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Replacing an oil or gas heating system saves heating costs and protects the environment. The type of replacement for a fossil fuel heating system depends on various factors. Both structural requirements and cost factors must be taken into account. Whether you’re replacing an oil or a gas heating system, you’ll find everything you need to know in the article.

Modern heating systems based on renewable energy sources are a sensible alternative to oil and gas heating systems. The following options are available:

When replacing a heating system various costs are incurred. These depend on a variety of factors, including the type of heating system, the amount of conversion work required and the choice of energy source.

Costs of oil or gas heating systems

Replacing your existing oil heating system like for like is permitted only if a more sustainable alternative is not technically possible. One reason for this is the constantly increasing scarcity of oil and gas. However, switching to a renewable heating system can be very expensive. For an average single-family home, the cost of purchasing a heat pump is at least CHF 27,000, rising to more than CHF 40,000 if you opt for a geothermal heat pump (brine water). Access to heat sources is an important cost factor for heat pumps.

It’s clear that it’s not always easy to estimate costs. These depend on the geopolitical situation, the provider and the suitability of the terrain.

Investing in a new heating system is financially worthwhile if the higher installation costs can be amortized by the lower operating costs during the expected service life. The operating costs of heat pumps are much lower than those of oil or gas heating systems. If the house is well insulated and the system is optimally adjusted, electricity and operation cost at most a few hundred francs per year. Heat pumps with geothermal probes (or air-to-water heat pumps) also require minimal service and maintenance.

�۶���Ƶ economists are in no doubt: In almost all cases, replacing an older oil heating system pays for itself within 10 to 15 years. Financially speaking, a conversion is especially worthwhile if the existing oil heating system has already reached the end of its service life, and the building costs a lot to heat due to poor insulation. If there is a carbon tax hike on fossil fuels in the medium term, the conversion will have paid for itself in less than ten years. If the homeowner received a subsidy of CHF 10,000, the payback period would be even shorter. In the best-case scenario, if the existing heating system has already been written off, the estimated payback period would only be five years.

Gas heating systems are generally quite easy to install and use. In residential buildings with good thermal insulation, gas heating is relatively inexpensive to run. “From a cost perspective, this makes a heat pump harder to justify,” the �۶���Ƶ economists point out. The decision would be easier if the old system had to be replaced anyway and the building was poorly insulated. Here too, return on investment will be much faster if state subsidies are available.

Are there subsidies or financial aid for switching to environmentally friendly heating systems?

Subsidies are available for those wishing to install a heating system that uses renewable energy. There are various options here. One important federal and cantonal program is the . The cantons supplement the subsidies from the program with their own budgets. You can find other programs available to you where you live at  (German, French and Italian only). It is important to apply for subsidies before you start any construction work.

In Switzerland, there is currently (in 2024) no obligation to replace a fossil heating system. However, property owners often have to comply with the cantons’ current model regulations in the energy sector (MuKEn). This is a federal guideline aimed at harmonizing the energy regulations of the cantons. Whether and how exactly the cantons implement these is up to them. In the cantons of Basel-Stadt, Glarus and Neuchâtel, for example, the use of fossil heating systems when renovating is prohibited. In general, however, heating systems using fossil fuels will only be permitted from 2026 if the building is very well insulated. From 2050, all oil and gas heating systems will probably have to be replaced.

Until now, apartment buildings in Switzerland have been heated with fossil fuels more frequently than single-family homes and there are many reasons for this. In new buildings, these new systems can be integrated more easily and more cost-effectively. With the ban on fossil fuels for heating systems from 2026, this change will also extend to apartment buildings.

At present, the heating systems of old buildings are converted less often than in those more recently built because the structural conditions are often more challenging and thus the possibilities are limited. Or there is a lack of long-term planning and capital. Some owners are put off by the fact that a change of energy source is associated with a considerable initial investment and wonder whether a sustainable renovation makes financial sense?

The time taken to replace an old heating system will vary depending on the type of replacement or the existing structural conditions. For example, replacing an oil heating system with a heat pump usually takes a few weeks. The same applies when switching to a solar-powered heating system. However, in most cases, replacement involves more than just the actual installation work. Various preparatory work and permits also take time and can take several months from the initial considerations to commissioning.

Investments in heating with renewable energy are fully tax-deductible in some cantons. If you do not have the liquidity for a sustainable renovation, you should consider increasing your mortgage. This also makes economic sense because in most cases the savings achieved in terms of property running costs will be higher than the additional costs for mortgage interest.

There are currently a lot of changes taking place around the topics of energy, real estate and investments. There is already a tendency for energy efficiency and the heating system to influence the resale prospects of real estate. Buildings that have already been retrofitted and comply with energy regulations will perform better in terms of market value than unrenovated properties. There is also a discussion about whether the energy balance could affect the risk assessment and the conditions in the mortgage sector in a few years’ time.

Fossil fuel heating systems generate unnecessarily high operating costs. Well-insulated homes that heat with gas are relatively energy-efficient. However, subsidies and tax benefits mean that in many cases the installation of a heat pump can still be beneficial. If you install or modernize systems that run on fossil fuels, there is a risk that you won’t be able to use them for their full service life.