Building energy act

https://www.bundesregierung.de/breg-de/aktuelles/neues-gebaeudeenergiegesetz-2184942

The Heating Act 2024 is coming. It will regulate the installation of new heating systems. What homeowners need to know now.
Heating Act 2024 - simply explained:

Heating Act 2024 passed
What does the new Heating Act look like?
Heating Act 2024 depends on local authorities
Municipal heating planning - what is it?
The Heating Act 2024 and the costs

Unanswered questions about the Heating Act 2024

Heating Act 2024 passed by the Bundestag

The reform of the Building Energy Act, which also governs the replacement of old heating systems, was passed by the Bundestag on September 8, 2023. The Heating Act 2024 protects consumers from high energy prices and ensures that local authorities and associations are included, according to reports from Berlin.

Before the parliamentary summer break, the controversial law was halted by the Federal Constitutional Court. Now the Heating Act 2024 still has to be passed by the Bundesrat - approval is considered likely.

There is a lot of talk about the Heating Act 2024 or the Heating Act. The correct term is an amendment and supplement to the existing Building Energy Act (GEG).
The bill has made it into the Bundestag after a long political dispute - but only because it is now to be linked to municipal heating planning.
Has the new heating law already been passed?

Many homeowners and renovators are asking themselves: when will the new heating law be voted on? On September 8, the Heating Act 2024 was passed in the Bundestag.
What's next for the Heating Act 2024?

The Federal Constitutional Court stopped the adoption of the Heating Act planned for July 7, 2023 by means of summary proceedings. The reason was the inadequate parliamentary procedure, not substantive concerns. However, Karlsruhe stated that conceptual weaknesses could not be pointed out and amended due to deliberations being shortened to a maximum.

As a result, the traffic light coalition did not pass the Heating Act before the summer break as originally planned. A planned special session of the Bundestag did not take place. This postponed the vote on the new Heating Act 2024 in parliament until September 2023.
Building Energy Act: what building owners need to consider when installing heating systems

The switch to a more climate-friendly heat supply must also succeed in the residential sector. However, many homeowners are at a loss and are wondering how they should react to the Heating Act 2024.
Based on data from the German Real Estate Association IVD, we provide an overview of what will apply in the future. What deadlines need to be observed? And what options will homeowners have with regard to their heating?
What applies to existing heating systems and new heating systems installed by the end of 2023?

A heating system that is already in use in the house or will be installed by the end of 2023 can be operated and repaired until December 31, 2044. This means grandfathering:

Exception: If the heating system has to be replaced before then because it can no longer be repaired.
If the heating system is not a condensing or low-temperature boiler, the operating period ends after a maximum of 30 years after installation.

The Immobilienunternehmerverband therefore currently sees no need for homeowners to take action if the heating system is expected to remain operational for a few more years.
What applies to the installation of a new heating system from 2024?

From January 1, 2024, homeowners will be obliged to only install heating systems that use at least 65% renewable energy.

Exception: If a conventional heating system was ordered before April 19, 2023. This system can then still be installed until October 18, 2024.
There are other deviations that also have to do with municipal heat planning.

Municipal heat planning will soon be mandatory for cities and municipalities. Large cities with a population of 100,000 or more must submit their heat planning by July 1, 2026 at the latest, all other municipalities by July 1, 2028.
If an oil or gas heating system is installed before the municipal heating plan is available, the obligation to use renewable energies will not apply until January 1, 2029. The mandatory minimum proportion of biomass (biogas, biodiesel, e-fuels) or hydrogen in the fuel will then initially be 15 percent, 30 percent from January 1, 2035 and 60 percent from January 1, 2040.
Once the municipal heating plan is available, these may be installed:
Heating systems with a mandatory 65% share of renewable energies in the fuel, such as heat pumps, biomass such as wood pellets, pure electricity heating, solar thermal energy, hybrid heating systems, connection to a heating network
any heating system that is replaced by a connection to the heating network after 10 Hagreb at the latest.
In any case, from January 1, 2045, only biomass or hydrogen may be used as fuel, no more fossil fuels.
Installation of new gas heating systems

If a heating system using natural gas was installed after January 1, 2024 and the municipality's heating planning provides for a hydrogen area, then this heating system can be operated until January 1, 2045 at the latest. Provided it is completely converted to hydrogen by then.

