In various places, the plans for switching to electric mobility have become uncertain: In Germany, the Christian Democrats will head into the European election campaign with the demand to revise the EU’s ban on combustion engine cars. It is unclear whether and how Ursula von der Leyen, lead candidate of the Christian Democratic party family EPP, will adopt this demand as her own. Meanwhile, US President Joe Biden wants to give his country’s industry more time for the transition. Laurin Meyer from New York reports on the background to this.
Carbon prices and road tolls lead to particularly high environmental taxes – this is a common impression. Why this is not true, explains Malte Kreutzfeldt using a study by Green Budget Germany (GB), which is exclusively available to Table.Media.
Lukas Scheid also analyzes the agreement EU legislators reached on the carbon capture and storage certification for the voluntary carbon market. We also look at forest fires in Chile, climate investments in the EU, German gas imports and introduce the new chairwoman of the Committee on Climate Action and Energy in the German Bundestag.
US President Joe Biden wants to give car manufacturers significantly more time to switch to electric vehicles. This was reported by the New York Times, citing insiders. According to the report, the required tailpipe emissions for combustion engines are to fall far less than initially planned by 2030 and only increase more sharply later. The president’s main aim with the relaxation is probably to appease the car industry. However, Biden is probably also looking to score points in the election campaign – at the expense of the climate, NGOs criticize.
After all, the plan was to introduce the strictest emissions regulations ever. Car manufacturers would have had to reduce the emissions of their new vehicles in the US by 56 percent between 2027 and 2032. This was the proposal of the US Environmental Protection Agency (EPA). The aim was to encourage manufacturers to quickly ramp up production of all-electric models. It is still unclear what the specific relaxations will look like. They are expected to be finalized in March at the earliest. The current regulations will remain in force until 2026.
The EPA cannot directly dictate car manufacturers to sell a certain number of electric vehicles. However, the Clean Air Act empowers the agency to set emissions limits. Under the original requirements, companies in the USA would have had to aim for an estimated 60 percent of new cars to be fully electric by 2030 and 67 percent by 2032.
Biden’s plan is above all a concession to the automotive sector. The leading industry association in the USA, the Alliance for Automotive Innovation (AAI), called the original plans “neither reasonable nor achievable in the timeframe provided.” Above all, demand for electric cars in the USA is not growing as quickly as expected. According to data from the automotive research company “Kelley Blue Book,” almost 1.2 million electric vehicles were sold last year – an increase of around 50 percent compared to the previous year. However, this accounted for just 7.6 percent of total cars sold. The AAI itself recently proposed a target of 40 to 50 percent market share by 2030, which should include hybrid models as well as fully electric models.
A few weeks ago, around 4,700 car dealers sent a letter to the US President urging him to “tap the brakes” on the planned mandate. “We share your belief in an electric vehicle future,” the letter reads. “We only ask that you not accelerate into that future before the road is ready.” From the dealers’ point of view, the poor charging infrastructure, in particular, curbs interest in electric vehicles. According to the AAI, around 1.1 million additional charging points will be needed by 2030 to meet the forecast demand. That would equate to 414 new charging points per day.
But dealers also complain that the high purchase prices discourage buyers. Not least because the US government has tightened the requirements for qualifying for tax credits. Since this January, vehicles with batteries containing minerals from China, for example, are no longer eligible for the full tax credit of up to 7,500 US dollars. This also includes popular models such as Tesla’s 3 Rear-Wheel Drive and 3 Long Range. Many manufacturers have recently tried to stimulate demand by offering generous discounts – at the expense of their bottom line.
Upon an inquiry by Table.Media, experts from the analysis firm J.D. Power said that the impact of the planned relaxations could only be assessed once the regulations are available. Volkswagen said the EPA proposals could have led to “significant civil penalties that would have diverted resources from our massive commitment to investing in electric vehicles.” A spokesperson emphasized: “Our commitment to electrification remains strong, and there is no plan to divert resources or investment away from electric mobility.”
