The building sector plays a key role in reducing greenhouse gas emissions, as buildings account for around 36% of final energy consumption in Germany. However, the Federal Environment Agency's “Greenhouse gas projections 2025 - compact results” show that Emissions in the building sector continue to far exceed climate targets. By 2030, the cumulative emissions gap is expected to be 110 million tons of CO₂ equivalents – a massive shortfall of the planned reductions. Why is there no progress even though effective solutions exist?  

The growing emissions gap: What could cause the heating transition to fail?  

Despite political measures such as the Building Energy Act (GEG) and funding programs for building refurbishment, emissions are not falling at the required rate. The discrepancy between the original expectations and the actual development has widened once again in 2024: the emissions gap has grown by a further 78 million tons of CO₂ equivalents compared to the last forecast. 

Reasons for the sluggish development:  

Too slow implementation of GEG requirements:  

• The 65% rule of the GEG, according to which new heating systems must use at least 65% renewable energy, will only gradually become mandatory by 2028. The heating market shows that building owners are not factoring rising heating costs into their investment decisions despite legal requirements.  

Cuts to funding programs:  

• Federal funding for efficient buildings (BEG) has been cut financially. Less funding means that fewer heating systems are replaced and refurbishment measures are carried out. The result: higher CO₂ emissions due to outdated heating systems.

Weather adjustment of emissions data:  

• New calculations that take weather effects into account show higher emissions for the first year modeled than originally assumed. In the long term, this balances out, but in the short term it further exacerbates the situation up to 2030.  

High proportion of fossil fuel boilers remains:  

• By 2045, current projections indicate that around a third of the final energy demand for space heating and hot water will continue to be met by fossil-fuel boilers, which will only gradually be operated with renewable fuels.  

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Climate targets cannot be achieved without faster implementation  

• The building sector is at risk of missing its climate targets by 110 million tons of CO₂ equivalents by 2030.  
• Subsidy cuts and delayed legislation are massively slowing down decarbonization.  
• Only by accelerating investment in heat pumps, heating networks and intelligent heating systems can the heating transition succeed.  

Efficiency gains and energy savings: the positive developments  

Despite the negative trends, progress is being made. By 2045, energy demand for space heating and hot water will fall by 35%. This decline is the result of two factors:  

• 85 % of the savings result from efficiency improvements, i.e. better insulation standards, intelligent heating control and switching to climate-friendly heating systems.  
• 15% of the savings are due to climate change itself - warmer winters mean less heating is required.

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What measures are crucial now? 

The following instruments are particularly effective in accelerating the heating transition:  

The heating transition succeeds through innovation instead of expensive renovations:

• Over 11 million buildings are to be heated with heat pumps by 2045.  
• Around 3.5 million buildings will be connected to heating networks.  
• Heat pumps, photovoltaics and AI-regulated heating control or renewable district heating enable an economically viable heating transition without expensive renovations.
• No inefficient insulation projects, but smart heating solutions that pay off economically.
• Artificial intelligence (AI) and digital control are the key to an efficient, cost-effective heat supply - even in older existing buildings.

Building Energy Act (GEG)  

The 65% rule is seen as the most important instrument for reducing emissions. From 2028, all new heating systems are to be operated with at least 65% renewable energy, which should save around 12.2 million tons of CO₂ equivalents by 2030.

CO₂ pricing in the Building Energy Act (BEHG)  

Increasing CO₂ pricing should improve the cost-effectiveness of low-emission heating systems and motivate owners to take action. 

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