Climate ChangeRenewables

German Government Softens Renewables Targets In Municipal Heating Plans

Germany’s coalition government has unveiled a draft law that mandates municipalities to develop plans for transitioning to climate-neutral heating. However, the government has scaled back interim targets for renewable energy usage. Under the new proposal, existing district heating networks must achieve a 30 percent renewable energy share by 2030. Notably, many municipalities are exempt from this requirement until 2035. This is a departure from an earlier draft that called for a 50 percent renewable energy share by 2030.

The draft law considers green, blue, and turquoise hydrogen as climate-friendly gases. Green hydrogen is produced from water using renewable electricity, while blue and turquoise hydrogen are derived from natural gas through processes that capture CO₂.

The economy and climate action ministry (BMWK) stated that the bill aims to implement heat planning across Germany’s approximately 11,000 municipalities. This will provide clarity to citizens and businesses about the local energy sources and supply options available to them. The plans are intended to inform households about whether they will be connected to a district heating network or if they need to transition to other climate-friendly technologies. Homeowners will not be required to switch to renewable heating systems until the plans are publicly disclosed.

The municipal heating law is closely tied to Germany’s draft law to phase out oil and gas boilers, which is currently under consideration. Both bills are slated for parliamentary approval after the summer recess. The use of fossil fuel-powered heating systems will be prohibited from 2045, the year when Germany aims to achieve complete climate neutrality. Heating buildings contributes to approximately 15 percent of the country’s CO₂ emissions.

The construction ministry and the economy ministry have not commented on how the revised interim renewable targets will impact Germany’s overall climate goals for 2030. Utility association BDEW welcomed the reduction, stating that it makes the decarbonization of grid-bound heating more feasible for district heating network operators while maintaining the objective of a climate-neutral heat supply by 2045. However, NGO Environmental Action Germany (DUH) criticized the bill for its late deadlines for municipalities’ plans (2026 or 2028, depending on size) and its failure to prioritize climate-friendly heating sources. DUH argued that bioenergy and green hydrogen should be considered niche solutions due to their inefficiency, limited availability, and high costs. The organization warned against adopting them as equal solutions in the law, as it could lead to significant wasted investments.

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