Manufacturers have invested massively in the expansion of electromobility. New production halls and battery plants are cropping up all over the country, partly because of the 370 billion US Inflation Reduction Act (IRA). Since it came into force in August 2022, incentives are estimated to have triggered around 161 billion US dollars in private investment in electromobility, as a recent White House overview shows. The only area in which more money (USD 235 billion) is said to have flowed is in the manufacture of computer chips and other electronics. However, some manufacturers now want to adjust their plans. Ford plans to scale back its plans for a 3.5 billion US dollar battery plant in Michigan by hundreds of jobs, while General Motors has postponed the construction of a second plant until the end of 2025.
However, Biden likely also hopes the delay will give him a significant edge in the election campaign. The powerful United Auto Workers (UAW) union, with around 400,000 members, has long debated whether to endorse the incumbent president again in the November election. Its members fear Biden’s plans to switch to electric mobility, which is supposedly less labor-intensive, will lead to massive job cuts. During its large-scale strike last summer, the UAW not only demanded generous wage increases of originally 40 percent, but also job guarantees. At the time, Biden joined the picket line in a grand gesture.
While the industry is probably pleased, climate activists are angry about the expected relaxation. “It’s not surprising that Big Auto, Big Oil and dealers have teamed up to push the EPA’s proposed emissions rules off the road,” criticized Dan Becker, Campaign Director at the Center for Biological Diversity, in a statement. What is surprising, however, is that the Biden administration is bowing to undue pressure, he said. According to the EPA calculations, postponing the sharp increase in electric vehicle sales until after 2030 would save about the same car emissions as the original proposal, the New York Times reports. According to scientific calculations, this is the decisive timeframe for meeting the 1.5-degree climate target. Laurin Meyer, New York
Despite the introduction of the national carbon price and the significant increase in the truck toll in Germany, environmental and health-related taxes and levies currently represent a significantly lower proportion of government revenue than in almost all of the past 20 years. This is the result of a new analysis by Green Budget Germany (GBG), which Table.Media has obtained in advance.
After the gradual introduction of the German green tax, the share was 9.5 percent in 2003. In 2023, it was only 6.2 percent; this year, the share is expected to rise slightly to 6.4 percent. The study thus provides an argument in support of an ecological reform of Germany’s tax system, something that scientists, authorities, environmental groups and the EU have long been calling for.
The main reason for the decline so far is that many environmental and health taxes are not levied as a percentage, but as fixed amounts. For example, German energy tax rates have remained constant over the past 20 years at 65 cents per liter of gasoline and 47 cents per liter of diesel. According to GBG calculations, the actual revenue from the energy tax has fallen sharply due to inflation. If they had been regularly adjusted to the inflation rate, revenue would be more than 1.5 times as high today – namely 55 instead of 36 billion euros.
Even all environmental and health taxes and levies combined have shown an almost continuous decline over the past 20 years when adjusted for inflation. The significant increase in the truck toll this year and the ongoing rise in the national carbon price will reverse this trend over the next few years. However, this additional revenue will only partially offset the previous decline: Even in 2028, the GBG forecast of 120 billion euros remains below the peak of 128 billion euros in 2003 (according to 2023 data).
As a consequence of this development, the think tank calls, among other things, for indexing environmental tax rates, i.e., regularly adjusting them according to inflation. GBG is not alone in this demand: Back in 2019, the Federal Environment Agency (UBA) called for energy tax rates to be “regularly adjusted to inflation in order to avoid the creeping erosion of taxation through inflation.” Sweden introduced such indexation in 1994, the Netherlands in 1999 and Denmark in 2008.
The German Environment Agency also proposes that “the tax rates for heating and motor fuels should be calculated according to the energy and, where applicable, carbon content of the individual energy sources.” For some time now, climate and energy researchers have been demanding that the carbon content of fossil fuels be used as a benchmark for taxation.
