In October 2023, the oPEN Lab team released a policy brief addressing the financial and market challenges for Positive Energy Neighbourhoods (PENs). The authors include consortium members from BPIE and BAX & COMPANY. The paper is also shedding light on the pivotal role of Positive Energy Neighbourhoods (PENs) in advancing climate-neutral building stock and fostering community benefits. PENs, exemplified as pioneering projects in sustainable urban development, have demonstrated tangible advantages in enhanced public health, comfort, social inclusion, and climate resilience. Additionally, they play a critical role in alleviating energy poverty and fortifying energy security.
The paper underscores the importance of addressing current economic challenges, including inflation and higher borrowing costs, which pose potential obstacles to the renovation efforts within the European Union and flagship projects like PENs. It calls for strategic engagement with private finance to augment funding streams, alongside encouraging constructive dialogues between the public sector, construction, and financial communities.
Additionally, the paper highlights a barrier – currently, construction and financial sectors operate independently, utilising distinct methodologies for assessing investment risk and sustainability performance. A unified approach is advocated, calling for harmonised metrics to measure, track, and report projects’ environmental, social, and governance (ESG) impacts at both building and neighbourhood levels. Extension of the EU sustainable finance taxonomy to encompass environmental and social criteria is suggested as a means to further catalyse investments in PENs.
To fully realise the potential of PENs, the paper underscores the need for comprehensive guidance and policy support. It identifies the importance of universally defined terms and established benchmarks to facilitate effective decision-making, KPI setting, and industry best practices.