The energy renovation market - France (2024)

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 population growth, urbanization and industrialization. To meet this growing demand, energy retrofit systems are increasingly sought after to reduce energy consumption and associated costs Mitigating greenhouse gas emissions: Energy renovation systems play a key role in reducing greenhouse gas emissions. By contributing to a more efficient use of energy, they reduce the carbon footprint of buildings, which is essential in the fight against climate change Urbanization and industrialization: Rapid urbanization and industrialization are driving demand for energy retrofit systems. Urban areas account for a large proportion of energy consumption, and both governments and businesses are looking to reduce this consumption by implementing energy renovation solutions. Government incentives: Governments, both established and emerging, encourage the adoption of energy retrofit systems by offering incentives such as tax breaks, subsidies and energy efficiency programs. These incentives help stimulate the market by reducing the initial cost of installation. Energy shortages: Energy shortages are a ...

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 FFB's official analysis.

Home renovation will account for **.*% of total maintenance-renovation sales in ****

Total sales of building professionals in maintenance-renovation according to the FFB France, ****, € bn Source: ****

The size of the French energy renovation market more than doubled between **** and ****, reaching more than **.* billion euros. **% of this amount was spent on renovating the housing envelope - insulating walls, replacing openings -, i.e. ** billion euros.

Size of the French energy renovation market France, ****-****, € billions Source: ****

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 grants worth a total of *.* billion euros, underlining the program's significant impact on improving the energy efficiency of French homes.

Source: ****

MaPrimeRénov'

In January ****, the MaPrimeRénov' program was introduced to replace the "Habiter Mieux" programs and the energy transition tax credit (***). This program supports two types of intervention:

Work on heating and domestic hot water, with amounts of up to **,*** euros. Thermal insulation, in particular insulation of walls (***), attics, roofs, glass walls, etc. The bonus can also be applied to double-flow ventilation or the performance of an energy audit.

From *ᵉʳ October ****, MaPrimeRénov' is available to all homeowners, regardless of income, whether they live in the property or rent it out.

MaPrimeRénov', launched in ****, has met with remarkable success, characterized by a clear increase in both the premiums distributed and the number of beneficiary homes.

By ****, MaPrimeRénov' had benefited nearly ***,*** homes, with total premiums distributed reaching *.* billion euros.

MaPrimeRénov' in figures France, ****-****, Million/ ...

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 sector was one of the few to benefit from the health crisis, as part of the spending was redirected towards home improvements.

As mentioned above, growth in this sector is mainly due to the impact of inflation and rising prices in the industry, as well as new regulations that encourage private individuals to invest in home renovation.

Trend in sales of older homes France, ****-****, by units sold Source: ****

Trends in the number of real estate transactions in the older housing segment have a direct influence on activity in the energy-efficiency renovation sector. This is because, on a fairly regular basis, renovation work is undertaken following these sales.

Between **** and ****, we have observed continuous growth in the volume of sales of older homes, with an average increase of *.**%. However, from **** onwards, various factors such as rising interest rates and declining household purchasing power, linked to inflation, caused a steady decline ...

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 efficiency of their homes is the cost of the work, cited by **% of them, followed by the scale of the work, cited by **%.

What discourages homeowners most from improving the energy performance of their homes? France, ****, % of homeowners Source: ****

For **% and **% of French homeowners respectively, the prospect of being able to deduct part of the cost of the work from their income tax, as well asthe possibility of benefiting from financial aid, are the main deterrents.are the two measures that seem most effective in encouraging homeowners to improve the energy efficiency of their homes. What do you consider to be the most effective ways of encouraging homeowners to improve the energy efficiency of their homes? France, ****, % of respondents Source: ****

**% of homeowners have already carried out energy renovation work since January ****, while **% of homeowners have not yet undertaken such work, but intend to do so in the future.

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 *** billion euros by ****. Consequently, if landlords wish to continue renting out their homes, and if regulations remain unchanged between now and then, ECDs would have to contribute an average of around ** billion euros a year to the energy renovation market to reach this target.

Source: ****

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 to the tertiary eco-energy decree, which requires large companies to reduce their energy consumption over the long term. *. Local authority building renovation projects, as part of ongoing asset management and carbon emission reduction strategies. *. The widespread adoption of corporate social responsibility (***) strategies by real estate investors, who are implementing initiatives to reduce their environmental footprint, in particular by improving their carbon footprint. Despite these potential growth factors, spending on maintenance and renovation has not increased significantly in volume terms. Businesses have adopted a wait-and-see attitude, while public projects supported by the Stimulus Plan have been slow to materialize operationally.

Trend in non-residential maintenance/improvement revenues by players France, ****-****, in million euros Source: ****

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 undertaken by private individuals and professionals. The "intermediation" category includes platforms that put people in touch with each other for renovation work, as well as delegates of energy-saving certificates. The latter play a prescriptive role in the field of energy renovation. The "works" category mainly comprises construction companies of various kinds, from large construction firms to craftsmen. In the case of large-scale renovations, design offices and architects may also be involved in project management.

Source: ****

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 (***) in residential building energy efficiency since **** France, ****-****, FTE Source: ****

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' Sérénité, Loc'Avantages avec travaux énergétiques and MaPrimeRénov' Copropriétés.

MaPrimeRénov' "classique": Between **** and ****, *.* million applications were submitted for energy-saving renovations. of these, **% were approved, and nearly a million applications were fully completed with work completed and premiums paid. The energy savings generated by the work in **** are estimated at *.* TWh/year for work in progress and * TWh/year for work completed. Renovations are mainly carried out in single-family homes, with heating or domestic hot water systems installed in **% of cases. MaPrimeRénov' Sérénité: This assistance scheme finances energy renovation work packages delivering energy savings of at least **%. By ****, **,*** owner-occupiers had undertaken work with this assistance, generating conventional energy savings estimated at ** MWh/year per dwelling and *.* TWh/year in total. Loc'Avantages: This program enables landlords to benefit from financial assistance to carry out energy renovation work before letting their property. By ****, *,*** landlords ...

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 process.

Wooden frames and panels also saw an increase in production prices, reaching **%, mainly due to panels and veneers. The market faced difficulties due to fierce international competition for access to resources, shifting flows from European producing countries to the USA. This led to a scarcity of supply, longer lead times and, consequently, higher prices. French manufacturers have partially integrated these changes. [***]

In ****, building maintenance and improvement costs rose by a further *.*%. The building maintenance and improvement price index showed an average annual growth rate of *.**% between the first quarter of **** and the second quarter of ****.

Building maintenance and improvement price index - All buildings - IPEA (***) - Base **** France, ****-****-Q* Source: ****

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 introduces measures for public buildings. Requires companies to carry out energy audits. Law on Energy Transition for Green Growth - August **, ****: Sets targets for reducing energy consumption and increasing the share of renewable energies. Encourages energy renovation of existing buildings. Loi Élan (***) - November **, ****: Contains provisions to simplify energy renovation rules for buildings. Encourages the renovation of older buildings. Finance Act for **** - December **, **** *.* billion € released to finance energy renovation in France The PLF **** provides for a **% increase in funding for energy renovation, reaching €* billion, with a target of ***,*** high-performance renovations and the extension of the zero-rate eco-loan until ****. The "second life" scheme will enable social landlords to extend their property tax exemptions for ambitious renovations of thermal flats. The zero-rate loan will be extended until **** to produce more affordable housing, with increased support for intermediate rental housing for the middle classes. The Anah will launch MaPrimeAdapt', a €*.* billion program ...

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