Homeowners in Germany can receive a state grant of up to €21,000 for replacing an old heating system with a climate-friendly alternative. The funding comes from the federal building energy efficiency program (Bundesförderung für effiziente Gebäude, or BEG). It is managed by KfW.
The grant covers between 30 and 70 percent of eligible costs. It is capped at €30,000 per residential unit.
How is the Heating System Replacement Grant calculated?
The total subsidy is built from three components that can be combined to reach the maximum subsidy:
- Basic subsidy (Grundförderung): 30% of eligible costs for all applicants
- Heating replacement bonus (Heizungstauschbonus): an additional 20% if you replace a fossil fuel heating system such as an oil or gas boiler
- Low-income bonus (Einkommensbonus): an additional 30% if your household’s taxable annual income is below €40,000
The eligible cost ceiling is €30,000 per residential unit. A homeowner replacing a gas boiler with a heat pump can receive up to 70% of €30,000. That is a maximum grant of €21,000.
You must own the property and live in it yourself (Eigennutzung). Owner-occupiers can combine all three bonus components. Investment property landlords cannot access the full grant stack under BEG.
Air-source heat pumps face stricter noise requirements to qualify for BEG funding
Since 1 January 2026, air-source heat pumps must meet a stricter noise condition to qualify for BEG funding. The outdoor unit must produce at least 10 dB(A) less noise than the EU minimum standard. Verify with your installer or manufacturer that the model meets this requirement before purchasing.
This requirement applies to air-to-water heat pumps only. Ground-source heat pumps and water-to-water heat pumps are not subject to the noise condition.
NOTE: BAFA (the Federal Office of Economics and Export Control) no longer handles heat pump grant applications. Since 2024, all heat pump BEG grant applications go through KfW exclusively. BAFA now only covers heating optimisation measures (Heizungsoptimierung).
Which heating systems qualify for BEG Funding?
Eligible heating systems include:
- Heat pumps, including air-source, ground-source, and water-to-water models
- District heating connections where the network meets renewable energy requirements
- Biomass heating systems such as pellet boilers
- Hydrogen-ready gas systems (H₂-ready) in specific configurations
Pure gas and oil boilers are not eligible. Hybrid systems combining a heat pump with a gas backup may qualify for partial funding depending on the configuration.
How to apply for KfW’s Heating System Replacement Grant?
You must submit your application via the KfW portal “Meine KfW” before construction starts. You cannot apply retroactively.
- Obtain a quote from a certified installer (Fachbetrieb)
- Create an account at meine.kfw.de
- Submit your application with the installer’s quote and property details
- Wait for KfW’s funding confirmation before beginning any work
- After completion, submit proof of the finished work and costs to KfW
Energy efficiency improvements (e.g., insulation, windows, roof) are not covered under the heating grant. These fall under separate BEG programs. They can be combined with the heating grant.
The government has committed to keeping BEG funding at sufficient levels through at least 2029.
