Oct 1, 2025
Utilities are urging the Merz administration to develop a new strategy for reducing carbon emissions in the heating sector.
Local utilities in Germany are urging the government to swiftly enact an anticipated reform of the Building Energy Act (GEG) to enhance decarbonization in the heating sector. Ingbert Liebing, head of the Association of Local Utilities (VKU), emphasized the need for timely decisions during an industry conference in Mainz. He stressed that draft laws for the GEG and the Combined-Heat-and-Power-Law (KWKG) should be expedited to provide planning security for utilities, businesses, and citizens. “Climate neutral heating must be secure and affordable for all,” he stated.
A survey of over 600 local utilities revealed that 82% believe the current legal framework will result in excessive costs for consumers. Additionally, 68% expressed concerns about sufficient funding for decarbonization efforts, while 55% criticized the ambiguity surrounding the transition in the sector.
The GEG was approved by the prior government in early 2024, mandating that new buildings use heating systems powered by at least 65% renewable energy. Existing buildings are included in municipal plans for improving district heating, with larger cities required to outline decarbonization strategies by mid-2026 and smaller towns by mid-2028. According to the VKU survey, over 90% of local utilities are optimistic about meeting these timelines. Nearly half plan to utilize a combination of district heating and heat pumps to meet decarbonization goals, noting that "green gases play only a minor role." The same percentage of surveyed utilities anticipates doubling their investments in clean heating by 2030.
The regulations concerning the replacement of fossil fuel heating with cleaner options like heat pumps generated controversy prior to the law's adoption, prompting the previous Green Party-led economy ministry to relax restrictions on new natural gas and oil heating systems. The coalition of the conservative CDU/CSU and the Social Democrats (SPD) pledged to “abandon” the law but has yet to provide details on how to achieve emissions reduction targets in the building sector.
Reducing greenhouse gas emissions in heating is a significant challenge for Germany in its pursuit of climate neutrality by 2045, as most heating systems remain fossil-based.
A survey of over 600 local utilities revealed that 82% believe the current legal framework will result in excessive costs for consumers. Additionally, 68% expressed concerns about sufficient funding for decarbonization efforts, while 55% criticized the ambiguity surrounding the transition in the sector.
The GEG was approved by the prior government in early 2024, mandating that new buildings use heating systems powered by at least 65% renewable energy. Existing buildings are included in municipal plans for improving district heating, with larger cities required to outline decarbonization strategies by mid-2026 and smaller towns by mid-2028. According to the VKU survey, over 90% of local utilities are optimistic about meeting these timelines. Nearly half plan to utilize a combination of district heating and heat pumps to meet decarbonization goals, noting that "green gases play only a minor role." The same percentage of surveyed utilities anticipates doubling their investments in clean heating by 2030.
The regulations concerning the replacement of fossil fuel heating with cleaner options like heat pumps generated controversy prior to the law's adoption, prompting the previous Green Party-led economy ministry to relax restrictions on new natural gas and oil heating systems. The coalition of the conservative CDU/CSU and the Social Democrats (SPD) pledged to “abandon” the law but has yet to provide details on how to achieve emissions reduction targets in the building sector.
Reducing greenhouse gas emissions in heating is a significant challenge for Germany in its pursuit of climate neutrality by 2045, as most heating systems remain fossil-based.