The Heat Pump Subsidy 2026 in Detail
The Federal Funding for Efficient Buildings (BEG) is Germany's central subsidy instrument for heating system replacement. Since 2024, private owners apply for the heating grant at KfW (program 458, a grant without credit check); BAFA remains responsible for other individual measures such as the building envelope. The heating subsidy was reorganized as of July 21, 2026.
The base subsidy is a flat 30 percent of eligible costs. It applies to all heat pump types provided they meet certain minimum technical requirements: The heat pump must achieve a seasonal COP of at least 2.7, a heating load calculation according to DIN EN 12831 must be available, and hydraulic balancing must be performed. Eligible costs are capped at 28,000 euros for the first residential unit (until July 2026: 30,000 euros). For the second to sixth unit, 15,000 euros each are added, from the seventh unit 8,000 euros each.
The Climate Speed Bonus: Plus 16 Percent
The Climate Speed Bonus aims to motivate owners to switch from fossil heating to renewable energy as quickly as possible. Since July 21, 2026 it amounts to 16 percent (previously 20 percent) and is available only to owner-occupiers. It covers the replacement of a functional oil, coal, gas floor or night storage heating system, as well as gas or biomass heating that is at least 20 years old.
From February 1, 2027, the Climate Speed Bonus drops by 4 percentage points every six months (February 1 and August 1); for applications from August 1, 2028 it no longer applies. At the same time, eligible costs for the first unit fall by 750 euros every six months from February 2027. Those who want to capture the full bonus should act sooner rather than later. The bonus does not lapse if the old heating system is broken, as long as it would have been repairable at the time of the application.
The Income Bonus: Plus 10 to 40 Percent for Low and Middle Incomes
The Income Bonus targets owner-occupiers with low and middle incomes and has been tiered since July 21, 2026: 40 percent for a taxable household income up to 30,000 euros, 30 percent up to 40,000 euros, and 10 percent up to 50,000 euros. If children live in the household, the limits rise once by 10,000 euros. The income tax assessment from two years prior serves as proof. If multiple people live in the household, their incomes are added together.
In practice, this means: A retired couple each receiving 1,800 euros gross monthly pension (= 43,200 euros gross per year) often falls below the 40,000 euro threshold after deducting the tax-free pension portion, allowances and pension/insurance contributions, and can claim a 30 percent Income Bonus – with lower pensions below 30,000 euros even 40 percent. Single parents with middle incomes can also benefit.
Maximum Subsidy: How to Optimally Combine the Bonuses
Combining all three subsidy components yields a theoretical maximum of 86 percent (30 plus 16 plus 40), but for owner-occupiers this is capped at 80 percent (previously 70 percent). This is the maximum possible subsidy rate. With eligible costs of 28,000 euros, this means a grant of 22,400 euros. Landlords and other non-owner-occupiers only receive the 30 percent base subsidy.
The optimal strategy depends on your situation. If you own an old gas or oil boiler and have a taxable income up to 30,000 euros, you can reach the full 80 percent subsidy. If you can only use the base subsidy and climate bonus (46 percent), you still receive 12,880 euros on 28,000 euros of eligible costs. And even with the base subsidy alone (30 percent), the switch is worthwhile thanks to annual savings on operating costs.
The KfW Complementary Loan: Affordable Financing for Remaining Costs
In addition to the grant, the KfW offers a complementary loan (programs 358 and 359). The terms are attractive: a loan amount up to 120,000 euros per residential unit, interest rates significantly below market level (typically 1.0 to 2.5 percent effective), and repayment subsidies at certain energy efficiency levels. The complementary loan requires a grant approval for the measure.
Application Process Step by Step
The correct sequence is crucial to avoid losing the subsidy. First, obtain quotes from specialist companies; energy advice is useful, but the iSFP bonus does not apply to the heating subsidy. Then sign a supply and service contract with the installer that makes the funding approval a condition. Next, submit the application online in the KfW customer portal. Only then may installation begin. After installation and acceptance, submit proof of use and receive the grant in your account.
A common mistake: Signing a contract without a funding condition or starting installation before the application has been submitted. This can lead to complete loss of the subsidy. Planning and consulting services may be carried out before the application.
Conclusion: Act Now Before Bonuses Decrease
For low-income households, the heat pump subsidy has never been as attractive as it is now. With up to 80 percent grants and the KfW complementary loan for remaining costs, the switch is possible even for owners with limited budgets. Since the Climate Speed Bonus decreases every six months from February 2027, it pays to act soon. Use our heat pump calculator to determine your individual subsidy and the resulting net costs.