EU's Fit for 55 package must leave national flexibility - Germany

The EU's Fit for 55 package must reconcile climate protection with a prosperous economy and leave member states with enough flexibility, the German government said in a statement on the major EU legislative package on the Green Deal, reports Susanne Ehlerding in energy and climate newsletter Tagesspiegel Background. A one-size-fits-all solution would not meet the challenges, says the paper seen by the newsletter and dated 27 May, which also restates the government's rejection of support for nuclear power plants. The paper's largest section deals with the reorganisation of European emissions trading (ETS) and the planned Carbon Border Adjustment Mechanism (CBAM), according to the article. The government says the package must offer protection against industrial migration due to strict climate legislation (carbon leakage), and calls for careful consideration of the advantages and disadvantages of a CBAM or a tax. Existing instruments to protect against carbon leakage, such as the free allocation of certificates, would have to be extended to an appropriate extent, according to the paper, which also calls for an emissions trading system for heating and transport.

The Fit for 55 package is a key component of the bloc’s green growth strategy – the European Green Deal – and the necessary foundation for the EU to reach its newly decided more ambitious 2030 climate target. The legislative package will be presented on 14 July.

Further sector- and technology-specific measures are needed to secure investments in all technologies, because an "ETS-only" approach does not address the challenges of the upcoming comprehensive structural change, the paper argues. "As far as CO2 standards for passenger cars and light commercial vehicles are concerned, the German government no longer appears to oppose stricter standards as it used to," writes Ehlerding. New fleet limits have a key role in achieving the climate targets in the transport sector, the paper says, which also states that an "over-stimulation" for electric vehicles could disrupt the value chain if companies do not have enough time to adapt. Regarding the revision of the Renewable Energy Directive (RED), the paper says it is crucial for the credibility of the renewables target that only truly renewable forms of energy are counted towards the expansion target. "We therefore reject an expansion of the RED to include 'low-carbon fuels'," writes the government.