Heat - A section of heating pumps fails - heating transformation at risk?
Paragraph about Heat pumps in Germany has declined. The federal government's goals for the energy transition, i.e., the gradual departure from gas and oil heating, are likely to be significantly missed this year - despite the new Heating Law being in effect since the beginning of the year. With the increasingly slow modernization pace, politics runs the risk of missing climate targets in the building sector, according to the German Heating Industry Association (BDH).
Clear numbers speak
The overall market was strongly declining in the first half of the year. According to BDH figures, 43% fewer heating devices were sold compared to the previous year's period, which was marked by strong demand. In terms of heat pump sales, there was a record year in 2023 with 356,000 units sold. Many people ordered a heat pump due to the rising gas prices caused by the Russian attack on Ukraine. In the course of the year, there was strong demand, especially for new gas heating systems, due to advance effects caused by uncertainty about the new Building Energy Law, often referred to as the Heating Law.
Customers hold back
Customers are obviously holding back this year. The sales of gas heating systems dropped by 42% to 223,000 units. The decline in the first half of the year for heat pumps was even more drastic. Only 90,000 units were sold - a decrease of 54%. The association expects a maximum of 200,000 heat pumps to be sold by the end of the year - a goal the federal government had set for 2024.
Uncertainty among the population about what municipal heating planning will bring is causing people to postpone modernizing their heating systems, according to BDH managing director Markus Staudt.
The new Heating Law generally stipulates that from 2024, every newly installed heating system must be operated with renewable energy to 65%. However, these regulations initially only apply to new buildings in new housing estates. Existing heating systems can continue to operate.
The focal point for existing buildings is municipal heating planning. It is expected to be available in major cities from the middle of 2026 and for the rest of the communes from the middle of 2028. Homeowners should then have clarity about whether they will be connected to a district heating network or whether they should take care of their own decentralized solutions - for example, a heat pump.
The association hopes for impulses
The BDH is hoping for positive impulses, for example, through the expansion of state funding. According to the state development bank KfW, owners or tenants of single-family houses and apartment buildings, as well as owners or tenants of self-owned or rented apartments in housing cooperatives, will be able to submit applications for state funding for the switch to climate-friendly heating systems as of the end of August 2024.
The funding looks like this
For the switch to a climate-friendly heating system, a funding of up to 70% is possible, in addition to a basic grant, there is a speed bonus and an income bonus. The maximum eligible investment costs amount to €30,000 for a single-family house.
The German Federation of Heating Industries (BDH) stated that since May, application numbers for the KfW heating funding have significantly increased. Starting in August, the housing industry is expected to join the funding, and payments are scheduled to begin in September, which is expected to lead to increased demand for heat pumps.
BDH recommends: Communicate better
The BDH advises intensifying communication towards end consumers and providing information on funding opportunities in a broad manner. The German Heat Pump Association shares this view. Business manager Martin Sabel stated: "People want to move away from fossil gas heating, and a heat pump is then the preferred technology. Industry and politics can work together to better inform about the very good funding opportunities." The positive development of the KfW funding shows that these efforts pay off.
Staudt also demanded planning security in funding. This year, approximately 17 billion Euros from the Climate and Transformation Fund (a special pot of the Federal Government) are available for building renovation and heating system conversions.
A spokesperson for Economic and Climate Protection Minister Robert Habeck (Greens) stated: "We currently assume that it will continue." However, this is subject to change - budgetary negotiations in the German Parliament have not yet begun after the summer break.
- Despite the new Heating Law being in effect, the federal government's goals for transitioning away from gas and oil heating might not be met this year due to a decline in heat pump sales in Germany.
- The German Heating Industry Association (BDH) noted a 43% decrease in the overall market for heating devices in the first half of the year, with 90,000 heat pumps sold, a decrease of 54%.
- The increasing uncertainty about municipal heating planning is causing people to delay modernizing their heating systems in Germany, as per the BDH managing director Markus Staudt.
- From 2024, every newly installed heating system in Germany must operate with 65% renewable energy, as stipulated in the new Heating Law, but these regulations apply only to new buildings in new housing estates initially.
- Homeowners in Germany will have clarity about whether they will be connected to a district heating network or should invest in decentralized solutions like heat pumps by the middle of 2026 or 2028, depending on their location.
- The BDH is hoping to receive positive impulses through the expansion of state funding, such as KfW heating funding, which will allow owners or tenants of residential buildings to apply for grants as of August 2024.
- For the switch to a climate-friendly heating system, up to 70% funding is possible, including a basic grant, speed bonus, and income bonus from KfW, with a maximum eligible investment cost of €30,000 for a single-family house in Germany.
- The German Heat Pump Association agrees with BDH, emphasizing the importance of improving communication towards end-consumers and providing information on funding opportunities to encourage the adoption of heat pumps as a renewable energy heating source in Germany.
