The Building Modernisation Act significantly changes the landscape for heating systems and heating system modernisation in existing buildings: gas, oil and LPG heating systems remain available options, but are tied to increasing proportions of climate-friendly fuels. This brings tank-based solutions, bio-LPG, bio-oil and renewable substitutes such as DME and rDME into sharper focus for property owners, specialist trades and energy suppliers.
Can an oil or LPG heating system continue to be operated in 2026 and beyond? If so, does the heating system need to be modernised? And what applies if the natural gas network in a region is expected to be decommissioned or repurposed? These are questions that many owners of existing buildings ask time and again. Since spring 2026, the legal situation has evolved significantly at the political level: the Building Modernisation Act, or GModG for short, was passed by the German Bundestag on 10 July 2026 and cleared the Bundesrat on the same day without referral to the Mediation Committee.
It is important to classify the position precisely for ongoing projects: as at 23 July 2026, according to the available official procedural information, the Act had completed the parliamentary process, but its first provisions will not enter into force until the day after promulgation in the Federal Law Gazette. Until then, the existing Building Energy Act formally remains authoritative. Nevertheless, the implications for planning are clear: the political and legal framework is shifting away from a rigid technology requirement towards a modernisation approach that focuses more strongly on fuels.
At the heart of the new approach is a move away from the existing 65 per cent rule (every heating system must be operated with at least 65 per cent renewable energy). Under the adopted GModG, various technical solutions are once again to be explicitly permitted: heat pumps, heat networks, solar thermal energy, biomass and hybrid solutions, combined heat and power (CHP) systems, direct electric heating subject to strict conditions, as well as gas, oil and LPG heating systems.
However, this opening-up does not mean that existing oil and gas heating systems can continue to be operated without modification.
Anyone using a gas, oil or LPG heating system in an existing building will in future have to ensure that an increasing proportion of climate-friendly fuels is used. This means that it is not the heating technology, but the energy source used that becomes the decisive factor in modernisation.
This distinction is important for owners and specialist planners. There is rarely one ideal solution for existing buildings. Insulation standards, heat emitters, available infrastructure, investment budgets, listed-building requirements and regional heat planning can vary greatly. The GModG takes greater account of this reality, but at the same time requires a robust fuel strategy.
For gas, oil and LPG heating systems in existing buildings, the adopted GModG provides for a phased obligation to use more climate-friendly fuels. Under the model adopted during the parliamentary process, the prescribed proportion increases in four stages:
The fuels mentioned include biomethane, biofuel oil, biogenic LPG and certain types of hydrogen, including derivatives. This so-called biofuel ladder is particularly relevant to tank-based solutions because it does not fundamentally exclude the existing infrastructure. Instead, the key questions are which fuels are available, how their use can be demonstrated, and whether the system, components and manufacturers’ approvals are suitable for the particular application.
In addition, the GModG includes a mandate for a further law on green gas and green fuel oil quotas. The Federal Government is to submit a corresponding proposal by 1 December 2026. The aim is to organise the ramp-up of climate-friendly fuels on the supply side and to make the fuels fully climate-neutral by 2045. This is a strong signal for investment decisions, but it is not yet a fully formulated market regulation.
LPG has a structural advantage in existing buildings: it is independent of the grid. The energy is stored in a tank on site and delivered as required. This is relevant where there is no heat network, the future of a natural gas connection is uncertain, or switching to a heat-pump-only solution would require substantial structural work.
The debate about the possible decommissioning or repurposing of natural gas distribution networks, or their becoming increasingly uneconomical, reinforces this point. If the number of gas network customers falls, network charges and future supply prospects may come under greater scrutiny. LPG is not dependent on these networks.
For detached and semi-detached houses, agricultural buildings, smaller commercial units or remote existing properties, this can be an important consideration.
Biogenic LPG makes this role more future-proof. Bio-LPG is chemically comparable to conventional LPG and can in principle play a role in existing supply infrastructures. At the same time, substitutes and blending components such as DME or rDME are being discussed as renewable building blocks. However, standardisation, material compatibility, manufacturers’ approvals and safety-related design are crucial for higher blends or specific applications.
Nor will fuel oil automatically disappear from existing buildings as a result of the GModG; fuel oil offers the same advantages as LPG (independence from the grid and on-site storage). In certain existing buildings, modern oil condensing technology can therefore continue to be a realistic option, particularly if the tank compartment, pipework and safety components are in place and in good technical condition.
