Next German government's key climate and energy plans in 2021 coalition agreement

The three parties forming the next government coalition in Germany stress in their coalition treaty that bringing Germany onto a 1.5°C path is their central task.

Renewable energies

• In the electricity sector, renewable energies are to have a share of 80 percent by 2030 as electricity demand increases (to 680-750 terawatt-hours; current government estimated 658 TWh for 2030). To achieve this, their expansion is to be defined as a "public interest" and given priority over other areas of environmental protection, until climate neutrality is reached
• Use two percent of German land for onshore wind power; begin work on comprehensive planning of these areas in first half of 2022 with federal, national, local authorities
• Communities near renewables installations should “profit appropriately” 
• Where wind farms are already in place, it must be possible to replace old wind turbines with new ones without a major approval procedure
• Offshore wind targets: 2030: 30 gigawatt; 2035: 40 GW; 2045: 70 GW (status 2020: 7.8 GW)
• Solar PV target for 2030: ca. 200 GW (status 2020: 54 GW)
• Rooftop solar mandatory for new commercial buildings, “as a rule” on new private buildings
• Phase out government support to renewable energies once the coal exit is completed
• Achieve “massive” expansion of renewable energy capacities
  - through Renewable Energy Act (EEG) and other instruments such as long-term power purchase agreements (PPA)
  - through faster approvals, by supporting public authorities with “external project teams”, by clarifying deadlines and requirements in application documents

• To reduce burden on industry and households, the renewable energy surcharge will not be paid via the power price as of 1 January 2023. It will instead be paid for from the federal budget, the income from the CO2 prices on energy, heating and transport

• Support an increasing CO2 price, combined with a strong social compensation and support for low-income households. “What is good for the climate will become cheaper, what is bad will become more expensive"

• No increase in CO2 price on heating and transport fuels right now for social reasons, as the price for energy is currently very high due to non-CO2 price related effects

• Will make a proposal for CO2 price development after 2026; develop a social compensation mechanism (“climate payment”) for consumers

• Reach a fair division of the CO2 price (on heating) between landlords on the one hand and tenants on the other. On 1 June 2022, the coalition wants to introduce a new model that, based on a building's energy class, regulates the allocation of the CO2 price according to the fuels emissions trade law (Brennstoffemissionshandelsgesetz - BEHG). Should this legislative solution not be possible in time, the increased costs due to the CO2 price will be divided equally between landlord and tenant from 1 June 2022.

• Push for an EU-wide carbon floor price under the ETS
• Push for the establishment of an EU CO2 price in the buildings and transport sector
• Support creation of a European Union for green hydrogen to become leading market for hydrogen technologies by 2030 – update the national hydrogen strategy accordingly
• Initiate (together with European and international partners) an international Climate Club with a uniform CO2 minimum price and a common carbon border adjustment
• No mention of Nord Stream 2 or German dependence on Russian fossil energy:  The new government wants to cooperate with Russia on hydrogen and climate protection; wants to support Ukraine and strengthen the two countries' energy partnership in particular on green hydrogen production, renewable energies.

• Develop industrial strategy that prevents carbon leakage
• Create instruments to help industry achieve climate targets, e.g. carbon contracts for difference
• Support the introduction of an EU wide carbon border adjustment mechanism (CBAM) which has to be in compliance with WTO rules and fit in with the existing emissions trading system
• Government will ensure competitive electricity prices for industry
• Make Germany a centre for research, production and recycling of battery cells.

• Sustainable mobility transition that makes Germany a lead market for e-mobility
• Target of a minimum of 15 million fully-electric passenger cars on German roads in 2030
• Proposal by European Commission to only allow CO2 neutral cars as of 2035 means that Germany will have to get there earlier. “Outside the existing system of fleet limits, we advocate that only vehicles that can demonstrably be fuelled with e-fuels can be newly registered”
• “Massive acceleration” in establishing a comprehensive charging infrastructure
• Support transition in auto-industry regions towards e-mobility through “targeted cluster support”
• Create a “strategy platform automobile industry”.

• Adopt a national moorland protection strategy
• Develop long-term approach for additional climate protection of forests, e.g. reward forest owners for climate action and creating climate change resilient forests
• Make changes to the accompanying regulations of the CAP strategic plan to ensure climate action, environment protection and income security for farmers
• Review the current funding architecture of the CAP by the middle of the legislature; bring animal numbers in line with the targets of climate and water protection
• Reduce ammonia and methane emissions from livestock considerably, taking into account animal welfare
• Support farmers during the transition to climate neutrality as part of the restructuring of livestock farming
• Present a concept how direct payments under the CAP can be replaced with paying for environmental and climate services
• Tie the development of livestock numbers to the available land area
• Improve the natural CO2 storage capacity of the oceans by means of a targeted programme for seagrass meadows, algae forests
• "Actively follow" the European Commission's debate on "Carbon Removal Certification Guidelines"
• Need to update the soil protection law, create a soil monitoring centre and support the EU with its Soil Directive.
• Step up research and promotion of climate-friendly crop production and launch a federal programme for Sustainable Arable Farming
• Continue to develop a protein crop strategy.