BAFA LED Funding 2026: What Changed and How to Finance LED Now

For years, many German companies financed their LED retrofits with a BAFA grant. Since 21 July 2026 that is over: with the reformed Federal Funding for Efficient Buildings (BEG), funding for interior lighting in non-residential buildings has been discontinued. This guide shows what changed, which financing routes remain and why LED still pays back quickly without a grant.

What has changed?

Until July 2026, companies, associations and public bodies in Germany could apply to BAFA for a grant under the BEG individual measures for replacing luminaires in heated non-residential buildings. Requirements included minimum luminaire efficiencies (e.g. 120 lm/W, 140 lm/W for trunking) and the involvement of an energy efficiency expert. With the new BEG guideline from 21 July 2026, interior lighting has been removed from the funding catalogue. Basic funding for the remaining individual measures stays at 15%.

Because funding programmes change regularly, check the current status with BAFA or your energy consultant before any investment.

Which options remain?

Route	For whom	Note
Municipal and state programmes	Municipalities, public bodies, sometimes companies	Varies by state and municipality, check the current status
Programmes from utilities and energy suppliers	Business customers	Sometimes grants or contracting offers
Tax depreciation	Companies	Luminaires are depreciated over their useful life, low-value assets sometimes immediately
Leasing or hire purchase	Companies	Instalments are paid from the electricity savings, no upfront financing
Energy performance contracting	Larger properties, municipalities	A service provider finances and is paid from the savings

For tax questions, your tax adviser is the right contact. Municipalities may also find LED Street Lighting useful.

Why LED pays off even without funding

The BAFA grant was most recently 15% of eligible costs. The electricity saving from an LED retrofit is many times that, every year. On top of that, direct-import prices 2–4× below comparable branded products often make the investment lower than the subsidised branded solution used to be.

• High bays instead of HQL/HQI: 60–70% less electricity (see Replacing HQL, HQI and Sodium Lamps with LED).
• Tri-proof lights instead of fluorescent: around 50–60% less electricity.
• With motion sensors and daylight control, another 30–60% (see DALI and Lighting Control).
• Hardly any maintenance or lamp replacement.

Efficient luminaires for your retrofit

Worked example without funding

Warehouse with 40 metal halide high bays of 400W (approx. 440W), 4,000 hours a year, €0.28/kWh. Replaced by 40 LED high bays of 150W:

• Saving: 40 × 290W × 4,000 h = 46,400 kWh, around €13,000 a year
• At typical material and installation costs, the retrofit pays back in around 1–2 years, with no grant at all
• Over 10 years, well over €100,000 in savings remain after deducting the investment

Calculate with your own values: LED Payback Period Calculator.

Frequently asked questions

Is BAFA funding for LED lighting still available in 2026?

Not for interior lighting in non-residential buildings. Funding under the BEG individual measures was discontinued on 21 July 2026.

What happens to applications made before?

Already approved applications are generally governed by the terms of the approval notice. Clarify details directly with BAFA or your energy efficiency expert.

Is funding available for municipalities?

Municipalities should check federal and state programmes for municipal climate protection. Conditions change regularly.

Is LED worthwhile without funding at all?

Yes. In halls, warehouses and workshops, a retrofit typically pays back in 1–3 years from electricity savings alone.

Can I finance the retrofit without investing myself?

Through leasing, hire purchase or contracting. The instalments are paid from the electricity savings.