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EU Taxonomy and the Construction Sector

The construction sector is an essential part of the European economy and, therefore, must contribute to reaching the EU Commissions' goals on climate change. On the one hand, this is a chance for a cleaner way of construction, but on the other hand, it will take substantial effort.

The Construction 2050 Alliance published six key messages regarding the EU Taxonomy and its influence on the construction sector. For example, the Alliance underlined: 

  • the importance of the sector for achieving the EU Green Deal and 
  • how the taxonomy can set a new benchmark for competitiveness in the construction sector.

However, they also argued that the:

  • planned reporting criteria should be improved in certain aspects,
  • reporting obligations need to be simple and proportionate, especially for SMEs,        
  • taxonomy must create the conditions for mobilizing capital to support the sustainable transition and       
  • non-alignment with the taxonomy must not lead to a cut in access to financing and funding.

The Alliance consists of organizations representing the European construction sector for Austria, e.g. the WKO (Austrian federal economic chamber), the Fachverband Bauindustrie, or the Bundesinnung Bau joined.  


The taxonomy itself is a long list of economic activities that can be deemed "green", if:

  • they contribute to one of the taxonomy's goals,
  • fulfill the technical screening criteria,
  • meet the social minimum safeguard and
  • do not violate the Do No Significant Harm (DNSH) principle.

The current taxonomy includes the two climate goals, "climate change mitigation" and "climate change adaption", which include the construction and real estate sectors.

However, the taxonomy will also include four additional environmental goals expected in 2023. Currently (11/2022), the draft version of the extension has been published. It includes the taxonomy goal of "transition to a circular economy", which is crucial for the construction sector and the EU Commissions' goals. The economic sectors included in this goal are, for example, the:

  • construction of new buildings,        
  • renovation of existing buildings or        
  • maintenance of roads and motorways

For instance, if a company is active in one of those economic activities (mentioned above), the turnover, OpEx, or CapEx of the activity will be eligible for the taxonomy.

If it also fulfills the substantial contribution criteria (see below*) and does not violate the "Do No Significant Harm" criteria (see below **). The activity's turnover, OpEx, or CapEx could be classified as aligned with the taxonomy.

* Part of the Substantial contribution criteria for the economic activity of "construction of new buildings" for the EU Taxonomy goal of "transition to a circular economy"All generated construction and demolition waste is treated in accordance with the checklist of the EU Demolition and Construction Waste Protocol and at least 90 % (by weight) of the non-hazardous construction and demolition waste on the construction site is prepared for re-use or recycling.

** Part of Do No Significant Harm criteria for the economic activity of "construction of new buildings" for the EU Taxonomy goal of "transition to a circular economy" for the DNSH criteria "protection and restoration of biodiversity and ecosystems"The new construction is not built on one of the following:(a)    arable land and crop land with a moderate to high level of soil fertility and below ground biodiversity as referred to the EU LUCAS survey…

For inquiries please contact:

RBI Regulatory Advisory

Raiffeisen Bank International AG | Member of RBI Group | Am Stadtpark 9, 1030 Vienna, Austria  | Tel: +43 1 71707 - 5923