Merkel’s Conservatives say will work on energy taxation reform, mull price on CO2

The German conservative party CDU has said it will work on a reform of the country’s system of taxes and levies on energy to better align fiscal measures with climate action. The leader of Chancellor Angela Merkel’s governing party, Annegret Kramp-Karrenbauer, said the CDU would come up with proposals for a reform of energy taxation but stopped short of promising that a CO2 price would be part of these reforms, Nora Zaremba writes for Tagesspiegel Background. “Very different ideas exist within the CDU as to what a rearrangement of the system could look like,” Kramp-Karrenbauer said after a party meeting on Monday.
Just a few days earlier, CDU state party leaders Thomas Strobl from Baden-Württemberg and Bernd Althusmann from Lower Saxony, who the party leadership commissioned with devising a position paper on the topic, said they favoured “a binding price recommendation for CO2” but rejected an outright tax on carbon emissions, the Rheinische Post reports. The proposed pricing mechanism could instead be built on the existing EU emissions trading system (ETS). A group of conservative members of parliament seized upon the proposal and called for a decision on carbon pricing “before the summer break” in an interview with news network n-tv. 

The loss of votes at the EU elections and the parallel rise of the Green Party in Germany and across Europe has plunged the CDU into an internal dispute over the party’s future climate policy. While many in the party argue that the conservatives have to gain ground against the Greens by sharpening the CDU’s climate profile, others warn that ambitious emissions reduction measures that come with a financial burden for voters could alienate large swathes of the party’s traditional supporters.