New Economic Thinking - Enabling a just transition of the built environment in Europe

The report titled "New Economic Thinking - Enabling a just transition of the built environment in Europe" is published by Dark Matter Labs and authored by Emily Harris, along with contributors Vlad Afanasiev, Aleksander Nowak, Ivana Stancic, and others. The focus of this research is on the challenges and opportunities associated with equitable decarbonization of Europe’s land and buildings. It emphasizes the need for innovative strategies to create a sustainable built environment that addresses both climate change and social inequality.

The report identifies significant trends and systemic constraints within Europe's built environment. It highlights that achieving the EU climate targets by 2030 will require an estimated EUR 275 billion in additional investments per year solely for retrofitting existing buildings. This financial requirement underscores the urgency for innovative funding strategies and collaborative models to support sustainable housing.

The research discusses deep trends, including labor shortages and increasing energy prices, which complicate the sustainability efforts. A critical bottleneck is the ongoing energy crisis, where reliance on fossil fuels is diminishing, affecting productivity in construction. The report also touches on the material crisis, indicating that the demand for essential building materials like copper will require an unprecedented extraction rate, compressing thousands of years of mining into mere decades.

The report maps various organizations that are leading the transition towards a just economy in the built environment. It categorizes them into core and adjacent organizations. Core organizations, such as Community Land Trusts and cooperative housing networks, operate at the intersection of economic, ownership, and governance issues. Meanwhile, adjacent organizations focus on specific domains like policy advocacy and material reuse, providing critical support for scalable transition models.

The report emphasizes the importance of understanding the socio-economic context in which the built environment operates. It addresses the dynamics that drive inequality and volatility, particularly the finance/power/inequality dynamic, which exacerbates housing disparities. The narrative around housing as a human right is increasingly relevant, as investor-owned housing has surged by 700% since the 2008 financial crisis.

To enable a just transition, the report suggests several strategic options, including embracing low-tech dematerialization and rethinking housing as a universal basic service. It advocates for the creation of new, agile institutions that can facilitate inclusive decision-making processes. Engaging citizens is crucial for ensuring that the transition meets the needs of diverse communities.

The research concludes with a call to action for stakeholders across Europe to engage in transformative partnerships. It stresses the need for a collective response to the challenges posed by climate change and social inequality in the built environment. The findings serve as a prologue to further research and action aimed at achieving a sustainable and just built environment in Europe.