Funding programs to make energy modernization of buildings a success
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To achieve climate protection targets, a significant proportion of buildings within Germany will have to be refurbished to make them more energy-efficient. To create incentives for owners, the German government is digging deep into its pockets. In 2020 alone, the state development bank KfW spent tens of billions to support renovation concepts. But there are also numerous funding programs at the state level that could already promote your energy modernization. In particular, on April 20, 2022, there will be a full "comeback" of the "Federal Funding for Efficient Buildings" under Federal Minister of Economics Robert Habeck. We want to take a look at this and four other programs with you today.
We will also be happy to determine the right program for you as part of a subsidy quick check. We offer this quickly and inexpensively. Please do not hesitate to contact us.
The article reflects the status as of 6 April 2022.
Where can I find funding?
It is often not easy to find funding. The best-known place to go for this is www.foerderdatenbank.de - a service provided by the federal government. The platform is tried and tested, contains the most important grants - and is unfortunately also very confusing.The authors have therefore also founded the platform www.foerdermittelnetzwerk.de. There are not only extensive overviews of subsidies in various areas, but also many basic materials on subsidies. They help companies with the application process. You can register there free of charge.
Funding programs at the federal level
First, let's take a comprehensive look at the federal level - this is where federal funding comes in.1. "Federal Funding for Efficient Buildings (BEG)"
The prominent "Federal Funding for Efficient Buildings (BEG)" returns from hibernation in its entirety on April 20, 2022. After a flood of applications to KfW in January 2022 significantly exceeded the funds made available, this program was temporarily halted as of January 24, 2022. Now, Federal Minister Robert Habeck is starting a new run-up from April 20, 2022, and is making EUR 1 billion available for new construction funding for this purpose. We will now look at the three pillars of the BEG in detail.a) "Federal Funding for Efficient Buildings - non-residential buildings (BEG NWG)".
If you want to construct a non-residential building (new construction) or purchase a newly constructed energy-efficient non-residential building that meets certain energy standards, or if you are thinking about energy-efficient renovation of an existing building, the "Federal Funding for Efficient Buildings - Non-residential Buildings (BEG NWG)" is particularly attractive for you. You can obtain details of the extensive program here.
The most important key data:
- The funding body is the Federal Ministry of Economics and Climate (BMWK).
- Private individuals, companies, public institutions, municipalities, associations and non-profit organizations are eligible to apply.
- They receive the funding either as a grant or as a loan with interest rate reductions and partial debt relief.
The following are eligible for funding
- the construction and initial purchase of new energy-efficient non-residential buildings and
- the renovation and initial purchase of existing buildings and
- Energy planning and construction supervision in connection with the implementation of the subsidized measures as well as sustainability certifications.
The following energy standards are subsidized:
- For new construction and initial acquisition of new energy-efficient non-residential buildings: 40, 40 EE or 40 NH.
- For rehabilitation and initial acquisition of existing buildings: historic, historic EE or historic NH; 100, 100 EE or 100 NH; 70, 70 EE or 70 NH; 55, 55 EE or 55 NH; 40, 40 EE or 40 NH.
Other requirements:
- Only capital projects within the Federal Republic of Germany are eligible for funding.
- The subsidized buildings must be used for at least ten years in accordance with their purpose.
- All minimum technical requirements according to the funding guidelines must be met.
The amount of funding through a grant or loan varies greatly depending on the specific project and the energy standard. The maximum amount of eligible costs is EUR 2,000 per m² of net floor area in the thermally conditioned building volume for new construction and renovation, max. EUR 30 million per project that achieves a new energy efficiency level.
For whom is this program suitable? For applicants who are planning a project that falls under the specific eligibility requirements. The concrete program is characterized by high flexibility in the type of funding. Special exemptions apply to those affected by the 2021 flood.
What are the arguments against this funding? The application process can take time. In particular, the ten-year commitment to use can be unwelcome. Furthermore, according to the BMWK, it can be assumed that the funds for the new construction subsidy will be exhausted very quickly. The good news is that if the 2022 budget is exhausted, a new BEG new construction grant program is expected to follow seamlessly.
b) "Federal Support for Efficient Buildings - Residential Buildings (BEG WG)."
If you want to improve the energy level of condominiums, single- and multi-family houses or other residential buildings, you can receive funding from the "Federal Funding for Efficient Buildings - Residential Buildings (BEG WG)" under certain conditions. Details of the detailed program can be found here.
The most important key points:
- The funding provider is the Federal Ministry of Economics and Climate Protection (BMWK).
