GMG cornerstones meet with approval and criticism

25.02.2026

Source: E & M powernews

The governing parties have agreed on key points for the new Building Modernization Act (GMG). Associations are calling for them not to rest on their laurels.

After many months of waiting, the governing parties agreed on key points for the new Building Modernization Act (GMG) on 24 February. It will replace the Building Energy Act. The municipal sector, energy suppliers and industry representatives have responded with approval of individual elements, but see a need for clarification regarding the green gas quota, technical implementation and the funding framework.

The German Association of Local Utilities (VKU) sees the resolutions in the key issues paper on district heating as progress. VKU Managing Director Ingbert Liebing describes the planned regulations as a signal for the heating market. At the same time, he points to unanswered questions regarding the planned green gas quota. The association believes that an initial quota of one percent is feasible. It remains unclear how availability is to be increased along the planned biogas staircase.

Liebing criticizes: "We do not currently see how the ramp-up of green gases and biomethane in particular can be massively increased for blending into the gas grid without causing further cost increases for owners and tenants." The technical integration of different gases also raises questions. Hydrogen and biomethane cannot easily be transported via the same infrastructure. Fixed quotas could also trigger price increases if supply remains limited.

District heating and regulation as leverage

In the case of district heating, associations such as the VKU and AGFW see a need for action in the design of subsidies. The statutory anchoring and increase in federal funding for efficient heating networks (BEW) is seen as a prerequisite for further investment. A mandatory price transparency platform for all heat suppliers and an arbitration board are also on the agenda. In addition, associations are calling for an amendment to the Heat Supply Ordinance (WärmeLV) and the AVB district heating. According to the AGFW, the amendment of the WärmeLV in particular is an overdue step in the right direction.

The VKU criticizes the fact that landlords have so far not been allowed to pass on investment costs for connecting to district heating to the same extent as for other heating options. The municipal companies see a need for adjustment here in order to avoid lock-in effects with fossil fuel systems.

With regard to the abolition of the previous 65% target, the AGFW also sees considerable risks. Abandoning this guard rail could make it more difficult to achieve the target in the building sector and lead to delays in reducing emissions. This increases the risk of additional burdens within the framework of the EU Effort Sharing System.

In principle, the industry welcomes the fact that the heating issues are to be bundled in a separate heating law. According to the AGFW, this underlines the relevance of the transformation in the heating sector. However, it is now crucial that the legislative process progresses swiftly and that the announced reforms are quickly translated into robust legislation.

Municipal planning and choice of technology

Thüga AG is calling for swift legislative concretization. Its CEO, Constantin H. Alsheimer, emphasizes that municipal heat planning must be the guideline for further regulations. Alsheimer: "The local authorities know the local needs and conditions best and should be able to shape them themselves as far as possible. Investments must be plannable for everyone in the long term." He believes that close dovetailing with the Energy Industry Act and the Heat Planning Act is necessary.

Thüga also advocates technological neutrality. The law should define targets, but leave implementation to the local players. A green gas quota could be an instrument, provided it includes all green gases. Funding decisions should be based on local specifications. In areas with a binding planned heating network, the company envisages prioritizing corresponding solutions.

EU Buildings Directive as a framework

The German Business Initiative for Energy Efficiency (Deneff) supports the commitment to full implementation of the EU Energy Performance of Buildings Directive (EPBD) as part of the GMG. From the initiative's perspective, the European requirements create a planning basis for investments. It is now crucial that they are swiftly implemented in law and in funding policy.

Die Deneff points to the importance of modernizing existing buildings with poor energy performance and a zero-emissions standard for new buildings. The initiative is positive about the promised funding for federal subsidies for efficient buildings (BEG) until at least 2029.

Author: Heidi Roider