Heating: Solar, Oil, Gas, Heat Pump, Pellets – Comparison, Costs & State Subsidies

Heating & Types – The topic heating is not only interesting for building owners, but also for real estate owners. Heaters are not only necessary in a real estate, but also legally required. Which types of heating are there, how do they have to be maintained and are there legal subsidies for the construction of certain types of heating or do the costs have to be paid completely by the owner? In particular with the building of houses and with the redevelopment and modernization the heating system plays a decisive role, a large part of the later, running costs depend on it, for you or for your tenants. Please note, that while this article is written with reference to the German market, similar rules apply everywhere.

Solar systems, Oil and Gas Heating or Heat Pump?!

When deciding on a heating system some things must be considered, because there are big differences. Depending on the property, it must be decided individually which system is best suited to heat the entire property efficiently. However, the systems differ not only in their environmental friendliness, but also in efficiency and price.

Solar Thermal: Solar Energy

Solar thermal is the process by which solar energy is converted into usable heat. In residential properties, the heat produced is usually used to heat water or for heating. Depending on the location and conditions of the property, this system can completely replace the previously used heating system.

State subsidy of 2,000 euros

Renewable Energy Reduces Running Costs

The solar cells can replace hot water by up to 50 to 65 percent and thus also cover the majority of the annual hot water demand.

How do Solar Cells Work?

The solar cells on the roof have a special function. So-called absorbers catch the heat of the sun and pass it on to pipes in which a heat transfer fluid runs. This heats up and runs to a hot water storage tank in the building, where the heat of the heat transfer fluid is transferred to the water in the storage tank via a heat exchange. The hot water from the storage tank can now be used directly in the house, both for heating and as hot water. The heat transfer fluid flows back to the solar cells to be reheated. The water in the storage tank can also be used without direct solar radiation thanks to this technology.

Solar System, Photovoltaics, where is the Difference?

In addition to a solar system a photovoltaic system is suitable. This also uses solar energy, but the energy is not converted into heat but into usable electricity. Both systems together free the owner from dependence on large energy companies, because he can now produce both heat and electricity in his own home. If the house is in a good location, the owner no longer needs to rely on externally produced heat or electricity.

Solar system (single family house):

Optimal use of space for energy generation:

Settlement and urban development, favorable energy costs for tenants:

Close-up of the roof with quantities of solar collectors to generate energy for the residents.

State Subsidies for Solar Thermal Energy

The promotion of solar thermal energy is subsidized in various areas. The first point of contact for future solar thermal energy owners should be the BAFA (Federal Office of Economics and Export Control). The conditions of funding are as follows:

  1. In the area of one and two-family houses, a lump sum for the construction of a solar system of 2,000 euros can be applied for, which can be used both for hot water preparation and for heating support. This flat rate applies to solar systems up to 14 square meters. With a size of 15 to 40 square meters 140 euro per square meter are granted at gross collector surface.
  2. An extension of already existing plants is subsidized with 50 Euro per square meter of gross collector area
  3. Solar systems that are used exclusively for water heating can be subsidized with 50 euros per square meter of gross collector area, as long as the area is in the range of 3 to 40 square meters. The maximum subsidy per system is 500 Euro.
  4. In addition, certain bonuses are offered, such as a subsidy for the replacement of defective parts or additional installations, such as a heat pump or similar.

Further Subsidies for Solar Thermal Energy

However, the promotion in the field of solar thermal energy goes even further and various banks also offer special conditions when taking out loans for the construction of solar thermal systems. Depending upon individual case it applies here however directly with the offerer to inform and individual offers obtain.

Heating Stock: High Consumption, Low Efficiency

56% find their heating system “insufficiently efficient”. My tip, rely on a humidifier before the heating system is permanently turned up to full power. This will give you the same feeling of warmth at lower costs.

Very few heating systems are efficient, and therefore also cost-saving. Here you can see the efficiency structure in the heating stock in Germany in 2018 and 2019. More than half of the respondents, a full 57% (2018) and 56% (2019), consider their heating system to be “insufficiently efficient”. A real cost eater, if used incorrectly.

  • Insufficiently efficient: 56%
  • Efficient: 24%
  • Efficient and renewable: 20%

Statistics: Efficiency structure in the heating stock in Germany in 2018 and 2019 | Statista

Gas heating: Heating with Natural Gas, Liquid Gas or Biogas

Gas heating is probably the most widespread type of heating in Germany and rightly so, because the system offers many advantages. Modern technology, efficiency and inexpensive offers characterize the gas heating. In addition, they are easy to combine with renewable energies, save space and can be easily installed during modernization and renovation.

