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German tenants continue to bear brunt of CO2 tax under new energy law

The German Tenants Association has expressed anger at the government's failure to ensure that the cost of the CO2 price is shared equally among tenants and landlords in its amendment to the heating costs law.

Published: 5 November 2021 11:40 CET
Thermostat
A thermostat. Photo: picture alliance / Jens Büttner/dpa-

On Friday, the Bundesrat – Germany’s upper house of parliament – voted through an amendment to the heating costs regulation that will implement new EU requirements on energy efficiency. 

But the tenants’ association has criticised the fact that the new regulation fails to scrap the one-sided CO2 tax, a green levy on carbon dioxide use that currently falls entirely on the shoulders of tenants.

“This leads to significantly higher heating costs, especially for tenant households in buildings that are not renovated,” Weber-Moritz told DPA. 

The CDU/CSU and SPD-led federal government had previously agreed that the additional heating costs caused by the CO2 price would be borne equally by landlords and tenants.

However, this proposal ultimately collapsed due to opposition from the CDU/CSU parliamentary group.

That means that tenants have been bearing the entire brunt of the €25-per-tonne CO2 tax alone since it was introduced at the start of the year.

Slamming the decision not to split the levy between landlords and renters, the tenants’ association said transferring the costs of the CO2 tax entirely to tenants could limit its effectiveness as a green tax.

The incentive effect of the CO2 pricing, which is intended to make climate protection investments in the building sector more attractive, is “completely lacking” when CO2 costs are passed on to tenants, Weber-Mortiz said. 

It comes as households in Germany are under increased financial pressure from soaring heating and energy costs, as well as a steep rise in the cost of living over the past six months or so. 

The additional costs could threaten to harm public perception of the transition away from climate-harming fossil fuels to clean, renewable energy, Weber-Moritz warned.

READ ALSO: Should Germany do more to support households with rising energy costs?

End of on-site meter readings

The amendment to the heating costs regulation stipulates that energy companies must be able to read newly installed meters remotely and that older meters must be retrofitted or replaced by the end of 2026.

The regulation is intended to eliminate the need for on-site meter readings.

As soon as the remote-readable meters are installed, tenants should receive information on their consumption every month.

According to the Bundesrat, the aim of the ordinance is to encourage consumers to be “conscious and economical in their use of heating energy” in order to reduce emissions. 

The newly installed meters must also be able to exchange data with devices from other manufacturers. This is to ensure that there is sufficient competition and that metering service companies cannot impose drastic price increases.

In the future, heating bills must also include a comparison that informs people both of their previous energy consumption and average consumption.


Euro notes and coins next to a German heating bill. In future, energy companies will have to be more transparent about usage and costs in their billing. Photo: picture alliance / dpa | Jens Büttner

Weber-Moritz said the new heating cost regulation could help save energy by providing more information on consumption and increased transparency on costs.

“Climate protection in the building sector, however, can primarily only be achieved through energy-efficient modernisation of the building stock,” she explained.

Weber-Moritz added that subsidies to the building sector would have to be increased. 

Furthermore, the tenants’ association is concerned that the regulation does nothing to protect renters against additional costs. 

“There is a fear that tenants will have to pay more for these devices and billing and consumption information than they will save in additional energy costs,” Weber-Moritz explained. 

READ ALSO: How households in Germany can tackle rising energy costs

Vocabulary 

Unrenovated – unsaniert

Heating cost surcharge – (der) Heizkostenaufschlag

Heating bill – (die) Heizkostenabrechnung 

Meter – (der) Zähler

We’re aiming to help our readers improve their German by translating vocabulary from some of our news stories. Did you find this article useful? Let us know.

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INHERITANCE

EXPLAINED: How to write a will in Germany

German succession law is pretty clear on what happens to your assets if you die without a will. But there are some big advantages - particularly for foreigners - of writing one.

Published: 26 April 2024 10:19 CEST
EXPLAINED: How to write a will in Germany

First and foremost, the largest advantage when it comes to writing wills as a foreigner in Germany – is the option to decide which country’s law applies when you write your will.

“Foreigners living in Germany have a huge advantage over German citizens, because you can choose the law of your own country for your will – even if you live in Germany,” says Andreas Moser, a Chemnitz-based immigration and family lawyer who runs a popular blog on German citizenship and family law. “Dual citizens who are German and have another nationality also have this advantage.”

READ ALSO: Everything you need to know about German inheritance law

Whether you want to do this of course, depends highly on the other country concerned and its law – and how much it differs from German law.

In specific detailed cases, you may want to consult a lawyer who specialises in wills and estates. One example of how German law may differ though is that many countries don’t have “forced heirship”, which requires you to leave certain shares of your estate to certain immediate family members.

By contrast, Germany has forced heirship. If, however, you would like to get around this for some reason, you can specify that your will should go under the other country’s law – if, for example, that country doesn’t have forced heirship.

This is unlikely, however, to result in people resident in Germany you leave assets to being able to get around inheritance tax, as this counts towards the receiver’s tax and not the deceased’s. However, there are other cases when using either country’s estate law might have different implications for certain assets – something a specialised lawyer can give you more information about.

If you want your other country’s rule to apply, make sure you specifically state that in your will.

EXPLAINED: The rules around inheritance tax in Germany

When should you definitely have a will?

Moser suggests that foreigners in Germany who want their native country’s law to apply write a will and specifically state that as their wish.

He also recommends wills in particular for those who have “patchwork” families, where one or both spouses have been married before or have children from previous marriages – in order to avoid complicated proceedings over who gets what.

A family sit at a lake.

Foreigners in Germany – even if they are dual German citizens – can choose the succession law they want to apply in their will. Image by Eva Mospanova from Pixabay

How should I write a will?

When it comes to composing a will, you have three main options:

The first is to write an international will that’s valid in your home country and that specifically states that you want the law of your home country to apply. 

The disadvantage of this approach is that your heirs may have to later pay to have it translated into German. You can also arrange to have an official German translation of it done.

Your second choice is to handwrite a will and sign it. This is known as a holograph will or Eigenhändiges Testament in German. It can be in any language, although again – your heirs may have to pay to have it translated later.

This option also avoids certain expensive legal fees – and you can state which country’s law you want to apply. However, for it to be valid, it must be entirely handwritten and include the date and place of signature. It cannot be typed and signed. If you’re concerned about the will going missing, you can deposit it with your responsible probate court for a fee of €75.

The final option is to write a public testament – which is prepared by a German notary. These wills are pretty ironclad but can be expensive – with fees that differ depending on the size of the estate. Once prepared, the notary will then file it with the public registry – so there is always a record of it.

READ ALSO: Do foreigners in Germany owe tax on money that is inherited from overseas?

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