In Germany, however, there are no signs of a change. In its election program, the Green Party also declared plans to “gradually restructure the tax system to ensure a higher taxation of environmental pollution and resource consumption.” However, the Free Democratic Party has so far rejected any tax raises. However, the pressure is likely to increase due to the massive hole in Germany’s national budget next year. It would at least be conceivable to increase the tax on diesel, provided the lower rate is interpreted as a climate-damaging subsidy. After all, the Social Democrats, Greens and Free Democrats had announced the reduction of such subsidies in the government’s coalition agreement.
Carolin Schenuit, Managing Director of GBG, also hopes for progress here. “The Federal Constitutional Court’s budget ruling has massively increased the pressure on the governing coalition to act, including in terms of tax revenues,” she told Table.Media. “Now is the time to end the schizophrenia of tax policy and scrap the environmentally harmful tax breaks or reform them with an eco-positive effect.”
The EU could also add to the pressure. With the Energy Tax Directive amendment, the EU aims to align energy taxation more closely with its environmental impact. The Commission proposed in 2021 to significantly increase the minimum rates and review them regularly to align them with inflation. Furthermore, privileges for diesel, paraffin for intra-European flights and commercial energy consumers are to be abolished. In addition, the minimum tax rates are to be raised considerably – especially for fossil fuels.
However, this is highly controversial among the member states, which are solely responsible for tax policy. Next week, a working group will discuss a new compromise proposal from the Belgian Council Presidency. It will be one of the last chances to finalize the reform before the EU elections. Contributor: Manuel Berkel
A political agreement was reached between negotiators from the European Parliament, the European Commission and the Belgian EU Council Presidency in the trilogue on the certification of carbon removals on Tuesday night. The Carbon Removal Certification Framework (CRCF) is intended to promote the ramp-up of technological and natural carbon sequestration by enabling transparent and verifiable carbon removal certificates to be offered and monetized on voluntary carbon markets.
The new law distinguishes between different forms of carbon removal:
The Commission is to decide on the inclusion of avoided methane emissions from livestock farming in a revision in 2026. Captured carbon from large industrial facilities or power plants (CCSU) is not affected by the law, as these emissions are covered by the European Emissions Trading System (ETS) and do not represent direct carbon removals from the atmosphere.
The inclusion of carbon farming activities in the certification framework will enable farmers to earn money on the voluntary carbon markets in the future by switching to more climate-friendly agriculture. However, it is not yet clear when this will be possible. The exact methods for certification still have to be worked out by the Commission after the law enters into force and have to be defined by delegated acts. This will take at least two years and offers hardly any say for the co-legislators.
However, the compromise already stipulates some criteria for certification. Among other things, carbon farming activities must always make a positive contribution to biodiversity, for example, by promoting soil health and preventing soil degradation. All other forms of extraction must “do no significant harm” to the environment.
Furthermore, the additionality principle applies, clarifies parliamentary shadow rapporteur Tiemo Wölken (SPD): “The text contains enough guarantees to ensure no activity is certified that would have taken place without certification.” However, the fact that the member states could count the withdrawals from the CRCF towards their other targets, for example, the national LULUCF targets, could rightly be criticized, admits the environmental policy spokesperson for the S&D Group in the EU Parliament. The Brussels-based think tank Carbon Market Watch criticizes this as double counting. “Unfortunately, it was not possible to achieve more with the Council,” says Wölken.
Viviane Raddatz, Head of Climate Action at WWF Germany, describes the trilogue result as too imprecise and too short-term. The boundaries between carbon reduction and removals would become blurred. This could lead to a lot of greenwashing with a small and short-term impact on the climate. “This is because carbon storage in products or natural sinks, for example, through humus formation or reforestation, is subject to major uncertainties,” says Raddatz. She fears that certified and sold carbon removals will end up as emissions due to droughts and fires. A new sale of indulgences will not protect the climate.
Although Wölken supports the distinction between removal and avoidance, he also points out that emission reduction targets are defined in the Effort Sharing Regulation and the ETS, over which the CRCF has no influence. What companies are allowed to use the certificates for is currently being negotiated in the Green Claims Directive.
