Federal Minister of Buildings, Verena Hubertz (SPD), has emphasized the need for enhanced protections for tenants as part of the reformed heating law, which is expected to be titled the Building Modernization Law (GModG). Her arguments center on the danger posed by escalating energy costs.
According to Hubertz, if a landlord decides to install a new gas or oil heating system-which the new law would generally permit-the cost of heat could rise significantly over the years due to increased fuel prices. She argued to “Welt am Sonntag” that since tenants have no input into management decisions, it is appropriate that landlords must also share in any subsequent cost increases.
The Minister highlighted that current geopolitical pressures are already driving high prices for natural gas and oil, potentially exceeding the impact of a future CO2 levy. Furthermore, there is the variable of the “Bio-staircase” an element included in the coalition’s initial platform paper. This mechanism dictates that newly installed gas or oil heaters must progressively incorporate more climate-friendly elements. Hubertz warned that as the market for biogas or biofuel-both in transport and buildings-matures and scales up, price increases are inevitable.
Financial analysis conducted by the Fraunhofer Institute for System and Innovation Research (ISI) suggests a substantial burden for tenants. Model calculations estimate that if the reform proceeds without major tenant protections, and if heating remains predominantly gas-powered, residents could face an additional financial strain of approximately €18,600 between 2027 and 2045.
Hubertz also addressed consumer concerns regarding district heating, noting the risk of inflated prices. She stated that they are developing a new legal framework for this sector to prevent what she called “connection mandates at moon prices”-scenarios where consumers are forced to pay thousands of euros just to access the system, leaving them vulnerable to uncontrolled pricing.
Beyond energy costs, the Minister also spoke about overall construction expenses. The commodity shortage stemming from the Iran conflict has caused raw material prices to rise, such as the cost of bitumen. While acknowledging product-specific issues, Hubertz stressed that the overall construction costs are too high and the rate of improvement too slow. To address this systemic issue, she mentioned collaborating with the Ministry of Justice on a “Building Type E Contract” within the Civil Code. This proposed contract aims to link contractor obligations with state building codes, simply requiring the achievement of a baseline standard and potentially saving between ten and twenty percent of the total construction costs. A draft for this contract is expected by summer.