- Applications can be submitted by companies, public institutions, private individuals, municipalities, associations and federations.
- Here, too, you receive the funding either as a grant or as a loan with interest rate reductions and partial debt relief.
The following are eligible for funding:
- the construction and initial purchase of new energy-efficient residential buildings and
- the renovation and initial purchase of existing buildings and
- Energy planning and construction supervision in connection with the implementation of the subsidized measures as well as sustainability certifications.
The following standards are subsidized:
- New construction and initial acquisition of new energy-efficient residential buildings: 40, 40 EE or 40 NH; 40 Plus.
- Rehabilitation and initial acquisition of existing buildings: historic or historic EE; 100 or 100 EE; 85 or 85 EE; 70 or 70 EE; 55 or 55 EE; 40 or 40 EE.
Other requirements:
- Only investment projects within the Federal Republic of Germany are eligible.
- The subsidized buildings must be used for at least ten years in accordance with their purpose.
- All minimum technical requirements according to the funding guidelines must be met.
Eligible costs are those incurred in connection with your project. Support is also provided for necessary measures in the surrounding area that are required for the implementation of the measure.
The amount of funding through a grant or loan varies greatly depending on the specific project and the energy standard. The maximum amount of eligible costs for new construction and renovation is EUR 120,000 per residential unit if an "EE class" is achieved. If a "NH" or "Plus" class is achieved, a maximum of EUR 150,000. Bonuses may be granted under certain circumstances.
For whom is this program suitable? For applicants who are planning a project that falls under the concrete eligibility requirements. The concrete program is characterized by high flexibility in the type of funding. Special exemptions apply to those affected by the 2021 flood.
What are the arguments against this funding? The application process can take time. In particular, the ten-year commitment to use can be unwelcome. In particular, according to the BMWK, it can be assumed that the funds for new construction funding will be exhausted very quickly.
c) "Federal subsidy for efficient buildings - individual measures (BEG EM)"
If you invest in existing buildings and want to improve the energy level of the building, you may be eligible for the "Federal funding for efficient buildings - individual measures". Details can be found here.
The key points:
- The funding provider is the Federal Ministry of Economics and Climate Protection (BMWK).
- Applications for funding can be submitted by private individuals, companies, municipalities, public institutions and associations.
- Funding is granted in the subprogram BEG EM as a grant in the amount of 20 - 50% of the costs of the project; max. 60,000 EUR per residential unit and 1,000 EUR per m² for non-residential buildings; total max. 15 million EUR.
Funded are:
- Individual measures on the building envelope, e.g. insulation or replacement of windows and exterior doors
- Plant technology, for example installation of digital systems for optimizing energy operation and consumption and energy-efficient interior lighting systems
- Renewable energies for heating (replacement of oil heating systems and heat pumps)
- Heating system optimization
- - Specialist planning and construction support
In this respect, necessary surrounding measures are also promoted, which are required for the implementation of the measure. For example, the removal and disposal of an old heating system. Both residential and non-residential buildings are eligible for funding.
For whom is this program suitable? For applicants who are planning or implementing a sustainable real estate project. The program is particularly important for applicants whose renovation involves extensive but necessary environmental measures.
What is wrong with this funding? Funding is only available for measures on existing buildings.
2. "federal funding for innovative fuel cell heating devices in buildings"
If you want to install stationary fuel cell systems in your new or existing building, you can receive a grant of up to 34,300 EUR from the program "Federal funding for innovative fuel cell heating devices in buildings" under certain conditions. Details on this program are available here.The most important key points:
- The grant provider is the Federal Ministry of Economics and Climate Protection (BMWK).
- Beneficiaries can be private individuals, companies, municipalities, public institutions, non-profit organizations and associations.
- Applications can still be submitted to KfW before the start of the respective measure until December 31, 2022.
- Funding is provided in the form of a grant amounting to a maximum of 40% of the eligible costs, up to a maximum of EUR 34,300.
The following are eligible for funding:
- Innovative stationary fuel cell systems in residential and non-residential buildings with a power consumption of at least P = 0.25 kWel and a maximum of P = 5.0 kWel.
- Material costs associated with the installation
- Any costs for carrying out the necessary environmental measures
- Installation of the fuel cell heating system and regular maintenance
- Uninstallation and disposal of the old system
The subsidy consists of a fixed amount of EUR 6,800 (basic subsidy) and a performance-based amount of EUR 550.50 per 100 watts of electrical output or part thereof (additional subsidy). Both residential and non-residential buildings are eligible.
