Germany’s climate law and national emissions trading system clear last legislative hurdle

The council of federal state governments (Bundesrat) has greenlit Germany’s Climate Action Law and the planned national emissions trading system for transport and buildings, clearing the last legislative hurdle. The Bundesrat also agreed to plans to increase the air traffic tax. As the federal parliament (Bundestag) has already adopted these, the German president can now formally sign all three bills into law. However, other parts of the climate package Chancellor Angela Merkel’s government decided in September are being held up. The Bundesrat called for setting up the so-called mediation committee with the Bundestag to debate planned tax changes, such as those supporting the energy-efficient modernisation of buildings, increasing the commuting allowance and decreasing the VAT on train tickets. The latter is planned for January 2020. States had criticised the distribution of costs between the federal, state and municipal levels. Environment minister Svenja Schulze (SPD) had cautioned against delaying key elements of the climate package in an interview with Funke Mediengruppe: “It's important to me that the reduction in rail fares is not held up.” State premiers, such as Daniel Günther (CDU) of Schleswig-Holstein, said they hoped a solution could be found by the end of 2019.

The German government in September adopted a comprehensive climate package to help reach the country’s 2030 targets. Over the coming months, the decisions must be implemented, mostly through legislative amendments or newly created laws. Among the most contentious elements are the coal exit law and renewables expansion legislation.