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Summary
The French energy renovation market has witnessed significant growth due to increasing government incentives and regulatory measures aimed at enhancing energy efficiency and reducing greenhouse gas emissions. The MaPrimeRénov' program, which replaced previous schemes in 2020, has been a key driver, distributing work funds worth €3.1 billion in 2022 and benefiting nearly 700,000 homes. Moreover, eco-loans have seen a 31% increase in distribution in 2022.
As regulations grow stricter, with homes rated label G being banned from the rental market starting in 2025, and label F by 2028, the market is expected to expand further. Despite this, the high cost of energy renovation works remains a hurdle, with 70% of French citizens considering it a significant barrier to improving their homes' energy performance
The French Market's Growing Appetite for Energy-Efficient Renovation
In France, the urgency for energy-efficient renovations is driven by a trifecta of compelling reasons: battling climate change, supporting the financial capabilities of its citizens, and enhancing the overall living standards.
Within its borders, the building sector stands as a critical area of focus, being the second-largest source of greenhouse gas emissions, responsible for almost a third of all CO2 emissions and close to half of the country's final energy consumption.
Achieving carbon neutrality by the year 2050 casts a significant spotlight on this sector. Over the span of thirteen years, from 2006 to 2019, the energy renovation market saw its size more than double. This rising trajectory seems to be soaring even higher in 2022 and 2023, spurred on by the supportive push of governmental incentives and financial grants.
The stakes will only get higher come 2025, with a mandate poised to pull all lowest energy-efficient homes (labeled G) off the rental market, and then further homes (labeled F) by 2028. This regulatory measure underscores the government's resolve in steering the energy renovation objectives of the country.
There is a clear inclination among the population to pursue energy renovations; about a third of French citizens express plans to engage in such improvements in the years to come. These prevailing circumstances suggest that while the demand for energy-efficient renovation in France is progressively on the rise, sustained and perhaps even increased support from the government and related entities will be critical in overcoming financial obstacles and achieving the nation's ambitious environmental and energy objectives.
Key Market Leaders Pioneering Energy Renovation in France
As France steers towards a sustainable future, the energy renovation market is burgeoning, driven by the potent combination of government legislation, incentives, and a growing public awareness of environmental issues. Central to this green transformation are the trailblazing players whose innovative solutions and services are shaping the industry's landscape.
- Effy Group Starting with Effy Group, this stalwart has become synonymous with energy efficiency. As a facilitator of energy renovations, Effy Group simplifies the complex process for consumers by offering end-to-end solutions. They guide homeowners through audits, eligibility checks for government aids like MaPrimeRenov', and pair them with qualified contractors. Their influence is inextricable from the success of energy efficiency programs in France.
- French Ministry of the Economy On the regulatory side, the French Ministry of the Economy plays a pivotal role. Not only do they orchestrate the distribution of financial incentives such as MaPrimeRenov', but they also set the legislative framework that drives energy conservation efforts within the residential sector.
- SGFGAS (Société de Gestion des Financements et de la Garantie de l'Accession Sociale à la propriété) SGFGAS administers the eco-PTZ, an interest-free loan that underpins the government's strategy to make energy renovations more financially accessible. Their effective management and promotion of the eco-PTZ grant have contributed significantly to the loan's increased uptake.
- ADEME (Agence De l'Environnement et de la Maîtrise de l’Énergie) ADEME, the French Environment and Energy Management Agency, stands at the forefront of promoting sustainable energy use and investigating innovative solutions to energy and environmental challenges. ADEME's involvement extends to funding research projects, supporting the deployment of clean technologies, and implementing national energy-saving initiatives.
- FFB (Fédération Française du Bâtiment) Representing the building industry, the FFB provides a voice for professionals in the sector, lobbying for favorable policies and supporting members in the transition towards energy-efficient practices. The organization's role is crucial in fostering industry standards and providing training and resources for the adoption of green building techniques.
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- Number of pages : 30 pages
- Format : Digital and PDF versions
- Last update : 02/11/2023
Summary and extracts
1 Market overview
1.1 Definition and scope of the study
Energy-efficient renovation of French homes and commercial buildings is of paramount importance, responding to a triple imperative: combating the effects of climate change, supporting citizens' purchasing power and improving the population's quality of life.
In France, the building sector is the second largest contributor to greenhouse gas emissions. it alone accounts for 27% of CO2 emissions and nearly 45% of final energy consumption. As a result, the building sector is of crucial importance if we are to achieve carbon neutrality by 2050.
The energy renovation market more than doubled in size between 2006 and 2019, and this upward trend looks set to become even more pronounced in 2022 and 2023 thanks to government incentives and available grants.
The energy renovation market is boosted by government incentives and grants. The introduction of the PrimeRenov' scheme, which financed work worth 3.1 billion euros in 2022, benefiting almost 700,000 homes, and the 31% increase in the distribution of eco-loans in 2022, have played a key role. What's more, from 2025 onwards, it will be mandatory to remove from the rental market all homes classified as label G (and label F by 2028).
Although almost a third of French people plan to undertake energy renovation work in the coming years, 70% consider the cost of such work to be the major obstacle to improving the energy performance of their homes. What's more, the building renovation and improvement sector is experiencing rising costs, due to the significant increase in raw material and energy prices in 2022, a trend that continues into 2023.