If the conversion from natural gas to hydrogen fails or the municipality does not designate a hydrogen area or the gas supplier's conversion schedule is not approved, then in all these cases the heating system must meet the requirement of being powered by at least 65% renewable energy within three years.
Good to know

From January 1, 2024, any type of heating system can be installed, even if a municipal heating plan already exists. The prerequisite for installation is that the heating system is replaced by a connection to a heating network after ten years at the latest. As proof, the homeowner must submit a contract for supply via a heating network when the heating system is installed.
How is the installation of climate-friendly heating systems subsidized?

In future, homeowners can apply for 30 percent funding for the installation of a new climate-friendly heating system.
Homeowners who invest in a new heating system early, even though they are not yet obliged to do so (speed bonus), receive a further 20 percent subsidy. This only applies to owner-occupied properties.
Homeowners with an annual income of less than 40,000 euros and an owner-occupied property receive a further 30 percent subsidy.
In total, the subsidy is capped at a maximum of 70%. The subsidy amount for a single-family home, for example, is limited to a maximum of 30,000 euros.

What does the new heating law look like?
Obligation initially only for new builds

The obligation to install heating systems - which are powered by at least 65% renewable energy - initially only applies to new buildings.

In existing buildings, heating systems that do not meet the requirements of the Heating Act may continue to be installed until the end of June 2026 or the end of June 2028. If a natural gas or oil heating system is irreparably broken, there will be a transitional period - this will also apply to planned heating system replacements.
During the transitional period of five years, heating systems that do not meet the 65% renewable energy requirement can be installed, set up and operated. At the end of this period, local heating plans will be available, on the basis of which homeowners will be able to decide on a suitable climate-friendly heating system.
Wood and pellets

Heating systems that run on wood and pellets meet the 65 percent target. This means that heating with wood and pellets remains permitted for the time being.
Subsidy

The owner of a single-family home can claim up to 30,000 euros of the total bill for the installation of a new, climate-friendly heating system. A maximum of 70 percent. The state subsidy amounts to a maximum of 21,000 euros for a heating system conversion. This cap has been criticized by the Bauherren-Schutzbund, among others, because the investment costs for installing a heat pump that uses groundwater or the ground as an energy source, for example, will exceed 30,000 euros. However, this type of heat pump is particularly efficient and is characterized by low operating costs.
Even when converting an old building to an air/water heat pump, the investment sum of 30,000 euros can quickly be exceeded if, for example, new heat pump-optimized radiators have to be installed.
Exception no longer applies

The originally planned special rule for people over 80 has been removed.
Specialist tradesmen check out gas heating.
Gas heating systems that are still working do not have to be replaced, but are to be operated with a 15 percent share of green biogas or hydrogen from 2029. This proportion will increase thereafter. Photo: stock.adobe.com/Angelov
More details on the Heating Act 2024

Since June 27, 2023, the government has decided on further details:
Funding
The subsidy for a new climate-friendly heating system is to be a standard 30 percent of the investment costs. Low earners (up to 40,000 euros taxable annual income) are to receive a further 30 percent subsidy, i.e. a total of 60 percent. Anyone who switches over particularly quickly is to receive a 20 percent bonus. However, the maximum cumulative subsidy is 70 percent. The quick-change bonus then decreases by a few percentage points from year to year.
Gas heating systems

Gas heating systems that are still working do not have to be replaced. However, from 2029, they are to be operated with a 15 percent share of green biogas or hydrogen. This proportion will increase more and more in the following years. From 2024, homeowners must be advised on future costs when installing a new gas heating system.
Municipal heating planning

The following still applies as a guard rail: the Heating Act is linked to municipal heating planning. It must be available first. This should be the case everywhere by 2028.
Heating Act 2024 depends on municipalities

The municipal heating planning referred to in the Heating Act has yet to be drawn up by many cities. As long as it does not exist, there are no new regulations for homeowners and builders. Gas heating systems that can later be converted to hydrogen can still be installed.
If there is a local heating plan in place, 65 percent of newly installed heating systems must be powered by renewable energy.
Heat pump in a garden
Climate-friendly technologies such as heat pumps play a decisive role in the climate transition. Photo: stock.adobe.com/Bahiriya
Municipal heat planning - what is it?

The idea behind it is to generate heat centrally on a large scale and distribute it to buildings. This replaces the individual heating systems in the buildings.

The question is then how many households can be connected to this heating network and which energy sources can be used. At the moment, 65 percent of district heating is still generated from gas and coal. In future, more and more climate-friendly technologies such as heat pumps will be used as large-scale systems. However, this system is only economically viable in conurbations, not in rural areas.

