Germany’s Heat Transition Stalls as Funding Delays Hit 202 Days

Bureaucratic gridlock leaves heat projects frozen for months—putting Germany’s green transition on thin ice. Can a broken system be fixed in time?

, and Administrator

2025 December 5 . 7:02 PM

1 min read

In this image we can see some rooms which were closed, to the each room there is lamp which is... — In this image we can see some rooms which were closed, to the each room there is lamp which is hanged to the wall, there are ventilators to the each room, in front of the room there is a chair, we can see two entryways to the building on the top of the roof there are lamps hanging.

Germany’s Heat Transition Stalls as Funding Delays Hit 202 Days

The Federal Office for Economic Affairs and Export Control (BAFA) is struggling under a flood of applications for the Federal Funding for Efficient Heating Networks (BEW). Processing times now average 202 days, far longer than expected. BAFA cites 'highly complex procedures' as the main cause of the backlog.

One developer, Solarcomplex, applied for BEW funding in January 2025 but remained unapproved by July. Construction has yet to start, leaving timelines uncertain. Another firm, CDE Systems, reports delays of up to nine months, forcing them to renegotiate expired construction bids and adjust to shifting interest rates.

A survey by the Association of Municipal Utilities (VKU) reveals growing concerns among local providers. Most believe current conditions make it impossible to guarantee affordable heat in the long run. Seventy-two percent of companies are now demanding higher funding—but only if approvals and payments arrive on time.

The German Combined Heat and Power Association (AGFW) has proposed a solution: a subsidy system modelled on the Combined Heat and Power Act (KWKG). This approach would bypass annual budget debates and speed up approvals. However, a shift to the KWKG model appears unlikely, as BEW will continue relying on budgetary funds subject to political changes.

Without faster approvals, heating network projects face cancellations or indefinite delays. Developers and industry groups agree that funding increases alone won’t solve the problem. The current system leaves investments stuck in bureaucracy, risking Germany’s transition to sustainable heat supply.