Evaluating the effectiveness of public subsidies for energy-efficient retrofit: a comparative study of two next-generation programs with standard market interventions in Catalonia

Abstract

Assessing the impact of past and current renovation efforts is essential for refining decarbonisation mechanisms and ensuring the effective use of public resources. In this context, this paper examines the effectiveness of two Next Generation subsidy schemes implemented in Catalonia between 2021 and 2024. It evaluates their impact on energy demand, non-renewable energy use, and CO2 emissions, while also assessing the associated investment costs. In addition, the analysis compares subsidised interventions with a reference sample of standard market interventions carried out without financial support. The analysis revealed that the subsidies reached 35% of the region and 15% of low-income municipalities, with a scope comparable to that of standard interventions. The study also emphasises that the impact of the samples remained broadly similar, noting only a few minor differences when more restrictive conditions were introduced. Furthermore, the study shows that although in some cases there is a clear improvement in the Energy Performance Certificates, in many others the impact is significantly lower, with some even remaining in conditions clearly below the decarbonisation objectives. The assessment also identifies a lower effect on energy demand compared to overall energy consumption and emissions, as well as a correlation between energy savings and climate, with colder climates yielding greater results. Finally, territorial urban–rural disparities in terms of investment costs are revealed. These findings underscore the need to redesign the instruments to consider geographic and social aspects, effectively engage more of the population, particularly the vulnerable groups, and facilitate integral interventions that surpass conventional market practices.