First of all, local authorities are required to take stock of how many buildings are heated with which energy source. This is followed by concrete plans on how building heating can become more climate-friendly in future, e.g. via a district heating network based on the use of renewable energies.
This also means a change in planning law, as solar, geothermal and biogas treatment plants must be given priority planning and approval. Cities with more than 100,000 inhabitants should have this municipal heating planning in place by 2026, smaller municipalities by 2028.
The Heating Act 2024 and the costs

The construction of a new district heating network with renewable energies requires huge investments on the part of municipal utilities, for example.

And what will customers end up paying? There is a lack of nationwide, systematic price supervision. At the moment, "suppliers have practically unregulated monopolies", warns the consumer association.
Heating law wants to give homeowners access to district heating

Such plans can be imagined as a land use or development plan. Such a map then shows the area for which a heating network is planned. The aim is to encourage homeowners to connect to the local authority's green heating network instead of investing in their own heat pump.
Tip for homeowners: If you need or want to replace your heating system soon, you should definitely contact your local authority to find out about the status of heating planning.
Open questions about the Heating Act 2024

Municipal heating planning is only drawn up for municipalities with over 10,000 inhabitants. So will the replacement obligations apply immediately from 2024 for many small municipalities in rural areas?

There is a lot of unrenovated building stock here in particular, and the financial burden of replacing heating systems is very high here. So what does it look like in detail with transitional periods, exemptions and subsidies? The draft of the Heating Act 2024 is not yet concrete in this respect.

The Building Energy Act (GEG) came into force on November 1, 2020. A further change came into force on January 1, 2023 (reduction of the permissible annual primary energy requirement in new buildings from 75 percent of the reference building to 55 percent).

The GEG contains requirements for the energetic quality of buildings, the creation and use of energy certificates and the use of renewable energies in buildings. The former EnEV, the EnEG and the EEWärmeG were merged with the GEG.
The applicable European requirements for the overall energy efficiency of buildings were fully implemented with the GEG 2020 and the regulation of low-energy buildings was integrated into the energy saving law.

The coalition agreement for the 20th legislative period addresses changes to the GEG in various aspects, including the alignment of new building requirements with the EH40 standard as of January 1, 2025. This is intended to take place in connection with the transition to a modern requirements system. The EH55 standard was introduced as an interim standard for new buildings on January 1, 2023 until it is aligned with the EH40 standard. A corresponding change to the GEG was announced in the Federal Law Gazette on July 28, 2022.

The proven funding structure of the existing “Federal Funding for Efficient Buildings” (BEG) will be slightly changed so that the funding will continue to meet the legal requirements in the future. In concrete terms, this means: There will continue to be funding for all citizens who own their own homes to exchange an old fossil fuel heating system for a new, climate-friendly heating system. In the future, the funding rate will be a uniform 30 percent, regardless of which of the climate-friendly forms of heating listed in the law you choose.

In addition to the basic funding, there are three different climate bonuses, i.e. increased funding rates, to promote the faster switch from particularly old and inefficient heating systems to sustainable heating systems.

Switching your heating system to renewable energy should also be possible for older homeowners or those with little money or with state transfer payments.

In addition to the subsidies, there are also new low-interest loans for replacing heating systems. Alternatively, the tax depreciation also remains.

Reduzierung des zulässigen Jahres-Primärenergiebedarfs für Neubauten von bisher 75 Prozent des Primärenergiebedarfs des Referenzgebäudes auf 55 Prozent.

Anpassung des in Anlage 5 des GEG geregelten vereinfachten Nachweisverfahrens für Wohngebäude. Anlagenoptionen, die im vereinfachten Nachweisverfahren nicht aufgeführt werden, sind weiterhin im Rahmen des Referenzgebäudeverfahrens umsetzbar, so dass das Referenzgebäudeverfahren technologieoffen ist.

Einführung eines Primärenergiefaktors für Strom zum Betrieb von wärmenetzgebundenen Großwärmepumpen für den nicht erneuerbaren Anteil von 1,2 eingeführt (statt 1,8): Ziel: Behebung einer bestehenden systematischen Benachteiligung von Fernwärme aus Großwärmepumpen gegenüber Fernwärme aus KWK-Anlagen oder Wärmeerzeugern mit fossilen Energien.

Streichung der Absätze 2 und 3 des § 23 GEG, da sich in der Praxis erwiesen hat, dass das dort vorgeschriebene Bewertungsverfahren zu widersprüchlichen Ergebnissen führen kann.
Anpassung der Regelung zu den Fördermaßnahmen in § 91 GEG an die Anhebung des Anforderungsniveaus.