Condensing gas heaters are currently the best on the market in terms of technology, they replace the constant boilers, which are almost non-existent, and there are also some advantages over low-temperature gas heaters. Condensing gas heaters only use the calorific value of natural gas and liquid gas or biogas and therefore use the heat of the exhaust gas. This results in a very good efficiency and standard efficiencies of well over 100% are achieved. In addition to these advantages, condensing gas heating systems do not take up more space than others and can therefore even be integrated into small niches. Learn more about the topic

Hot water and cold water temperature in the heating system:

With all these advantages, however, it should not be forgotten that gas is also a fossil fuel and is therefore more harmful to the environment than renewable energies. However, gas is the most environmentally friendly fossil fuel, as its combustion produces few CO2 emissions and no soot. Biogas is also an alternative, as it does not emit CO2.

State funding for gas heating systems

There are also certain subsidy programs for gas heating systems, which promote both the installation of a gas heating system in a new building and the conversion to gas heating in older properties. The conditions are as follows:

    1. The BAFA (Federal Office of Economics and Export Control) promotes gas heating only indirectly. Real estate owners who install an eligible solar system for combined heating support and hot water preparation receive a so-called boiler exchange bonus of 500 euros if they switch to gas heating with condensing technology at the same time.
  • Also banks, like the KfW promote the installation of gas heaters by granting low-interest loans to finance gas heating systems. This also includes modernizations but also ancillary costs such as those for radiators, thermal insulation and installations.
  • The program number 430 “Energy-efficient renovation – investment subsidy” subsidizes various measures, such as the installation of gas heating systems or the modernization of the heating system.


Oil Heating: Heating with Fuel Oil or Bio Fuel Oil

Oil heatings are after gas heatings the probably most frequently occurring systems in Germany. The function mode is simple and works for decades in the same way. The fuel fuel oil is pumped over an oil pipe to the heating system where it is sprayed and burned. The heat generated during this process is used to warm up the heating water and thus to heat the house. Most of these components can be found in the boiler, which now takes up little more than one square meter of space and can even be hung on the wall, depending on the model.

Advantages for property owners

Oil heating systems offer many advantages for real estate owners, because oil heating has a proven and reliable technology that has proven itself for decades. Besides fuel oil can be procured with low price level and be stored on stock. A connection to gas or district heating networks is not necessary, making the owner independent of energy suppliers. The combustion is very economical and has low emissions. There is also a solution for the environmentally conscious, because bio fuel oil, which is produced from renewable raw materials, covers the requirements for the share of renewable energies and an oil heating system can also be combined well with a solar system.

In addition, disadvantages are to be led, because fuel oil prices are badly foreseeable and the fuel costs must be financed by the owner in advance. In addition, space is needed in the cellar, where the tank can be stored.

Who wants to save on fuel oil costs must also accept an oil smell in the cellar, which can only be avoided by premium fuel oil with fragrances. Who does not heat with bio fuel oil, must besides know that with the burn of oil CO2-Emissionen develops.

  • Economical combustion
  • Low emission

State subsidies for oil heating systems

The subsidies for oil heating systems are lower than those for other heating systems, but there are different subsidies for oil heating systems to help the owners. The conditions for the subsidies are as follows:

  1. With its program 152 individual measures, the KfW Bank promotes higher energy efficiency and a reduction of energy costs. Not only the replacement of the oil heating system is therefore being promoted, but also the installation of a highly efficient circulation pump and a circulation pump.
  2. The BAFA (Federal Office of Economics and Export Control) promotes oil heating systems only indirectly, as well as gas heating systems. Real estate owners who install an eligible solar system for combined heating support and hot water preparation receive a so-called boiler exchange bonus of 500 euros when replacing the old heating system with an oil heating system with condensing technology.

Pellet Heating: Ovens with Pressed Wood Residues

A modern pellet heating system is known for low fuel costs as well as for environmentally friendly heating and is therefore one step ahead of conventional gas and oil heating systems. Also the function mode is relatively simple. The wood pellets are periodically delivered to the combustion chamber by means of a feeder, so the correct filling is fully automatic. The heat generated by burning the pellets is used in a separate boiler to heat the water. Thus, both the heating can be operated and the hot water can be produced.