While government subsidies are growing steadily, they are faced with the growing problem of work costs. Against this complex backdrop, it's worth asking how the players in this sector will adapt and evolve.
1.2 A booming global market
The global energy renovation market is estimated at *** billion in ****, with average annual growth of *.*% between **** and ****.
The global energy renovation market World, ****-**** Source: ****
Growth drivers for energy renovation systems include
Growing demand for electricity: Demand for electricity is rising rapidly in many parts of the world, largely due to ...
1.3 A fast-growing French market
In ****, sales generated by players specializing in maintenance and renovation in the building sector reached ** billion euros, marking significant growth of **% on the previous year. An interesting observation is that, according to the FFB, around a quarter of this market is attributed to DIY (***) or to undeclared practices, thus escaping the ...
2 Demand analysis
2.1 Demand driven by government incentives
Demand is stimulated both by government incentives (***) and by the imperative for many homeowners to undertake energy renovation work in response to new regulations.
In ****, MaPrimeRénov' supported the renovation of ***,*** homes in France. All of this work generated the distribution of premiums worth a total of *.* billion euros, underlining the ...
2.2 Housing maintenance-renovation market
Housing maintenance-renovation market France, ****-****, billions of euros Source: ****
The housing maintenance and renovation market, which includes energy renovation, has recorded steady growth from **** to ****. The average annual growth rates for large-scale home improvement work and small-scale work are *.**% and *.**% respectively in terms of value.
It should be noted that this ...
2.3 The French and energy renovation
For **% of French people, the top housing priority is to improve the insulation of existing homes over the next * years.
What do you consider to be the most important housing measures to implement over the next * years? France, ****, % of respondents Source: ****
The main reason that dissuades homeowners from improving the energy ...
2.4 Heat sieve: 150 billion euros by 2034
**% of French homes have a DPE rating of E or below. All homes with a rating below E will have to be withdrawn from the rental market by ****.
Distribution of housing by DPE (***) rating France, ****, in Source: ****
The government estimates that the total cost of eradicating "thermal flaws" will reach nearly ...
2.5 Non-residential renovation maintenance market
The growth of the maintenance andand renovation marketwas**.*% in value terms in ****this represents an even higher growth rate than in ****. However, due to rising inflation in ****,volume growth has slowed significantly. This development is disappointing given the market's growth potential, supported by a number of factors, including :
*. Obligations linked ...
3 Market structure
3.1 Value chain
The value chain in building maintenance and renovation
Source: ****
The general building renovation market involves three main categories of players:
The "materials" category encompasses both manufacturers of building products (***) and distributors, such as merchants and DIY superstores. A large part of their revenue comes from the renovation market, thanks to work ...
3.2 Jobs in residential building energy efficiency
According to the Agence de la transition écologique (***) in Paris, the energy efficiency sector recorded significant growth over the period from **** to ****. On average, the number of employees rose by *.*% per year, equivalent to almost *,*** additional employees each year. Moreover, in ****, the number of employees in this sector rose by *%.
Employment ...
3.3 Focus on Ma Prime Renov
In ****, MaPrimeRénov' will be supporting energy renovations in the residential sector in a variety of ways. There are "classic" MaPrimeRénov' subsidizedenergy renovation projects, aimed at owner-occupiers and landlords. In addition, there are comprehensive renovations aimed at generating significant energy gains, which are supported by MaPrimeRénov' "classique", MaPrimeRénov' ...
4 Offer analysis
4.1 The full range of energy-efficiency solutions and their prices
The price of home insulation
The price of a heating system change
Price of carpentry changes
The price of a ventilation change
The price of a new DHW (***) system
Source: ****
4.2 Soaring building maintenance and improvement costs
In ****, professionals had to cope with a considerable increase in costs, largely due to the sharp rise in prices of raw materials, particularly the main building materials. The biggest increase was for bricks and tiles, where prices rose by almost **%. These products, like cement, were affected by their energy-intensive production ...
5 Regulations
5.1 Regulations
Laws governing energy renovation in France:
POPE law (***) - April **, ****: Creates the Energy Savings Certificate (***) scheme. sets targets for reducing energy consumption. Grenelle I Law - August *, ****: Sets targets for energy efficiency and the reduction of greenhouse gas emissions. Grenelle II law - July **, ****: Reinforces the provisions of Grenelle I and ...
6 Positioning the players
6.1 Player segmentation
- Effy Groupe
- Izi by EDF
- Cozy Energy
- Izol France
- Hello Watt
- Dorémi
- Ithaque Rénovation
- HEERO
- Tuco Energie
- Verlaine Groupe
- Domofinance
- Tilkeo Rénovation
List of charts
- Trend in the number of eco-PTZs granted
- Average amount granted per Eco-PTZ
- MaPrimeRénov' in figures
- Change in volumes of CEE issued
- Sales of older homes
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Latest news
Effy obtains €20 million from Felix Capital - 30/03/2023
- Effy carries out nearly 100,000 energy renovation projects a year
- Business volume of over 800 million euros
- More than 3,600 certified local partners across France
- 20 million euros capital increase for Effy
- 33% of work carried out by 2022 to benefit low-income households
- More than 50 million euros invested in developing their technology platform and creating their brand
- Energy renovation sales up by over 80% by 2022
- Felix Capital has raised over $1.2 billion since its inception in 2015
- More than 150 energy renovation advisors support nearly 500,000 people every year
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