25 May 2023, 13:28
Sören Amelang

Germany could launch new attempt to return CO2 income to citizens – media report

Tagesspiegel Background

The German government could revive the neglected idea of returning revenue from the national carbon price on transport and heating fuels to the population to help lower income households, reports energy and climate newsletter Tagesspiegel Background. Responsibility for the mechanism, which is known as a “climate bonus,” has been moved from the finance to the labour ministry, government sources told the publication. The labour ministry set up an interdepartmental working group with a brief to prepare the "political decision-making process" on a possible design, a ministry spokesperson said, but didn’t give any details on the timetable of the working group. However despite the working group, it remains totally uncertain whether a “climate bonus” will be introduced.

In their coalition agreement, the three government parties said they would develop a “climate bonus.” However, it remains unclear how the money could be distributed, because Germany lacks a system via which all residents could be paid. This was a problem during the energy crisis because the government struggled to find a mechanism to support citizens, who ultimately received subsidies via their energy bills. A year ago, the coalition said it would develop a payment method via the tax ID in order to enable a simple and unbureaucratic way for direct payments to citizens, but the government let the issue slide. The current government spat over how to organise the phaseout of fossil fuel heating systems has directed new attention to the idea, because raising the country's CO2 price could be an alternative approach which would bet on market forces instead of regulations.

Last year, the government took in 6.8 billion euros from the EU’s emissions trading, and 6.4 billion euros from the national scheme, according to the report. But at present, there is no money to distribute left, because it has already been earmarked for other purposes.

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