Germany Keeps €12 Billion Heating Swap Aid, Plans Building Energy Law Revision

Overview

• Environment Minister Carsten Schneider said state support for replacing fossil-fuel heaters will continue, with socially tiered grants offering up to 70% for low-income households.
• The government intends to revise the Building Energy Act but keep its core principles and emissions objectives, including the 2045 climate-neutral target.
• Schneider cited market shifts with heat pump installations recently outpacing new gas boilers, describing incentives as driving quiet uptake.
• The current law requires new systems in designated new-build areas to use 65% renewable energy, with local heat plans due by mid-2026 in cities over 100,000 residents and by mid-2028 elsewhere.
• CSU leader Markus Söder rejected the SPD stance and reiterated his demand to abolish the law and reduce what he called excessive heat-pump subsidies, saying he will press the point in coalition talks.