For whom is this program suitable? For applicants who want to equip their construction project or existing buildings with innovative stationary fuel cell systems.
What are the arguments against this funding? The application process can take time.
3. "IKU - Energetic Urban Redevelopment - Neighborhood Supply"
If you are planning neighborhood-related investments to improve energy efficiency, climate protection and adaptation to the consequences of climate change, you should take a closer look at the funding program "IKU - Energetic Urban Redevelopment - Neighborhood Supply ". Details can be found here.- The most important data at a glance:
- The funding provider is the Federal Ministry of the Interior and for Home Affairs (BMI).
- The funding is addressed to companies and public institutions.
- Applications must be submitted via the company's bank or other credit institutions, which will forward them to KfW.
- The funding is granted as a loan. 100% of the eligible costs can be covered; a maximum of EUR 50 million in total. Depending on the type of eligible measure, repayment subsidies of up to 40% can be granted.
Funding is available for:
- Climate protection projects and adaptation to climate change through green infrastructure (e.g. upgrading and networking of green and open spaces, greening of roofs, facades, streets and squares)
- Climate-friendly mobility in the neighborhood (e.g., redesigning public street spaces into car-reduced neighborhoods)
- Heating and cooling supply in the neighborhood (e.g., heat and cold storage across buildings)
- Energy-efficient water supply and wastewater disposal in the district
The respective interest rate is based on the development of the capital market and is bindingly fixed on the day of the commitment. The maximum interest rates applicable in each case can be found here.
Who is this program suitable for? For companies and public institutions with cost-intensive projects that are eligible for funding and that are seeking 100% financing rather than just partial financing.
What are the arguments against this funding? The use of other federal funding programs for the same measure is not permitted.
4. "Environmental Protection Funding from the German Federal Environmental Foundation"
If you are committed to environmental protection with a project, you can receive a grant from the German Federal Environmental Foundation under certain conditions. You can find the detailed program here.The most important facts at a glance:
- The grant provider is the German Federal Environmental Foundation.
- Funding is available to companies, educational and research institutions, municipalities, public institutions, private individuals and associations.
- Applications must be submitted directly to the DBU prior to the respective measure.
- Funding is awarded as a grant, which varies depending on the project and applicant (SMEs are given preference). As a rule, 50% of the eligible costs are subsidized.
Funding is available for innovative, exemplary and solution-oriented projects in the following topic areas listed in overview:
- Energy-saving neighborhood development and renewal, climate and resource-saving construction.
- Instruments and competences of sustainability assessment as well as strengthening of sustainability awareness and action
- Renewable energy, energy saving and efficiency
- Sustainable nutrition and sustainable food handling
- Preservation and protection of nationally valuable cultural assets from harmful environmental influences
Even if your specific project does not belong to any of the above-mentioned funding fields, there is the possibility of open-topic funding, provided that a high contribution to solving environmental problems is aimed for.
For whom is this program suitable? Particularly relevant for SMEs, as they are given preferential support. In particular, the funding is independent of government programs and can even complement them. In addition, open-topic funding is also possible.
What are the arguments against this funding? The application process can take time.
Funding programs at the state level
At the state level, there are an exceedingly large number of subsidy programs for energy-efficient modernization. Therefore, it would go beyond the scope of this article to present each program individually. However, there are often overlaps between the state programs. It is therefore essential that you also take a look at the subsidy programs in your federal state.5. "Renewable heat"
If you want to use renewable energies for heat supply, you can receive a grant from Hamburg's "Renewable Heat" program under certain conditions. You can get detailed information here.
The most important key data:
- The funding provider is Hamburg Investment and Development Bank.
- Companies, private individuals and associations can apply for funding.
- They receive the funding as a grant, which depends on the type and scope of the measure. The maximum amount of funding per project is 200,000 EUR.
You will receive the funding e.g. in the following funding modules:
- Solar thermal and heating system modernization (min. 20m² gross collector area)
- Bioenergy plants
- Heat pump plants
- Geothermal energy and heat as waste water
- Construction or modernization of heat distribution networks and storage facilities
- Investment costs in the amount of at least 100,000 EUR, which arise from the multiple use of areas for renewable heat.
In this respect, necessary surrounding measures are also supported, which are required for the implementation of the measure. This can be, for example, the removal and disposal of an old heating system. The achievement of a new efficiency building level is not required. Both residential and non-residential buildings are eligible for funding.
For whom is this program suitable? For modernization projects in Hamburg.
What are the arguments against this funding? The application process can take time.