Economy calls for stable funding for energy-related refurbishments

Renovation of a house facade

Since April 21st, money has only flowed for new buildings according to the efficiency house standard 40 (EH40) plus the quality seal for sustainable building (QNG).

(Photo: dpa)

The year that is coming to an end was marked by surprising cuts in funding for energy-efficient building refurbishment. That must change, the Federation of German Industries (BDI), the Federation of Energy and Water Management (BDEW) and the Central Association of German Crafts are now demanding in a joint written appeal to the federal government. The paper is available to the Handelsblatt. The associations are convinced that a reliable framework for building refurbishment is essential in order to achieve the much-needed progress in refurbishment.

“The federal government must make a public commitment to continue federal funding for efficient buildings (BEG) for at least ten years. Multiple funding freezes this year have resulted in a maximum loss of trust,” said Holger Loesch, deputy BDI general manager, to the Handelsblatt.

“A strong political signal is required so that citizens regain confidence in the funding offers and renovate buildings”. In order to achieve the climate protection target for 2030, building renovation must increase in 2023.

The money threatened to run out

This year, the federal government had to change the funding framework, in some cases completely surprisingly, because the money was threatening to run out. Federal Economics Minister Robert Habeck (Greens) had to stop state support twice in the spring.

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After that, the conditions were tightened. Since April 21st, money has only flowed for new buildings according to the efficiency house standard 40 (EH40) plus the quality seal for sustainable building (QNG). EH40 means that a building only uses 40 percent of the energy that a legally defined standard house requires. The smaller the key figure, the lower the energy requirement of the property.

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Up until last year, EH55 buildings were still being funded. That was deleted to the annoyance of the housing industry. In addition, funding is now more focused on existing buildings.
However, rapid progress in energy-efficient refurbishment is essential in order to achieve the climate targets. For years, the renovation rate has been around one percent per year.
According to the joint appeal, a “credibly stable long-term funding framework” is of elementary importance for the dynamics of building renovation and an increase in the speed of renovation. The refurbishment contributes to increasing energy security in the long term by reducing the energy consumption of the buildings. In addition, a stable subsidy environment will provide an economic stimulus.

After the reduction in the subsidy rates and a limitation of the subsidy facts with a focus on the building stock this year, the subsidy rates should “under no circumstances be lowered further”, according to the associations. The existing funding offers for technology-neutral modernization aimed at the goal of climate neutrality in 2045 “should be continued in the longer term”.

If, in retrospect, it turns out that the cuts made in mid-2022 had a negative impact on modernization activities, the three associations believe that they should be reversed immediately. BDI, BDEW and ZDH are in favor of a review by the end of the first quarter of next year at the latest.

According to estimates by the associations, funds of at least 15 billion euros per year are required to enable an increase in renovation work without further stops and cuts in funding offers. “The coalition partners should include these budget funds in their financial planning and continuously ensure that they are funded,” the appeal continues.

Associations are demanding long-term commitments

ZDH General Secretary Holger Schwannecke considers the long-term commitments of politicians to be urgently needed, as this is the only way to build up the necessary capacities. “In addition, the objects of support should be designed in such a way that the optimal technical and ecological solution for each building can be implemented – especially since the climate policy and housing policy goals are very ambitious and therefore all solution options must be on the table,” said Schwannecke.

>> Also read here: “30,000 euros more for a normal single-family house” – the construction industry fears a massive slump in orders

The BDEW emphasizes the orientation of funding towards the refurbishment of existing buildings as the “right step”. However, BDEW General Manager Kerstin Andreae finds the freeze on subsidies for all gas-based heating systems – including heating systems that are operated entirely or partially with climate-neutral gases – incomprehensible. “Even hybrid heating systems, which enable the use of heat pumps in combination with a peak load boiler in existing buildings with high heating loads in the first place, are affected by the funding freeze,” criticizes Andreae.

A successful heat transition requires the inclusion of all heat supply options, she said. “This is the only way to find the right individual solution for owners and buildings in view of the variety of buildings in Germany, their infrastructure and the renovation rates. Without a holistic view, unnecessary costs are produced.”

More: When is it worth installing a heat pump and what property owners need to know

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