German heating law hearing draws sharp expert criticism over high costs and planning uncertainty

According to the federal government, chimney sweeps will still measure emissions from fossil fuels for a very long time. Photo: Wolfinger/imago

By Anja Krüger

During a hearing on the Building Modernization Act, experts warned of high costs for tenants and a lack of planning security for the construction industry and municipalities under the new Heating Act pushed by the federal government. Questions were also raised about whether the amendment would withstand scrutiny from the Federal Constitutional Court.

The expert hearing, held Monday by the Bundestag's Economic Affairs Committee, addressed the new Building Modernization Act, which the black-red coalition intends to use to revoke the heating rules established by the previous traffic light government.

After months of negotiations between the Union and SPD, the new Heating Act is now being fast-tracked through the Bundestag. Following the public hearing, the law — largely overseen by Federal Minister of Economics Katherina Reiche (CDU) — is expected to pass its second and third readings this week or next.

Key Changes in the Proposed Law

The amendment would:

• Remove the requirement that 65 percent of new heating systems' output must come from renewable energy.
• Eliminate the previous deadline requiring gas and oil heating systems to be replaced by 2045. These systems could continue operating indefinitely.
• Introduce a "biogas staircase" requiring new fossil fuel heating systems, from 2029 onward, to use an increasing share of CO₂-neutral fuels.

Cost Concerns

Biofuels are expected to be very expensive. Under the new rules, property owners would decide on the type of heating. To limit cost risks for tenants, the Union and SPD agreed that landlords must share half of the CO₂ costs, grid fees, and additional costs for CO₂-neutral fuels for new fossil fuel heating systems.

However, the half-share for biofuels would only apply up to a 30 percent blending share.

"This means that from 2040, tenants will be left alone with high cost risks, because at least 60 percent CO₂-neutral fuels will then have to be blended, so the split would only cover a fraction of the fuels used." — German Tenants' Association, written statement

Florian Becker from the German Tenants' Association demanded at the hearing: "This gap must absolutely be closed."

Lack of "Strategic Directional Clarity"

The property owners' association "Haus und Grund" also criticized the cost-sharing rule — but from the opposite perspective, calling for its removal. Landlords have no influence on consumption, the association argued, and the cost allocation does not sufficiently account for investments in façade insulation, window replacement, or other efficiency measures, according to its statement. Overall, however, the association welcomed the federal government's plan to abolish the traffic light's Heating Act. The Central Association for Sanitary, Heating, and Air Conditioning also viewed the change positively, despite significant detailed criticism.

The German Trade Union Federation (DGB), by contrast, called the abolition of the traffic light law "counterproductive" and described the federal government's building energy policy as "largely conceptless."

"The draft law is a testament to technology policy disorientation." — DGB, statement for the hearing

The DGB criticized a lack of "strategic directional clarity" and noted that uncertainties in the current legislative process lead to further complications.