German tenants continue to bear brunt of CO2 tax under new energy law

The German Tenants Association has expressed anger at the government's failure to ensure that the cost of the CO2 price is shared equally among tenants and landlords in its amendment to the heating costs law.

A thermostat. Photo: picture alliance / Jens Büttner/dpa-

On Friday, the Bundesrat – Germany’s upper house of parliament – voted through an amendment to the heating costs regulation that will implement new EU requirements on energy efficiency. 

But the tenants’ association has criticised the fact that the new regulation fails to scrap the one-sided CO2 tax, a green levy on carbon dioxide use that currently falls entirely on the shoulders of tenants.

“This leads to significantly higher heating costs, especially for tenant households in buildings that are not renovated,” Weber-Moritz told DPA. 

The CDU/CSU and SPD-led federal government had previously agreed that the additional heating costs caused by the CO2 price would be borne equally by landlords and tenants.

However, this proposal ultimately collapsed due to opposition from the CDU/CSU parliamentary group.

That means that tenants have been bearing the entire brunt of the €25-per-tonne CO2 tax alone since it was introduced at the start of the year.

Slamming the decision not to split the levy between landlords and renters, the tenants’ association said transferring the costs of the CO2 tax entirely to tenants could limit its effectiveness as a green tax.

The incentive effect of the CO2 pricing, which is intended to make climate protection investments in the building sector more attractive, is “completely lacking” when CO2 costs are passed on to tenants, Weber-Mortiz said. 

It comes as households in Germany are under increased financial pressure from soaring heating and energy costs, as well as a steep rise in the cost of living over the past six months or so. 

The additional costs could threaten to harm public perception of the transition away from climate-harming fossil fuels to clean, renewable energy, Weber-Moritz warned.

READ ALSO: Should Germany do more to support households with rising energy costs?

End of on-site meter readings

The amendment to the heating costs regulation stipulates that energy companies must be able to read newly installed meters remotely and that older meters must be retrofitted or replaced by the end of 2026.

The regulation is intended to eliminate the need for on-site meter readings.

As soon as the remote-readable meters are installed, tenants should receive information on their consumption every month.

According to the Bundesrat, the aim of the ordinance is to encourage consumers to be “conscious and economical in their use of heating energy” in order to reduce emissions. 

The newly installed meters must also be able to exchange data with devices from other manufacturers. This is to ensure that there is sufficient competition and that metering service companies cannot impose drastic price increases.

In the future, heating bills must also include a comparison that informs people both of their previous energy consumption and average consumption.

Euro notes and coins next to a German heating bill. In future, energy companies will have to be more transparent about usage and costs in their billing. Photo: picture alliance / dpa | Jens Büttner

Weber-Moritz said the new heating cost regulation could help save energy by providing more information on consumption and increased transparency on costs.

“Climate protection in the building sector, however, can primarily only be achieved through energy-efficient modernisation of the building stock,” she explained.

Weber-Moritz added that subsidies to the building sector would have to be increased. 

Furthermore, the tenants’ association is concerned that the regulation does nothing to protect renters against additional costs. 

“There is a fear that tenants will have to pay more for these devices and billing and consumption information than they will save in additional energy costs,” Weber-Moritz explained. 

READ ALSO: How households in Germany can tackle rising energy costs


Unrenovated – unsaniert

Heating cost surcharge – (der) Heizkostenaufschlag

Heating bill – (die) Heizkostenabrechnung 

Meter – (der) Zähler

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REVEALED: The everyday products getting less expensive in Germany

Inflation rates are soaring in Germany - but the jump in prices hasn't affected all consumer goods. Here are a few of the thing that have actually become cheaper in recent months.

REVEALED: The everyday products getting less expensive in Germany

The cost of living is rising at an alarming pace. In April, the inflation rate in Germany hit a stunning 7.4 percent – the highest it’s been in more than 40 years.

In real terms, that means that many people will be getting poorer year by year, unless they’re lucky enough to have got a stellar pay rise at work. 

When you dig down into the nitty gritty of the price rises though, the cost hikes are quite unevenly spread across different goods and services. 

The Local has reported regularly on the dizzying rise in the cost of fuel and energy, as well as the food items – like milk and fresh meat – that are getting more expensive by the week.

READ ALSO: What to know about the latest price hikes in German supermarkets

In April, energy prices rose by 35.3 percent, while prices for heating oil almost doubled. Consumers also had to pay significantly more for fuel (38.5 per cent) and natural gas (47.5 per cent).