The costs for the fuels of a pellet heating system are much cheaper than fossil fuels, such as oil or gas, but the purchase costs for pellet heating systems are much higher and also maintenance work costs more. In addition, this heating system requires considerably more space than a gas or oil heating system. On the other hand, the pellet heating system is very environmentally friendly.

Wood pellets: size and units

  • Diameter: 6 – 9 mm
  • Length 10 – 35 mm
  • Raw density 1.1 kg/dm³ 1.2 kg/dm³
  • Bulk density approx. 650 kg/m³ (0.65 kg/l) approx. 650 kg/m³

Close-up of wood pellets:

State subsidies for pellet heating systems

The funding for pellet heating systems is extraordinarily good. Again, there are different possibilities, which have different requirements. The conditions are as follows:

    1. The KfW Bank also promotes here with low-interest loans
    2. The BAFA (Federal Office of Economics and Export Control) wants to make the installation of a pellet heating system as attractive as possible with their subsidy, therefore they offer financial means of the market incentive program (MAP), which do not have to be paid back! However, these unbelievable conditions require strict conditions to make the subsidy possible. These conditions only include pellet boilers with and without buffer storage and pellet stoves with water pocket and combination stoves that can be filled with wood pellets, logs or wood chips.

Heat Pump: Heating with the Heat of Nature

Technically speaking, a heat pump is a system that can extract thermal energy from a medium with low temperatures through technical work and supplied working energy. That sounds first once quite complicated, the principle of the heat pump is however actually quite simple. The heat pump extracts heat from the different energy sources air, earth and water and uses it to heat water for heating purposes. For this purpose external electricity must be supplied, but not as much as would be necessary for a normal heating system.

Heat pumps also have many financial advantages, because the state subsidies are very high here. Banks also offer favourable credit conditions for households with heat pumps. The value increasing function, which a heat pump for a real estate represents, is additionally a plus for the owner. Heat pumps are besides extremely pollution free. They emit neither CO2-Emissionen, nor use them fossil fuels. The lastingness is probably one of the largest advantages for heat pumps, which arrive not only with owners of real estate well, but also by the state are increasingly supported.

State funding for a heat pump

The subsidies for heat pumps are regulated by the BAFA. Banks also offer favorable interest rates for financing heat pumps, but the large subsidies come from the state. Efficient heat pumps with a nominal heat output of up to 100 kilowatts are subsidized if they perform the following tasks:

  1. Combination of space heating and hot water (only space heating if hot water is produced by other renewable energies)
  2. Exclusively for space heating in non-residential buildings
  3. To provide process heat and heat for the heating network
  4. Funding guidelines must be fulfilled

Excluded from state subsidies are air-to-air heat pumps and other heat pumps that transfer their heat directly to the air. Heat pumps that produce only hot water are also not subsidized.

BHKW – Heat and produce electricity at the same time

Combined heat and power plants or CHPs for short are known for using energy particularly efficiently. The system is quite simple, because a CHP produces not only thermal energy, i.e. heat, but also electrical energy, i.e. electricity, and that at the same time. Ecologically, the parallel generation of electricity and heat is extremely useful because it results in fewer losses.

The mode of operation is extremely effective, because the CHP works with the principle of combined heat and power generation. During the production of electricity, heat is generated which is normally not used as waste heat and is therefore lost. However, if this heat is used, one speaks of a cogeneration plant. These CHP plants are particularly suitable for large industrial plants, hospitals or universities, as the heat used can be fed into district heating networks or used for production in industrial plants. This model combines the motor, the generator and the heat exchanger in a sound-insulated housing and thus compactly packs all required modules in one block. This is where the name block-type thermal power station comes from.

A CHP can be operated by almost all drives and gets along with almost any fuel. From gasoline and diesel engines, steam or Stirling engines to gas turbines or fuel cells, the CHP can use almost any drive. The fuels are then selected according to the drive system. Thus, a CHP can be very environmentally friendly and can be operated with biogas or regenerative energies, for example, but it can also function just as environmentally harmful with crude oil. The possibilities are therefore broadly diversified and can be individually adapted to the customer’s wishes.

