Evaluating the effectiveness of fiscal grants for energy efficiency measures in flatted dwellings

Abstract

The Maltese government stipulates financial aid to homeowners in order to renovate their households so as to become sustainable and more energy efficient. This does not only benefit the homeowners, but also the government as they strive to abide by the several EU directives, in line with the decarbonisation of the economy by 2050. The goal of this study is to analyse present fiscal support schemes are at both supporting effective energy efficiency measures and making them more accessible to families, as well as to identify further effective energy efficiency measures that need to be supported. This was made possible by calculating different variables in the Energy Performance Rating for Dwellings in Malta (EPRDM) software, followed by economic analysis calculations to reveal the Net Present Value (NPV), Internal Rate of Return (IRR), Payback Period (PBP) and the Life Cycle Costing (LCC). The findings indicate that most fiscal grants require a revision either up or down. For example, it was demonstrated that the current grant on solar photovoltaics is beyond the necessary limit given that photovoltaic systems have dropped in price, while other grants such as for roof insulation requires a strong upgrade to make it economically feasible for households to renovate their roofs to a more efficient level. On the other hand, insulation of single walls has been demonstrated to be effective from an energy saving point of view, however till this date no grant has been considered for them. Finally, the study has revealed that the combination of some energy efficient measures together with solar photovoltaics have the potential of making flats reach near-zero energy status and upgrading penthouses to the level of a positive renewable energy building, meaning that it generates more renewable energy than it requires. Finally, this study could serve as an eye-opener to policy makers to reconsider their future initiatives as Malta strives to reduce its carbon footprint.