Buildings have a far greater impact on our environment — and on our wallets — than we often realise.
Around 34% of global energy consumption is tied to the building stock. This includes the energy used for heating, cooling, lighting and mechanical systems — and that figure does not even account for the emissions from material production or demolition, both of which further increase the sector’s carbon footprint.
Despite gradual improvements in energy efficiency across many countries, the average consumption of homes and offices remains far too high, and renovation rates are still lagging.
This is why a new generation of building regulations is essential — rules that truly move the needle towards buildings that use less energy, produce lower emissions, offer healthier indoor environments and remain affordable to operate.
Climate neutrality
According to the European Parliament, modernising the building stock is essential for the EU to meet its 2050 climate-neutrality target.
Under the EU definition, climate neutrality is reached when greenhouse-gas emissions from human activities are reduced to the greatest extent possible, and any remaining, hard-to-avoid emissions are fully balanced by certified carbon removals—ensuring no impact on the climate system.
In line with this goal, the EU has introduced a series of strategies and directives in recent years aimed at reducing energy use, increasing the share of renewables and lowering emissions across the entire life cycle of buildings.
The EU’s climate and energy policy framework for buildings
In recent years, the EU’s climate agenda has been built on three major pillars that directly affect the construction sector — and whose implementation will also be mandatory in Hungary. These are:
- The European Green Deal
- The Fit for 55 Package
- The revised EPBD (Energy Performance of Buildings Directive – 2024/1275)
Let’s take a closer look at each of these to understand what they mean for buildings — and when their requirements will come into force.
1. European Green Deal – the overarching policy framework (2019– )
The EU’s long-term strategy sets out that the Union will achieve a climate-neutral economy by 2050.
What does this mean for buildings?
The Green Deal was the first framework to state clearly that the energy use and carbon emissions of the entire building stock must be drastically reduced.
It introduced the Renovation Wave, a flagship initiative designed to accelerate energy-efficient renovation across Europe.
Its key target: doubling the annual renovation rate of buildings (from the current ~1% to above 2%).
Is it mandatory in Hungary? → Yes, as a strategic direction.
While the Green Deal itself is not a legislative act, the directives and regulations adopted under it — such as the EPBD — are legally binding for all Member States.
2. Fit for 55 Package – concrete regulatory measures (2021– )
The Fit for 55 package sets the goal of reducing EU greenhouse-gas emissions by 55% by 2030. It introduces a wide range of amendments to energy and climate legislation — many of which directly affect buildings.
Key elements for the building sector:
a) Renewable Energy Directives - (RED II / RED III)
- Member States must increase the share of renewables to at least 42.5% by 2030, with additional sector-specific obligations for buildings and heating.
- In Hungary, the transposition of these requirements is mandatory and must be completed by 2030.
b) Energy Efficiency Directive (EED)
- Hungary must achieve annual energy savings in the building sector under the EU’s binding energy-efficiency targets.
- This obligation is already in force today.
c) Emissions Trading System for buildings and transport (EU ETS2)
- From 2027 (or 2028 in case of exceptional price volatility), fossil fuels used for heating buildings will fall under a new emissions-trading regime.
- This will place a carbon price on fossil heating, making gas and oil-based systems increasingly expensive.
d) Phase-out of fossil boilers
- Under Fit for 55 and the revised EPBD, from 2025 onwards, Member States may no longer provide subsidies for installing fossil-fuel boilers.
- This rule is mandatory in Hungary as well.
3. The New EPBD (2024– ) – the most concrete and impactful reform
The EPBD (Energy Performance of Buildings Directive – EU 2024/1275) is the key piece of legislation that directly determines how buildings must be designed and renovated. It entered into force on 24 April 2024, with a transposition deadline of 29 May 2026.
What does it require for buildings?
a) From 2030, all new buildings must be “zero-emission buildings”.
This means:
- very low energy demand
- a complete ban on fossil-fuel heating systems
- mandatory use of renewable energy, generated on-site or supplied from nearby sources.
Who must comply, and from when?
- Public and government buildings: from 2028
- All new buildings: from 2030 → These requirements will become binding in Hungarian law once the directive is transposed.
b) Mandatory Whole-Life Carbon (WLC) assessment and reporting from 2027
From 2027, designers will be required to carry out an LCA (Life Cycle Assessment) for all new buildings. Member States — including Hungary — must introduce national WLC limit values.
This marks a major shift: for the first time, embodied carbon regulation will enter Hungarian building law.
Implementation timeline:
- 2027 → WLC reporting becomes mandatory
- After 2030 → binding national limit values are expected
c) Minimum Energy Performance Standards (MEPS) – for the worst-performing buildings
All EU Member States must:
- establish minimum energy performance thresholds, with specific focus on the worst-performing buildings.
- Hungary is expected to introduce these requirements between 2028 and 2030.
d) Stronger Energy Performance Certificates (EPC) – with a new EU-wide scale
The revised EPBD introduces:
- a common EU template for EPCs,
- mandatory disclosure of GWP (Global Warming Potential), i.e. whole-life carbon.
- Hungary’s transposition period: 2025–2026.
e) Solar requirements for new buildings:
From 2026, all Member States must ensure that new buildings:
- are solar-ready (structurally and technically suitable for PV installation), and
- install PV systems on certain building types where technically and economically feasible.
What makes a building truly climate-neutral?
The definition of a climate-neutral building only becomes meaningful when we understand which emission sources must be addressed for a building to have a genuinely minimal climate impact over its entire life cycle.
