05 Jun 2020, 15:13
Sören Amelang

Reactions to Germany's stimulus programme and its climate effects

The German government coalition has decided to reboot Europe's largest economy with a 130 billion euros stimulus package that contains many steps to further the country's landmark energy transition. The Clean Energy Wire presents first reactions to the programme in this compilation. Our main coverage of the topic can be found here. (Updates media reactions)

Media reactions: tageszeitung, Frankfurter Allgemeine Zeitung, Süddeutsche Zeitung

The German government’s decision to focus its 130 billion euro economic stimulus programme on future, more climate-friendly technologies such as e-cars and to snub the carmakers lobby was a watershed moment for the industry and the country, commentators in German media said. The fact that the governing coalition rejected the call for a general buyer’s premium that included combustion engine cars showed that the “almost unlimited power of the car-lobby has been broken”, writes Malte Kreutzfeldt in left-leaning daily taz. The sums and ambitions in the plan were still too small to tackle the climate crisis. But in light of the discussions in the run-up the programme was a positive surprise from an ecological point of view. 

Many commentators took a largely positive view of the plans, noting the general shift away from the dominant tight fiscal policy of the past decade. However, Heike Göbel, for leading conservative daily Frankfurter Allgemeine, called the package “oversized”. She also criticised that the decision to lower the renewables levy with support from the federal budget failed to fix the underlying problem. Göbel also applauded the decision to stay away from a buyer’s premium for cars. Max Hägler argued in Süddeutsche Zeitung that car managers had sealed their own fate by calling for state support while still defending payouts to shareholders.

Green Mobility NGO Transport & Environment (T&E)

“After France now Germany is pointing the way forward with massive investments in electric cars, recharging infrastructure and railways," said Stef Cornelis, T&E Germany director. "This is exactly what's needed to support jobs and help us emerge stronger and greener from the COVID crisis. The plan isn't perfect but it should be a wake-up call for the Commission and other European countries ahead of the all-important decision on the EU's €750 billion recovery and resilience fund.” However, T&E said the plan to spend 1 billion euros of taxpayers’ money on new planes is misguided. "Airlines should pay for them out of their own pockets. Instead, Germany should go all in on greener jet fuels, such as synthetic fuel, which actually have the potential to substantially reduce aviation emissions."

German Association of Energy and Water Industries (BDEW)

Kerstin Andreae, head of utilities association BDEW, said the stimulus programme had the potential to provide a "significant economic boost" while "accelerating the move towards a more sustainable economy". She welcomed decisions in the areas of sustainable mobility, hydrogen, and the expansion of renewable energies. Remaining hurdles to wind power and solar PV expansion, however, still needed to be removed, she added. A "drastic increase of the renewables levy has been avoided", said Andreae, adding a more drastic reduction would have been even better. BDEW also welcomed the boost in building modernisation programmes as further incentives were needed for greenhouse gas reduction in the heating sector.

German Association of Local Utilities (VKU)

Michael Ebling, president of the German Association of Local Utilities (VKU), said the German government coalition had shown "courage and foresight" with its stimulus programme. Besides considerable support for citizens, investments particularly in climate-friendly technologies were substantial, added Ebling. He "expressly welcomed" this approach as "climate action and economy must be considered together." For the local utilities, support for a national hydrogen strategy, the expansion of electric mobility, digitalisation, research programmes and artificial intelligence were among the most important measures. VKU also welcomed the planned cap on the renewables levy, but added that in the long term, a more robust system able to respond to economic development and with a stronger steering effect towards climate-friendly technologies was necessary.

Federation of German Industries (BDI)

"The planned increase in support for new technologies in central areas such as mobility and climate protection is constructive," said BDI president Dieter Kempf. "These are strong industries, which will be further strengthened by the package. It is it is good that the Federal Government wants to pursue the announced hydrogen strategy. However, in this case it must become more binding during this legislative period." Kempf also welcomed increased investments in public infrastructures, but added these must be implemented rapidly, and that infrastructure expansion must become "better and faster."

Association of German Chambers of Commerce and Industry (DIHK)

The DIHK welcomed the cut of the renewables levy as a step to increase companies' liquidity. DIHK president Eric Schweitzer also said investment incentives resulting from an increase in support for research and new depreciation rules were "very positive and forward-looking," adding that overcoming the epidemic will take years rather than months. "Given the wide range of public investments by the federal government, states and local authorities now announced, especially in the area of new technologies and mobility, it is not only the money that counts," Schweitzer warned, adding that the promised investment funds could only provide an effective stimulus if planning procedures were also accelerated as planned in the coming months. 

