Differences between BAFA individual measures funding and KfW standard efficiency house funding

BAFA individual measures funding

The Federal Funding for Efficient Buildings – Individual Measures (BEG EM) , administered by the Federal Office for Economic Affairs and Export Control (BAFA) , supports targeted energy-efficient refurbishment measures in existing buildings. Funding includes, among others:

• Measures on the building envelope : insulation of walls, roofs and floors as well as the replacement of windows and external doors.

• Plant engineering (without heating) : installation of ventilation systems or the installation of measurement, control and regulation technology.

• Heating technology : installation of heat pumps, biomass systems or solar thermal systems.

The funding rate varies depending on the measure. For example, measures on the building envelope are subsidized with 15% of the eligible costs, while the installation of heat pumps is subsidized with 30% . In addition, 50% of the costs for specialist planning and construction supervision can be reimbursed. It is important that the building application or building notification for the building was submitted at least five years ago at the time of application. 

KfW Efficiency House Funding

As part of the Federal Funding for Efficient Buildings (BEG), the Kreditanstalt für Wiederaufbau (KfW) offers low-interest loans and grants for the energy-efficient refurbishment of residential buildings into so-called Efficient Houses. An Efficient House is characterized by particularly low energy consumption. The various Efficiency House levels (e.g., 40, 55, 70) indicate how high the energy consumption is compared to a reference building.

The higher the efficiency class, the higher the subsidy. For example, for refurbishments to an Efficiency House 40, a repayment subsidy of 20% can be granted on a maximum loan amount of €120,000 per residential unit, corresponding to a subsidy of up to €24,000. Upon achieving the Renewable Energy Class or the Sustainability Class, the repayment subsidy increases to 25% for a maximum loan amount of €150,000 per residential unit, i.e., up to €37,500. Here, too, the prerequisite is that the building application or building notification for the building was submitted at least five years ago at the time of application. 

Current developments and changes

Several changes to the BEG funding came into effect on 1 January 2023 :

• Increase in the Energy Efficiency Building Bonus : The bonus for renovating the worst-performing buildings has been increased from 5% to 10% . This bonus is now available for refurbishments to Efficiency House 70 EE .
• Funding for DIY projects : There are now expanded options for funding DIY projects during refurbishments. This offers additional financial support to owners who do the work themselves .
• New funding programs : Since September 3, 2024, KfW has offered the "Young Buys Old" program, which supports families with minor children in purchasing older buildings in need of refurbishment. This program provides low-interest loans with an interest rate of 1.51% for a term of 35 years. The maximum loan amounts vary between €100,000 and €150,000, depending on the number of children. The prerequisite is that the purchased buildings have an energy performance certificate of class F, G, or H and are renovated to Efficiency House 70 standard within 54 months. 

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Conclusion

The choice between BAFA funding for individual measures and KfW Efficiency House funding depends on the individual goals and the scope of the planned refurbishment measures. While BAFA funding supports targeted individual measures, KfW funding is aimed at comprehensive refurbishments that meet the Efficiency House standard. Given the dynamic funding landscape, it is advisable to inform yourself about the current funding conditions before starting a project and, if necessary, seek professional advice.

At Purpose Green, we're here to support you with our expertise and help you find the optimal funding strategy for your refurbishment project. Contact us for a free initial consultation!

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For further reading:

1. BAFA Individual Measures Funding, Federal Office for Economic Affairs and Export Control (BAFA) ➝ bafa.de
2. KfW Efficiency House Funding, Kreditanstalt für Wiederaufbau (KfW) ➝ kfw.de
3. Differences between individual measures and Efficiency House funding, Energy Consultant ➝ energie-fachberater.de
4. Economic impacts of remediation measures, Federal Environment Agency (UBA) ➝ umweltbundesamt.de
5. Funding programs for renewable energies and energy efficiency , German Bundestag ➝ bundestag.de
6. Changes in BEG funding from 2023 , Energy consultant ➝ energie-fachberater.de
7. Renovation funding & own contributions , Energiezukunft.eu ➝ energiezukunft.eu
8. New KfW program “Young Buys Old” (since September 2024) , Welt.de ➝ welt.de

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(Photo: Envato Elements)