The German government’s recently unveiled plans for a reform of the Buildings Energy Act (GEG), now rebranded as the Buildings Modernization Act, are drawing criticism from industry associations and companies, highlighting a pervasive lack of clarity and hindering progress toward national climate goals. While the coalition government has presented a timeline establishing key points for a new law by early 2026 and subsequent cabinet approval, this is being met with skepticism and accusations of continued indecision.
The German Heating Industry Association voiced serious concerns, stating that a consensus, despite commitments outlined in the coalition agreement, remains elusive. The persistent ambiguity, they claim, constitutes a worrying pattern of hesitant policy decisions. While the Zentralverband Sanitär Heizung Klima (ZVSHK) acknowledged the introduction of a “binding timeline” as a positive step, they emphasized the urgent need for decisive action following months of uncertainty, arguing the prolonged ambiguity has demonstrably harmed the industry, the trades and crucially, climate protection efforts.
A central point of contention revolves around technology neutrality. Industry representatives insist that any future legislation must permit the utilization of all technologies capable of carbon-neutral operation, a stipulation they feel is threatened by the opaque and evolving nature of the government’s proposals.
Enerix, an energy company, openly criticized the current draft, underlining that beyond a name change and a timeline, the proposed legislation provides few concrete details and has failed to alleviate public anxieties surrounding heating system replacements. Octopus Energy Germany echoed this sentiment, describing a climate of “fog” within the heating sector, punctuated by a succession of announcements devoid of substantive content. “Announcement follows announcement, but clear content for the new Buildings Modernization Act is lacking” stated CEO Bastian Gierull.
The existing GEG mandates a minimum requirement of 65% renewable energy for newly installed heating systems, allowing flexibility in the chosen technology and supported by incentives for CO2-reducing technologies. However, the German Advisory Council on Climate Change – tasked with monitoring the implementation of the federal climate protection law – has consistently flagged a significant need for greater action within the building sector to meet national climate goals. Faster emission reductions in this area are crucial not only for environmental sustainability, but also for mitigating energy costs for consumers and alleviating broader socioeconomic burdens across Germany and the European Union. The delayed clarity and uncertain direction of the reform are now jeopardizing the potential for these benefits.