Einführung einer bis Ende 2024 befristeten Erleichterung für bestimmte Gebäude, die der Unterbringung geflüchteter Menschen durch die öffentliche Hand oder im öffentlichen Auftrag dienen. Inkrafttreten dieser Regelung: Am Tag nach der Verkündung, also am 29. Juli 2022.

Für die Umsetzung der übrigen Vorgaben aus dem Koalitionsvertrag zur Änderung des GEG stehen Einzelheiten noch nicht fest.

The GEG 2020 introduced a new, equivalent procedure for proving compliance with energy requirements when constructing residential buildings (so-called model building procedure for residential buildings).
The obligation to use renewable energies for new buildings can also be fulfilled by using electricity generated from renewable energies close to the building.
The GEG also provides for flexibility options when it comes to meeting energy standards for new buildings. These particularly concern the options for crediting electricity generated close to buildings from renewable energies and gaseous biomass in energy balancing.
The primary energy factors to be used when calculating the permissible annual primary energy requirement are regulated directly in the GEG. This increases the transparency and traceability of the primary energy factors for builders and owners.
The GEG contains a limited innovation clause in Section 103. This enables two things in individual cases.

On the one hand, it is possible until the end of 2023, through an exemption from the responsible authority, to demonstrate the requirements required under the GEG instead of the main requirement of the permissible annual primary energy requirement via a system aimed at limiting greenhouse gas emissions and the permissible annual final energy requirement, insofar as the Equivalence of the requirements is given.
Secondly, until the end of 2025, it will be possible to ensure compliance with the requirements when making changes to existing buildings through joint fulfillment in the district, i.e. a majority of buildings. This regulation and the possibility of agreements on a shared heat supply in the district serve to strengthen district-related concepts.
The GEG is thus providing new impetus for the use of innovative approaches to energy-efficient construction.

The carbon dioxide emissions of a building resulting from the primary energy requirement or primary energy consumption must be stated in energy certificates. An energy certificate therefore contains additional information that takes the climate impact into account.

The GEG 2020 also standardized a regulation to restrict the installation of new oil heating systems from 2026 in accordance with the requirements in the key points for the 2030 climate protection program. From 2026, this regulation also applies to the installation of new boilers fed with solid fossil fuels (coal heating systems ).

In the case of sales and certain major renovations of one- and two-family houses, mandatory energy advice for the buyer or owner is required.

With the Building Energy Act 2020, the enforcement regulations have also been improved. A so-called declaration of compliance was introduced for new buildings and certain major renovations in existing buildings.

As of: January 16, 2023

If the heating is broken and can no longer be repaired - a so-called heating accident - transition periods apply: generally these are three years; for gas floors up to 13 years. A used, fossil fuel-powered heater can also be installed temporarily. If a connection to a heating network is foreseeable, transition periods of up to ten years apply.

For owners over 80 who live in a building with up to six apartments, the obligation to switch to renewable heating should no longer apply in the event of a heating breakdown. This should also apply when replacing floor heating systems for apartment owners who are 80 years old and older and live in the apartment themselves.

The law is pragmatic and deliberately designed to be technology-neutral: owners can implement individual solutions. You can also prove the renewable share (at least 65 percent) mathematically.

Or you can choose between various legally provided options for at least 65 percent renewable heating: connection to a heating network, electric heat pump, direct electricity heating, hybrid heating (combination of renewable heating and gas or oil boiler), heating based on solar thermal energy. Under certain conditions, there is also the option of so-called “H2-Ready” gas heaters, i.e. heaters that can be converted to 100 percent hydrogen.

Further options are planned for existing buildings: biomass heating, gas heating that verifiably uses renewable gases - at least 65 percent biomethane, biogenic liquid gas or hydrogen.

In the future, tenants will be protected from excessive operating costs and from an excessive contribution to the investment costs for a new heating system.
If landlords decide to install and use gas heating systems based on biomethane, tenants should be protected from the foreseeably high operating costs. The costs for the biogas may then only be billed at the amount required to generate the same amount of heating heat with a sufficiently efficient heat pump. This should also apply to all biogenic fuels, especially pellets/solid biomass. Otherwise, tenants would be burdened with the high operating costs of a green gas supply contract.

If the decision is made to install a heat pump in a building with poorer energy efficiency, landlords should only charge a modernization levy if the heat pump achieves an efficiency of at least 2.5. Otherwise, only 50 percent of the investment costs can be allocated. This is intended to protect tenants from excessive operating costs caused by less efficient heat pumps. At the same time, landlords should be motivated to invest in the energy efficiency of the building.