2. Good Practice Example: Renovation of Village Block (Óbuda / Budapest, Hungary)

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1 2. Good Practice Example: Renovation of Village Block (Óbuda / Budapest, Hungary) Village Block Renovation Project, Óbuda (District III), Budapest, Hungary Project Contributor: FŐTÁV Zrt. Budapest District Heating Supply Company was founded in It is fully owned by the City Council and so far this is the only district heating company in Budapest, thus FŐTÁV is in a monopoly position. Their main activity is heat generation and heat supply. The company divides Budapest into two territories: North- and South-Budapest. The share capital of the company is 28,359,900,000 HUF. The heating system of the Village House was updated by the FŐTÁV Zrt. Construction Company: ÉPKAR Zrt. The predecessor in title of the ÉPKAR Private Limited Company (ÉPKAR 81 'GMK) was established in 1981 in Karcag. In 1993 it was transformed into a public limited company. The members of the company are natural persons. Their main activity includes the whole spectrum of building industry. This company was the contractor of the recovery. Project partners: CEU CEU (Central European University) is accredited in both the United States and Hungary, and offers English-language Master's and doctoral programs in the field of social sciences, humanities, law, management and public policy. It is located in the heart of Central Europe, in Budapest, Hungary. CEU is known for excellence in teaching and research with purpose. They also made the surveys among the residents in this project. Energia Klub (Energy Club) Energy Club is a civil organization. Their work concentrates on energy efficiency, renewable resources, climate protection, conventional energy resources and energy policy. They were responsible for the communication and for the dissemination of the project results. EHÖSZ The Energy Efficient Government Association (EHÖSZ) was established in the field of energy efficiency, this is a non profit organisation. Their main activity is to coordinate the energy efficient management and to speak in support of the residential. EHÖSZ organized many conferences along the project. BECO BECO is an internationally operating consultancy in sustainable development with offices in the Netherlands, Belgium and Hungary. BECO helps its clients convert their sustainability issues into opportunities, balancing financial, ecological and social performance and creating value. BECO was the professional program coordinator of STACCATO project.

2 Background, objectives, implementation measures and financing Hungary, like many Member States of the European Union, labours under a difficulty with energy efficient architecture. The research was located in Óbuda- Békásmegyer that is the second most populated district of Budapest (126,000 inhabitants). Two-thirds of its population currently live in residential estate blocks (so called soviet-type blocks of flats ) which operate with obsolete energy systems, poor roof insulation and outdated windows. The Local Government of Óbuda-Békásmegyer supports the use of renewable energy and tries to turn it into a profit for the local population. Therefore, at the end of 2006 the municipality of Óbuda together with Amsterdam North, Sofia Oborishte joined the STACCATO project to apply for the EU s Framework Programme, Concerto II. At first they selected the building in Óbuda for this renovation in June The energy efficient transformation of the building was planned into the Village Block with its 884 flats (the building named after its 3,000 inhabitants, which easily makes up a population of a village), 43,500 square meters, and 15 stairways on 10 floors. This is the largest residential house of Hungary, which was built in The municipality of Óbuda is committed to improve energy efficiency and reduce resource use and waste, because higher energy efficiency causes lower CO2 emission, and lower running expenses for the proprietors. Increasing energy prices resulted in a serious problem for owners and residents as the long term sustainability of these buildings were unacceptable. Project capital has been provided primarily through matching funds of the European Union, the Hungarian Government and the local municipality. Moreover, the social contribution was especially considerable. The general public perception of energy efficiency is positive; as a general rule, the majority of people find the efficient way of energy consumption very important which is showed by the under mentioned data. Finance comes from: Municipality of Óbuda-Békásmegyer (including EU funds) 40% Hungarian Government (Panel Plus Programme) 33% Owner s own resources (3% own resources+ 24% credit) 27% The total implementation cost was 1.2 billion HUF (about 4,18m EUR) with about 287 million HUF (1 million EUR) contributions from the EU. Cost benefit, effects and results achieved Cost benefit: Total cost: gross HUF Municipal support: HUF Panel Plus Programme: Ft Owners own resources: Ft. The estimated payback period of the project exceeds 20 years (5-6 years for the owners)

3 Annual district heating bill decreased to approximately 150 thousand HUF net (from 220 thousand HUF net) Results achieved: 10 centimetres thick Styrofoam insulation, improving heat transmission (before: 0.7 W/m2K, after: 0.3 W/m2K) 90 percent of the total window surface area was replaced (U=3 W/m2K) Heating modernisation (digital individual meters installed) Renewable energy use, solar thermal collector system (capacity of 1,128 MW) Effects: Decreasing thermal energy use (45%) The building achieved category A+ (according to the Lakcímke energy certificates, The average heat consumption per apartment dropped to 22 GJ from 40 GJ Planning procedures, involvement of stakeholders and possible participation structures This project would not have been possible without the cooperation of the EU, the municipality, the owners and the civil organizations. Municipality are playing an especially considerable role in the conformity of the district's energy efficiency. In this project the main actor of the local energy efficiency is the local government. As stated above, the resident population has a positive understanding of energy efficiency; they find it very important. The clear majority (82%) vote in favour of the reconstruction. Honestly, they were the absolute winners of the renovation; they get clear and tangible financial benefit from it. Apparently, the financial support offered by the municipality and by the EU was sorely needed. Many civil organisations had a significant role in the Village Block project. They relieved the synergy between the institutions and the residents. Previously mentioned Energy Club was responsible for the communication and for the dissemination of the project results. They have reached great success through this project. CEU (Central European University) made the surveys among the residents to repair their communicational opportunities. EHÖSZ (Energy Efficient Municipalities) organized many conferences which helped to make a personal contact. BECO was the professional program coordinator of STACCATO project. It should be noted that financial institutes also played an outstanding role. Banks so far have been in a really good position; the non-repayable EU funds encourage them to participate in project financing.

4 Images, map Village Block before the renovation (Source:

5 Roof insulation (Source:

6 The outdated windows (Source: Village Block after the renovation (Source:

7 Solar system on the roof (Source: Innovation fostered - local / regional developments triggered As stated above, the greater part of the Hungarian population currently live in residential estate blocks, which operate with outdated energy systems, with poor roof insulation, and outdated windows. The renovation of Village House was just the beginning. The methods of energy efficient urban development are still at an early stage in Budapest in general, and in Óbuda in

8 particular so this could be the pilot project for the reconstruction of the whole district. In contrast with many other projects, there was a really outstanding social contribution. It could be a good example not only for the district but also for the city, for the country. Panel Plus Programme didn t end here; there are many state-aided projects with municipal contribution of the non-repayable EU funds. Lessons learnt practical recommendations Challenges: The operation of the building will be dateless challenge A constantly controlling computer system is also necessary The age of the building could be risky Opportunities: Refurbish the staircase lighting and the elevators The solar thermal collector system produces more heat than needed