Peter Liese, climate policy spokesperson for the EPP, would have liked to go even further. He is calling for the inclusion of at least the technological extraction options such as DACCS in the ETS as soon as possible.
Carbon removals under the CRCF can be counted towards the EU climate targets (NDCs) deposited with the UN, meaning that double counting of certificates is also possible here. However, the EU legislators agreed that carbon removals certified in Europe may not be sold to other countries for their NDCs. This is to prevent the EU from offering other countries offset opportunities.
The trilogue compromise still needs to be formally confirmed by Parliament and the member states. The plenary is expected to vote in its last plenary session in April so that the law can be passed before the European elections in June.
Feb. 22, 4:30 p.m., Berlin
Discussion Energy security: How do we secure offshore infrastructure?
The Bundesverband Windenergie Offshore e. V. is organizing various inputs and a discussion on energy security and wind power infrastructure for the parliamentary evening at the British Embassy in Berlin. Info
Feb. 25- Mar. 1, Nairobi, Kenya
Summit meeting UN Environment Assembly 2024
The United Nations Environment Assembly meeting will address the question of how multilateralism can contribute to tackling the triple planetary crisis of climate change, loss of nature and biodiversity, and pollution and waste. Info
Feb. 27, 10:30 a.m. CET, Online
Webinar Facilitating green loans for a sustainable energy transition in Pakistan
Agora Energiewende and the Policy Research Institute for Equitable Development (PRIED) have collaborated on a study to examine tailored financing facilities aimed at boosting the expansion of distributed solar photovoltaics (DSPV) and EVs in Pakistan. This webinar will present the results. Info
Feb. 28, 2:30 p.m., Oxford/Online
Lecture Granular technologies to accelerate decarbonization
Granular energy technologies that scale through replication have smaller unit sizes and costs than lumpier large-scale alternatives. What potential do they have for decarbonization? This will be discussed in the lecture by Charlie Wilson from the Energy Program of the Environmental Change Institute at Oxford University. Info
Two years after the start of Russia’s war of aggression against Ukraine, a clear shift in German gas imports can be observed: Almost 55 percent of Germany’s natural gas imports came from Russia until 2022 and have now been replaced by other suppliers. Nevertheless, according to a study by the environmental organization Urgewald, Russian gas continues to flow to Germany and Europe – via detours.
According to official figures and own estimates, the study found that Germany’s largest gas supplier in 2023 was Norway with around 43 percent, followed by the Netherlands (26 percent) and Belgium (22 percent). In addition to raw materials from other importing countries, around seven percent of gas demand now also arrives at German LNG terminals as liquefied natural gas. Almost 80 percent of this volume comes from the USA.
Until October 2023, the Netherlands exported its own gas. Since then, the Netherlands and Belgium, in particular, have been transferring gas that arrives at their LNG terminals to Germany. According to the study, this also includes Russian LNG, which is not banned from being imported into the EU. The study estimates that around six to eleven percent of Belgian imports came from Russia in 2022, with a rising trend after that. Exact data is not available.
According to figures from the German Federal Network Agency, gas consumption in Germany declined by five percent overall from 2022 to 2023. Compared to the average of previous years, consumption even fell by 17.5 percent. The decline in imports is probably also partly due to the fact that Germany has transferred less natural gas to other countries. Citing environmental and human rights concerns, Urgewald demands that Europe phase out fossil gas entirely by 2035. bpo
According to Table.Media information, SPD politician Katrin Zschau will become the new chairwoman of the Bundestag Committee on Climate Action and Energy. The parliamentary groups have agreed to elect the Social Democrat to this position in March.
Zschau succeeds the former Left Party politician Klaus Ernst. He left the Left Party to join a newly founded political party. His position as chair of the Climate Committee became vacant because neither the Left Party nor his new party have parliamentary faction status and are therefore not entitled to chair a parliamentary committee. bpo
The EU’s CO2 fleet legislation, which mandates the end of combustion technology in new cars after 2035, is under pressure. The German Christian Democrats will enter the European elections with demands to revise the combustion engine ban. According to EU rules, the next Commission could propose revising the CO2 fleet legislation and revoking the ban on combustion engines in the process. Another possibility would be to allow manufacturers to count e-fuels towards the CO2 fleet legislation.
