EU Tracker – Local heating and cooling plans in Germany
Summary
What is the status of the transposition of Art 25.6(EDD) and its implementation ?
The German Bundestag voted a national law to transpose Art 25.6. Since January 2024, a nationwide heat planning obligation is applicable to all municipalities. This law provides a national legal framework to municipalities and the Länder, some of which had already mandated their local authorities.
A handful of German Länder (states) had already made local heat planning obligatory. While access to a comprehensive support framework remains limited in parts of Germany, some Länder already have well established support for drafting local heating plans. The national Municipal Heat Transition Competence Centre (KWW) and similar one-stop shops at the Länder level, and the ongoing work for open, interoperable databases shows a promising path forward. Large, sustained investment in human resources in local administrations dedicated to climate, energy and spatial planning will nevertheless be needed to make the German Wärmewende (heat transition) a reality. Obligations and support for cooling planning will also be needed, which is currently overlooked.
Detailed assessment
The legal framework and the obligations
Since 2024, municipal heat planning is mandatory in all municipalities. In addition about one third of German Länder, have set up a complementary legal framework.
Overview of the legal frameworks per governance level
| National | The Bundes-Klimatschutzgesetz (Federal Climate Action Law) is the first federal climate law in Germany, adopted in 2019 and amended in 2021, which sets a legally binding target for climate-neutrality by 2045 with emission reduction targets to 2030 to 65 % and 80 % to 2040 compared with 1990, including sector specific emission targets. On November 17, 2023, the German Bundestag passed a law for heat planning and the decarbonization of heat networks. The revised Building Energy Act (GEG) and the new Local Heat Planning Act (WPG) aim to completely decarbonise the heating sector by 2045 and to transpose the new Energy Efficiency Directive, in particular its art 25.6 on local heat planning. The law oblige : – building owners to switch from fossil to renewable heating technologies; – operators of district heating networks to ensure the use of climate-friendly heat sources and; – municipalities to identify and describe which heating technologies are or may become available, particularly with regard to gas, hydrogen and district heating networks. For municipalities, the level of requirement is based on the total population: · Municipalities and cities with a population of more than 100,000 are mandated to draft heat plans by June 30, 2026 the latest. · For smaller municipalities, the deadline applies two years later, June 30, 2028. Municipalities with fewer than 10,000 inhabitants can also use a simplified procedure. |
| Regional | In Germany, the Länder have nearly full competence to issue legislation on environment, climate and energy. About two-thirds of the Länder have issued Climate Protection Acts (Landesklimaschutzgesetz), with Länder in the eastern part of Germany clearly underrepresented. These legal documents outline measures within each Bundesland to reach climate targets, and they include to various extent obligations and responsibilities at the local level related to energy and spatial planning. |
| Local | Since January 2024, municipal heat planning is mandatory according to national law. In addition, state law in some German Länder, including Baden-Württemberg, Schleswig Holstein, Hamburg, Niedersachsen, had already adopted mandatory local heat planning measures. A legal basis is currently in preparation in Nordrhein-Westfalen. The Land of Berlin and Thüringen has meanwhile imposed making decarbonization plans for district heating utilities obligatory. Municipal energy planning is voluntary albeit recommended in Bayern and encouraged through guidance provision and targeted financial support. |
Content of local heating and cooling plans according to the law
The aim of the local heat plans (as mandated by national law since 2024) is to define whether future heat supply should be decentralized, via heating networks or using climate-compatible gases (biomethane, “green hydrogen”). By 2030, existing heating networks must be supplied with 30% of renewable energy or unavoidable waste heat, 80% by 2040 and 100% by 2045. New heating networks from 2024 must be fueled by at least 65% renewable energy or unavoidable waste heat.
Municipalities must follow a three-step approach, including:
- In the first phase, an inventory analysis. In this phase, building types are analyzed and recorded. Existing heating networks and heat sources are identified. This data is logged into a digital map of the area.
- In the second phase, an analysis of the potential for heat production through renewable energies. This analysis includes: the production of biogas, solar thermal energy and geothermal potential. In addition, other heat sources such as waste heat from industrial plants or waste incineration plants are considered.
- In the third phase, scenarios for the future heat supply must be developed. The scenario must take into account the climate objectives as well as the affordability.
A component that is not yet mandatory, but still relevant, for the development of a comprehensive strategy for future energy supply is the analysis of the effects that heat planning has on the development of the power grid and the associated infrastructure. Investments in the electricity grid will be required. Additional studies will therefore have to supplement municipal heat planning.
