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Dec 20, 2023

German cabinet adopts ban of new fossil fuel boilers, but consumers remain uncertain

The majority (79%) of homeowners in Germany are in favour of replacing fossil

The majority (79%) of homeowners in Germany are in favour of replacing fossil heating systems with climate-friendly alternatives, but uncertainty reigns as to how this heating transition will be justly implemented, a survey by consultancy co2online found. While the German cabinet agreed on Wednesday (19 April) on a de-facto ban on the installation of new fossil fuel heating systems, most homeowners remain unsure as to what possibilities are available to them, rate planning security as not good, and are generally concerned about the topic of changing heating systems, according to the survey. As part of the Building Energy Act, all newly installed heating systems must be run with at least 65 percent renewables from 2024 "if possible". The details around the law are "leading to massive uncertainty and even deep concern about not being able to cope with possible challenges", co2online head Tanja Loitz said.

Ahead of the cabinet meeting, Social Democrat (SPD) leader Lars Klingbeil told newspaper Bild that climate protection and social justice go hand in hand: "That's why we're going to spend a lot of money to promote the switchover of heating systems." Additionally, economy minister Robert Habeck had announced a subsidy programme worth billions. There will be a basic subsidy of 30 percent of the costs of a new heating system, as well as a 20 percent climate bonus for people over 80 and those on benefits, and low interest loans of up to €60,000, according to business daily Handelsblatt. Between other bonuses, the government will also discuss the extension of tax incentives. Greater clarity and advice from politicians, as well as financial support, the assurance that enough trained skilled workers for implementation are available, and more transparency would increase support for the legislation, according to the survey.

The de-facto oil and gas heating ban caused much controversy within the government's coalition parties and civil society, with initial leaked transition plans criticised as too ambitious and costly. Since then, extensions of transition periods and exemptions were agreed, such as allowing hydrogen-ready gas-fired boilers. However, consumer groups have warned against these, saying they are deceptive and are set to cost buyers dearly. After the cabinet approval on 19 April, the law will go into parliament, where amendments could still be made. The use of fossil heating systems will be banned completely by 2045, the year in which Germany aims to have made its economy entirely climate neutral. Currently, over 80 percent of the country's heating demand is met with fossil fuels.

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