If the ban on combustion engines is overturned, this would have consequences for the EU’s climate targets. It would mean more vehicles with combustion engines being registered than planned and, thus, higher CO2 emissions in traffic. Unless cars with combustion engines are fueled exclusively with climate-neutral e-fuels after 2035. The CO2 fleet legislation is part of the Green Deal and ensures that the EU reduces carbon emissions by 55 percent by 2035 compared to 1990. The EU Commission aims to cut carbon emissions by 90 percent by 2040 and reach net zero by 2050 at the latest.
Ulf Neuling, Project Manager for Fuels at Agora Energiewende, believes that it does not make sense to rely on large-scale e-fuels use for road traffic. E-fuels remain “less energy-efficient, expensive and, in all likelihood, only available to a very limited extent in the coming decades.” By 2030, e-fuels could probably cover less than ten percent of European fuel consumption in aviation and maritime transport – which is why they should be used in a targeted manner, says Neuling.
It is clear that EVs are better for the climate than e-fuels: Over their entire life cycle, EVs emit 53 percent less CO2 equivalents than a combustion engine powered 100 percent by e-fuels. In addition, with an efficiency of 70 to 80 percent, EVs are significantly more efficient than e-fuel-powered combustion engines. Their efficiency is only 20 to 30 percent. mgr/kul
The EU invested 407 billion euros in climate action in 2022. This is an increase of nine percent compared to the previous year – but only half of what would be needed annually to achieve the EU’s 2030 climate targets: 813 billion. This is according to a report by the French Institut de l’Économie pour le Climat (I4CE) published on February 21. To put this into perspective: The EU provided 290 billion euros in fossil fuel subsidies in 2022.
Every year of underinvestment increases the absolute investment deficit. This makes it harder for the EU states to meet their targets of reducing greenhouse gas emissions by 55 percent by 2030. The biggest investment deficit is in the area of wind power. There is a shortfall of 74 billion euros of the required annual investment here. In the solar energy sector, the gap is eight billion euros. According to an IEA forecast, investment in wind and solar power could decline further by 2030. Only investments in hydropower (two billion euros plus) and battery storage (0.5 billion euros plus) are above the target value.
According to the report, investments are needed, for example, to keep Europe competitive as a business location, to reduce electricity prices and to ensure a reliable energy supply. To this end, the institute examined private and public investments in 22 sectors, including energy, buildings, and transportation. No data was available for other areas such as climate adaptation, industry and agriculture.
To date, the EU has not conducted a standardized assessment of climate investments. The report aims to close this gap. The authors recommend transparent and comprehensive annual EU monitoring and a long-term climate investment plan. The report further recommends reconsidering the budget rules. Germany, in particular, pushes for a strict austerity policy, which is likely to make climate investments even more difficult. lb
Drought, heat, strong winds: Current weather conditions in central Chile create ideal conditions for forest fires. However, there is currently no scientifically sound answer to whether climate change has amplified the fire weather. This is the result of a quick analysis by the World Weather Attribution Group (WWA). It regularly examines to what extent global warming increases the risk of extreme weather such as heatwaves, cold spells, heavy rainfall and droughts.
Despite the unclear correlation, the study is relevant to climate policy for two reasons:
In their analysis, the research group focuses on a coastal region of central Chile, where the cities of Valparaíso and Viña del Mar are located. The region is one of the few in the world where average annual temperatures have decreased slightly due to climate change. This could be why the local weather is not hotter, drier and windier despite global warming. However, this could change as climate change progresses – especially further inland.
