Germany's 'Winter of Decisions' for Heat: Challenges and Preferences Revealed
The 'winter of decisions' for heat is approaching, with crucial legislative projects set to be unveiled this fall. The Verband kommunaler Unternehmen e.V. (VKU) has revealed insights from suppliers, indicating challenges and preferences in the heat transition. Suppliers are optimistic about municipalities completing their heat plans on time, with 90 percent expecting completion by mid-2026 or mid-2028. However, two-thirds find current financing insufficient, and over half struggle with the unclear legal situation regarding the heat transition. Companies are exploring various heating options. Thirty-eight percent plan to use electricity and heat pumps together, while 23 percent opt for district heating alone. Green gases like hydrogen or biomethane are barely considered, with only 4 to 8 percent expecting them to play a significant role. VKU advocates for new gas power plants that can be retrofitted to be climate-neutral or a capacity market for flexible generation. Municipal utilities, supported by VKU, seek more legal clarity regarding the planned abolition of the Heating Ordinance and the revision of the Building Energy Act. They also call for increased federal funding for efficient heat networks, aiming to raise the BEW funding to 3.5 billion euros annually. This is to reduce costs for the population and the economy during the heat transition. Over 160 companies responded to the VKU survey, with almost half planning to use a mix of district heating and heat pumps in the future. Currently, three-quarters of all apartments in Germany are heated with gas or oil, and 15 percent with district heating, with a small share of renewable energies. The heat transition faces challenges in financing and legal clarity. Suppliers and municipal utilities urge the government coalition to increase federal funding for efficient heat networks, from 1 billion euros to 3.5 billion euros annually. The 'winter of decisions' will shape the future of heat supply in Germany.
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