With heating and cooling being the largest energy end-users in the EU buildings sector, air temperature is the primary short-term determinant of the bloc’s buildings sector energy demand. Direct and indirect use of renewable energy through electricity, in addition to greater energy efficiency and energy sobriety, can play a key role in reducing EU gas demand in the short term.

Annual EU buildings natural gas demand, including indirect consumption, has ranged from 150 bcm to 210 bcm since 2010. The number of heating degree days has largely influenced this demand along with prices and consumer behaviour. The 2022/23 heating season was the second warmest on record for the European Union, with the average air temperature 1°C above the previous ten-year average, and 9% fewer heating degree days. 

All other things being equal, such mild winter conditions alone would entail an estimated 7% drop in gas consumption in buildings from previous winters. This mild weather therefore eased pressure on EU gas markets considerably in the winter of 2022/23.1

While long-term climate trends point to an overall temperature rise, a harsh winter and a hot summer could intensify EU buildings sector heating and cooling demand in the short term.

The rapid expansion of renewable energy technology use in buildings can ease EU natural gas demand and contribute to the bloc’s energy security in the short term. Projected cumulative new developments in direct use of renewable heat and expansion of renewable electricity post-2022 would displace almost 8 bcm of EU buildings-related gas consumption annually in 2023 and more than 17 bcm in 2024.2 This is equivalent to avoided emissions of more than 50 Mt CO₂ in 2023-2024.

The largest contribution to gas displacement in buildings is expected to come from projected development of renewables in the electricity sector, with additional renewable generation compared to 2022 substituting 5 bcm of gas consumption for buildings electricity consumption in 2023 and more than 10 bcm in 2024. Countries for which growth in electricity generation is projected to displace the most gas cumulatively in 2023-2024 are Spain, Italy, Netherlands, Germany and France. Spain and Italy have important shares of gas in their electricity mixes and they benefit from well-matched demand-supply profiles with solar PV generation patterns accommodating summer cooling demand.

The sustained growth of annual heat pump sales driven by policy incentives in many countries is anticipated to represent another quarter of the gas displaced in buildings (7 bcm cumulatively by 2024). Limited biomass stoves and boilers, solar thermal and geothermal developments in buildings yield only marginal gas savings by 2024 (less than 3 bcm cumulatively). While these renewable energy contributions will help ease potential tensions on gas markets, the potential of renewable heat technologies is still largely untapped, both in buildings and industry. Harnessing their potential would, however, require sustained and comprehensive policy action to improve consumer awareness, reduce high upfront costs and split-incentive challenges, alleviate supply chain challenges, expedite permitting procedures, establish training programmes and support R&D to further improve technologies.