Sustainable buildings – what the new coalition government is planning

The new government is focusing on energy efficiency. In addition to the abolition of the German Heating Act, further adjustments are to be made in the building sector. 

Climate change mitigation remains on the political agenda

The new German government has made it clear in the 2025 coalition agreement that the building sector plays a key role in achieving climate targets. At the same time, openness to technology, affordability and security of supply must be maintained. One key measure is the announced abolition of the controversial German Heating Act  and a fundamental amendment to the German Buildings Energy Act (GEG). At the same time, municipal heat planning , energy efficiency standards and EU requirements, in particular the EU Energy Performance of Buildings Directive (EPBD), are to be more closely interlinked. Companies in the real estate industry are thus faced with new legal rules, the specific content of which is still largely unclear.

Shift away from German Heating Act and amendment to German Buildings Energy Act (GEG)

Extensive adjustments are to be made to the German Buildings Energy Act (GEG) to modernise heat supply. The amendment to the German Buildings Energy Act (GEG) is not only intended to abolish the controversial German Heating Act of the former Traffic Light Government, but also to make way for a German Buildings Energy Act (GEG) that is more open to technology, more flexible and simpler. The key control parameter in the amended German Buildings Energy Act (GEG) should be the achievable avoidance of CO₂. However, the renovation and heating subsidy is to be continued.

Interplay of German Buildings Energy Act (GEG) and municipal heat planning

According to the new government, municipal heat planning and the German Buildings Energy Act (GEG) should be better legally interlinked in future. The aim is to increase planning security and efficiency in the implementation processes and to create economies of scale. To this end, the neighbourhood approach, according to which a joint consideration and optimisation of the heat supply of several neighbouring buildings within a spatially connected area, is to be retained. This will also result in long-term investment security for both energy suppliers and local authorities.

Harmonisation of building efficiency classes

The building efficiency classes in the German Buildings Energy Act (GEG) are to be harmonised and aligned with neighbouring European countries. In addition to the implementation of the EU Buildings Directive, which requires such a uniform standard, this will improve market transparency and comparability of buildings, thereby helping to make progress in the energy efficiency of buildings measurable.

EU Buildings Directive

In implementing the EPBD, the new government aims to make use of the wide range of national options available, for example with regard to certain technologies, construction methods or standardised instruments for achieving zero-emission new buildings by 2030 and a zero-emission building stock by 2050. At the same time, an extension of the implementation deadlines at EU level is to be actively pursued. The EPBD, which was adopted in April 2024, must be transposed into national law by the end of May 2026. The intended extension may well lead to a delay, but it can also be concluded that there is (still) considerable uncertainty at the political level regarding the specific implementation, some parts of which are also likely to take place in line with the amendment to the German Buildings Energy Act (GEG).

Using sustainability as a competitive advantage

In particular, the intended amendments to the German Buildings Energy Act (GEG) and the implementation of the EPBD appear complex, confusing and difficult to predict at first glance, both in terms of content and timing.

Nevertheless, it is crucial for the real estate industry to proactively monitor new political and legal developments and requirements as well as technological developments and to take them into account in strategic planning at an early stage. Projects that not only meet the minimum legal standards but also focus on energy efficiency and innovative technologies at an early stage and integrate forward-looking solutions have the chance to benefit from the competition on the real estate markets. Our expertise enables you to view the new political and legal framework conditions not as an obstacle, but as scope for future-oriented action.