A draft law requiring German households to replace fossil-fuelled boilers with climate-friendly alternatives has been dropped by the Cabinet.

The Buildings Energy Act, also known as the Heating Act, has come under constant fire from critics who feared it would force households to spend thousands of euros on new systems.

The latest reform to the law, announced on Wednesday (13 May), aims to give homeowners greater freedom of choice and create “investment security” for construction companies, Economics Minister Katherina Reiche said after the cabinet meeting.

She announced that the “rigid” requirement that new heating systems must be powered by at least 65 per cent renewable energy would be abolished, along with “forced heating system replacements or bans”. This includes the ban on new oil and gas heating systems, phased in since 2024.

However, critics say the reform could be “catastrophic” for the climate.