German Länder still have the possibility to further develop regional legal support, in line with the national law. One example of an existing law on municipal heat planning is the state law (Landesrecht BW § 27 KlimaG BW) of Baden-Württemberg, that hasve influenced the design of similar laws in other German Länder and at the federal level. More information on this law can be found in German on the state energy agency website and in English in Energy Cities 2022 factsheet. It requires municipalities to include following elements when developing a municipal heat plan:
- Cover all parts of their respective territory
- Make a systematic analysis of current heat demand, including an assessment of existing buildings and age classes, and the existing heating supply structure
- Determine the potential of reducing the heat demand and the potentials of meeting the remaining heat demand with renewable energy and excess heat
- Develop a scenario for climate-neutral heating by 2040 with interim targets for 2030, including a spatial representation of the planned heating supply structures
- Develop strategies and measures to reduce and cover the remaining heat demand in a climate-neutral way
- Be updated at a minimum every seven years
- Involve citizens and relevant stakeholders as early and continuously as possible in the preparation process of the plan
The support framework
The support provided for heating and cooling plans differs across the Länder, with federal and state guidance and support under development
The support framework for municipal heating planning varies greatly across Germany. Some German Länder have developed comprehensive support frameworks even on regional level for municipal heat planning, such as Baden-Wurttemberg where around half of all existing local heating plans nationally have been developed. Other Länder have considerably less developed frameworks, mainly in those without obligations or encouragement issued often located in the eastern part of Germany. Dedicated state aid, ongoing efforts to build guidance support both nationally and in Länder, most notably through the Municipal Heat Transition Competence Centre (KWW) and the Energy Agencies of the Länder, and the establishment of open access databases show promising signs of a comprehensive support framework in the making. The most pressing constraint for local authorities to carry out heating and cooling planning may be the lack of staff, for which sustained and long-term public investment to build capacity will be necessary.
Provided Support
| Technical and organisational | 4/5 | The extent to which local authorities are provided with technical guidance and support to draft heating plans varies greatly across Länder. Extensive technical and organizational support frameworks to draft heat plans have been developed in some states. Examples include Baden-Württemberg and Nordrhein-Westfahlen by their respective energy agencies, which have developed initial advice, step-by-step guidance, and a technical toolbox, and a technology catalogue (Baden-Württemberg). At the federal level, a technical support framework is currently being developed, while it is foreseen that the new heat planning law will be accompanied by federal guidance on Local heating plans. Moreover, the Municipal Heat Transition Competence Centre (KWW) established in 2022 on behalf of the German energy agency (DENA) under BMW, works as a nation-wide instrument for local heating planning in Germany through fostering knowledge exchange between different stakeholders, agencies and institutions. |
| Financial | 3/5 | In the case of voluntary heat planning, municipalities can apply for funding. The federal state provides financial support for municipalities to draft heat planning documents voluntary within the framework of the municipal directive (Kommunalrichtlinie) through the National Climate Protection Initiative (NKI) of the BMWK. Financially weak municipalities and municipalities located in lignite areas can – when applying this year – be 100% compensated for their total expenditure to draft municipal heat plans and all other municipalities can get 90% of the eligible costs funded. When applying next year, the funding quotas decrease for financially weak municipalities and municipalities located in lignite areas to 80% and for all other municipalities to 60%. Financial support schemes to support the development of municipal heating plans have been established in some Länder. In Baden-Württemberg, the subsidy covers 60% of the eligible expenses and up to 80 % of the cost with a funding scheme for smaller municipalities. This support however only adheres to municipalities without obligations for heat planning and will be revised in light of the new national obligation. Municipalities that are now embarking on this journey will receive financial support for the planning process. 500 million euros are available, as the Federal Government assured the Bundesrat in October 2023 (during parliamentary debate). In the case of mandatory heat planning, the body that is obligated to conduct heat planning gets so called “Konnexitätszahlungen”. According to the “Konnexitätsprinzip” the level of government that delegates a task is responsible for its financing, which would either fall on the federal or Länder level. The issue of funding still needs to be clarified as part of the legislative process. Municipalities and other stakeholders can, in addition but not explicitly linked to heat planning, apply for funding for district heating transformation plans and feasibility studies respectively to expand and convert existing district heating systems to renewable energy and excess heat as well as build new district heating systems. Municipalities and municipal companies can, in addition but not explicitly linked to heat planning, apply for funding for district concepts and personnel to coordinate these concepts. It will become important to sustain and strengthen funding sources following a nation-wide obligation, especially for local authorities with constrained budgets and limited know-how and lack of political support |
| Staff & skills | 3/5 | German local administrations are currently constrained by their human resources to carry out local heating and cooling plans. A 2022 study by Energy Cities identified a substantial staffing shortage in German local administrations for the types of position that would be required for drafting heating and cooling plans. Some regional energy agencies provide experts for the drafting of plans, but often at an insufficient number in relation to demand. Heat plans are today most often drafted by external contractors, which may be short in number and costly to hire to meet demand following a nationwide obligation. Targeted and sustained public investment would thus increase the chances for a proper preparation and implementation of heating and cooling plans in Germany. Strengthening intermunicipal and multi-level coordination, training and knowledge exchange could work alongside as a lever for capacity building for integrated and strategic local energy planning. |
| Access to data | 3/5 | Accessibility to sufficiently precise and comprehensive spatial data for developing heating and cooling plans varies across the Länder, which to various extent have issued legislation on third-party provision of data. Germany has promising examples of open access databases. These may work as blueprints for developing harmonized and interoperable databases for energy and building-related geodata in other German states and beyond. Such databases have so far been developed in Baden-Württemberg, Bayern, Freie und Hansestadt Hamburg, Nordrhein-Westfalen, Saarland, Sachsen, Schleswig-Holstein and Thüringen, and are currently being developed in Berlin, Brandenburg, Hessen, Niedersachsen and Sachsen-Anhalt to support heat planning. Data collection and centralization play an important role in the energy transition. Although the new law includes provisions on a nation-wide obligation for third-party data accessibility (Section 3 Data Processing §§ 10 – 12), it lacks the means of implementation for data collection. While having a digital readiness level around the EU average, Germany scores well on the use of open data, and the emerging examples of open access data platforms for spatial data tailored for localized energy planning purposes illustrate a European good practice example in the making. |
