Decarbonising the residential building sector requires not only technical solutions, but also financially viable delivery models. This paper examines the economic performance of Energy Plus Service (EPS) schemes applied to deep renovation projects under uncertainty, with particular attention to the role of project scale and market conditions. The analysis is based on a portfolio of 21 residential buildings in Northern Italy and combines a Discounted Cash Flow (DCF) model with Monte Carlo simulation. Key sources of uncertainty include renovation costs, post-retrofit energy performance, rental values, and electricity prices, allowing for the estimation of probabilistic Net Present Value (NPV) outcomes. The results show a clear impact of residential asset spatial scale on financial outcomes. Small projects are generally unprofitable, while medium-sized assets are highly sensitive to uncertainty. Larger projects, instead, display a much higher likelihood of positive financial outcomes. Sensitivity analysis indicates that financial performance is driven mainly by investment costs and rental income, while energy-related variables play a more limited role. The findings suggest that the viability of EPS models depends as much on market conditions as on technical performance, pointing to a potential misalignment between energy policy objectives and private investment incentives. Results suggest that projects approaching 160 m2 are more likely to achieve a 50% probability of a positive NPV, indicating a potential scale threshold beyond which EPS schemes become significantly more bankable and below which aggregation or additional de-risking measures are likely to be required.
Gabrielli et al. (Sat,) studied this question.