Energy Efficiency Quick Check: Check Your Property's Energy Class and GModG Obligations in Germany

From the GEG to the Building Modernisation Act: what applies now?

Since29 July 2026, Germany's Building Modernisation Act (Gebäudemodernisierungsgesetz, GModG) has applied. It replaces the Building Energy Act (Gebäudeenergiegesetz, GEG, often called the "heating law") and was published in the Federal Law Gazette on 28 July 2026 (BGBl. 2026 I No. 226). Further parts take effect in stages on 1 January 2027, 2028 and 2030.

The most important change: the obligation to use at least65% renewable energy when replacing a heating system has been abolished. The rule requiring old boilers to be replaced after 30 years and the ban on running fossil heating from 2045 are gone too. Instead, anyone who installs a new gas or oil heating must use a rising share of biomethane, bio-oil or hydrogen from 2029 (the "bio-ladder", Bio-Treppe).

What does that mean in practice? If you own a property or are looking to buy one, you should still know its energy condition precisely. The worse the energy efficiency class, the higher your heating costs and CO₂ price, and the more a renovation pays off.

Our energy efficiency quick check helps you assess the current energy condition of your building and identify the key areas for action. Free and with no data transfer.

Energy efficiency classes A+ to H: what do they mean?

The energy performance certificate (Energieausweis) assigns each building an efficiency class from A+ (outstanding) to H (very poor). The basis is the final energy demand or consumption in kilowatt-hours per square metre and year (kWh/(m²·a)). The lower the value, the less energy the building consumes and the lower your heating costs.

The German building stock averages around 160 kWh/(m²·a), i.e. class E to F. Around two-thirds of all residential buildings were built before 1979 and have hardly been renovated for energy efficiency, or only in part. The savings potential is correspondingly large.

Note: The EU Energy Performance of Buildings Directive (EPBD) provides for a new, uniform scale from A to G from 2026. The national classes A+ to H will be replaced by this EU system in the medium term.

Obligations under the GModG: what owners need to know now

With the Building Modernisation Act, most retrofit obligations for existing buildings have been dropped. For an older building, these points matter today:

1. 1. Insulate heating and hot-water pipes (§ 69 GModG):Previously uninsulated, accessible pipes outside heated rooms, for example in the basement, must be insulated. This is the only retrofit obligation that remains.
2. 2. No more replacement obligation for old boilers:The former rule to take constant-temperature boilers out of service after 30 years (GEG § 72) has been repealed. Your heating may keep running and be repaired.
3. 3. No more obligation to insulate the top-floor ceiling:This retrofit obligation (GEG § 47) no longer exists either. It still makes sense, because it saves a lot of heat for little money.
4. 4. Bio-ladder for a new gas or oil heating (§ 43 GModG):A gas, oil or LPG heating newly installed in an existing building after 29 July 2026 must produce at least 10% of its heat from biomethane, bio-oil or hydrogen from 2029, 15% from 2030, 30% from 2035 and 60% from 2040. Existing heating systems are not affected.
5. 5. Cost sharing for landlords (§ 5a CO2KostAufG):With such a new gas or oil heating in a rented home, landlord and tenant each pay half of the CO₂ costs and gas network fees from 2028, and from 2029 also half of the cost of the bio share up to 30%.

The 5 most important renovation measures at a glance

Not every renovation delivers the same benefit. The following five measures have the best cost-to-energy-saving ratio and should be planned in the right order:

1. 1. Heating replacement: Switching from an old oil or gas heating system to a heat pump saves 30–50% of heating energy. Cost: approx. €15,000–35,000 (before subsidies). Particularly effective in combination with underfloor or wall heating.
2. 2. Facade insulation (ETICS): Up to 35% of heating energy is lost through the external walls. An external thermal insulation composite system reduces transmission heat loss by 60–80%. Cost: approx. €150–250/m² of facade area.
3. 3. Roof insulation: Up to 20% of heating warmth escapes through an uninsulated roof. Above-rafter or between-rafter insulation costs approx. €50–200/m² and reduces heat loss by 70–80%.
4. 4. Window replacement: Replacing old single or double glazing with triple glazing saves 10–15% of heating energy. Cost: approx. €500–1,000 per window. Most effective together with facade insulation, to avoid thermal bridges.
5. 5. Basement-ceiling insulation: The cheapest measure with the fastest payback period. Cost: approx. €30–60/m². Saves 5–10% of heating energy and noticeably improves floor comfort.

