Germany Launches New Support for Energy-Efficient Construction

February 2023

EUR 750 million in low-interest loans are now on offer for construction and first-time purchases of domestic buildings and private homes in Germany. The money is part of an incentive program called “Climate-Friendly New Construction” (KFN) from the country’s state economic development bank KfW.

German Minister for Housing, Urban Development and Building Klara Geywitz described the initiative as “sustainable support for generations.” It is part of a larger, EUR 13.9 billion program, the Bundesförderung für effiziente Gebäude or BEG, that includes renovating old buildings as well as constructing new ones.

“For the first time, we are exclusively supporting new buildings that are not only run with energy efficiency but that have low greenhouse gas emissions throughout their entire life cycle,” Geywitz said in a statement.

Participants in the KFN will have access to interest rates around 3 percent lower than standard ones – right now around 0.9 percent for a ten-year fixed-interest loan. To qualify for the loans, buildings must use a maximum of 40 percent of the energy consumed by conventional structures.

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