Community initiatives demonstrate scalable models for climate-neutral heat • Modernized GDR-era wells supported by federal €8.3m grant federal funding • German municipal utilities warn that climate-neutral heating investments risk making heat unaffordable • Read more about the developments in sustainable heating and cooling on this month’s news update from Germany
A recent joint investigation by SWR and CORRECTIV gives a rare, ground-level perspective on how citizens in Baden-Württemberg experience Germany’s heating transition. Nearly 2,000 people participated in surveys and pop-up events across the region, sharing both frustration with political uncertainty and surprisingly positive stories of successful system switches. The initiative highlights a key insight for Swedish companies: despite public skepticism, many households are already investing in new technologies when planning clarity and installer capacity align.
The three-week pop-up tour revealed the issues dominating public debate: heat pumps, subsidies, the role of district heating, and the impact of the amended Building Energy Act (GEG). While a significant share of participants reported smooth installations and reasonable costs, such as simple air-to-air heat pumps in small homes, many others expressed confusion about regulations, financing, and long-term affordability. Notably, concerns about unclear political guidelines came up as frequently as technical questions. This uncertainty is seen as slowing down municipal planning and the willingness of citizens to invest.
At the same time, positive examples demonstrate how community engagement can accelerate the heat transition. The village cooperative in Hägelberg, which built its own local heating network from biogas and biomass, shows that collective initiatives can deliver resilient heat supply, fair pricing, and high acceptance. Yet municipal leaders warn that without clearer national regulation and stable investment conditions, Baden-Württemberg risks missing its 2040 climate target. For Swedish suppliers and solution providers, the findings underline a growing demand for reliable technologies—and a market shaped as much by trust and planning stability as by technical performance.
Read more in the report by CORRECTIV
Prenzlau is emerging as a flagship project for Germany’s geothermal transition. The city is re-using an old GDR-era deep drilling site to extract thermal water at around 44°C. Using modern high-capacity heat pumps, the water will be heated to district-heating temperatures of approximately 80°C. After the heat is extracted, the cooled water will be reinjected underground, creating a closed, environmentally sound system.
By 2027, the geothermal plant is expected to cover up to 60% of the city’s heating demand, supplying around 5,500 households. The investment of €20.7 million is shared between federal funding and municipal and private capital. The long-term goal: stable heat prices and an almost CO₂-neutral supply by 2030.
This development is particularly relevant for Swedish suppliers of heat pumps, geothermal technologies and efficient district heating systems. Prenzlau demonstrates how existing geological resources, strong municipal leadership, and reliable public funding can create ideal conditions for low-carbon heat projects. It also provides a replicable model for many medium-sized cities across Germany.
Read more in the full article from Cleanthinking
Municipal utilities (Stadtwerke) across Germany are sounding the alarm: reaching climate targets in the heating sector requires massive investments that many local providers cannot fund alone. A recent industry survey shows that more than half of utilities see their long-term financial viability under threat if they are expected to modernise networks, integrate renewable heat sources, and expand district heating without additional support.
To address this, the Association of Municipal Utilities (VKU) is calling for a national heat-transition investment fund. Such a fund would combine state guarantees with private investment to reduce financial risks and accelerate project development. The utilities argue that existing subsidy schemes are helpful but insufficient for the scale and speed required.
For Swedish companies in thermal technology, digital optimisation, and waste-heat recovery, this debate is highly relevant. A dedicated heat-transition fund could significantly increase demand for large heat pumps, thermal storage, geothermal systems, digital energy management solutions, and efficient district-heating components. The German market is signalling that it is preparing for large structural investments — but needs financial instruments to unlock them.
Read more in the article by MDR
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