In December 2019, European Union countries signed the European Green Deal, whose main objective is to achieve a 55% reduction in emissions by 2030 and net greenhouse gas emissions by 2050.

The Deal aims to make Europe the world’s first climate-neutral continent, with proposals intended to ensure that all sectors of the economy are able to meet this challenge in areas such as sustainable transport, industrial development and clean energy systems, building renovation for greener lifestyles, and the protection of nature, the planet, and health.

Following the signing of the Deal, the EU has continued to introduce laws and regulatory frameworks to guide the economy towards a circular and sustainable future.

In relation to the construction sector, and due to the urgent need to adapt the existing building stock to this new reality, the European Commission proposes requiring Member States to renovate at least 3% of the total floor area of all public buildings each year, setting a benchmark of 49% renewable energy in buildings by 2030, and requiring Member States to increase the use of renewable energy for heating and cooling by 1.1% each year until 2030. [1]

European Taxonomy

The European Taxonomy is a regulation adopted in June 2020 that establishes an EU-wide classification—a common language for determining which economic activities (including building) can be considered sustainable—in order to support the transition to a carbon-neutral, resilient, and resource-efficient economy.

In other words, it provides the financial sector with a definition of sustainable investment, described as follows:

“An environmentally sustainable activity must make a substantial contribution to at least one of the six objectives pursued:

a) climate change mitigation;

b) climate change adaptation;

c) the sustainable use and protection of water and marine resources;

d) the transition to a circular economy;

e) pollution prevention and control;

f) the protection and restoration of biodiversity and ecosystems.

Without harming any of the other five, in line with the principle of doing no significant harm.” [3]

In addition, it must ensure two minimum objectives: the building cannot be intended for the extraction, storage, production, or transport of fossil fuels, and the companies involved must comply with minimum social safeguards regarding human and labour rights.

These performance thresholds are known as “technical screening criteria” and, in addition to identifying which activities are already environmentally friendly, they also help companies, project developers, and issuers access green financing to improve their environmental performance. In this way, they enable the development of low-carbon sectors and the decarbonisation of high-carbon ones.

To prevent the increasingly widespread phenomenon known as greenwashing, which often goes hand in hand with progress on sustainability, this regulation introduces obligations for financial market participants regarding the disclosure of pre-contractual information and subsequent periodic reports, in relation to the environmental objectives of the economic activity, as well as a description of the approach and measures aimed at achieving those environmental objectives.

Accordingly, companies required to publish non-financial information must report information on their revenues, expenditures, and assets related to processes associated with economic activities classified as sustainable.

This section is complemented by the regulation adopted a few months earlier, in November 2019, on sustainability-related disclosures in the financial services sector, which specifies these requirements and distinguishes between companies with good governance practices and those that invest exclusively in sustainable products or services. [4]

The Level(s) project

The Level(s) project was developed by the European Commission in close collaboration with key stakeholders such as Skanska, Saint-Gobain, Sustainable Building Alliance, and the Green Building Council in each country.

In this way, the EU brought together two leading private companies in the construction sector with two non-profit organisations whose aim is to build alliances between countries—connecting institutions, universities, and research and development centres with private stakeholders.

The initial premises aim to link a building’s environmental impact to the EU’s priorities in the circular economy. It is important that it is an accessible tool, so an open-source assessment framework will be developed.

On September 28, 2017, the Level(s) pilot phase began, lasting 2 years (2017–2019): a beta version that, over this period, was tested by professionals in more than 130 buildings across 21 European countries.

In 2020, a new, easier-to-understand methodology was published—Level(s) Methodology v2—which already applied the construction life cycle. In January 2021, two technical guidance reports were published to support this pilot phase, covering successes and potential modifications.

The first technical report is essentially an introduction to Level(s) and how it works, titled User Manual 1: Introduction to the Level(s) common framework, developed by the JRC Technical Reports consultancy. [5] It is a theoretical framework that addresses frequently asked questions such as who should use this manual and why, and refocuses on the need for a common language, describing the main objectives in a very visual and straightforward way.

In the final part of the document, titled Thinking sustainability, key concepts for Level(s) and the EU are developed on how to drive economic change that ensures sustainability, and concepts are defined as the reflection progresses.

The topics are as follows: full life cycle and circular thinking; closing the gap between design and actual building performance; how to achieve a sustainable renovation; and how sustainability can positively influence a property’s market value.

The second technical report provides detailed guidance on carrying out performance assessments and is titled User Manual 2: Setting up a project to use the Level(s) common framework.[6] It is essentially divided into two distinct sections: establishing a project plan and completing the building description. For the first section, planning tables are provided with questions to be completed with the team’s responses, as well as grids with all indicators and the different project phases to provide a view of the life cycle and the implications of the built environment. Finally, the building description focuses on four aspects: location and climate, building typology and age, how the building will be used, and the construction model and its characteristics.

The Level(s) framework

Level(s) is currently a voluntary reporting framework to improve the sustainability of buildings, despite the challenges posed by its voluntary nature. However, short-term objectives include making it mandatory for public buildings, following the logic of the requirements set out in the recent regulation on NZEB Nearly Zero Energy Buildings, with deadlines for when compliance will become compulsory.

