Ireland's State of the Environment Report 2024

323 Chapter 12: Environment and Energy Energy efficiency and electrification of buildings In addition to significant ambitions for renewable energy supply, Ireland has many policies and measures in place to upgrade the energy performance of buildings and to switch their energy supply from fossil fuel boilers to electric heat pumps. Houses currently built in Ireland tend to have a high standard of energy performance and are mostly heated by heat pumps following changes to building regulations in 2005. Almost half (48%) of Ireland’s existing dwellings, however, have a relatively low building energy rating of ‘D’ or lower on a scale of A-G, indicating significant ongoing energy costs for these households. CAP24 has a target of upgrading 120,000 dwellings to a rating of ‘B2’ by 2025 and the installation of 45,000 heat pumps. The targets for 2030 are to retrofit 500,000 dwellings and install 400,000 heat pumps. The National Retrofit Plan sets out how the government intends to deliver on the climate action plan targets (DECC, 2022). There is progress, according to SEAI, including 47,953 home upgrades delivered in the year 2023 – 17,600 to a B2 level (SEAI, 2024e). To achieve the desired delivery trajectory and meet the 2030 target, SEAI has projected that 185,000 home energy upgrades should be delivered between 2019 and 2025. Of these, over 83,000 should be upgrades to a B2/cost-optimal level. According to SEAI, when the carbon savings from the non-B2 upgrades are included, this will be equivalent to the CAP24 target of 120,000 B2 upgrades over the period. To deliver on the National Retrofit Plan objective, SEAI said it would need to deliver on average 75,000 B2-equivalent home upgrades per year from 2026 to 2030 to achieve the overall target of 500,000 by 2030 (SEAI, 2024e). Heat pumps are gaining in popularity as the default heating system for new builds, and 3750 heat pump installations were supported by SEAI in 2023. While the number of heat pumps supported in 2023 was up 65% on the 2022 figure, SEAI stated that this number will need to dramatically increase in the coming years to achieve the 45,000 target by 2025 (SEAI, 2024e). The 2022 Heat Study by SEAI noted that capital costs are a barrier to installing heat pumps in the residential sector, and additional policy support is needed to drive uptake (SEAI, 2022). The SEAI report also highlighted that the biggest challenges in achieving the 2025 and 2030 targets is the availability of sufficient skilled workers and construction sector inflation (SEAI, 2024e). In addition to retrofitting and heat pumps, the SEAI Heat Study also highlights the untapped potential in Ireland of district heating, which has the distinct advantage of being able to use renewable energy supplies to meet heating requirements (Topic Box 12.1). In the context of the rising energy prices, driven by international geopolitics, that have significantly affected oil, gas and electricity prices over the past 3 years, researchers at the Economic and Social Research Institute estimated that 29% of Irish households were in energy poverty (Barrett et al. , 2022). Retrofitting the homes of those experiencing energy poverty is crucial for a just transition. Topic Box 12.1  District heating District heating has the potential to play an important role in improving energy efficiency and reducing emissions in Ireland. District heating networks can use various renewable technologies to help decarbonise the heat sector. Currently, district heating accounts for a very small share of the Irish heating sector, estimated to be significantly less than 1%, representing one of the lowest shares in Europe (SEAI, 2022). The large-scale deployment of heat networks (district heating) and the use of bioenergy can make significant contributions to reducing CO 2 emissions. Heat extracted from purpose-built combined heat and power generation and waste heat are the cheapest energy sources for heat networks. Heat pumps and biomass are also widely used to meet heat supply needs in the modelling where combined heat and power is not available. SEAI recommends that opportunities for extracting heat from power stations, recovering waste heat from industrial sites, and feeding heat from geothermal sources and low-grade heat from data centres into district heating schemes should also be encouraged. This would need policy, planning and regulatory support to be provided. The revised EU Renewable Energy Directive strengthens the promotion of district heating in EU Member States. This will be transposed into Irish law by 11 October 2025.