A new heating cost subsidy is on its way

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Taking the heat out of energy prices A new heating cost subsidy is on its way

People who receive housing benefit, trainees and students: the new heating cost subsidy is designed to help a wide range of people who are hit particularly hard by rising energy prices. The Federal Cabinet therefore adopted the draft law for a second heating cost subsidy.

2 Min. Lesedauer

The second heating cost subsidy provides relief for around two million people.

The second heating cost subsidy provides relief for around two million people.

Foto: picture alliance/Geisler-Fotopress

Everybody is affected by the steep increases in heating costs. However, citizens on low incomes are hit the hardest, as a large share of their disposable income is required to cover housing costs to begin with. With its first heating cost subsidy the Federal Government reacted to the sharp increase in energy costs in the first half of the year.

As energy prices continue to rise rapidly and the resulting financial burden on households is becoming ever more pronounced, the Federal Government is topping up its support through a second heating cost subsidy. This subsidy is a part and supplementation of the housing benefit reform.

Recipients of housing benefit and people in training and education

The heating cost subsidy is paid to people who receive housing benefit, as well as to trainees, students on vocational training, participants in advanced further training measures and students who receive funding pursuant to the Federal Training Assistance Act, the Advanced Further Training Assistance Act including a subsistence allowance or pursuant to the Third Book of the Social Code. Those who were granted the respective type of funding for at least one month between September and December 2022 are eligible to receive the heating cost subsidy. 

Households that receive housing benefit will get a one-off amount based on the number of people. A two-person household will, for example, receive a one-off heating cost subsidy of 540 euros. Eligible trainees and students will each get a heating cost subsidy of 345 euros.

Around two million people will receive the subsidy

The second heating cost subsidy will reduce the burden for around two million people in total, including 660,000 households that receive housing benefit and are home to around 1.5 million people. Further recipients include about 372,000 people who receive BAföG-funding, about 81,000 people who are eligible for a subsistence allowance pursuant to the Advanced Further Training Assistance Act, and around 100,000 recipients of vocational training and education benefits.

The full cost for the heating cost subsidy is covered by the Federal Government. In addition, the draft law adds specific provision to the Eleventh Book of the Social Code, such that approved long-term care providers can quickly enter into payment negotiations with care insurance companies if energy costs change to an unexpected extent.