Promotion for BHKW

The subsidies for CHP plants are precisely regulated. The owner of such a plant can feed the electricity into the public grid, similar to photovoltaic systems, and receive compensation for this. The conditions for BAFA-supported CHP plants are as follows:

  • The “Law for the Maintenance, Modernization and Expansion of Combined Heat and Power Generation” regulates that operators of a CHP plant receive a supplement for the electricity produced. However, in order to do so, the CHP unit must be approved by the BAFA
  • The KfW Bank also subsidizes a CHP with favorable interest rates and good credit conditions

Infrared: Heating with Electricity

Even if the conventional heating systems have proven themselves, infrared heating is definitely an alternative that should be considered. Although heating with electricity is generally considered expensive, there are other factors that make heating with electricity economical. Our detailed guide will tell you which points are important and when heating with electricity is worthwhile.

Heating with electricity by infrared rays

When building a house, the question of the right heating system always arises. There are many variants that need to be considered, and infrared heating is one of them. The model shows many advantages that are well adapted to different life situations. But under which conditions is it worthwhile to install infrared heating and how exactly does heating with electricity actually work?

Acceptable and healthy heat through infrared rays

The radiation of infrared heating works differently than other heating systems, because the radiation does not heat the air in the room, but directly the body. This includes not only the human body, but also walls, ceilings or floors and even furniture. The principle can be compared with sunbathing in winter. With this technique, the body feels the warmth as pleasant even at low temperatures. From this follows that only low temperatures are necessary and thus electricity and heating costs are saved. Another advantage of infrared heating is that the rooms do not have to be preheated for a long time to keep the body pleasantly warm. This provides comfortable warmth and thus increases well-being and health.

Heating Technology: Circulation Pump, Combined Heat and Power & Condensing Technology

Owners of buildings or real estate meet with searches for heating systems again and again the same technical terms. So what is really behind terms such as combined heat and power or condensing boiler technology and how important are these for the new heating system?

Heating pump – the heart of central heating

Probably the most important element of a common central heating system is the heating pump, also called circulation pump. It works in the basement and ensures that there is always enough warm water to the radiators, thus enabling heating. However, the willingness to perform, especially in older models, results in unnecessarily high energy consumption and the resulting high energy costs. Therefore, it makes sense to replace older models, as they are usually oversized and always provide high performance, even when this is not necessary. The older models do not adapt to the actual demand and therefore often work unnecessarily at full speed even in summer. New models have a stepwise or automatic regulation and therefore only work at full power when it is really needed. This reduces costs enormously and energy consumption is not unnecessarily high.

Heating pump to be replaced: drain

But when is it necessary to replace a heating pump? This is easy to find out by following these tips:

  • Calculate how many watts you use and compare this value with the power value of your existing pump. Calculate about 1-2 Watt per radiator. A household with 10 radiators therefore needs a heat pump with the power of about 20 watts. If the achievement value of your heat pump lies clearly over the value, you should think about an investment into a new heat pump.
  • Check the energy class of your heat pump. The higher the energy class, the lower the power consumption and the higher the energy saving potential. A class A heat pump is optimal, as it works most efficiently.
  • Look for a specialized company and get individual advice on whether the installation of a new heating pump makes sense for your real estate.

Cogeneration: Efficient use of energy

In general, the term cogeneration is used to describe the generation of energy, i.e. electricity by combustion, whereby the waste heat is used for heating purposes. The kinetic energy generated to drive a generator is used to generate electricity. The available waste heat is then supplied to heating systems. This waste heat is so great in large plants, such as industrial plants, that entire districts but also public buildings, such as hospitals, can be supplied with it. The parallel generation of electrical and thermal energy makes enormous economic sense, as otherwise much energy remains unused.

The technology has been minimized enormously over the last years. Where large machines were needed in the past, there are now CHP plants that are compactly combined in a box and produce the same output. Meanwhile, there are also systems for multi-family houses, which can generate outputs of about 4kW of electrical and 20kW of thermal energy and are relatively small. The technology is thus becoming increasingly compatible and individually applicable in many different areas.

Condensing technology: utilization of condensation heat

Condensing technology uses the temperatures of the exhaust gas to preheat the combustion air. A pipe-in-pipe flue gas system heats the cold outside air through the flue gas. The exhaust gas then cools down to the outside temperature. The flue gas must pass a very large heat transfer surface and in doing so releases the heat to the lowest possible system temperatures of the heating system. Since these are very low, the water content in the exhaust gas condenses and the condensation heat is used. Condensing technology therefore mainly describes the process by which the heat of condensation is used.

