German states’ climate advisors urge policymakers to seize €500bln special fund’s “historic opportunity”

In a first joint appeal, the climate advisory councils of Germany’s states have urged policymakers to use the “historic opportunity” offered by the country’s 500-billion-euro special fund for infrastructure and climate neutrality to advance coherent emissions reduction and climate adaptation measures. 

Ahead of a meeting of the states’ finance ministers, the councils said the debt-financed package - the largest in Germany’s history - must be used to strengthen economic competitiveness, public well-being and deliver effective climate action systematically.

Climate advisory councils currently exist in 11 out of Germany’s 16 states. The expert bodies, made up of researchers and specialists from various fields, advise state governments on how to implement scientific findings in policymaking. The advisors said they “explicitly” offer their assistance to state administrations, which will receive 100 billion euros from the fund directly to finance their own projects.

All investments made under the special fund must be compatible with the states’ and the federal government’s climate targets, the councils said. Infrastructure projects should also be designed to withstand the impacts of global warming, including more frequent floods, droughts and other extreme weather events.

“Investment decisions that are being taken today will affect our infrastructure for decades,” said economist Karen Pittel from the ifo institute and member of Bavaria’s climate council. “These need to be consistently aligned with climate neutrality and resilience, otherwise they will turn into a costly risk.” 

Kai Uwe Totsche, hydrogeology researcher from the University of Jena and member of Thuringia’s advisory board, called on Germany to aim for technological leadership in climate adaptation. Investments should include better data collection on climate impacts on transport, buildings, and the energy system as well as more research and education, he said. 

The councils identified focus areas for investments included renewable energy expansion, grid modernisation, clean and integrated mobility, climate-resilient infrastructure, nature-based solutions and a general push in research and innovation to support these sectors from the ground up. “Targeted investments in these areas not only strengthen climate action, but also industry, local value creation and the quality of life,” the advisors argued. 

The councils said the role of municipalities is central to the success of the special fund’s investments. “Municipal climate action is public welfare, secures social cohesion and protects local economies,” said Maike Schmidt, head of the climate council of Baden-Wurttemberg and researcher at the ZSW institute. 

The government has been criticised for using the debt package that is meant to provide additional funds to infrastructure modernisation and climate neutrality over one decade to shift expenses from the core budget and direct funds at projects that do not serve the target. Germany’s national Council of Economic Experts (“Wirtschaftsweise”) warned in late 2025 that spending from the fund must be “additional and productive.” Otherwise, it could undermine short-term growth potential and threaten the country’s long-term debt sustainability.