Allianz calls for level playing field for district heating in the heating market
An alliance of municipal companies, utilities and an umbrella association under the initiative of the LBD consulting company warns of the consequences of the Building Modernization Act (GMG) in its currently planned design. The reform outlined in the key issues paper of the government parliamentary groups has the potential to slow down the heating transition, devalue investments and jeopardise German and European climate targets. Instead of providing planning security, the project could create new market distortions and false incentives – in view of the current geopolitical upheavals, a wrong signal for resilience, security of supply and affordability of energy supply.
At the centre of the criticism is the planned abolition of the previous 65% rule without introducing equivalent and clearly formulated replacement instruments. From Allianz’s point of view, this step is hasty. It could lead to building owners investing more in fossil heating technologies again. This threatens a lock-in effect for decades – with considerable consequences for the heating market, infrastructure development and climate protection. At the same time, it remains unclear how central new control instruments such as biostairs and green gas quotas will have a concrete effect. The dovetailing with the Heat Planning Act and the EnWG amendment has also not yet been sufficiently clarified. Without a reliable framework, municipalities, grid operators, investors and building owners lack the necessary planning and investment security. At the same time, the opportunity to make the energy system more resilient step by step is being missed.
According to the analysis, it is not enough to abolish existing rules and hold out the prospect of subsequent improvements. What is needed is a regulatory framework that creates comparable and binding requirements for all infrastructures and energy sources. This is the only way to organise fair system competition and effectively control the heating transition. The alliance is therefore calling for the requirements for renewable energies in the heating market to be made clear and predictable. One way to implement this is to maintain the renewable shares for heating networks in accordance with the Heat Planning Act. In addition, the biostaircase should start as early as 2027 with 15 percent, rise to 30 percent by 2030 and 80 percent by 2040. A clear commitment is also needed to design the green gas quota in such a way that it provides real incentives and is effective in the market by the mid-2030s at the latest. Resilience is becoming increasingly important in this context. The transformation that has been initiated reduces dependence on volatile raw materials and increases value creation in Germany and the EU.
Without clear guardrails, there is a risk not only of wrong decisions on heating investments, but also of increasing political pressure to soften climate targets at a later date. This would jeopardize emissions targets in the building sector, place a financial burden on the state and consumers, and especially tenants, and prolong dependence on volatile fuel imports.
“The planned regulations fall short, create new uncertainties in the market and jeopardize the resilience of the energy system,” says Carsten Diermann, authorized signatory of the LBD consulting firm and author of the analysis. “Anyone who abolishes the 65 percent rule without defining clear alternatives opens the door to wrong fossil decisions.” At the same time, there is a risk of a loss of confidence among investors who have already invested in climate-friendly solutions. “If politicians send the wrong signals, we will lose years – and we cannot afford that,” says Diermann. “The heating transition is being decided now.”
About the initiative “Save the heat transition!”
Save the heat transition!” is an alliance of municipal companies, suppliers and a leading association under the initiative of the LBD consulting company. The aim is to provide constructive support for the legislative process for a new Building Modernisation Act and to incorporate the perspectives of practice into political decision-making. The alliance is open to further supporters. More information at www.waermewenderetten.de
Full list of supporting organizations
AGFW | The Energy Efficiency Association for Heating, Cooling and CHP e.V.
Hamburger Energiewerke GmbH
FairEnergie GmbH
MVV Energie AG
Stadtwerke Delitzsch GmbH
Stadtwerke Duisburg AG
Stadtwerke Kiel AG
Stadtwerke Leipzig GmbH
Stadtwerke Sigmaringen GmbH
SWN Stadtwerke Neumünster GmbH
“If politicians send the wrong signals, we will lose years – and we cannot afford that. The heating transition is being decided now.”
