German climate and energy policy

The German government knows that a progressive climate policy is vital for a healthy economy. It leads to economic growth, employment, industrial innovation and greenhouse gas emission reductions. To achieve a low carbon growth path, Germany has set itself a set of ambitious climate and energy goals, which exceed those of the E.U.

Smokestacks Enlarge image (©

  • A 40% reduction in Green House Gas emissions by 2020 compared to 1990 levels.
  • Renewable energy will provide 18 percent of final energy consumption (35 percent renewable energy in electricity generation by 2020).
  • Energy efficiency will be doubled by 2020 compared to 1990 levels (this equals a 3 percent increase p.a.).
  • Cogeneration (combined heat and power or CHP) will generate 25 percent of electricity by 2020.
  • Renewable energies will provide for a 14 percent share in heat supply by 2020.

Germany has already met its 21 percent Kyoto emissions reductions target and in 2009, it emitted 28 percent less than in 1990.

How is Germany achieving these goals?

1. Electricity: Germany’s Feed-In Tariff System (EEG)

Germany’s feed-in tariff system encourages innovation and the development of production facilities and provides a basis for strong export capacities in the sector. Its main elements are:

  • Grid operators must give priority to renewable energy.
  • A price guarantee exists for a period of 20 years and is regularly adapted according to the market situation, technological development (degression) and energy source.
  • EEG-costs are passed on to the consumer (currently about 2 Cent/kWh for private households; the average family - with energy use of 3.500 kWh/year - pays about 6 Euro per month.
  • The EU Commission has concluded that feed-in systems lead to more efficiency and lower prices compared to quota or bonus approaches due to long-term calculations.

The EU Commission has concluded that feed-in systems lead to more efficiency and lower prices compared to quota or bonus approaches due to long-term calculations.

2. Heating and Cooling
Construction Enlarge image (© picture-alliance/dpa) The German market incentive program spent 500 million Euro on retrofitting existing buildings with heating from renewable energy in 2009, triggering an additional 2.6 billion Euro in private investments.

All buildings must now use renewable energies (biomass, solar- and geothermal energy), and financial rewards exist for feeding electricity from new combined heat and power (CHP) plants into the grid.

3. Energy Efficiency

All new and renovated buildings have achieved a 30 percent cut in energy use in 2009 since energy efficiency measures were first applied, and will achieve a further energy reduction of 30 percent by 2012.

As of 2010, new buildings may only consume 3 litres of heating oil per square metre and year, and home owners may apply for grants (worth a total of 1.4 billion Euro p.a.) and low priced credits. A further 600 million Euro p.a. is available for educational institutions for supporting energy efficiency in old buildings.

Economic, social and energy security benefits of investing in low-carbon development

As of 2009, approximately 109 million tons of greenhouse gas emissions were avoided, the total turnover (investments and operations) was 33.4 billion Euro, and 340,000 jobs had been created in Germany’s renewable energy industry.

Looking ahead

By 2020 the implementation of the climate package will have created 500,000 new jobs, and by 2030 this is set to increase to 800,000.

Germany’s share in environmental technology is 16% of the total world market.

Annual avoided fossil energy imports will be worth approximately 22 billion Euro by 2020.

Finally, estimates suggest that by 2030, Germany’s national GDP is likely to increase by around 20 billion Euro p.a. and that its national debt would be 180 billion Euro lower than without these measures.

Germany’s energy future
Enlarge image (© picture-alliance/dpa) In September 2010, a new 40-year Energy Concept for Germany was presented by Chancellor Angela Merkel in Berlin. She hailed it as "a revolution in the field of energy supply" that would create the most efficient and environmentally sound energy system worldwide in Germany.

This energy plan makes Germany the first country not only to state the goal of keeping global warming within a limited range and reducing emissions, but also to outline concrete steps for getting there.

The focus will remain on increasing the use of renewable energies further - the average share of renewable energies in the energy mix is likely to reach 18 percent or more by the end of this year.

Increasing the energy efficiency of buildings will also play a vital role, as buildings are responsible for 40 percent of our entire energy consumption and 30 percent of our greenhouse gas emissions.

To reduce carbon emissions in the transport sector and develop electro-mobility, Germany’s goal is to put one million electric cars on the streets by 2020 as well as increasing the share of biofuels.

With this energy plan, Germany’s energy supply will become the most efficient and the most environmentally sound worldwide, whilst remaining affordable for both households and businesses.

For a more detailed description of the Energy Concept

Source: GIC Washington

German climate policy


Federal Ministry for the Environment, Nature Conservation and Nuclear Safety

Federal Ministry for the Environment, Nature Conservation and Nuclear Safety

The Federal Ministry for the Environment, Nature Conservation and Nuclear Safety - in short, the Federal Environment Ministry (BMU) – is responsible for environmental policy within the German federal government. Some of its objectives are the protection from environmental toxins and radiation, wise and economical use of resources, energy and the conservation of flora and biodiversity. The overall objective of Germany's environmental policy is  sustainability. In practice, Germany strives for development that is both environmentally friendly, socially fair and economically efficient.

Federal Ministry of Economic Affairs and Energy


The central priority of economic policy - and therefore of the Federal Ministry of Economic Affairs and Energy - is to lay the foundations for economic prosperity in Germany and to ensure that this prosperity is spread broadly throughout the population. The Federal Ministry of Economic Affairs and Energy has the lead responsibility for the formulation and implementation of energy policy.