BEW funding for heat networks: who gets what – and where the limits are

The short answer

The Bundesförderung für effiziente Wärmenetze (BEW, federal funding for efficient heat networks) pays 40 per cent of eligible investment in new or converted heat networks and up to ten years of support towards the operating costs of large-scale heat pumps and solar thermal plants. Only those who build or operate the network can apply: municipal utilities, municipalities, cooperatives, businesses and contractors, not the individual household.

Funding for the individual building is a separate matter, explained in the guide to heating subsidies. This piece is about the level above: the network a building connects to. Many municipal heat plans say such networks are coming. Whether they pay off depends to a large extent on the BEW.

Which modules are there and what do they pay?

The BEW consists of four modules that follow the course of a project. The responsible authority is the Bundesamt für Wirtschaft und Ausfuhrkontrolle (BAFA, Federal Office for Economic Affairs and Export Control). The figures come from the BAFA programme page and the information sheet version 3.0 of 1 January 2026:

Module	What is funded	Funding rate	Maximum per application	Approval period
1	Feasibility studies (transformation plans no longer since 01.04.2026)	50 %	€2m	12 months (+12)
2	New build or full conversion of a network: generation, storage, pipes, substations	40 %	€100m	48 months (+24)
3	Individual measures in an existing network, e.g. heat pump, solar thermal, storage, pipe	40 %	€100m	24 months (+12)
4	Operation of solar thermal/PVT and heat pumps funded under module 2 or 3	amount per kWh	€100m	10 years from commissioning

Modules 2 to 4 have a second limit, which in practice is often the tighter one: funding may not exceed the profitability gap. BAFA requires a net present value calculation over 35 years covering all costs and revenues. If a network pays off with less subsidy, it gets less than 40 per cent.

Who may apply – and who may not?

Under no. 5.1 of the guideline, eligible applicants are businesses within the meaning of section 14 BGB, municipalities where economically active, municipal enterprises, companies and special-purpose associations, registered associations and cooperatives. Contractors are included if they meet the obligations in Annex 2 of the guideline.

Two conditions narrow the group further. The network must supply more than 16 buildings or more than 100 dwellings; below that it is not a BEW case. And it must be operated in line with the guideline for ten years from commissioning and, as a rule, remain owned by the grant recipient for that period.

So the owner of an apartment building who connects to a new network receives nothing from the BEW directly. They benefit only indirectly, if the funded network operator passes the subsidy on in the heat price. The BEW does not regulate whether that happens. District heating price rules are set out in the AVBFernwärmeV (district heating supply regulation), and the announced price supervision is still pending, as the report on the delayed heat network package shows.

Which technical conditions apply?

The BEW does not fund fossil networks with a green coat of paint. The information sheet sets clear minimums:

• New build: At least 75 per cent of the heat must come from renewables or waste heat by the end of the approval period. The flow temperature may never exceed 95 °C.
• Existing network: No fixed 75 per cent quota, but a pathway with milestones in 2030, 2035, 2040 and 2045. By 2045 at the latest, the network must be greenhouse-gas neutral. No individual measure without a transformation plan.
• Biomass: Unlimited for networks under 20 km of pipe; for 20 to 50 km at most 35 per cent (new build) and 25 per cent in the final state; above 50 km at most 25 and 15 per cent.
• Early start: Supply and service contracts only after the grant notice. Commissioning work earlier puts the funding at risk.

Independently of the funding, section 29 of the Wärmeplanungsgesetz (WPG, Heat Planning Act) requires every heat network to generate at least 30 per cent of its heat from renewables or unavoidable waste heat from 2030, and at least 80 per cent from 2040. The BEW is therefore less a bonus than financing help for an obligation that is coming anyway.

What does the funding deliver? A worked example

Assumptions (freely chosen figures): new network for a district of 40 buildings, large-scale heat pump as main heat source, 3,000 megawatt hours of heat a year, seasonal performance factor 3, i.e. 1,000 megawatt hours of electricity. Eligible investment €6 million, feasibility study €120,000. Electricity price 17.64 cents per kilowatt hour net, the average for non-household customers in the first half of 2026 (Destatis, 30.09.2026, provisional).

Component	Calculation	Grant
Module 1: feasibility study	50 % × €120,000	€60,000
Module 2: construction	40 % × €6,000,000	up to €2,400,000
Module 4, ceiling from funding rate	(3,000 − 1,000) MWh × 9.2 ct	€184,000 per year
Module 4, cap of 90 % of electricity costs	90 % × 1,000 MWh × 17.64 ct	€158,760 per year
Module 4 over 10 years	lower value × 10	up to around €1.59m

Two things stand out. First, over ten years the operating support reaches a similar order of magnitude to the construction grant if the rate is close to the ceiling; in reality BAFA calculates the rate from the plant's SCOP, and it can be considerably lower. Second, every line is a maximum. If the profitability gap calculation shows that the network needs less, all amounts fall.

How secure is the money?

The guideline entered into force on 15 September 2022 and runs for six years, i.e. until September 2028. According to the information sheet, applications received by then will still be processed afterwards. Every approval, however, is subject to the availability of budget funds.

The funds are rising. Around €1.40 billion was earmarked in 2026 for converting and building climate-neutral heat networks; the government draft for 2027 provides around €1.87 billion, financed from the special fund for infrastructure and climate neutrality (Bundestag, 08.09.2026). That is a draft; what counts is the budget the Bundestag adopts. For network operators this means: the BEW is the largest federal programme for heat networks, but not a legal entitlement, and there is no follow-up arrangement after 2028 yet.

What owners, municipalities and businesses should do now

1. Clarify the level: A single building or a small building network of up to 16 buildings or 100 dwellings falls under building-level funding (check the boundary case by case), larger networks under the BEW.
2. Read the heat plan: If the property lies in a prospective heat network area, ask the supplier whether a BEW feasibility study is under way or planned.
3. As a connecting customer, ask about the price: How does the subsidy feed into the standing and unit charges, which price adjustment clause applies, how long does the contract run? The guide to district heating contracts shows what matters.
4. As a network operator, keep the sequence: feasibility study, application, grant notice, and only then award contracts.
5. Plan module 4 early: The application for operating support belongs before commissioning; otherwise the funding period is shortened.
6. Keep the deadlines in view: guideline until September 2028, quota obligation under section 29 WPG from 2030. Those who plan now use the funding while it is secure.