CO2 mitigation in the Hungarian domestic sector: opportunities and associated costs

Residential sector is the key target for climate mitigation policy in Hungary. In 2004, this sector was responsible for 30% of total national carbon dioxide (CO2) emissions, the largest share among all energy end-use sectors in Hungary. At the same time, buildings house the largest potential for CO2 emission reductions worldwide as demonstrated by the recent IPCC report. However, estimates for the size and associated costs of GHG mitigation or energy-efficiency opportunities in the Hungarian domestic sector have not been assessed for the last decade. Such knowledge is essential for designing evidence-based climate policies and for understanding of the business opportunities on the markets of abatement technologies. The paper aims to address this gap in knowledge and summarizes the results of research quantifying CO2 mitigation potential in the Hungarian residential sector by 2025 via bottom-up model. The paper concludes that a wide range of opportunities for cost-effective CO2 mitigation is available in all studied types of residential buildings. Efficient lighting, heating and water flow controls were identified as the most cost-effective measures. Fuel switch to low carbon heating solutions and improvement of the thermal envelope in old buildings provide the largest potential. The application of cost-effective measures will result in a reduction of app. 29% of the total sector baseline CO2 emissions in 2025 (5.1 Mt CO2). Realization of the cost-effective potential requires an investments of 9.6 billion EUR over 2008 – 2025, but will result in energy cost savings of 17.1 billon EUR. The total maximum potential achievable due to implementation of all investigated measures is app. 50% of baseline CO2 emissions in 2025 (8.7 Mt CO2). Implementation of the suggested abatement measures will help reduce energy poverty, improve social welfare and relieve social tensions related to the recent energy price increase.