However, future viability depends more heavily on the fuel than before. Biofuel oil and, in the future, other renewable or synthetic liquid fuels such as HVO can reduce the fossil share.
It remains crucial that the products used comply with the requirements and are suitable for the system. Operators should therefore consider more than just the heat generator and also have the tank, withdrawal system, filters, limit indicator, anti-siphon device and other safety-relevant components checked.
For specialist installers, this means that modernising a heating system with fuel oil or LPG will in future require more explanation and evidence. Alongside efficiency and investment, the fuel pathway, availability, documentation and technical suitability of the overall system will be important.
LPG systems and fuel oil systems
Knowledge about conventional heat generation systems
The heat pump remains a very good solution in many cases, particularly in well-insulated buildings with low flow temperatures. In unrenovated or only partially modernised existing buildings, however, the decision is more complex. Old radiators, high system temperatures, limited installation space, noise protection issues or restricted electrical connection capacities may necessitate additional measures.
In such cases, hybrid solutions or modern condensing systems using LPG or fuel oil can provide a technically robust transitional or permanent solution, particularly if existing tank infrastructure can continue to be used and the future fuel pathway is considered at an early stage.
Sound planning should therefore not begin with a blanket preference for one solution, but with an assessment of the building:
Alongside the GModG, the funding conditions under the Federal Funding for Efficient Buildings scheme were also amended. Since 21 July 2026, KfW has continued to specify a basic subsidy of 30 per cent for heating system modernisation.
New or more precisely defined maximum funding amounts apply to residential buildings: EUR 28,000 for the first residential unit, EUR 15,000 for each of the second to sixth residential units and EUR 8,000 for each additional residential unit.
The efficiency bonus and emissions reduction supplement have been abolished. The climate speed bonus is 16 per cent and will decrease by four percentage points every six months from 1 February 2027. The income bonus for owner-occupiers is more strongly tiered; under certain conditions, the funding ceiling can reach up to 80 per cent of eligible costs.
For standard fossil-fuel solutions, this does not amount to carte blanche. Legal permissibility, funding and long-term operating costs must be assessed separately. Particularly in the case of new oil, gas or LPG heating systems, owners must factor future fuel proportions, price trends, CO₂ costs and documentary evidence into their calculations.
When modernising a tank-based heating system, it is not only the boiler that determines operational safety and future viability. The technology between the tank and the heat generator is equally important.
In LPG systems, this includes in particular pressure regulators, safety shut-off devices, over-pressure safety devices, piping and fittings. In fuel oil systems, attention focuses, among other things, on filters, withdrawal valves, limit indicators, anti-siphon devices, and leak protection and safety devices.
Older systems in particular should be checked not only for functionality, but also for their condition, approval, sizing and suitability for potential fuel variants.
This is where specialist installers and component manufacturers make a key contribution. Control and safety equipment must be suitable for the medium, pressure range and application. GOK is therefore working to make its products fit for the future, for example in the field of oil firing installations with BIO- and GREEN-FUELS-READY markings and by testing components for Bio-LPG, DME or rDME. Specific technical approval for the particular application always remains decisive.
Heating system modernisation in 2026 is becoming more open to different technologies, but not simpler. The Building Modernisation Act broadens the range of choices for existing buildings and makes it clear that oil, gas and LPG heating systems are not being forced out of the market across the board. At the same time, the benchmark is changing: a solution is only fit for the future if efficiency, the fuel pathway, documentary evidence and operational safety work together.
This development is particularly relevant to LPG. Grid-independent supply, existing tank infrastructure, biogenic LPG and renewable substitutes such as DME or rDME can be important building blocks for a realistic transition to sustainable heating in existing buildings. However, the way forward does not lie in blanket promises, but in professional planning, suitable components and a clear assessment of the applicable legal requirements.
This blog will never ask members of the public or unqualified persons to make changes to or fiddle around with technical systems themselves.
In accordance with the Industrial Safety Regulation (BetrSichV), a qualified person must take care of a system which requires monitoring.
A qualified person is someone who has the specific specialist knowledge required. This knowledge is gained by way of a professional apprenticeship, corresponding professional experience or current occupational activity.
Please note that the texts are based on information, regulations and standards for Germany. Please always check the rules and regulations in the relevant country of destination and consult specialists if necessary.
