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

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

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. 

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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

Vocabulary 

Unrenovated – unsaniert

Heating cost surcharge – (der) Heizkostenaufschlag

Heating bill – (die) Heizkostenabrechnung 

Meter – (der) Zähler

We’re aiming to help our readers improve their German by translating vocabulary from some of our news stories. Did you find this article useful? Let us know.

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