The cabinet plans to delay its decision on the overhaul of the Building Energy Act (GEG), commonly known as the “heating law” until at least mid-May. This revised timeline comes from the cabinet’s schedule, as reported by the “Handelsblatt”, suggesting that the draft for the new Building Modernization Act (GMG) could be approved on May 13th.
Despite these dates, it remains unclear whether the core coalition partners, the Union and the SPD, will manage to resolve the major disputes surrounding the reform. Initially, consensus was hoped for closer to Easter, with the topic previously scheduled for April 29th. The key sticking point remains the adequate protection of tenants against excessively high secondary costs resulting from the installation of heating systems that rely on fossil fuels.
A basic framework prepared by the Union and SPD in February addressed the issue by proposing a “regulation to protect tenants from excessive secondary costs incurred by installing uneconomical heating”. However, this related rule has not yet been finalized or incorporated.
The potential financial consequences of the planned reform are already highlighted by modeling. According to estimates from the Fraunhofer Institute for System and Innovation Research (ISI), if the reform proceeds, tenants could face an additional burden of about €18,600 between 2027 and 2045 if they continue to use natural gas. This increased cost is attributed to the rising CO2 price and new regulations mandating that natural gas be increasingly blended with biomethane and relatively expensive synthetic fuels.
Furthermore, environmental groups point to a significant weakening of climate commitments. The Öko-Institut warns that the reform will exacerbate the existing gap toward the 2030 climate target by an additional five to eight million tons of CO2 equivalent per year. For the 2040 goal, the current gap of 102 million tons of CO2e annually would expand by an extra 14 to 22 million tons, pushing the total requirement to between 116 and 124 million tons of CO2e per year.