CAN WE GIVE UP OUR 'LUXURIES' TO ACHIEVE A 'NET-ZERO' CARBON CITY
In 2019, the European council endorsed the European Green Deal - an ambitious new plan to make Europe climate neutral by 2050. The goal is to eliminate pollution, and this is going to be achieved by boosting the economy through green technology as well as the creation of a sustainable industry and transport sector. Since its launch in December 2019, the system has already raised €1.8 trillion euros to transition the European state into a circular economy that is going to be powered by renewable energy and governed by a European Climate Law.
The year 2021 has proven to be one of great changes in many different aspects, and the EU made it clear from the start that they are going to be making every effort necessary in order to reach their 2050 environmental targets.
The plans are going to completely transform the ways that we live our lives, from cooking to heating our homes to moving around, affecting even how we work. As Johanna Lehne, a policy adviser at E3G, an independent climate change think tank, said, “Success would result in a Europe that has been tailored and re-engineered in a way that keeps you safe.”
Despite the Covid-19 crisis, the commission has been continuously pushing out legislative initiatives to ensure that deadlines are met. A series of communications, roadmaps and proposals have been published, and the results have been encouraging. In Germany, the victory of the Green Party in 2020 shows that the citizens have realized that the green option is a viable way to achieve prosperity. A little more north, Sweden and Finland have exceeded their renewable energy contribution targets in 2020, proving the effectiveness of the policies.
If we want to look further, the Green Deal includes a focus on renovating existing buildings to improve energy efficiency, as well as new transport measures to support cleaner, greener and alternative transport methods in order to achieve a 90% reduction of emissions from this sector.
Cyprus has some catching up to do
With the 2030 emissions reduction target raised from 40% to 55% in comparison to 1990 levels, it is evident that the EU is determined to drive a fast transition to cleaner energy, and is likely to get rid of obstacles in its way. To attain climate neutrality, all Member States must be making a fair contribution towards the overall goal, however some have been dragging their feet.
Cyprus ranked lowest in the EU for its share in renewable energy sources in 2020, particularly in the transport sector, which has earned it a whopping €40million fine.
The island’s Low Carbon Development Strategy for 2050 report states “climate change is a global issue, and measures designed to reduce it cannot be successful unless the nations of the world act together in a coordinated and harmonious manner.” But even with milder targets in comparison to those of other nations, the island has been slow to adapt their practices in order to meet them.
Even with a climate offering over 350 days of sunshine a year, it still primarily relies on imported petroleum products, which contribute for over 90% of the country's gross final energy consumption. One of the biggest challenges for Cyprus is going to be finding ways to reduce emissions from the transport sector, as they are responsible for almost 50% of the total 7.4 million tonnes of emissions (2019) . A growth emission rate of an average annual 2.78% means that great steps in both physical and social aspects are going to have to be taken in order to adapt the cities to this change.
As outlined in Cyprus’ National Energy and Climate Plan (NECP), intervening on transport is the key to reduce emissions for both the 2030 goal and for the longer-term. The land transport sector is one of the major emitters of CO2 and one of the hardest sectors to decarbonise. In order to comply with the EU's new and much more ambitious energy goals it is necessary to embrace renewable energy. Not only is it possible to achieve this, but it will become a prerequisite for Cyprus to benefit from the EU's recovery package.
We can use the UK, an active member of the Green Deal, as an example. The ‘De-carbonising Transport’ strategy which was introduced in 2020 places focus on “natural first choice” to be public transport and emissions-free modes of travel like walking and cycling. This has been supported with more than official announcements: the government has authorized a £2bn ($2.6bn) national grant and issued temporary bike lanes and car-free areas, with the clause of considering making some of them permanent. Encouraging means of transportation alternative to cars – that is, making them a safe and convenient option – is a first-impact strategy in the struggle against emission, and it shows that intervening in everyday life with immediately perceivable measures is the best way to involve people in this struggle.
Another approach can be incentivizing the use and purchase of Electrical Vehicles (EV). EVs will improve air quality significantly, a goal which sounds much less abstract when we consider that in Europe PM10 concentration in the vicinity of a household is directly linked with pulmonary cancer incidence (Lancet, 2013). As of now only 1% of cars in Cyprus are electric/hybrid, despite the indications on encouraging the use of climate-friendly vehicles and fuels in the low carbon report for 2050.
However increased use of EVs could, at least, improve air quality in cities and in the longer-term can lead to reductions in emissions once the share of renewables increases significantly. But without government proactive policy this is unlikely to happen. A road map to help achieve a significant EV penetration would be an essential first step: for example, the UK is working on a plan to entirely ban fossil fuel powered vehicles by 2030. (See Fig. A below)
Building an efficient future
As highlighted by a recent Housing Market Developments in Cyprus report, Cyprus never fully recovered from the devastating housing crisis of 2009, reaching in 2015 only 20% of the sale volume of 2007. A steep decrease in sales to non-residents, an important source of revenue, combined with excessive stock accumulation, lead to a fall in the price of real estate. In a country in which many loans are supported by house mortgages this is far from being a problem exclusive to investment funds: it means a compression of the resources and purchase capacity of residents and home-owners too.
