Within two weeks of the decision by the German Federal Constitutional Court, the Federal Cabinet has launched a revised draft climate bill with tougher emission targets for greenhouse gases in 2030, and 2045 as the target year for greenhouse-gas neutrality.
“The Climate Change Act will have tangible effects on all areas of the economy and society – including employees and consumers. The legislator has not built an adequate impact assessment of the social consequences into this hasty procedure. Climate protection is a central challenge, also for industry. We explicitly support the Paris Climate Protection Goals and are therefore actively engaged in climate protection with considerable innovation and investment. We have a responsibility for the climate, but also for the employees and their families. True sustainability takes account of the various needs. The transformation must therefore proceed in a manner that is socially acceptable.”
Right now it is crucial to improve the overall conditions for achieving the targets, and all stakeholders should concentrate on getting their tasks done:
“Germany is way ahead on the path to climate-neutral mobility. We are already European champions in electromobility, and Germany has the second highest growth of any market for e-cars. But even now Germany is not building anything like enough new charging pillars, and fossil-free electricity for charging is not yet on the horizon. The Federal Government rightly wishes to set priorities here within the ‘Climate Pact for Germany’, but concrete measures have to be taken.
“The new targets will further accelerate the transformation. But this also brings considerable burdens. All the stakeholders must now deliver more quickly, so that the companies can satisfy the targets and people are not disappointed,” said VDA President Hildegard Müller. Higher targets are one thing, but the instruments and measures necessary to achieve them are another. “We now also have to take the lead in infrastructure and investment,” Müller declared.
This means the faster expansion of eco-electricity, the faster expansion of the charging infrastructure, and the faster introduction of hydrogen and e-fuels – and, finally, faster digitization. Digitization of transport also harbors great potentials for climate protection. That will be a major task within the German Government’s ‘Concerted Action on climate-friendly Mobility.’ In particular, the booster charging infrastructure and the accelerated ramp-up of the hydrogen economy both point in the right direction.
However, it is also clear that “Climate protection costs money, so efficiency potentials must be exploited and burdens minimized. Market-economy instruments still have much too small a role in achieving the climate goals. The European Commission is planning the extension of the EU’s Emissions Trading System to include the transport sector. The German Government should also examine the use of this instrument. The Fuel Emissions Trading Act should replace the fixed-price system with a market-price system as soon as possible,” according to Müller.
“The automotive industry is already investing more than any other sector in the transformation. By 2025 the companies will invest over 150 billion euros in e-mobility, digitization, hybrid technology and the development of e-fuels based on sustainable energy sources. This equals the sum that the Federal Government is investing overall during this period in education and research, including space travel. So embracing all technologies is all the more important. All technologies are needed, and the potentials of innovations must be exploited in every field,” Müller demanded.
The transformation may have considerable impacts on competitiveness and employment. For this reason, accelerating climate protection also needs a flanking industrial policy to support the transformation process.
The sector targets set for each year in the new draft bill look like a planned economy and do not do justice to the dynamic innovation and investment activities. It is therefore the right step if – as envisaged – a report to be submitted to the Bundestag in 2028 will investigate whether we can forego the allocation of annual emission amounts for individual sectors from 2031 onward.
“In its judgment, the Federal Constitutional Court has emphasized the need for careful, long-term planning. It is therefore also important to have a detailed regulatory impact analysis in this procedure. To date this has been absent,” Müller said.