Govt passes 8 bn euro climate emergency programme, leaves critics dissatisfied

The German cabinet has passed a climate emergency programme allocating an additional 8.1 billion euros for climate protection measures over the next five years. The government aims to spend 4.5 billion euros on energy-efficient buildings. More than 650 million euros will go to the decarbonisation of industry as part of a plan that will also include Carbon Contracts for Difference (CCfD). Federal finance minister and SPD chancellor candidate Olaf Scholz praised the programme as “money well spent” and emphasised Germany should “become a pioneer in climate action”, Tagesschau reports. Federal economy minister Peter Altmaier said the funding programme is a “necessary and good addition to the Climate Action Law, because it provides additional impetus for investments in clean technologies”. He added that in order to become climate-neutral, Germany, as an industrialised country, “needs planning security, which we are creating with an additional 8 billion euros.” Environment minister Svenja Schulze, on the other hand, argued that the programme “also clearly shows what is missing,” Focus online reports. The last-minute failure to partially relieve tenants of the increased CO2 price on heating was “due to the resistance of the CDU/CSU parliamentary group, which was influenced by the real estate lobby,” she said, adding that this is “very painful.” What is also missing in the programme is a “spirited expansion of renewable energies”, Schulze said, referring to the government coalition's failure to agree the target of 95 gigawatts (GW) capacity of wind energy and 150 GW of solar power by 2030 in a binding way. The funds for the programme are part of the 2022 budget plan the government decided. As Germany is voting on 26 September, a new parliament will have the final decision on the budget.

In a press release, opposition party Die Linke (The Left) called the programme “overpriced, toothless and unfair,” saying the government “continues to be on the wrong track in terms of climate policy.” Lorenz Gösta Beutin, spokesperson for energy and climate of The Left’s parliamentary group, said the funds create “a social imbalance in the century-long task of decarbonisation,” in reference to the decision to exempt landlords from paying half of the burden of the increased CO2 price on heating.

Kerstin Andreae, president of the German Association of Energy and Water Industries (BDEW), said the emergency programme is a “positive signal and sets important incentives for investments.” She added that in addition to public investments, the way must be cleared for private investments in the energy transition: “Planning and approval procedures for energy transition projects must be significantly accelerated. And the investment capacity of the grid operators must be maintained in view of the great need for grid expansion and conversion.”

NGO Environmental Action Germany (DUH) called the programme inadequate, taking particular issue with the exclusion of increased renewable energy expansion targets. DUH argues that the plan “burdens the next government with a largely nonsensical subsidy programme of 8 billion euros.”