In order for the condensation to function under all conditions, low heating system temperatures are necessary, which are created by large heat transfer surfaces. Panel heating systems such as floor, ceiling and wall heating systems are therefore particularly popular.

Radiators: Models, Functions & Correct Ventilation

Radiators ensure that the heat produced can reach the various rooms in the building and be controlled there. There are not only different models of radiators, but also some things you should know about them.

Floor Heating: cuddly warm feet

The underfloor heating is one of the panel heating systems. A distinction is made between warm water heating systems (wet and dry systems) and electrical systems. Hot water underfloor heating systems are installed invisibly in the floor surface. The pipes are therefore laid directly in or under the screed. Electric underfloor heating consists of a mat or net in which heating cables are integrated. This is laid under the floor covering and heats the floor from there.

In terms of price, the cost of underfloor heating varies depending on the system. In the case of a dry system, the cost is 28-44 euros per square meter. Additional costs for other materials and installation are also included. A wet system costs between 13-40 euros per square meter, depending on the type of installation. Here, too, there are additional costs for additional installation materials. The electrical systems can be installed from 24 euros per square meter. The prices vary depending on the floor area. The larger the surface, i.e. the surface, the lower the price per square meter.

Wall & ceiling heating: invisible radiators

The wall and ceiling heating systems are also among the panel heating systems. They are installed under the wall or ceiling and initially only heat the wall/ceiling. The heat is then transferred to the room by thermal radiation. Heat dissipation by convection is almost non-existent here and the movement of the air is largely eliminated.

In most cases, a simple central heating system is the source of the heat, because it pumps the warm water through the pipes under the wall/ceiling. However, this heating system can also be combined with renewable energies and condensing boilers. The panel heating system manages here without any problems with supply temperatures of around 30° C. A prerequisite for the efficient use of this radiator, however, is good insulation, as otherwise too much thermal energy is lost.

Simply vent the radiator: drain

Each heater should be vented regularly. This helps to avoid annoying noises and allows the heater to develop its full performance. Trapped air in the heater reduces the performance of the heater and leads to higher energy consumption. This air must therefore be vented regularly. Signs that the heater needs to be vented are for example strange noises like a bubbling or a gurgling sound coming from the radiator but also that the heater does not get completely warm but only around the region of the water inlet.

Before the heater is vented, the water pressure must be checked. This should be within the marked normal range, otherwise water must be topped up to restore the pressure. After each new filling of the heater with water, the heater must be vented. For this purpose all thermostats should be closed and the valve should be searched for. This is usually located at the opposite upper end of the radiator and looks either like a small square pin or a pentagonal screw. Depending on which valve is present, venting must be done with a venting wrench or pliers.

The most common valve is the square spindle, which can be vented with a vent wrench. To do this, the valve must be opened until the air escapes hissing. It is important not to open the valve too far, otherwise it could fall out. If all excess air has escaped, water will start to escape from the valve. From this moment the valve should be closed again quickly. It is best to catch escaping water with a container.

Fireplace and Stove: Heating with Comfort

Also a chimney oven offers the possibility to save heating costs or even to heat the whole building. A fire-place with wood or pellets to heat, brings however by far more advantages than only the saving of heating costs. The burning of wood is CO2-neutral and thus very pollution free. Whether the choice falls now on a chimney oven or on a tiled stove, is here rather a matter of taste.

Fire-place in modern free-hold apartment (Berlin):

Fireplace integration country house (Mallorca)

An ordinary wood-burning stove consists of a steel body with a combustion chamber and a correspondingly required flue gas pipe. The flue gas pipe directs the flue gas products produced during combustion to the outside. The firebox is closed with a fireproof glass door to minimize the danger of an open fire in the living room. Fireplace stoves are offered in many different designs and models and can be individually adapted to the room by the owner. Besides the practical function of saving heating costs, the fireplace also has a cosy and aesthetic effect.

Firewood: Do-it-yourself, shredding & stacking

Kaminholz & Kaminholzlagerung – Larger quantities of firewood, are often stored on properties. The garden or a barn are often used for storage. Larger quantities of firewood, once stored on a property, must be stored in a fire protected place. This measure is regularly checked by a chimney sweep. In this article you will find tips and videos about storage, DIY, stacking and chopping firewood for your fireplace: