of the total emission of greenhouse gases, the related estimates of long-term investments, as well as the related research, development and innovation strategies, the expected socio-economic effects of decarbonisation measures, as well as aspects related to environmental protection. Based on8 the submitted national strategies, the Commission assesses whether the national long-term strategies are adequate for the EU to achieve its objectives.9

In addition, the New European Bauhaus is an EU policy and funding initiative launched by the European Commission in 2021, which supports sustainable solutions with its proposals and recommendations.10

The Waste Framework Directive defined recycling and utilisation targets to be achieved by 2020 for construction and demolition waste (70%), the implementation of which differs in each Member State, as can be seen with other environmental protection policies.11

The construction industry is the largest source of waste in Europe, in 2020 37.5% of waste in terms of weight, however, the utilisation rate of construction and demolition waste is 89%, mainly due to backfilling. Reuse and recycling rates remain low. The aging rate of the buildings is high, while the renovation rate is approx. 1%.12 In the case of greater use of secondary materials, the material use of buildings can be reduced by 30%.13

According to the Commission’s 2018 report, the efficiency of construction and demolition waste management can be increased through the use of a number of tools, so among other things, waste generation can be prevented through intelligent design, by extending the life of constructions, and by reuse. In addition, the efficient use of construction and demolition waste can be supported through selective demolition and on-site sorting.14

The EU launched the ESG Environmental, Social, Governance criteria system (abbr. ESG) into the operation of the economy, the purpose of which is to objectively examine the activities of individual business organisations in terms of sustainability and unified corporate responsibility. In this system, the environmental variable includes the factors of the given company affecting air pollution, energy consumption, waste management, and biodiversity, among others, while the social pillar condenses the entity’s relationships with the company’s stakeholders and society as a whole. Among other things, this includes occupational safety and health regulations, compliance with them, as well as their enforcement, and finally, the management element provides insight into the operation of the organisation, including a wide range of activities, such as the composition of management bodies, organisational culture, information sharing channels, internal audits and remuneration.

On 14 December 2022, on the issue of corporate sustainability reporting, Directive 2022/2464/EU of the European Parliament and Council amending Regulation 537/2014/EU, Directive 2004/109/EC, Directive 2006/43/EC and Directive 2013/34/EU was announced. The aim of the directives is to ensure consistency between the reporting requirements under the Taxonomy Regulation and the corporate sustainability reporting requirements. According to the directive, all large companies and all small and medium-sized enterprises listed on a regulated market (stock exchange) must prepare a report on sustainability issues such as environmental, social issues, human rights and governance factors. The directive introduced the requirements in stages, with the obligations first applying to the business year starting on or after January 1, 2024. This new set of rules also requires a change in approach to sustainability for construction companies.

Regulation (EU) 2020/852 of the European Parliament and of the Council (‘Taxonomy Regulation’) was submitted as part of the Commission’s previous action plan of March 2018 entitled ‘Financing sustainable growth,’ which defines uniform criteria for companies and investors for economic activities that can be considered sustainable from an environmental point of view, so its purpose is to increase the transparency and consistency of the classification of such activities, and to limit the risk of greenwashing and fragmentation of the affected markets.