Energy-efficient housing construction in India

With a loan in the amount of EUR 250 million, KfW is supporting the construction and the acquisition of energy-efficient flats in India. As a result of the investment, around 4,500 fewer tonnes of carbon emissions will be generated every year when compared to apartment blocks built using conventional methods.

On behalf of the Federal Ministry for Economic Cooperation and Development (BMZ), KfW is issuing the loan to the State Bank of India (SBI), India’s largest financier of private real estate projects. The contract was signed in mid-December. The funds from the “SBI Energy Efficient Housing” programme will be allocated to building companies that construct energy-efficient residential buildings and also to families who are keen to purchase a flat built in line with ecological criteria.

The energy consumption of buildings constructed or flats purchased using KfW loans is 25 per cent lower than houses with a non-ecological building style. For instance, the use of special materials such as high-performance glazing means that the flats heat up less and therefore require less cooling. In a hot country like India – where the average daily temperature for the capital New Delhi varies between 20 and 40 degrees during the course of the year – these passive measures have a noticeable effect on the energy balance sheet.

In order to promote investment in flats with energy consumption as much as 40 per cent lower than conventional flats, KfW is providing real estate project developers and buyers with an additional financial contribution of EUR 10 million. The lower consumption is also achieved by installing energy-saving systems.

Energy consumption a key factor in reaching climate protection goals

KfW’s commitment is one of a series of measures that India is employing in an effort to reach its climate protection goals. The efficient use of energy resources plays a decisive role in this.

In addition to the production of energy – 80 per cent of the power in India comes from the processing of fossil fuels, primarily at coal-fired power plants – energy consumption also determines whether the country with the second largest population in the world will reach its climate protection goals. One third of the population currently lives in cities, with this figure rising to half by 2030. According to estimates, the number of flats is set to double by then. Their residents will then become the country’s largest consumer of electricity. These forecasts mean that it is more important than ever to build flats in a sustainable and energy-efficient manner.