Germany updates BEG subsidies for heat pumps and pellet heating

New regulations for the Federal Funding for Efficient Buildings (BEG) in Germany have introduced changes to subsidies for heat pumps and pellet heating systems.

For heat pumps, the basic funding remains at 30 percent of eligible costs, but the climate speed bonus will decrease from 20 percent to 16 percent, with further reductions scheduled through 2028. The efficiency bonus and biomass emission reduction surcharge will also be eliminated. New income-based bonuses have been structured: households with taxable income up to 30,000 euros can receive a 40 percent bonus, with additional support for those with minor children.

Regarding pellet heating, the ‘green-to-green’ subsidy—which allows owners to replace existing renewable heating systems with newer models—will be significantly restricted starting in 2027. Owners of systems installed after 2008 will lose eligibility for this specific subsidy entirely. Experts advise those planning to modernize pellet heating systems to submit applications before the end of the year to secure current funding rates, which can reach up to 70 or 80 percent depending on household income.