What does an energy-efficiency renovation cost?

The cost of an energy-efficiency renovation depends on the starting condition, the size of the building and the goal. Here is an overview for a typical detached house with 130 m² of living area:

You can estimate detailed costs per measure for the roof, facade, windows, heating or bathroom with the renovation cost calculator.

With government subsidies (KfW, BAFA), 15–70% of the costs can be covered. On top of that, you save on heating costs every year, and as the CO₂ price rises the saving grows year after year.

Value increase: An energy-efficiency renovation from class F to B/A raises a property's market value by 10–20% on average. In times of rising energy costs, buyers increasingly pay attention to the efficiency class. A poor energy performance certificate becomes a real price discount.

Subsidies 2026: KfW, BAFA and tax benefits

Germany subsidises energy-efficiency renovation more generously than ever before. The KfW heating subsidy (programme 458) covers up to 70% of eligible costs when you switch to renewable heating, up to 80% on a low income, so a maximum of €22,400. The BAFA BEG individual measures fund insulation, windows and ventilation at 15%, and with a renovation roadmap the costs above €30,000 get 5 percentage points more. Under § 35c EStG you can deduct 20% of the cost as a tax reduction over three years. A KfW/BAFA grant and the tax incentive cannot be combined for the same measure.

Which programmes fit your specific project, and how high the grant turns out, is something you work through step by step with the KfW subsidy finder. It matches your project to the right KfW and BAFA programmes, estimates the amount and shows the application routes.

CO₂ price 2026+: how your heating costs rise without renovation

Since 2021, building owners and tenants in Germany have paid a CO₂ price on fossil fuels (gas, oil, coal). In 2026 it sits in a corridor of €55 to €65 per tonne, and a government draft keeps the same corridor for 2027. From 2028, EU emissions trading for buildings (ETS 2) sets the price on the market:

*Annual CO₂ costs excluding VAT for a detached house with 20,000 kWh of gas per the bill or 2,000 l of heating oil. Emission factors under the BEHG: natural gas 0.202 kg and heating oil 0.266 kg CO₂ per kWh (net calorific value). From 2028 the range of the immotap scenarios, not a forecast.

What is the ETS-2? From 2028, EU emissions trading will be extended to buildings and transport (the start was postponed from 2027 to 2028). Instead of politically fixed prices, supply and demand will then determine the CO₂ price. Nobody knows today how high it will go, which is why we work with three scenarios.

Conclusion: In the middle scenario, a detached house with gas heating and 20,000 kWh of consumption accumulates around €4,000 in CO₂ costs over the ten years from 2027 to 2036, and around €6,000 with oil heating. Rising energy prices come on top.

Obligations on change of ownership

When a one- or two-family house is bought, gifted or inherited, only one retrofit obligation remains under the GModG: previously uninsulated heating and hot-water pipes in unheated rooms must be insulated withintwo years of the transfer of ownership (§ 69 GModG). The former obligations to replace the boiler and to insulate the top-floor ceiling no longer exist.

For buyers: Check the energy performance certificate carefully before buying. If the building is in class F or worse, heating and CO₂ costs will be high and a renovation becomes likely. Plan for these costs in your budget.

Energy performance certificate: From 1 January 2027, the certificate is issued digitally in a machine-readable format, and still on paper on request.

EU Buildings Directive (EPBD): how Germany implements it

Germany transposes the revised EU Buildings Directive (EPBD 2024/1275) through the Building Modernisation Act. The key points for residential buildings:

• •Digital energy performance certificate from 1 January 2027
• •Solar requirement from 2030 for all new residential buildings, and from 2027 already for new non-residential buildings over 250 m² (§ 106 GModG). Some federal states already require more today.
• •Zero-emission buildings: new public non-residential buildings from 2028 and all new builds from 2030 may no longer emit CO₂ from fossil fuels on site
• •No new renovation obligations for existing residential buildings

What does this mean for you?As the owner of an existing building you are not obliged to renovate. Heating and CO₂ costs keep rising, though, and the subsidy for replacing the heating falls step by step from 2027. If you plan to renovate anyway, starting early pays off.