Europe’s homes are wasting too much energy – these startups have a plan

Single-glazing. Old electric-powered heat emitters. Walls with hardly any insulation. Damp throughout the ground floor. Welcome to Europe. 

While these problems vary in prevalence from country to country, even nations rated highly in assessments of household energy efficiency have room for improvement. Sweden, for instance, often does very well in such analyses. But for Magnus Petersson, cofounder and chief executive of Stockholm-based Dryft, there’s plenty of work still to do.

“We need to fundamentally transform the houses,” he says. Dryft, a startup with 150 employees that has raised €6 million to date, numbers itself among a fleet of new businesses targeting the energy renovation market. 

Petersson and his fellow cofounders noticed rising demand for home retrofits around 2019. That demand has only rocketed since because of energy price rises caused by Russia’s invasion of Ukraine.

Dryft and others like them are using tech to help homeowners find out how efficient their home really is — and what they can do to improve it. The treatments these firms propose will differ dramatically from house to house but the idea in general is to offer “holistic” advice.

Companies such as Dryft aren’t just about selling you a new heating system – the point, they say, is to find out the most suitable methods for making a dwelling more efficient within a certain budget, whatever those methods may be. 

Some homes will need lots more insulation, while others will already have that but require a more efficient method of ventilating the internal spaces, for example. Where would a homeowner’s cash best be spent?

Energy Tetris

“When we sell energy renovation to you as a customer, that energy renovation is a Tetris made up of different services,” says Petersson, referring to the popular block-sorting video game in his analogy. 

With Dryft, customers get a free 30-minute video consultation where they can talk through features of their property with an energy adviser. This yields a summary of what kind of retrofit might best suit the dwelling and how much it could cost. If the customer decides to proceed, Dryft conducts a more in-depth survey and can then go on and actually do the required renovation work as well.

The company currently covers the Greater Stockholm area but has plans to expand across Europe. Since 2020, Dryft has carried out renovation projects large and small in nearly 6,000 homes.

Petersson explains how the firm’s algorithm estimates the projected energy savings post-renovation. This algorithm is constantly being refined with data on the outcome of real Dryft projects, he adds, meaning that it ought to get more and more accurate over time. 

As an example, he shares a case study of a 1970-built, four-bedroom house in Stockholm. Dryft upgraded the double-glazing to triple-glazing, installed a heat pump, ventilation system with heat recovery, and also some smart controls. The whole renovation cost the equivalent of €38,000 and the household is currently saving €2,900 per year in energy expenditure. 

At that rate, it will take about 12-13 years to recoup the investment. In the meantime, annual energy consumption in the property has plummeted by more than 40% and its Energy Performance Certificate (EPC) rating has jumped from G to C. This should increase the value of the property, notes Petersson.

Show me the money

There’s no doubt that extensive energy retrofits are not cheap. Dryft and startups in the same market are also trying to help customers take advantage of government subsidies or grants. 

“People are planning renovation roadmaps and that is what we are actually showing to our customers,” explains Justus Menten, cofounder of Enter, an energy retrofit-focused startup in Berlin. 

Enter offers financing options to help people pay for their energy renovation in instalments and the firm supports customers in seeking out applicable subsidies that could lessen the upfront cost of the work they want to do. Enter works with partner companies who carry out the actual plumbing, engineering work, or installation of insulation, for example.

The startup, which has 135 employees and has raised €19.4 million so far, has around 1,000 paying customers per month, adds Menten. Enter has an app that can estimate the energy demands of a dwelling and how specific retrofit projects — say, upgrading the loft insulation — will impact that. 

Customers can try out different energy renovation measures and see the projected results in terms of emissions savings, reduced costs, and the potential increased value of their property, for example. A virtual retrofit before you decide on the real thing.

Enter also has a team of experts who subsequently survey each dwelling and confirm the accuracy of the app’s suggestions and projections.

Tools that help homeowners understand what renovation measures are available, and what their impacts might be, are much needed at present, say observers.

“From my research, there is a huge gap for householders to find high-quality information – that can delay renovations taking place,” says Kate Simpson at Imperial College London, who has studied the use of data in energy renovations. She notes that it can be difficult to accurately predict energy savings post-renovation because there are so many factors that affect consumption, from the weather to how much the occupants decide to heat their home.

Crucially, startups gathering data about energy consumption must ensure that they have consent to do so, she adds.

Data is key

Data protection is very important, though access to useful information on the current energy efficiency of homes around Europe is far from standardised, notes Michael Hanratty, chief executive of BERWOW, a startup in the Republic of Ireland. 

BERWOW uses an automated tool to analyse data from the Irish equivalent of an EPC – a Building Energy Rating (BER) certificate. The tool proposes energy renovation interventions that might be suitable for a given dwelling. These suggestions can be followed up with an on-site survey to get formal quotations for specific works.

Hanratty explains that the firm’s digital tool, built by Dublin-based tech firm Gamma Location Labs, was ready to go in 2017 but new GDPR legislation regarding data protection in 2018 meant BERWOW had to come up with a different system for accessing individual users’ own BER certificates. It requires users to provide their unique electricity meter number and upload proof of address to an online system before the BER can be released to BERWOW for analysis. 

“You’d imagine with the urgency of the climate crisis that there could be easier solutions to accessing this data,” says Hanratty. Homeowners who don’t yet have a BER for their property, or who don’t want to open up access to it, can select from one of 60 generalised Irish dwelling types to get an approximated result.

Hanratty adds that he hopes to expand BERWOW to other countries, though the methodology for retrieving EPC information differs greatly from country to country within Europe, he points out. 

Since launch, BERWOW has clocked more than 60,000 visitors to its live tool, which is published on the websites of SSE Airtricity, a major local energy provider in Ireland, among others. Those initial enquiries have resulted in a total of 2,400 surveys of properties to date. 

BERWOW has one employee — Hanratty — and has not needed to raise any external funding, besides initial research funding of €112,000 from the Sustainable Energy Authority of Ireland.

Thinking big

There are plenty of private homeowners with the means to carry out their own renovations around the continent. But they are just one slice of the pie. What about the big businesses that construct large residential developments, or social housing providers?

In the UK, Hubb is targeting such organisations. The company has its own software that creates a digital twin of a specific property. Hubb’s machine learning system can then model how to make each dwelling more energy efficient. Founder and chief executive James Major says he wants to do this on a big scale and is currently in discussions with two large companies in the UK — though no contracts have been signed just yet.

Major wants to demonstrate to firms constructing thousands of houses that, should they improve the energy performance of these buildings even slightly, there could be massive reductions in demand on the electricity grid, for instance.

“If you increase your fabric improvements by 10% or 15%, we could save X amounts of megawatts that you need to connect to your development,” says Major. And this could apply to existing properties requiring a retrofit, too. Doing it at scale would in principle cut down local energy demand drastically.

With the climate crisis worsening while millions of homes around Europe still require energy renovations of some kind, and with consumers expressing their desire to spend significantly less on heating in our age of inflation, it may be time to think big – and fast — about retrofits.