Chief of the Council of Economic Experts warns against new Heating Law - Germany softens heating law but leaves homeowners facing future cost risks
Germany's government has agreed to reform its controversial heating law, easing rules for homeowners replacing old systems. The updated plan drops the requirement for 65% renewable energy in new heaters and permits gas and oil boilers—provided they meet future green fuel quotas from 2029. Economists and industry observers have already raised concerns about the long-term costs and practical challenges.
The original law demanded that new heating systems use at least 65% renewable energy. Under the revised version, this rule no longer applies. Instead, a 'green gas quota' will offset emissions, allowing fossil-fuel boilers to remain in use.
Critics argue the changes create fresh uncertainties. Monika Schnitzer, head of the Council of Economic Experts, warned that gas and oil boilers could turn into a 'cost trap' for homeowners. She also questioned whether climate-friendly fuels would ever be affordable enough to replace traditional options.
Schnitzer proposed a different approach: cutting bureaucracy to make cleaner technologies more accessible. Meanwhile, the EU's Emissions Trading System is set to push up the price of fossil-fuel heating in the coming years. So far, the German reforms have not triggered noticeable price shifts for oil or gas in neighbouring countries with similar climate policies.
The reform allows older heating systems to stay in place longer but ties their future to green fuel quotas. Homeowners may face higher costs as EU carbon pricing takes effect. The government's next steps will determine how smoothly the transition plays out.
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