On January 1, 2023, a new federal fund support measure for green and energy-saving buildings officially came into effect in Germany. This fund aims to provide subsidies for the renewal of HVAC systems in the built environment. The products eligible for subsidies include heat pumps with a COP of 2.7 or higher. At the same time, for those heat pump products filled with natural refrigerants, an additional 5% subsidy can be received.
According to the calculations of the German Federal Office of Economics and Export Control, the subsidy can offset 40% of the cost of replacing the heat pump product, as it includes a 25% basic subsidy. In addition, if the heat pump product uses natural refrigerants or its heat source is surface water, or wastewater, etc., an additional 5% subsidy can be received. But the two subsidies for natural refrigerants and other heat sources do not accumulate.
Furthermore, the measure also states that if it is used to replace the original oil-fired, gas floor heating, gas central heating, coal-fired heating, and night storage heating systems in the building, an additional 10% subsidy can be received. However, the clause also mentions that, except for gas floor heating, the aforementioned other gas equipment that meets the renewal conditions must be an old system that has been in use for more than 20 years in order to meet the additional subsidy requirements.
Currently, the natural refrigerant primarily used in European residential heat pump equipment is propane, namely R290.
The fund clause also specifies that the net market purchase price of the updated heating equipment needs to be more than 2,000 euros to enjoy the subsidy; and when the energy system of the residential building is renovated, the price allocation per natural year for each unit building needs to be between a minimum of 60,000 euros and a maximum of 600,000 euros to be eligible for the financial subsidy.
Martin Sabel, the managing director of the German Heat Pump Association, said that the subsidy policy for heat pump products eligible for the fund in 2023 is basically stable. Additionally, other technologies within the scope of the fund subsidy include photovoltaic solar HVAC systems, bio-thermal energy systems, and solid fuel cell heating systems.
However, according to the information on the website of the German Federal Office of Economics and Export Control, by 2024, the COP value of heat pumps eligible for subsidies may increase from the current 2.7 to 3.0. By then, in some buildings, if no additional measures are taken, such as replacing the heating distribution system or improving building insulation materials, it may not be able to achieve the new annual energy-saving target.
Furthermore, starting from 2028, only heat pumps using natural refrigerants will continue to enjoy the qualification for fund subsidies, and the market promotion of R290 refrigerant heat pump products may still change by then.
Currently, Germany is also drafting the "Blue Angel" ecological label applicable to heat pump products. The interim report released by the German Environment Agency (UBA) in September 2022 stated that only household heat pumps using natural refrigerants can obtain the "Blue Angel" certification.