Forest fires are not uncommon in Chile. But this year’s fires have been particularly destructive. The fires that broke out near Viña del Mar in early February destroyed more than 29,000 hectares of land and more than 7,000 homes, killing at least 130 people and leaving dozens still missing. The fires still rage on: As of the middle of this week, the authorities counted more than 160 fires on almost 17,000 hectares of land.
Fires are also raging in other regions of South America, for example, near the Colombian capital Bogotá. Researchers warn that the fires could soon spread to the rainforests on Colombia’s Pacific coast and the Amazon region. ae
In various places, the plans for switching to electric mobility have become uncertain: In Germany, the Christian Democrats will head into the European election campaign with the demand to revise the EU’s ban on combustion engine cars. It is unclear whether and how Ursula von der Leyen, lead candidate of the Christian Democratic party family EPP, will adopt this demand as her own. Meanwhile, US President Joe Biden wants to give his country’s industry more time for the transition. Laurin Meyer from New York reports on the background to this.
Carbon prices and road tolls lead to particularly high environmental taxes – this is a common impression. Why this is not true, explains Malte Kreutzfeldt using a study by Green Budget Germany (GB), which is exclusively available to Table.Media.
Lukas Scheid also analyzes the agreement EU legislators reached on the carbon capture and storage certification for the voluntary carbon market. We also look at forest fires in Chile, climate investments in the EU, German gas imports and introduce the new chairwoman of the Committee on Climate Action and Energy in the German Bundestag.
US President Joe Biden wants to give car manufacturers significantly more time to switch to electric vehicles. This was reported by the New York Times, citing insiders. According to the report, the required tailpipe emissions for combustion engines are to fall far less than initially planned by 2030 and only increase more sharply later. The president’s main aim with the relaxation is probably to appease the car industry. However, Biden is probably also looking to score points in the election campaign – at the expense of the climate, NGOs criticize.
After all, the plan was to introduce the strictest emissions regulations ever. Car manufacturers would have had to reduce the emissions of their new vehicles in the US by 56 percent between 2027 and 2032. This was the proposal of the US Environmental Protection Agency (EPA). The aim was to encourage manufacturers to quickly ramp up production of all-electric models. It is still unclear what the specific relaxations will look like. They are expected to be finalized in March at the earliest. The current regulations will remain in force until 2026.
The EPA cannot directly dictate car manufacturers to sell a certain number of electric vehicles. However, the Clean Air Act empowers the agency to set emissions limits. Under the original requirements, companies in the USA would have had to aim for an estimated 60 percent of new cars to be fully electric by 2030 and 67 percent by 2032.
Biden’s plan is above all a concession to the automotive sector. The leading industry association in the USA, the Alliance for Automotive Innovation (AAI), called the original plans “neither reasonable nor achievable in the timeframe provided.” Above all, demand for electric cars in the USA is not growing as quickly as expected. According to data from the automotive research company “Kelley Blue Book,” almost 1.2 million electric vehicles were sold last year – an increase of around 50 percent compared to the previous year. However, this accounted for just 7.6 percent of total cars sold. The AAI itself recently proposed a target of 40 to 50 percent market share by 2030, which should include hybrid models as well as fully electric models.
A few weeks ago, around 4,700 car dealers sent a letter to the US President urging him to “tap the brakes” on the planned mandate. “We share your belief in an electric vehicle future,” the letter reads. “We only ask that you not accelerate into that future before the road is ready.” From the dealers’ point of view, the poor charging infrastructure, in particular, curbs interest in electric vehicles. According to the AAI, around 1.1 million additional charging points will be needed by 2030 to meet the forecast demand. That would equate to 414 new charging points per day.
But dealers also complain that the high purchase prices discourage buyers. Not least because the US government has tightened the requirements for qualifying for tax credits. Since this January, vehicles with batteries containing minerals from China, for example, are no longer eligible for the full tax credit of up to 7,500 US dollars. This also includes popular models such as Tesla’s 3 Rear-Wheel Drive and 3 Long Range. Many manufacturers have recently tried to stimulate demand by offering generous discounts – at the expense of their bottom line.
