Germany proposes new heating law with lower renewable energy requirements amid Iran war energy crisis

Germany's coalition government of Christian Democrats (CDU) and Social Democrats (SPD) has approved a draft bill that would lower the renewable energy requirement for new heating systems from 65% to 10%, replacing the current Heating Act with a new "Building Modernization Act." The move comes as the war in the Middle East threatens fossil fuel supplies and drives up energy prices in Germany, exposing the country's reliance on imported fuels.

The original law, introduced by the previous administration, required all newly installed heating systems to run on at least 65% renewable energy. Under the new proposals, oil and gas heating systems with significantly lower shares of climate-friendly gases would still be allowed in existing buildings for a longer period. The cabinet approved the plan based on a draft bill submitted by Building Minister Verena Hubertz (SPD) and Economy Minister Katherina Reiche (CDU).

The government hopes to push the Building Modernization Act through parliament before the summer recess in mid-July. However, the draft has drawn sharp criticism from the National Regulatory Control Council (NKR), an independent advisory body. Its chairman, Lutz Goebel, described the draft bill as "one of the weakest and most impractical pieces of legislation presented to the National Regulatory Control Council in recent years." He said parts of the text were "barely comprehensible" and warned that problems with implementing the law were likely, adding that "laws like this contribute to growing frustration among citizens toward the state and politicians."

Other groups have defended the proposal. Carsten Rolle, responsible for energy, mobility and environmental issues at the Federation of German Industries (BDI), said the "Building Modernization Act is better than its reputation." Peter Adrian, president of the German Chamber of Industry and Commerce (DIHK), called the draft law "overall a step in the right direction," saying it would reduce rigid requirements and give companies "more flexibility on the path toward climate neutrality in the building sector." Frederik Lippert of heating systems manufacturer Vaillant said that "some of the changes could help calm the debate," including abolishing the 65% rule, which many in the market viewed as a form of coercion.

Environmental groups and heat pump manufacturers have condemned the draft. Julius Neu of the German environmental organization BUND said the proposed law amounts to "a declaration of bankruptcy in climate policy." "By abolishing the 65% rule, the most effective instrument of the heating transition is being scrapped," he said, arguing that this would "artificially prolong fossil-fuel technologies and leave people trapped by rising gas costs." Katja Weinhold, spokesperson for the German Heat Pump Association, said the 10% requirement "sends entirely the wrong signal." "In light of the crisis in the Middle East and its impact on energy prices, Germany's energy security, and climate targets, this sends entirely the wrong signal," she said.

The Iran conflict and disruption of shipping through the Strait of Hormuz have exposed Germany's reliance on fossil fuel imports. Lippert said current geopolitical developments are likely to accelerate the trend toward renewable energy, including heat pumps. Neu said: "One hopes that the current energy crisis linked to the Iran conflict will encourage many people to choose heat pumps despite this irresponsible draft legislation."