Germany Passes Diluted Ban of Fossil-Fuel Heating Systems

(Bloomberg) — German lawmakers approved a controversial ban on fossil-fuel boilers in new homes, with a watered-down bill set to eradicate only about three quarters of the harmful emissions it initially targeted.

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From next year, home owners installing heating systems in new properties on new estates will have to make sure that they run on at least 65% renewable energy. But owners of existing properties will have until 2028 at the latest, giving them time to take local district heating plans into account. Gas boilers are still allowed if they are convertible to hydrogen.

Like many of its European peers, Germany has faced difficulties in reducing emissions related to aging buildings. The legislation approved Friday in the lower house of parliament, overseen by Greens Economy Minister Robert Habeck, prompted an outcry among voters concerned about the cost of new heating systems and was diluted after months of in-fighting within the governing coalition.

It was also delayed for several months following a ruling by the country’s top court, which ordered the government to give lawmakers more time to assess the complex plans.

After an emotionally charged debate in the Bundestag in Berlin Friday, 399 members voted in favor of the law and 275 against, with five abstentions.

“We have debated this law intensively for months, and the many discussions and conversations have made this law better,” Habeck said in an emailed statement after the ballot, calling it “key milestone for climate protection.”

Germany would now be less dependent on fossil energy, consumers will be protected from rising prices for natural gas and crude oil and domestic competitiveness in green technologies will be given a boost, he added. Chancellor Olaf Scholz said in a post on X that it’s “another good step” toward climate neutrality.

The law is expected to cut emissions by about 40 million tons by 2030, compared with 54 million tons estimated in a stricter draft of the legislation presented in February, according to the Economy Ministry.

The government also promised to cushion the financial burden for home owners and top up funding for the replacement of boilers from around 40% to a maximum of 70%.

If the boiler exchange is combined with other renovation measures, the government will provide as much as €90,000 ($96,404) in subsidies per year, up from €60,000 initially.

Joerg-Andreas Krueger, the president of German environmental group NABU, called the law a “toothless tiger,” arguing that the weaker version doesn’t solve the problem it’s trying to address.

“The bottom line is that the government still lacks a political response for a socially just and climate-friendly heating transition,” Krueger said in an emailed statement.

(Updates with Habeck comments starting in sixth paragraph)

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