German economy minister calls for clear rules for district heating prices

German economy and climate minister Robert Habeck has called for more transparent and fairer prices for district heating customers, reports Tagesschau. "You can't change your district heating provider like you can change your gas or electricity provider," said the Green Party politician. Habeck suggested that a comparison platform for the sector could be helpful, as could an arbitration mechanism in cases of dispute. "That would strengthen trust in district heating,” he said.

District heating markets remain one of the last unregulated natural monopoly markets in Germany, according to the independent competition authority Bundeskartellamt. Consumer advocates also criticise that district heating providers' prices are not transparent, and in some cases vary considerably from municipality to municipality, Tagesschau reported. Habeck also said that the district heating supply regulation would be reformed and that prices should no longer be based primarily on the price of oil. He intends to present initial solutions at a district heating summit in the summer or autumn.

Alongside heat pumps, district heating is set to play a key role on the path towards decarbonising Germany's heating sector, which is currently dominated by fossil fuel-powered heating systems. However, operators face a "massive financing problem" converting district heating to renewables, according to an Ariadne report. The government aims to connect 100,000 buildings to district heating annually in a bid to bring the sector closer to its climate targets. It has tasked municipalities with coming up with a "municipal heating plan" to provide clarity to homeowners about whether their buildings can be connected to district heating networks, or if they need to install heat pumps or other systems to comply with decarbonisation plans. Around 15 percent of households and many industrial companies in Germany currently use district heating.