Meanwhile, the weekly grocery shop has also gone up in price, with food costs on average 8.6 percent more expensive than in April last year. Edible fats and oils (27.3 percent) and meat products (11.8 percent) were the items that went up most steeply. 

But not everything is going up in price so dramatically, and some everyday items have even got cheaper over the past few years.

Here’s what consumers in Germany are saving money on today compared to last year.

Digital services and software

Some of the biggest drops in prices over the past year have been in the online and digital sectors, which is great news for anyone looking to pick up a new entertainment system or a new Wifi contract for their home. 

According to the Federal Office of Statistics (Destasis), computer operating systems and other types of software saw the biggest drop in price between April 2021 and April 2022. In fact, people purchasing a software subscription or operating system this spring are likely to have paid around 14.3 percent less than customers who purchased the same software last year.

Destatis also noted that Wifi and internet services have become cheaper in recent months. Since April 2021, the cost of “wireless telecommunications services” (otherwise known as Wifi) has decreased by 2.4 percent, while “access to online services has internet” is 0.8 percent cheaper.

Anyone’s who’s been saving up for a new TV, DVD players or satellite dish will also be pleased to discover that these products currently cost around one percent less than they did in April last year. 

Other electronic devices such as headphones, headsets, e-book readers and digital picture frames fell in price by 1.3 percent between March 2021 and March 2022. Renting videos or DVDs became 0.8 per cent cheaper over the same period.


Wine and sweet treats

While it’s true that most of the weekly grocery shop has gone up in price, some surprising items are actually cheaper now than they were a year ago.

In fact, you can get a romantic dinner for two today for less than you could a year ago, since a plate of seafood is 1.6 percent cheaper and a bottle of wine is 0.8 percent cheaper. Home bakers can also enjoy things like puff pastry and baking mixes for less.

People with a sweet tooth seem to be the biggest winners this year: they can now enjoy a bar of chocolate for less, since the price of chocolate has dipped by three percent since last April, and also make savings of 2.3 percent on any artificial sweeteners they buy. 

Milk and white chocolate bars on display in Berlin.

Milk and white chocolate bars on display in Berlin. Photo: picture alliance/dpa/dpa-Zentralbild | Monika Skolimowska

The other treat that is getting cheaper is ice cream. Just in time for summer, the cost of your ice-cream sundae or Eiskugel in Waffel (ice cream in a cone) has dropped by one percent. 

OK, it may only be a few cents lower, but we still think it’s a good reason not to feel guilty about treating to yourself to an ice cream on a sunny day. 

READ ALSO: German consumers to be hit by further price hikes in supermarkets

Household appliances

Though many household expenses have gone up this year, a few common household goods are currently bucking the trend. 

For soup and smoothie addicts, a staple appliance has decreased in price over the past twelve months. In fact, buying an electric mixer, food processor or blender will set you back 2.8 percent less this year than in April 2021.

Prices for electric irons (-0.5 percent), hoovers (-0.8 percent) and “other large household appliances” (-1.2 percent), which includes water softeners, sewing machines and safes, have also gone down.

READ ALSO: The products getting more expensive and harder to find in Germany

Home and contents insurance

At a time when people have been spending more time at home due to Covid-19, the cost of home-related insurance has gone down.

According to Destasis, the price of “insurance services connected with the dwelling”, which means home and contents insurance, has gone down by around 1.8 percent year on year. 

Glasses and contact lenses

Glasses and contact lenses can be a big expense for anyone who needs them, so people with less-than-perfect eyesight will be pleased to know that the price of both of these has gone down slightly in the past year.

As of April 2022, the price of glasses and contact lenses has gone down by around 1.8 percent on average. 

Designers sunglasses at an auction house in Cologne

Designers sunglasses at an auction house in Cologne. Photo: picture alliance/dpa | Oliver Berg

Clothes and shoes have also been trending downwards over the course of this year: back in February, women’s clothes were around 3.3 percent cheaper than they were in February 2021, while men’s clothes had dropped 0.7 percent in price.

Meanwhile, shoes would have set you back around 0.7 percent less on average, with women’s shoes once again showing the steepest decrease at minus 2.9 percent.

Children were the only demographic to buck this trend. In fact, children’s clothes had gone up in price by 1.6 percent in February and children’s shoes were up by 1.4 percent. 

READ ALSO: OPINION: Why Germany’s energy relief payouts are no fix for inadequate social security