Three-quarters of Germany’s municipal utility companies believe the country's target of a full transition to climate-neutral heating by 2045 is unrealistic under current conditions, according to a survey of 757 companies conducted by the German Association of Local Utilities. No respondents rated this target as “very realistic”, while only 7% described it as simply “realistic”. Conversely, 51% of those surveyed view the situation as unrealistic, and 24% as completely unrealistic.
Challenges and obstacles – “heating terror”
Germany's goal of achieving climate neutrality by 2045 is “five years more ambitious” than the European Union's overall plan. Decarbonising heat supply is one of the most complex stages of the process, as households continue to rely on natural gas and liquid fuels. Transitioning to heat pumps, district heating, or so-called green gases requires enormous financial investment. Municipal utility companies, which are often owned by cities, manage the majority of the country's heating networks and are at the forefront of these changes.
There are several serious obstacles to achieving climate goals in Germany. Firstly, legal uncertainty; 86% of respondents indicate that clear regulations are needed to continue investment. At present, 61% of companies consider the legal framework to be unclear.
Insufficient funding is also being criticised; every second company predicts that expenses for climate-neutral heating will double by 2030 compared to 2024, and 56% acknowledge that existing support conditions are inadequate.
There is quite strong dissatisfaction with the reforms. Recent changes to the Buildings Energy Act, which removed the requirement for new heating systems to ensure at least a 65% share of renewable energy, are viewed critically. Half of the companies believe that the reform has provided neither progress nor retreat, while 36% call it a step backwards at the national level.
Despite scepticism regarding the deadlines, industry representatives emphasise that companies remain committed to implementing the transition because it strengthens energy security and protects consumers from the price fluctuations of fossil resources in the markets.
The attitude and opinion of German society at present
Within German society and the political sphere, the issue of heating system transformation (known as Heizungsstreit or the heating dispute) is currently extremely polarised, full of anxiety, and critical. Public sentiment is currently characterised by three main trends.
German society is tired of legal instability and political compromises. Citizens and business owners feel confused by the government's inconsistent policy. The initial strict rules in favour of heat pumps triggered widespread public resistance, while subsequent changes to the law and the softening of requirements, such as the removal of the 65% renewable energy requirement for new systems, have created the impression that political decisions lack a clear long-term vision. This diminishes trust in public administration.
As households and utility companies lack guarantees regarding the scope of state support and the stability of regulations, there is a prevailing sentiment of wait-and-see in society. Both private individuals and companies are afraid of making large investments in heat pumps or connections to district heating networks, trusting concerns about potential cost increases and insufficient funding.
In German society as a whole, there is a high understanding of the need to reduce dependence on fossil resources from Russia and other countries in order to ensure energy independence. However, ambitious goals adopted “on paper”, such as climate neutrality by 2045, are perceived at a practical level as detached from reality, technological capabilities, and the actual capacity of local governments. Society is demanding a realistic and pragmatic action plan, not political slogans.
Impact on the stability of the German government – crisis and distrust
Disputes and uncertainties surrounding the heating reform have become one of the biggest catalysts for political change in the country, significantly undermining the stability of the German government and providing a huge “push” for the rise in popularity of the right-wing party “Alternative for Germany” (AfD).
The heating law, the original aim of which was to accelerate the transition to green energy, turned into a prolonged and destructive dispute in the political arena, which has heavily impacted political stability. Constant disputes, compromises, and legislative chaos have led to a historically low level of public trust in the country's leadership. Surveys show that even after political reshuffles and a change in government leadership, with Chancellor Friedrich Merz at the helm, up to 77-78% of voters are dissatisfied with the work of the current government and the Chancellor.
Fearing punishment from voters and protests, the government is forced to soften or even cancel previously planned climate reforms – as happened with the removal of the 65% renewable energy requirement. This creates the impression of a weak and indecisive government that is unable to offer clear economic development or ensure a stable transition to climate neutrality. The instability of the federal government and its inability to offer realistic solutions have transferred directly to the elections of the German federal states, where traditional parties are suffering heavy losses and are unable to easily form stable coalitions without complicated and unnatural political compromises.
“Heating terror” as a political trump card
The AfD party has been able to masterfully use the chaos created by the heating law and public concerns to its advantage, making this issue one of the cornerstones of its success strategy. AfD leaders in the public space have labelled the government's plans to transition to climate-neutral heating as the draconian heating reform and heating terror against ordinary citizens. The AfD positions itself as the only force defending ordinary workers and the middle class against state-imposed “ideological insanity” which, due to expensive heat pumps and renovations, threatens households with bankruptcy.
Many Germans are not voting for the AfD because of its ideology, but as the only radical alternative to the traditional parties, which in their eyes have lost touch with reality. Fear of a decline in personal living standards, which approximately 80% of AfD voters cite as a major risk, and concerns about inflation are directly linked to expensive energy reforms. The AfD offers a simple “solution” – to completely abolish CO₂ taxes, abandon climate commitments, and return to cheap fossil resources.
This strategy has borne fruit. The AfD is holding steady at high positions in national polls, outperforming even the “Greens”, while in regional elections, particularly in eastern Germany, the party has achieved historic successes, winning nearly half of the parliamentary seats in Saxony-Anhalt.
The clumsy and rushed promotion of the heating law has created the perfect breeding ground for the AfD's rise. Instead of uniting society in the fight against climate change, this issue has driven a deep wedge into German society, destabilised the federal government, and raised the far-right to historic popularity records.
What are the AfD's chances in the national elections?
At the national level, the AfD is currently experiencing an unprecedented wave of popularity and is leading the polls. The latest election polls – INSA, YouGov and GMS – indicate that approximately 27-30% of voters support the AfD on a national scale. The conservative bloc led by current Chancellor Friedrich Merz (CDU/CSU) has slipped to second place in the polls with approximately 18-21%. The governing coalition parties (SPD and the Greens) are following even further behind.
The low ratings of the Merz government and its inability to deal with economic stagnation and high energy prices have created a situation in which the majority of German society predicts Merz's premature resignation from office.
Although the chances of obtaining the most votes in the national elections are real, the AfD getting to the helm of the federal government is still unlikely. Germany's political system is based on coalitions, and all other major parliamentary parties (CDU, SPD, Greens) maintain a strict promise – a “cordon sanitaire” – to never form a joint government with the AfD. However, voter support means that the AfD will have a huge faction in the German Bundestag, which will be able to significantly paralyse the work of traditional parties and force them to adopt stricter rhetoric on both immigration and energy cost issues.
Sources: German economic and political news sites