Germany runs risk of missing emission-cutting targets with new government plans – climate council
Germany’s key climate advisors have said that the new government’s policy plans laid out in the coalition agreement will likely not be enough to reduce emissions in line with climate targets. They called on chancellor Friedrich Merz’s cabinet to present a sufficient climate action programme to address the projected target misses.
The Council of Experts on Climate Change assumes that the policies promised so far will not be an improvement over existing policies, or might even slightly increase emissions, depending on the details of their implementation.
“The coalition agreement does not provide any significant impetus for achieving the 2030 target,” said council co-head Brigitte Knopf.
Knopf and her colleagues highlighted several key areas that require the new government’s attention, such as measures in the transport and building sectors; the introduction of the new EU emissions trading system for these sectors (ETS 2); the projected miss of several EU and long-term national climate targets; or how to deal with the fact that Germany’s land use and land use change sector (LULUCF – e.g. forests and wetlands) has become a net carbon emitter, and looks set to remain one for the foreseeable future.
Germany's new coalition government has set out a steady but cautious path in climate and energy policy, committing to current EU targets but showing little ambition to go beyond. The coalition agreement foresees the continuation of the country’s landmark energy transition without major adjustments, but the text often lacks details regarding policies and measures.
“The coalition agreement does not explicitly address the key problem areas [identified by the council] and remains vague in many places,” said Knopf. With the coalition’s current climate plans “there is a risk that the 2030 targets will not be met and that the 2045 climate neutrality target will fall out of reach,” a council report said.
The coalition government must address the issues in a comprehensive climate action programme, which the new leadership is obliged to present within the first 12 months of the legislative period’s start, so by the end of March 2026, the council said. Relevant ministries must present first proposals for measures already by September 2025.
The council also renewed its call on the government to re-introduce the so-called “climate cabinet.” The group of ministers with responsibilities in key policy fields that interconnect with climate – from economy to transport and finance – would be tasked with resolving priority conflicts and making sure the country capitalises on mutually beneficial policy decisions.
The Council of Experts on Climate Change is tasked with assessing the emissions data and projections provided by the environment agency (UBA) every year. The agency said in March that Germany is on track towards missing crucial short-term climate targets under European Union rules, unless the government implements more effective measures and policies to reduce emissions especially in the transport and building sectors. The experts now generally confirmed the agency data.
Think tank Agora Energiewende has said that the projected EU target miss by 2030 could cost Germany 13 - 34 billion euros, as the government will have to try to purchase emissions allocations from other EU member states that overachieve their targets.
Government should introduce German CO2 floor price for ETS 2
The European Union is currently introducing a new emissions trading system (ETS 2) for the transport and building sectors. It is scheduled to take full effect at the start of 2027, but the EU could still decide to postpone it by one year – something favoured by some governments.
Researchers have warned that consumers across the union could face price jumps at petrol stations or in home heating bills once the new system takes effect. Governments are urged to increase their climate ambition – the more heat pumps replace gas heaters, the fewer emission allowances are needed and the lower the CO2 price becomes – and to set up support policies for low-income households to involve them in the transition.
“The ETS 2 is not a sure-fire success,” said Knopf at a press conference. “It is coming under pressure at European level and the German government must work to ensure that it actually starts in 2027."
As Germany already has a national carbon price for these sectors, the expert council said there is a chance that the price will actually decrease when the country switches to the EU scheme by 2027. To avoid price drops, the report proposed a national floor price.
“This would also stabilise the overall price across Europe and thus reduce the risk of upward price spikes in the EU ETS 2,” it said.
Government should clarify what it intends to do to ensure Germany can reach climate neutrality by 2045
The experts also called on the government to focus on closing the gaps towards reaching the long-term climate targets. The report said Germany is set to miss its national 2040 emissions reduction target by a lot, as well as fail to reach climate neutrality by 2045. However, the coalition agreement does not address this.
The country’s forests and wetlands are a major issue. Currently, the climate law stipulates that the LULUCF sector should make a significant contribution to emissions reduction by mid-century – balancing out unavoidable residual emissions for example from agriculture – but the outlook is rather bleak. Severe drought in 2018 and the following years led to large-scale dying of trees, making Germany’s forests net emitters of CO2. The report emphasised that it remains unclear whether the sector could once again be turned into a net carbon sink.
Drained peatlands in Germany have been a net emitter for some time, and there are efforts to re-wet them. Thus, achieving the emissions targets for the LULUCF sector “should not focus solely on forestry, but also on peatland emissions,” researcher Oliver Geden of the German Institute for International and Security Affairs (SWP) told the Science Media Centre.
In addition to these natural carbon sinks, technical sinks must also be developed. Technologies to capture carbon from the atmosphere and store it permanently “seem necessary to reach greenhouse gas neutrality” by 2045, said the experts. However, they warned against depending too much on negative emissions to reach the goal, because “the relevant technologies are still a long way from being ready for implementation in some cases.”
Experts critical of using international carbon credits
The new government has said that the EU should allow the use of CO2 reductions in non-EU countries to be counted to meet the union’s planned 2040 climate target. However, offsetting emission reductions abroad via international CO2 certificates would pose several challenges, such as the “frequent lack of quality and availability,” the experts said.
“We take a critical view of this,” said Knopf in Berlin.
Opposition from several member states to the European Commission proposal to reduce emissions by 90 percent by 2040 has sparked a debate about allowing international carbon credits, which could make it easier or cheaper to reach the target. The European Commission is expected to soon present a legislative proposal. In February 2024, it had already suggested that the target should be a net emissions reduction of 90 percent by 2040, based on 1990 levels. This was based on a recommendation from the EU’s independent scientific advisory board to have a target of 90-95 percent.
Green European Parliament lawmaker Michael Bloss has also criticised plans to allow the use of international carbon credits for the EU 2040 target. He argued that the approach could slow down necessary climate action, such as the green hydrogen ramp-up.
Climate activists called on the government to now take ambitious action. “As the next summer drought looms, the climate expert council confirms what we all already know: Friedrich Merz and his government need to outgrow themselves and change pace when it comes to climate action,” said Fridays for Future activist Linda Kastrup.
Stefanie Langkamp, policy managing director of NGO Climate Alliance Germany called for funding programmes staggered by income for renewable heating and energy-efficient building refurbishment, funding for small electric cars for people on low and medium incomes, and the expansion of public transport and rail. “This is the only way the new federal government can ensure that everyone can live and be mobile in a cost-effective and climate-friendly way,” she said. Renewable energy industry association BEE sees an opportunity in strengthening innovation and the green technology industry. “The new government is now setting the course for its energy and climate policy, which should take these forecasts seriously and use climate action as an innovation and economic booster for technologies 'made in Germany',” said BEE president Simone Peter.
