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“The climate package is a document of political despondency. With this decision, the German government will not achieve the climate targets it has set itself for 2030. Even if the architecture of a comprehensive carbon pricing system becomes visible – entry with a fixed price, a national emissions trading scheme for transport and heating in the medium term and integration into the EU Emissions Trading System in the long term – the price path is too low and does not extend far enough into the future to have a steering effect. By contrast, a sensible entry price is 50 euros per tonne of CO₂ and rises to 130 euros by the end of the next decade, i.e. 2030. The carbon price should be the core instrument of climate policy, but now it only has an alibi function. So there is a huge gap between the carbon price that is necessary and the price that is now being envisaged. It is unrealistic to close this gap within the framework of the planned monitoring process.

The Grand Coalition has not delivered on this central issue. This fact cannot be concealed by the large number of funding programmes announced – taken together, they will at most produce half of the CO₂ reduction that has been agreed under the legally binding EU Effort Sharing Regulation. This does not avert the risk of multi-billion fines. Today, the Federal Government fails to give us and future generations the decisive answer to the question of ambitious climate policy."

Weblink to the CO2 pricing report commissioned by the German government and delivered by Ottmar Edenhofer and his climate economics team in July: https://www.pik-potsdam.de/news/press-releases/pik-and-mcc-contribute-to-climate-policy-special-report-for-german-government