Heating subsidy: application process opens today for owner-occupied single-family homes

As of now, owners of owner-occupied single-family homes can submit applications for funding from KfW for the installation of climate-friendly heating. The German Federal Government provides budget funds for the investments associated with heating replacement; KfW uses grants and supplementary loans to disburse these funds. The aim of the funding is to accelerate the transition to climate-friendly heating and thereby reduce greenhouse gas emissions from the heat supply in the building sector.

The start of the application phase for the heating replacement subsidy will be staggered. Beginning today, private individuals who own existing, self-occupied single-family houses in Germany are eligible to apply first. Further applicant groups will follow according to the KfW funding schedule presented on 29 December 2023 after the “Federal Funding for Efficient Buildings – Individual Measures” promotional guideline entered into force.

Application for promotional grants for heating replacement

Applications for grants can be submitted directly online at KfW via the customer portal “Meine.KfW.de”. A prerequisite for this is a concluded supply or service contract with a specialist company for heating replacement, which must be submitted together with the subsidy application. Applicants will receive an automated notification of the acceptance of their application immediately after submitting the application.

For owner-occupied residential buildings with a maximum of one housing unit (single-family house), the maximum limit of eligible costs is EUR 30,000. The basic subsidy for heating replacement is 30% or EUR 9,000.

In addition, it is possible to apply for a

• 5% efficiency bonus for heat pumps when water, soil or waste water is tapped as a heat source or a natural refrigerant is used,
• climate speed bonus of initially 20% for the replacement of operational oil, coal, single-story gas, and night storage heaters or of operational gas or biomass heaters if they were commissioned at least 20 years ago at the time of application.
• as well as an income bonus of 30% for owners occupying the buildings themselves whose taxable annual household income does not exceed EUR 40,000.

The bonuses are cumulative. However, the subsidy for heating replacement for private owner-occupiers can amount to a maximum of 70% overall. In this case, the maximum amount of the promotion is EUR 21,000. In addition, an emission reduction allowance for biomass heaters complying with the emission limit value for dust of 2.5 mg/m3 can be applied for at a flat rate of EUR 2,500.

Applying for an additional supplementary loan

For applicants who have a commitment from KfW for the heating replacement, a supplementary KfW promotional loan with low interest rates also becomes available today; applications for this can be submitted to an onlending bank, usually a regular bank. The loan is subsidised using federal funds. The interest rate conditions for a promotional loan with a term of 35 years and a 10-year fixed interest rate are currently 2.21% eff. for applicants who are private individuals with taxable annual incomes not exceeding EUR 90,000. For all other applicants, the interest rate is 3.81% eff. (Interest rates may change daily). The supplementary loan is only available in combination with a grant commitment from KfW for the promotion of heating replacement and/or an allocation decision from the Federal Office for Economic Affairs and Export Control (BAFA) for individual energy-efficiency measures. It is not possible to apply for the supplementary loan by itself.

Further 2024 funding schedule

After the start of the application process today for owner-occupied single-family houses, the application process for other interest groups will begin during the course of the year.

The application process for owners of existing multi-family houses (with more than one housing unit) and housing associations (WEG) in Germany, provided that measures are being implemented on communal property, is scheduled to begin in May 2024.

The application process for heating subsidies for owners of rented single-family houses and owners of self-occupied or rented apartments in housing associations in Germany, provided that measures are implemented on individual properties, is scheduled to start in August 2024. The application process for heating replacement subsidies for the applicant groups of municipalities and companies is also scheduled for August 2024.

Important information: Eligible heating replacement projects can be started now by all applicant groups. If the project starts by 31 August 2024, the application can be submitted later, up to 30 November 2024.

More information at: www.kfw.de/heizung