Upon an inquiry by Table.Media, experts from the analysis firm J.D. Power said that the impact of the planned relaxations could only be assessed once the regulations are available. Volkswagen said the EPA proposals could have led to “significant civil penalties that would have diverted resources from our massive commitment to investing in electric vehicles.” A spokesperson emphasized: “Our commitment to electrification remains strong, and there is no plan to divert resources or investment away from electric mobility.”
Manufacturers have invested massively in the expansion of electromobility. New production halls and battery plants are cropping up all over the country, partly because of the 370 billion US Inflation Reduction Act (IRA). Since it came into force in August 2022, incentives are estimated to have triggered around 161 billion US dollars in private investment in electromobility, as a recent White House overview shows. The only area in which more money (USD 235 billion) is said to have flowed is in the manufacture of computer chips and other electronics. However, some manufacturers now want to adjust their plans. Ford plans to scale back its plans for a 3.5 billion US dollar battery plant in Michigan by hundreds of jobs, while General Motors has postponed the construction of a second plant until the end of 2025.
However, Biden likely also hopes the delay will give him a significant edge in the election campaign. The powerful United Auto Workers (UAW) union, with around 400,000 members, has long debated whether to endorse the incumbent president again in the November election. Its members fear Biden’s plans to switch to electric mobility, which is supposedly less labor-intensive, will lead to massive job cuts. During its large-scale strike last summer, the UAW not only demanded generous wage increases of originally 40 percent, but also job guarantees. At the time, Biden joined the picket line in a grand gesture.
While the industry is probably pleased, climate activists are angry about the expected relaxation. “It’s not surprising that Big Auto, Big Oil and dealers have teamed up to push the EPA’s proposed emissions rules off the road,” criticized Dan Becker, Campaign Director at the Center for Biological Diversity, in a statement. What is surprising, however, is that the Biden administration is bowing to undue pressure, he said. According to the EPA calculations, postponing the sharp increase in electric vehicle sales until after 2030 would save about the same car emissions as the original proposal, the New York Times reports. According to scientific calculations, this is the decisive timeframe for meeting the 1.5-degree climate target. Laurin Meyer, New York
Despite the introduction of the national carbon price and the significant increase in the truck toll in Germany, environmental and health-related taxes and levies currently represent a significantly lower proportion of government revenue than in almost all of the past 20 years. This is the result of a new analysis by Green Budget Germany (GBG), which Table.Media has obtained in advance.
After the gradual introduction of the German green tax, the share was 9.5 percent in 2003. In 2023, it was only 6.2 percent; this year, the share is expected to rise slightly to 6.4 percent. The study thus provides an argument in support of an ecological reform of Germany’s tax system, something that scientists, authorities, environmental groups and the EU have long been calling for.
The main reason for the decline so far is that many environmental and health taxes are not levied as a percentage, but as fixed amounts. For example, German energy tax rates have remained constant over the past 20 years at 65 cents per liter of gasoline and 47 cents per liter of diesel. According to GBG calculations, the actual revenue from the energy tax has fallen sharply due to inflation. If they had been regularly adjusted to the inflation rate, revenue would be more than 1.5 times as high today – namely 55 instead of 36 billion euros.
Even all environmental and health taxes and levies combined have shown an almost continuous decline over the past 20 years when adjusted for inflation. The significant increase in the truck toll this year and the ongoing rise in the national carbon price will reverse this trend over the next few years. However, this additional revenue will only partially offset the previous decline: Even in 2028, the GBG forecast of 120 billion euros remains below the peak of 128 billion euros in 2003 (according to 2023 data).
As a consequence of this development, the think tank calls, among other things, for indexing environmental tax rates, i.e., regularly adjusting them according to inflation. GBG is not alone in this demand: Back in 2019, the Federal Environment Agency (UBA) called for energy tax rates to be “regularly adjusted to inflation in order to avoid the creeping erosion of taxation through inflation.” Sweden introduced such indexation in 1994, the Netherlands in 1999 and Denmark in 2008.
