Is the Finnish residential sector ready to utilize the Smart readiness indicator?

Smart technologies are revolutionizing modern building operations. The number of smart elements rapidly increases among residential properties due to the ongoing large-scale energy transition. The transition brings new requirements to the building stock, such as the increased need for demand-side management and the growth of renewable energy sources. 

In 2018, the European Commission introduced the Smart Readiness Indicator (SRI) as a part of the Energy Performance of Buildings Directive (EPBD) to cope with the development in question. Ongoing updates of the directive will significantly impact the entire European built environment and our lives and make the role of the SRI more prominent. During the update, practical tests of the SRI will be carried out in six member states until the end of 2024. Based on the tests, European Commission will decide on the country-specific content and possible obligation to implement the SRI assessment by the end of 2026. Tentatively European Commission outlines that the obligation to conduct the SRI assessment will apply from the beginning of 2027 to non-residential buildings with a combined heating and HVAC capacity of over 290kW.

The Finnish professionally operated residential rental property market's awareness level and readiness level to adopt the SRI framework was recently determined by interviewing thirteen sectoral-related stakeholders. The research found that stakeholders' awareness of the SRI assessment is still quite modest, but their readiness level to adopt it is even high. Stakeholders understand the elements of building smartness (e.g., demand-side management and smart energy storage) and its benefits (e.g., energy efficiency and improved indoor conditions) well, even though the precise definition of building smartness is still uncertain among them. Stakeholders also recognize the SRI assessment's benefits, such as benchmarking, standardization, and a way to detect building smartness-related physical repair needs. However, stakeholders view conducting the SRI assessment as an intermediate step to the broader benefits, such as energy and cost savings from practical follow-up actions implemented by the assessment.

The SRI could grow into a practical tool promoting building smartness and society's sustainability transition, which means that stakeholders should pay attention to the significance and potential of the SRI. The mandatory SRI assessment may also apply to residential buildings at some period because most of the total building stock consists of residential properties, making it essential for stakeholders to understand and utilize the manifold benefits of building smartness. By comprehending the topic's importance and interest in building smartness, Finnish residential rental sector stakeholders can work with the SRI and act at the forefront of the sectoral smart revolution.

The writer, Sami Kaartinen, is a research assistant for the project. His master's thesis was “The adoption of the smart readiness indicator in the Fnnish residential rental property market”, was published in 2023.