Who should benefit from savings in building energy costs: landlords or tenants?

Landlords and tenants both have an interest in the energy performance of buildings; however, their interests are not always the same. Requirements concerning levels of energy efficiency continue to increase, but the question remains, who will pay for this work and who will benefit from the saving in energy costs? There is a problem with split incentives which includes what we highlight as the “landlord/tenant dilemma”. In a new document, CEPI and UIPI, the International Union of Property Owners, provide some useful ideas for further discussion and to promote debate on a subject which is important not only to property professionals and property owners, but also a wider European audience.

The solutions to the dilemma are determined by national legal systems in different countries. However much of the legislation in place concerning energy performance now originates from the EU. Therefore to provide solutions which can be used in different countries, property professionals and property owners, who now have extensive practical experience of these issues, need to discuss at a European level what can be done and to promote "best case examples".

In response to this need CEPI and UIPI surveyed their respective member associations, property professionals and property owners, as to the situation in their own countries and what solutions (if any) are available. The results of this survey are set out in a new position paper, available here. It is evident from the results of the survey that there are different solutions, but also that both CEPI and UIPI member associations are positive about the need to tackle this problem, and that the introduction of schemes that resolve the landlord/tenant dilemma is helpful in getting renovation work done. Further discussion and investigation are needed at an EU level to see what can be learnt from the schemes which exist and how these schemes could be adapted for different countries.