European Banking Federation submits recommendations to the European Commission on boosting lending for building energy renovations

The European Banking Federation (EBF) has responded to the European Commission’s consultation on how to increase lending for the energy renovation of buildings. While welcoming the development of a voluntary and non-binding portfolio framework, the EBF argues that increasing private financing depends on addressing underlying demand- and supply-side constraints in the EU renovation market. The response calls for EU-level initiatives that strengthen the economic case for energy efficiency investments and stimulate sustained demand, alongside measures to expand delivery capacity so that labour and material costs do not erode the impact of public support. It also highlights barriers linked to low borrower awareness and complexity, recommending coordinated EU and national awareness campaigns led by public authorities and the creation of one-stop shops for property owners. To improve project economics and the risk-return profile for lenders, the EBF advocates predictable EU-level subsidies, grants and public guarantees supported by a stable regulatory framework, and streamlined access to public financial support, particularly for SMEs and households. For the most vulnerable households in the worst-performing buildings, it flags high credit risk and collateral challenges and notes that banks’ risk-based loan origination requirements may still prevent lending where repayment capacity is insufficient, calling for a deeper public-private partnership to address this gap.