'Building Energy Efficiency' Construction Costs Up to 100% Zero-Interest Loans... Subsidy Payments Also Planned

Increase building energy efficiency with insulation, LED lighting, boiler replacement, etc., and get 0% interest construction loans
Up to 2 billion KRW per building, up to 3 billion KRW for Zero Energy Building certification
First subsidies for private buildings over 10 years... Full certification fees and 40% of construction material costs covered

[Asia Economy Reporter Lim Cheol-young] Seoul City will provide zero-interest loans covering 80-100% of construction costs when promoting energy efficiency projects such as insulation work, LED lighting replacement, and high-efficiency boiler replacement for non-residential buildings over 10 years old.

Additionally, subsidies will be proactively provided when residential and neighborhood living facilities over 10 years old achieve a building energy efficiency rating of grade 1 or higher. Full certification fees incurred upon acquisition (up to 13.2 million KRW for residential buildings and up to 19.8 million KRW for non-residential buildings) and up to 60 million KRW of construction costs will be supported.

On the 28th, Seoul City announced the 2021 Building Energy Efficiency Project (BRP) with these details and stated that applications will be accepted starting next month on the Seoul City Building Energy Efficiency Project online loan and subsidy application website. Support is mainly divided into loan support and subsidy support.

Seoul City will first provide zero-interest loans covering 80-100% of construction costs. Repayment can be made through equal principal installments within 8 years (with a grace period of up to 3 years). The support target is non-residential buildings over 10 years old. The support scale is approximately 6 billion KRW. Since 2008, Seoul City has been conducting loan support projects for building energy efficiency. The interest rate, which started at 3.0% in the first year, was gradually lowered to 0.9% last year, and this year, zero-interest loans of 6 billion KRW will be provided.

For energy efficiency improvements such as installing insulated windows, insulation materials, and cooling glass films, loans of up to 2 billion KRW per building can be obtained. If Zero Energy Building (ZEB) certification is acquired, loans of up to 3 billion KRW per building can be obtained. Zero Energy Buildings minimize the building’s total energy demand by minimizing energy use and producing renewable energy to reduce energy and greenhouse gas emissions. ZEB certification is granted in grades 1 to 5 depending on the energy self-sufficiency rate.

Seoul City plans to select supported buildings by reviewing the appropriateness and validity of loan support through a review committee. Even if the building is less than 10 years old, loan support is possible if short-cycle LED lighting replacement or installation of high-efficiency boilers or renewable energy facilities such as solar heat is carried out. However, there must be no disqualifications for loans from financial institutions at the time of support.

Additionally, subsidy support is newly established for residential and neighborhood living facilities over 10 years old. The purpose is to focus support on private buildings, which have relatively less attention compared to public or large-scale buildings. A total of 1.5 billion KRW will be invested. For small-scale buildings (residential, neighborhood living facilities, etc.) under 3,000㎡ of total floor area that achieve a building energy efficiency rating of grade 1 or higher, full certification fees and 40% of construction material costs (up to 60 million KRW) will be supported. For buildings over 3,000㎡, certification fees will be fully supported if they achieve grade 1 or higher, even though they are not subject to certification requirements under the ‘Seoul City Green Building Design Standards.’

Applications and payments for subsidy support are made through design (construction) companies or ESCO (Energy Service Company) operators. The company or operator obtains the building owner’s consent, prepares and submits related documents, and receives the subsidy after construction is completed. Applications for loans and subsidies will be accepted from April 1 to December 17. Considering the time required from design and construction to certification, Seoul City will conduct the review process until December to encourage more citizens to participate in energy efficiency improvement projects.

Lee Dong-ryul, Director of the Climate and Environmental Response Division of Seoul City, said, “Seoul City is making multifaceted efforts in buildings, transportation, and other areas to respond to the increasingly severe climate crisis. We hope Seoul citizens will reduce greenhouse gases and enjoy cooler summers and warmer winters at lower costs through various support projects.”

This content was produced with the assistance of AI translation services.