Business climate initiative Foundation 2° (Stiftung 2°)

"The government is making climate policy an important pillar of its recovery package and is thus using climate protection as an economic stimulus," said Sabine Nallinger, Director of business climate initiative 2°. "It is also clear, however, that the government is not sufficiently exploiting the economic potential of climate policy measures, and that the measures contained in the economic stimulus package do not have the ecological steering effect needed to transform the economy towards climate neutrality. The government must make further progress in this area and closely link economic policy measures to overcome the corona and climate crisis. Climate protection must be kept at the top of the agenda as a driver of innovation and growth. The implementation of the German government's economic stimulus package must be transformed into a climate economic stimulus programme in which the German government closely intermeshes its national action with the European level. The aim must be to formulate an ambitious Green Deal as a European response to the consequences of the Corona crisis as part of the German EU Council Presidency."

German Industry Initiative for Energy Efficiency (DENEFF)

"The measures are the first step of a marathon - an enormous social effort towards a sustainable economic recovery," said Christian Noll, director of the German Industry Inititative for Energy Efficiency (DENEFF). "However, further efforts are needed, especially in the area of energy efficiency." DENEFF said what's necessary are more specific measures to increase energy efficiency, especially in industry, through digitization or for sustainable financing models. "The good news: climate protection solutions Made in Germany have long been available. Here, domestic value creation, the creation of sustainable jobs and climate protection can be ideally combined. It is now up to the Federal Government to implement and further develop the economic stimulus package in such a way that demand for this is supported as specifically as possible," Noll said in an emailed statement.

NGO Environmental Action Germany (DUH)

"The Grand Coalition's decision to build up green hydrogen production points in the right direction," said Sascha Müller-Kraenner, director of NGO Environmental Action Germany (DUH). "Although the roll-out of a larger electrolysis capacity of 10 gigawatts by 2030 would be desirable, this decision [to build up 5 GW by that date] finally puts an end to months of delays to the urgently overdue National Hydrogen Strategy as a central component of the energy transition. This also means a rejection of blue hydrogen, which is produced from fossil natural gas by means of CO2 capture and storage. Ultimately, the success of the hydrogen strategy will be decided by the expansion of renewable energies: For the planned electrolysis capacity, the expansion of onshore and offshore wind must be further accelerated."

Climate think tank E3G

“It’s very encouraging to see how prominently climate protection measures feature in the German stimulus package," said E3G researcher Felix Heilmann in an emailed statement. "The package opens the door for a resilient and sustainable recovery, setting an important precedent for the German EU Presidency and the implementation of the European Green Deal. Moving forward, it is important to ensure that the opportunities made available through the package are also fully used, which, for example, requires an accelerated deployment of energy efficiency measures.”

Institute for Economic Research (ifo)

"We welcome that climate-friendly future technologies and infrastructures are explicitly taken into account," said ifo climate expert Karen Pittel in an emailed statement. She added the government's refusal to introduce a buyers' premium for all types of cars and limiting the renewables levy to keep power prices in check are positives from a climate policy view. "However, the government missed the opportunity to establish the compatibility of German and European climate targets as a cross-cutting issue of the stimulus package, as climate protection continues to be seen as industry and sector-specific. Although the EU Green Deal requires Germany to step up its climate protection efforts, the stimulus package only makes limited use of the opportunity to make the recovery compatible with it."

Energy transition think tank Agora Energiewende

“It ist great that the German government has earmarked about 40 billion euros for climate action," said Patrick Graichen, head of energy transition think tank Agora Energiewende. "This may not be the 100 billion euro Agora Energiewende has proposed. But the package contains many useful elements, including the promotion of hydrogen, e-mobility and building renovation. A downside is that the VAT reduction also applies to petrol, diesel and heating oil. The measures to lower the electricity price for consumers can at best be a first step. What we actually need is a comprehensive reform that will make electricity cheaper from 2022 on and, via the CO2 price, fossil fuels more expensive.”

Greenpeace Germany

"This stimulus package is pale green at best," said Greenpeace climate expert Tobias Austrup in an emailed statement. "Some sensible investments in climate protection are overshadowed by many measures that distribute money in a lump sum with the watering can, such as the lowered value-added tax. The necessary green line remains far too vague. The German government is thus missing a historic opportunity for an ecological recovery. The combustion engine is the big loser of today's decision. The technological phase-out model has lost political support. Even the ecologically absurd increase in the premium for hybrid vehicles does not change this. Now parliament must rescue the ecological potential of the package and, for example, accelerate the expansion of renewable energies. The members of parliament have the chance to turn this pale proposal into a programme for a sustainable economy and a clean environment after all."

Environmental NGO umbrella group DNR

"We are very relieved. Despite all the detailed criticism, not only has the worst been prevented here, but many sensible things to protect the climate have been started," DNR said on Twitter.

All texts created by the Clean Energy Wire are available under a “Creative Commons Attribution 4.0 International Licence (CC BY 4.0)” . They can be copied, shared and made publicly accessible by users so long as they give appropriate credit, provide a link to the license, and indicate if changes were made.
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