Published by Global Banking & Finance Review®
Posted on February 25, 2026
2 min readLast updated: April 2, 2026
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Germany plans to scrap the 2023 heating law, keeping oil and gas options while shifting to green gas quotas. New systems must use at least 10% biomethane from 2029, with higher steps to 2040; Greens fear climate goals could slip.
BERLIN, Feb 25 (Reuters) - Germany's coalition parties have agreed to ditch a contentious heating law introduced by the previous government and allow homeowners to continue to install oil and gas heating systems.
Replacing the rules, pushed through by the Greens in 2023, was an electoral promise of conservative Chancellor Friedrich Merz in last year's campaign and follows weeks of wrangling with his Social Democrat coalition partners.
Here are some details:
* Government says changes maintain goal of cutting emissionsfrom buildings, but gives households more freedom of choice overheating and technology * Under new plans, gas and oil heating systems must beoperated with increasing proportion of climate-friendly fuel,such as biomethane. Proportion is to be at least 10% in 2029 andrise in three further steps by 2040. * Previous law from 2023 required most newly-installedheating systems to use at least 65% renewable energy * Almost 80% of Germany's residential buildings arecurrently estimated to rely on oil or gas heating * Germany aims to be climate neutral by 2045. Transport andbuilding sectors have lagged on tackling climate change * Merz's conservatives and SPD promised to ditch previouslaw in their coalition deal agreed last year * Greens pushed through law in 2023 even though then EconomyMinister Robert Habeck had to water down his original plans dueto public outcry. A row within the three-way coalition of SPD,Greens and pro-business FDP caused backlash from homeowners andopposition parties, was widely viewed as beginning of end ofthat government * Greens politicians are now furious about move, arguing itputs climate goals at risk * Experts concerned that Germany may not have sufficientbiomethane, other green fuel to cover demand(Reporting by Madeline Chambers, editing by Thomas Seythal)
Germany plans to repeal parts of its 2023 heating law, keeping oil and gas options while introducing green gas quotas that rise over time.
A quota system for climate-friendly fuels such as biomethane will apply to new gas and oil systems, starting at 10% in 2029 and increasing in stages to 2040.
The government says building-sector emissions targets remain, but Greens and experts warn limited biomethane and other green fuels could jeopardize progress toward 2045 climate neutrality.
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