The European Investment Bank (EIB), the bank of the European Union, will provide EUR 300 million to the Ministry of Finance of Hungary to co-finance the Hungarian government’s national Home Renovation Program (with up to EUR 8,500 per household) to improve the energy efficiency of homes and reduce energy costs.
The loan will support the energy efficiency retrofit and upgrade of residential buildings and the installation of domestic renewable energy systems across the country, reducing energy bills for households as well as energy demand in Hungary, and cutting greenhouse gases and air pollution.
Only 1% of buildings in the European Union undergo energy-efficient renovation every year, making programs like the Home Renovation Program key for the success of the European Green Deal.
Hungary’s Home Renovation Program will use the EIB funds to co-finance the energy efficiency retrofit of homes and the installation of domestic renewable energy generation systems. The program was launched on January 1, 2021 and offers reimbursements for half of the renovation costs. The maximum amount of the reimbursement is HUF 3 million (approximately EUR 8,500) per household.
This is the first ever EIB loan under the new green loan label signed in Central and South-Eastern Europe. It accelerates Hungary’s green transformation into a carbon-neutral economy, as well as plans under the European Green Deal to transform the European Union into a carbon-neutral economy by 2050. The EIB financing will also help achieve the goals set in the European Commission’s Renovation Wave for Europe initiative.
According to EIB Vice-President Teresa Czerwińska, who is in charge of EIB operations in Hungary, “today we are making history with the first ever EIB green loan signed in Hungary. The loan is a triple win for Hungarians, the European Union and the global climate, and an important step towards delivering on the ambitious goals of the European Green Deal. It will enable Hungarians to improve their quality of life and save money thanks to lower energy bills as a result of more energy-efficient homes. Loans like this will help the European Union become carbon neutral faster, and in turn contribute to the success of global climate action. Hungary was among the first EU countries to ratify the Paris Agreement as the global roadmap to address the existential threat brought by rising global temperatures. As the EU bank, we are glad we can support Hungary’s green ambition and its transformation into a green and sustainable society.”
The operation will support investments in reducing energy demand and improving both the reliability and security of supply in the country. In parallel, financing from the EU bank will help reduce greenhouse gases and alleviate air pollution. Energy efficiency investment will generate local and regional economic activity and thus increase employment.
Hungarian households consume 34% of the country’s total energy, which is more than transport (24%) or industry (23%), making investments in the energy efficiency of homes key for meeting the carbon-neutral ambitions.
On the national level, the loan accelerates the National Energy Strategy and the National Energy Efficiency Action Plans, which designate energy efficiency as a national priority and call for reduced energy imports, improved energy security and increased energy affordability.
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