Modern buildings generate emissions from two main sources:
- Embodied carbon – material production, transportation, construction, renovation and end-of-life processes
- Operational carbon – heating, cooling, lighting, ventilation and hot water
Today, a growing body of research shows that in well-insulated, renewable-powered buildings, operational emissions are dramatically lower, meaning that embodied carbon becomes the dominant contributor to total life-cycle emissions.
This is why climate neutrality cannot be achieved through efficient building services alone — it requires a fundamental rethinking of materials, structural systems and construction processes.
Climate-aligned buildings therefore rest on three key pillars:
- Extremely low energy demand - achieved through passive design strategies (orientation, shading, massing, insulation, airtightness) combined with high-efficiency building services.
- Decarbonised energy supply - through the phase-out of fossil fuels, adoption of heat pumps, integration of PV systems and access to renewable or green-grid electricity.
- Low embodied carbon - enabled by circular material use, reusable structural systems, biogenic materials and whole-life carbon assessment (LCA).
Ultimately, a climate-neutral building is a design and operational framework: an approach that strives, from the very first line on the drawing board, to minimise climatic impact across the entire life cycle.
And this goes far beyond energy efficiency. Climate-neutral buildings not only consume less — they actively contribute to:
- slowing global warming,
- reducing extreme weather risks,
- lowering health and societal impacts,
- preserving the livability of urban environments, and
- creating safer, more economical, future-proof building stock.
The 10 key performance indicators
Climate neutrality is not a technology, a label, or a marketing claim — it is a set of measurable performance targets.
These indicators help determine whether a building is genuinely low-carbon or simply gives the impression of being so.
Together, the ten KPIs below offer the most straightforward and practical framework for understanding what truly makes a building climate-aligned and sustainable.
1. Embodied Carbon (Upfront Carbon: A1–A5)
- Unit: kg CO₂e/m²
What it measures:
- Emissions from material production, transport and construction.
Recommended benchmark ranges (LETI, RIBA):
- Residential: ≤ 300 kg CO₂e/m²
- Office / non-residential: ≤ 500 kg CO₂e/m²
Regulatory context:
- From 2027, national embodied-carbon limits are expected under the EPBD.
2. Whole-Life Carbon (WLC: A–C + D)
- Unit: kg CO₂e/m² (50-year period)
What it measures:
- All carbon emissions generated across the entire life cycle of the building — including construction, operation, maintenance, replacement and end-of-life.
Target ranges:
- Residential: 600–800 kg CO₂e/m² / 50 years
- Office: 900–1,200 kg CO₂e/m² / 50 years
What counts as excellent performance?
- Values below 500 kg CO₂e/m² — achievable particularly with timber-based construction.
3. Material circularity indicators
Units:
- Recycled content: %
- Reusability / recoverability: %
Typical benchmark values:
- 30–50% recycled content for non-structural materials
- ≥ 80% recoverability for modular construction systems
- For timber: high reusability beyond 50 years, with low or even negative upfront carbon, depending on biogenic storage.
4. Annual Energy Use – EUI (Energy Use Intensity)
Unit: kWh/m²·year
What it measures:
- The building’s total operational energy consumption across all systems.
Recommended benchmark ranges:
- Residential: ≤ 60 kWh/m²·year
- Office: 60–85 kWh/m²·year
- Passive House standard: 15 kWh/m²·year (space-heating energy demand).
5. Primary Energy Demand – EP
Unit: kWh/m²·year
A widely used indicator in Hungary’s energy certification system.
Recommended benchmark range:
- New residential and office buildings: ≤ 80–100 kWh/m²·year
- Zero-Emission Buildings (ZEB): very low primary energy demand (exact thresholds vary by Member State).
6. Operational Carbon
Unit: kg CO₂e/m²·year
What it measures:
- The carbon intensity of the building’s heating, cooling, lighting and electricity use.
Benchmark range (1.5 °C pathway):
- ≤ 2–5 kg CO₂e/m²·year for total operational emissions
- Fossil-fuel heating typically results in 10–20 kg CO₂e/m²·year, which is not compatible with a climate-neutral trajectory.
7. Electrification – share of heat pumps and fossil-free systems
Unit: SPF / SCOP (Seasonal Performance Factor / Seasonal Coefficient of Performance)
What it measures:
- The seasonal efficiency of heat pumps.
Recommended benchmarks:
- SCOP ≥ 3.5–4.5 for air-source heat pumps
- SCOP ≥ 4.5–5.0 for ground-source systems
Regulatory note:
- After 2028–2030, fossil-fuel boilers will no longer be permitted in new buildings under EU rules.
8. Share of renewables in annual Energy Use
Unit: %
Purpose:
- A higher share of green, on-site or nearby renewable energy lowers both emissions and operating costs.
Benchmark values:
- ≥ 30–50% renewable share = good performance
- ≥70% for Zero-Emission Buildings (ZEB) — typically achieved through PV + heat pump combinations
9. Airtightness & thermal comfort
Airtightness:
- n₅₀ ≤ 1.0 h⁻¹ (blower door test)
Overheating:
- ≤ 100 hours/year above 26 °C (RIBA 2030 target)
Comfort:
- PMV (Predicted Mean Vote): thermal sensation on a −3 to +3 scale
- PPD (Predicted Percentage of Dissatisfied): share of occupants dissatisfied; PPD ≤ 10% is the common international target
10. Resilience & climate adaptation indicators
Unit: no single metric — indicator-based assessment
Typical factors include:
- Flood-risk exposure
- Urban heat-island vulnerability
- Preparedness for heatwaves
- Energy autonomy (e.g., survivability during grid outages)
What defines a well-performing building?
- Located outside high flood-risk zones or adequately protected
- At least 24 hours of passive survivability during extreme heat (shading, thermal mass, natural ventilation)
- Combination of renewables and storage for improved energy resilience