Therefore, Level(s) establishes common units of measurement and basic calculation methodologies through a set of indicators that both draw inspiration from and serve as the basis for many European building-related policies. As a result, compliance with these indicators will increasingly be required at both European and national levels.

Its target audience is both public and private, arguing that collaboration between the two is not only necessary but also enriching, and likewise framing the model of economic change towards sustainability. Stakeholders may include construction professionals, building assessment systems, investor reporting tools, or public-sector initiatives.

In addition, the disclosure of these indicators improves understanding of how buildings affect the environment. The third technical document, Levels User Manual 3, was published in July 2021 and is divided into one document per indicator.

Each document provides a brief introductory summary, step-by-step instructions on how to apply the indicator at different levels, and supporting guidance. Some indicators also have associated Excel templates to help calculate or record data.

Project phases

The Level(s) framework is a staged procedure for properly assessing a building’s life cycle.

To eliminate differences between design performance, as-built performance, and occupied building performance, users can report on the indicators at different phases of a project:

– design phase: the indicators at this preliminary design stage are based on prior calculations of building performance—that is, on a hypothesis that makes it possible to adjust geometry and select materials according to their specifications. This is primarily a qualitative analysis.

– construction phase: performance calculations at this stage become more precise and apply corrections to the previous ones, as they are based on as-built drawings—that is, the set of drawings redrawn once the works are completed to compare them with the original drawings. Geometry may be adjusted slightly, or the actual performance of certain materials may be calculated. Therefore, at this stage it is already possible to quantify the building’s design performance using the common units of measurement and reference calculation methods established by the Level(s) framework.

– occupancy phase: throughout the occupancy phase—that is, the only period in the building’s service life when it is used for the purpose for which it was conceived—it is essential to account for consumption and performance in order to calibrate actual behaviour according to climatic seasons, as this is a sampling period. Data is therefore collected to monitor the project’s real performance.

– post-occupancy phase: once the period of use has ended, with all the data collected over the years it is possible to develop a measured performance baseline that takes into account the time factor, maintenance, occupant flow, etc.

Performance indicators of the Level(s) framework

Each indicator has been designed to link a building’s impact to the European Union’s sustainability priorities.

There are 16 criteria grouped into 6 macro-objectives that emphasise environmental performance, health and wellbeing, life-cycle cost and value, and potential risks to future performance. These objectives can, in turn, be grouped into 3 thematic areas.

For each indicator, a “stepwise” approach is possible, allowing users to move from basic-level calculation methods to a full life-cycle assessment (LCA).

1. Greenhouse gas emissions over the building’s life cycle

1.1. Energy efficiency in the use phase [7]

1.2. Life-cycle global warming potential (GWP) [8]

2. Material life cycles that are circular and resource-efficient

2.1. Bill of quantities, materials, and service lives [9]

2.2. Construction and Demolition Waste (CDW) and materials [10]

2.3. Design for adaptability and renovation [11]

2.4. Calculator

3. Efficient use of water resources

3.1. Water consumption in the use phase [12]

4. Healthy and comfortable spaces

4.1. Indoor air quality [13]

4.2. Time outside the thermal comfort range [14]

4.3. Lighting and visual comfort [15]

4.4. Acoustics and noise protection [16]

5. Climate change adaptation and resilience

5.1. Protection of occupants’ health and thermal comfort [17]

5.2. Increased risk of extreme weather events [18]

5.3. Sustainable drainage [19]

6. Full building life-cycle cost and value

6.1. Life-cycle costs [20]

6.2. Value creation and exposure risk [21]

1. Greenhouse gas emissions over the building’s life cycle

This section, which relates to Sustainable Development Goal number 7—ensuring access to affordable, reliable, sustainable, modern, and above all non-polluting energy—covers two indicators: energy efficiency in the use phase and the building life-cycle global warming potential.

Life-cycle assessment (LCA) is a method for calculating the environmental impact of a product throughout all stages of its life. An LCA of a building typically involves assessing its entire life cycle, that is, all phases: raw material supply, manufacturing of construction products, the construction process, use, demolition, and material recycling.

The Paris Agreement highlights the importance of assessing environmental impact and more actively reducing activities that contribute to global warming. To calculate these effects in the construction sector, the most effective method is life-cycle assessment (LCA), because it considers multiple criteria and the full environmental impact throughout the life of a product or building.

1.1. Energy efficiency in the use phase [7]

The guide begins by summarising essential definitions for understanding the building’s energy performance, including that of Nearly zero-energy building:

“It means, according to the Energy Performance of Buildings Directive, a building that has very high energy performance. The nearly zero or very low amount of energy required should be covered to a very significant extent by energy from renewable sources, including energy from renewable sources produced on-site or nearby.”

To measure the building’s energy performance, the guide for this indicator goes back to the design phase and the aspects that must be considered, following the principles of bioclimatic architecture to adapt the building to its surroundings. It also discusses incorporating the concept of renovation, high-quality construction materials, and smart monitoring and control systems. The energy consumption calculation will take into account the energy needed to heat and cool spaces, supply hot water, light spaces, and operate the building’s technical systems, as well as any energy exported from the building, where applicable.