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08 Feb 2021, 13:09
Kerstine Appunn

German govt allocates €6 bln to building efficiency, hopes for EU-wide CO2 price

Clean Energy Wire

The German government has earmarked six billion euros for building insulation and heating modernisation in 2021 to achieve its emission reduction targets. “The low-hanging fruits in the building sector have already been harvested and in other areas, for example new insulated roofs, there are very long amortisation times for investments,” minister of economic affairs Peter Altmaier said at a conference. In addition to the modernisation incentives, Altmaier named reducing the power price and the introduction of a CO2 price in the building and transport sectors as the most important policies to achieve change in the heating sector. “We have known from the beginning that we would achieve our climate goals in the energy sector but it was always clear that we would have a harder time achieving them in the building and transport sectors. That's why it makes sense to make electricity cheaper and to set additional fuel saving incentives in these sectors through CO2 pricing.” Altmaier said he hoped that the EU’s new 2030 climate target would result in a bloc-wide carbon price in all sectors.

The take-up of subsidy programmes to modernise buildings and heating systems has picked up considerably in the past year. The total number of applications for the economy ministry’s building efficiency programmes almost doubled from 2019 to 2020 due to the improved funding conditions - from 326,000 in 2019 to 600,000. The increase would double the subsidy-related CO2 savings to 14 million tonnes by 2030 compared to figures quoted in earlier expert studies, the ministry said.

The heating sector accounts for over one third of Germany's primary energy consumption, and for years has been sluggish to accomplish any major improvements in terms of greenhouse gas emission reductions. In order to boost the clean energy transition in buildings, the government increased funding for energy efficiency refurbishments from 1.85 billion euros in 2019 to 8.6 billion euros in 2020.

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