Financial Incentives for Energy Efficiency Retrofits in Buildings

In this paper, we evaluate international experiences (in Italy, the Netherlands, and the United States) with tax incentives that support thermal retrofits, and draw a comparison to the experience of preferential loan and grant programs offered by the German development bank, Kreditanstalt für Wiederaufbau KfW). We find that tax incentives as well as loans and grants had high pick-up rates, but the added value of these schemes remains to be analyzed. We also find that progressive support of comprehensive retrofits compared to single measures appears to be important. Countries that have provided the same level of support for both comprehensive retrofits and single measures have experienced, almost exclusively, investment in single measures.