German govt agrees higher 2024 national CO2 price, returning to pre-crisis plans – media

Germany’s coalition government has agreed a higher national CO2 price for transport and heating fuels for 2024, news site Table.Media reports citing coalition sources. The fixed carbon price for fossil fuels such as diesel, petrol and heating oil is set to rise from the current 30 euros per tonne to 45 euros from 1 January 2024, instead of only 35 euros. To ease the burden on consumers during the energy crisis, last year the government agreed on a more moderate price increase for several years. However, as energy prices have gone down significantly, Germany’s ruling coalition has now decided to return to pre-crisis plans, writes Table.Media. The decision was taken as part of current 2024 federal budget talks, the news service said. It added that the increase in the CO₂ price would make a litre of petrol around 4 cents more expensive at the turn of the year, diesel and heating oil around 5 cents per litre and natural gas 0.3 cents per kilowatt hour.

Beginning in 2021, Germany put a fixed price on carbon emissions from fuels used predominantly for transport and heating, in addition to the EU emissions trading system (EU ETS), which covers the energy and industry sectors. Germany plans to switch from a fixed price to a market-based system from 2026. Germany’s national price will also have to be aligned with EU plans to introduce a second emissions trading system – for the transport and buildings sectors – from the late 2020s.