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“The Agree project work team is a smart laboratory for generating knowledge and ideas”

Mario Yoldi, director of Housing, Planning and Operative Processes

Mario Yoldi, director of Housing, Planning and Operative Processes of the Basque Government is concerned about problems derived from an ageing fleet of housing in the Basque region. More than half of all homes were built before the technical building codes were enacted, a long time before modern energy efficiency regulations came into force. Yoldi says that when it comes to renovations, most people want better temperature control in their homes and lower energy bills, and that the AGREE project is “a smart laboratory for generating knowledge and ideas” to be implemented in three judiciously selected areas.

Q: Why did the Basque Government decide to take part in the Agree project? How does it expect to benefit?
A: The housing in the Basque Region is among the oldest in southern Europe. In fact 57% of our residential buildings were constructed between 1940 and 1980, before modern planning regulations and the Technical Building Code were enacted, and long before the recent energy efficiency regulations came into force in Spain. This is a significant drawback when it comes to upgrading and improving living conditions in homes.

Q: Agree is a public-private cooperation project. How important is this formula?
A: Public-private cooperation is absolutely necessary to be able to undertake innovative and, above all, replicable projects. As a government organisation, we need to find the most suitable ways of sharing our success, and in this case, we had some to share. In the wake of the health crisis, this type of joint project has become yet more important and necessary. There are going to be enormous budgetary constraints which mean we need to undertake our work in the best possible way. Simultaneously, new opportunities to attract funds through innovative projects aligned with the sustainable development strategies in the framework of the Next Generation EU European Reconstruction Plan are emerging.

Q: What criteria did you apply to selecting the pilot projects?
A: The Agree project work team was a smart laboratory for generating knowledge and ideas. The studies conducted by Tecnalia, the three municipalities involved and ourselves have shown that we need to emphasise neighbourhoods with the greatest need for funding and rehabilitation, aggregating demand and, above all, visualising a far more efficient, welcoming space for families in the future. In-depth knowledge of the three sites by the project members has been crucial to their choice. All we had to do was confirm them.

Q: How much accommodation is there in the Basque region with similar characteristics to the properties in these projects? Might they be candidates for similar renovations?
A: According to the Needs and Demands Survey 2019 (in Spanish: Encuesta sobre Necesidades y Demanda 2019 (ENDV)) conducted by the Basque Housing Observatory, in 2019 a total of 68,423 homes, that is 7.7% of all homes in the Basque Region, need renovating. However, the demand is much lower if we consider that the owners of just over half of these homes (51.9%) said that it is likely or very likely that they will upgrade the properties within the next two years (35,543 homes). Four in ten homes (38.7%) need renovating to resolve temperature control problems. Regardless of the type of renovation required, energy efficiency is always relevant. Temperature control is the most widespread need (38.7%), followed by a desire to reduce consumption and fuel bills (32.3%). All this in a situation where according to the Technical Building Inspection Register of the Basque Region, of the 68,423 in need of rehabilitation identified in the 2019 ENDV, just 31,479 (46.0%) have a registered ITE. That’s why the need for this type of projects is so obvious and pressing.

Q: You have created a “special financial instrument for rehabilitation”. What do you hope to achieve with it?
A: The special financial instrument for rehabilitation is intended to mobilise 30 million euros in loans by 2023. These loans are properly guaranteed by credit organisations, covering credit risk for the first time, enabling them to grant loans to private citizens, joint ownership associations and other types of body under better-than-market conditions.

Q: How will the guarantees of this instrument work?
A: The special financial instrument will have a guarantee fund to cover default set up by the Department of the Environment, Territorial Planning and Housing and will be managed by the Basque Institute of Finance. The idea is to guarantee and promote funding for home and building refurbishment projects, universal accessibility and improved energy efficiency by providing standardised loans for up to 18,000 per home, with a variety of terms, guarantees and interest rates, all of which will be extremely attractive.