Construction costs are currently skyrocketing

Law on Energy Savings and the Use of Renewable Energies for Heating and Cooling in Buildings* (Building Energy Act)
§ 109 Obligation to Connect and Use

Municipalities and municipal associations may make use of a provision under state law, which authorizes them to establish a connection and usage obligation to a public district heating or cooling network, also for the purpose of climate and resource protection.

I ask for a moment of attention for a paragraph in the recently finally passed heating law. This paragraph will still play a major role for many. It will be lucrative for municipalities, especially to forcibly connect densely built new housing developments to district heating networks. Then it will mean dismantling the heat pump.

Prices for district heating have already risen drastically.

For example, in Baden-Württemberg, where the Climate Protection Act already prescribes heat plans, it was found "that various municipalities or the associated municipal utilities apply the instrument of the connection and usage obligation out of purely economic interest."

According to Ebisch, it could also happen that those who install a heat pump now later fall under a connection and usage obligation for district heating, especially if uncertainty persists for a long time due to municipal plans.

District heating providers lack competition and consumer protection. Their heat production, network operation, sales, and distribution mostly lie in one hand; and the – unlike gas and electricity – completely missing liberalization here leads to non-transparent pricing.

There is yet another risk for consumers: that municipalities secure their heat suppliers against their economic risk and prescribe a connection and usage obligation for potential customers. This is enabled by the heat planning law.

Act on Energy Savings and the Use of Renewable Energies for Heating and Cooling in Buildings* (Building Energy Act) § 109 Connection and Use Obligation

Municipalities and municipal associations may also make use of a provision under state law authorizing them to establish a connection and use obligation to a public district heating or district cooling network, also for the purpose of climate and resource protection.

Please allow me a brief moment of attention for a paragraph in the recently enacted heating law. This paragraph will still play a major role for many. It will be lucrative for municipalities, especially to forcibly connect densely populated new residential areas to district heating networks. Then it means dismantling the heat pump.

The prices for district heating have already risen drastically.

For example, in Baden-Württemberg, where the Climate Protection Act already mandates heat plans, it has been found "that various municipalities or the affiliated municipal utilities apply the instrument of connection and use obligation purely out of economic interest."

According to Ebisch, it could also happen that those who now install a heat pump will later be subjected to a connection and use obligation for district heating, especially if uncertainty remains longer due to municipal plans.

District heating providers lack competition and consumer protection. Their heat generation, network operation, sales, and marketing mostly lie in a single hand; and the – unlike gas and electricity – completely missing liberalization here leads to non-transparent pricing.
There is also another risk for consumers: that municipalities secure their heat suppliers against their economic risks and impose a connection and use obligation on potential customers. This is enabled by the Heat Planning Act.

Fortunately, we live in a state governed by the rule of law and there is a legal remedy. Should a municipality impose requirements based on irrelevant considerations, a judge will certainly criticize this. How a municipality would justify a dismantling obligation for heat pumps on the grounds of climate protection would also be interesting to see.

There is nothing surprising about that. The investment in a district heating network only pays off if, in the medium term (e.g. when changing the heating system), everyone must connect to it. However, I do not see existing single-family house new housing developments as candidates for this anytime soon, but rather existing buildings in the center as well as newly developing areas.

The number is not new. This requirement has existed since 2020. The city of Hanover also has this in a statute. However, it clearly states what the purpose is:

* the reduction of greenhouse gas emissions in energy supply
* the saving and the most possible avoidance of the use of fossil energy sources such as coal, natural gas, and heating oil

It also clearly describes when one does not fall under this obligation

emissionsfreie Wärmeerzeugungsanlage: primär durch die Nutzung erneuerbarer Energien betriebene Anlage, die auch mittelbar (z. B. durch gesteigerten Stromverbrauch) nicht zu einem Anstieg der dadurch hervorgerufenen Emissionen führt (z. B. Solarthermie, Wärmepumpen, Geothermie)

I would then like to see how the mentioned municipalities want to manipulate this to generate money.

Certainly, if you follow this path with the FW, a certain number of users must be reached to operate economically. But if the core of the regulation is the saving of CO2 and fossil fuels – well, then someone should try to enforce that against a heat pump with photovoltaic and green electricity. Presumably, this will keep the administrative courts busy for a long time.

I rather suspect the usage obligation as a "if a replacement is already due" kind of thing and can hardly imagine that it can be pushed through otherwise.

I am still undecided about district heating and local heating networks, what I think of them. We once looked at a new development area where the developer then centrally sets up a combined heat and power plant and you get heat from it (I think you have to get it) (and I even think you become co-owner). I believe the first 10 (or 15?) years or so were also fixed in terms of how expensive it would be, and I think the developer also took care of a maintenance contract. Basically, that sounded reasonable to me for the dense settlement prevailing there, but the calculated monthly price was quite steep and the prospect of having to argue with about 50 other homeowners about how to proceed sounded rather discouraging to me.

How was it again with the revenue-neutral new property tax? They reassured and downplayed it. Hardly anyone is supposed to pay more than before. How does reality look? It is becoming more expensive for everyone. Suddenly, no one wants to know anything about revenue neutrality anymore. Don't worry, the municipal utilities and communal heat producers will surely find enough "customers" to cover their costs and make money. The legal basis for this has already been established.