Emissions from Germany’s industry and energy sectors have almost halved since the introduction of the European Emissions Trading System 20 years ago, the Federal Environment Agency (UBA) has announced. During that time, Germany saw a 47 % drop in emissions from energy-intensive industries and the energy sector. Across Europe, ETS emissions have fallen by 51 % during the same period, reports online agency Clean Energy Wire.
“Since its introduction, emissions trading has gradually developed into the central climate protection instrument in Germany and Europe,” said UBA head Dirk Messner. The energy sector has driven the emissions decline in Germany, cutting greenhouse gas emissions by 54 % since 2005. UBA attributes this recent progress to the growing share of renewable energies, the decline in electricity generation from coal and lignite, and the increase in net electricity imports from other countries.
“Embedded in an effective mix of [financial] instruments, emissions trading will make a significant contribution to achieving the legal climate targets of Germany and the EU,” said Daniel Klingenfeld, who heads the emissions trading authority division at the UBA. The ETS market mechanism creates an incentive to reduce CO2 by requiring emitters to buy or receive allowances corresponding to their emissions, thus making the combustion of fossil fuels more expensive. The EU sets a cap on how much CO2 can be emitted, and reduces the maximum amount each year. Emissions from internal European air transport and maritime transport were added to the ETS in 2012 and 2024 respectively. A reformed ‘ETS 2’ will cover the entire heating and transport sector by 2027.
Around 85 % of German emissions are covered by carbon pricing systems – the EU ETS, together with Germany’s national carbon price, which currently covers emissions from heating and transport. The proceeds from this levy are the main source of funding for the special ‘climate and transformation fund’, which is used to finance energy transition projects. However, Germany is at risk of missing emission-cutting targets with the new coalition government’s declared climate policy plans, the country’s key climate advisors have warned.
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