Even after timid signs of reprise in 2014, the average purchase capacity of a Cypriot household is still not growing to its full potential, and certainly not at the speed experienced after entering the EU in 2004. The European Green Deal is not just an ethical fancy or a sign of our times: it’s an unprecedented opportunity to improve the financial stability and stimulate the creation of wealth of Cypriot men and women.
In the face of the Covid-related housing market crisis, which saw house sales falling up to 90% between 2019 and 2020, it is imperative to rethink the approach to real estate sales and development, and this opportunity could be decisive in tackling both structural and extraordinary problems at once.
As the European Green Deal is a comprehensive plan targeting a multitude of interrelated issues, it means that every single initiative is interconnected with the next. Frans Timmermans, European Commissioner for Climate Action,highlighted that “housing renovation initiative will mean lower energy bills and more comfortable houses.” Even without quoting high-level EU bureaucrats it’s quite clearly a win-win: a timely investment on renewable technology in housing will prevent further expenditure while improving the daily life of local citizens. Such advancements are the beginning of the journey towards eradicating the living gap that will make houses more accessible to workers and young people.
A first encouraging step has been taken this March by the Cypriot government in the form of a co-financed budget of €30m to upgrade energy efficiency in houses, resulting in lower consumption and rates - a good example of the connection between ecology and economy. This is a textbook application of the Green Deal – supporting climate-friendly measures as a means to improve the citizens’ material conditions.
A non-secondary aspect of this approach is the effects on the youngest sector of the population. The generations born after the 90s have on average a lower purchase capacity than their elders, and it goes without saying this affects their role in the real estate and housing market.
When the municipality of Limassol announces for example that the construction of 600 new housing units will be partly financed through EU funds it is implied that these funds will be erogated under Green Deal conditions. This means not only that the lower-than-market-value price of those new houses will be possible because they’ll be built with low-interest loans from the EU, but that these loans are in fact possible because of the eco-friendliness of the new houses. In the end, if more young people and couples in Limassol will be able to afford a new house it will in good part be because of the Green Deal.
It is commonplace to say a young society is a healthy society. This is although far from being rhetoric: without the economic and cultural dynamism youth brings about, stagnation (both cultural and economic) becomes endemic. Housing is perhaps one of the key factors that measures and determines what the perspectives of young people are: the rapid rise in property prices has made millennials favor rent over taking on a loan to purchase property. Funding less expensive housing through the Green Deal will also mean those houses will remain less expensive to maintain, making them a palatable investment even for young or small earners.
It is an age-defining change we’re talking about. New solutions to persistent problems usually encounter diffidence and resistance from those agents of tradition who are not used to doing things the new way. This is both an obstacle and an opportunity: those who’ll have the ability to recognize the future face of the real estate and housing market will reap handsomely, at either side of the development and sales process.
The sheer volume of the Green Deal should speak of its seriousness. The Green Deal is much more than just setting carbon emission goals, it is a wide variety of policy frameworks that feed into this. It is about setting targets for reduction of pesticide and fertilizer use, deforestation targets, nature conservation, rebuilding of natural watersheds; it is above all about changing our lives for the better now, to avoid them changing for the worst tomorrow. The bare fact that such an ambitious endeavor is possible makes it worth giving it a serious shot.
Right after recognizing the importance of this opportunity, our first challenge is to create a new paradigm fit to work within it. Real estate renovation is too often synonymous with out-pricing and gentrification: The Green Deal could be an incredible opportunity to change this: for the first time technological innovation could result not only in lower purchase prices and maintenance costs, but also in the creation of neighborhood communities rather than their dissolution. Affordable housing would imply the opportunity to buy rather than rent, favoring the creation of a stabler social fabric – people living side to side with the prospect of sharing the same streets and squares and bars for years rather than seeing it just as a stepping stone to somewhere “better”. What’s more, the awareness that this community vibe has been made possible by a collective, supra-national effort aimed at no less than giving our children a livable future is likely to increase the sense of bond. After all, it’s exciting to know that what gave you the opportunity to settle down you were looking for is also giving your family the opportunity to secure a safe future.
As we said before, this is not just about housing – or rather every part of the Green Deal is connected with another, just like the effort and results of every country in the Union benefit every other. This is especially evidently true on an island. From now on we cannot afford to build and live in houses that endanger the very existence of the cities they’re built in. Building a house without a careful insight on its ecological footprint is no longer something we can afford – not economically, not socially. Not even practically soon enough, if we don’t tackle climate change.
Share of energy from renewable sources in trasnsport
Fig. A. A graph depicting the share of energy generated from renewable sources in 2020 by EU Member States in regards to land transport. Source: ec.europa.eu