The German Environment Agency also proposes that “the tax rates for heating and motor fuels should be calculated according to the energy and, where applicable, carbon content of the individual energy sources.” For some time now, climate and energy researchers have been demanding that the carbon content of fossil fuels be used as a benchmark for taxation.
In Germany, however, there are no signs of a change. In its election program, the Green Party also declared plans to “gradually restructure the tax system to ensure a higher taxation of environmental pollution and resource consumption.” However, the Free Democratic Party has so far rejected any tax raises. However, the pressure is likely to increase due to the massive hole in Germany’s national budget next year. It would at least be conceivable to increase the tax on diesel, provided the lower rate is interpreted as a climate-damaging subsidy. After all, the Social Democrats, Greens and Free Democrats had announced the reduction of such subsidies in the government’s coalition agreement.
Carolin Schenuit, Managing Director of GBG, also hopes for progress here. “The Federal Constitutional Court’s budget ruling has massively increased the pressure on the governing coalition to act, including in terms of tax revenues,” she told Table.Media. “Now is the time to end the schizophrenia of tax policy and scrap the environmentally harmful tax breaks or reform them with an eco-positive effect.”
The EU could also add to the pressure. With the Energy Tax Directive amendment, the EU aims to align energy taxation more closely with its environmental impact. The Commission proposed in 2021 to significantly increase the minimum rates and review them regularly to align them with inflation. Furthermore, privileges for diesel, paraffin for intra-European flights and commercial energy consumers are to be abolished. In addition, the minimum tax rates are to be raised considerably – especially for fossil fuels.
However, this is highly controversial among the member states, which are solely responsible for tax policy. Next week, a working group will discuss a new compromise proposal from the Belgian Council Presidency. It will be one of the last chances to finalize the reform before the EU elections. Contributor: Manuel Berkel
A political agreement was reached between negotiators from the European Parliament, the European Commission and the Belgian EU Council Presidency in the trilogue on the certification of carbon removals on Tuesday night. The Carbon Removal Certification Framework (CRCF) is intended to promote the ramp-up of technological and natural carbon sequestration by enabling transparent and verifiable carbon removal certificates to be offered and monetized on voluntary carbon markets.
The new law distinguishes between different forms of carbon removal:
The Commission is to decide on the inclusion of avoided methane emissions from livestock farming in a revision in 2026. Captured carbon from large industrial facilities or power plants (CCSU) is not affected by the law, as these emissions are covered by the European Emissions Trading System (ETS) and do not represent direct carbon removals from the atmosphere.
The inclusion of carbon farming activities in the certification framework will enable farmers to earn money on the voluntary carbon markets in the future by switching to more climate-friendly agriculture. However, it is not yet clear when this will be possible. The exact methods for certification still have to be worked out by the Commission after the law enters into force and have to be defined by delegated acts. This will take at least two years and offers hardly any say for the co-legislators.
However, the compromise already stipulates some criteria for certification. Among other things, carbon farming activities must always make a positive contribution to biodiversity, for example, by promoting soil health and preventing soil degradation. All other forms of extraction must “do no significant harm” to the environment.
Furthermore, the additionality principle applies, clarifies parliamentary shadow rapporteur Tiemo Wölken (SPD): “The text contains enough guarantees to ensure no activity is certified that would have taken place without certification.” However, the fact that the member states could count the withdrawals from the CRCF towards their other targets, for example, the national LULUCF targets, could rightly be criticized, admits the environmental policy spokesperson for the S&D Group in the EU Parliament. The Brussels-based think tank Carbon Market Watch criticizes this as double counting. “Unfortunately, it was not possible to achieve more with the Council,” says Wölken.
Viviane Raddatz, Head of Climate Action at WWF Germany, describes the trilogue result as too imprecise and too short-term. The boundaries between carbon reduction and removals would become blurred. This could lead to a lot of greenwashing with a small and short-term impact on the climate. “This is because carbon storage in products or natural sinks, for example, through humus formation or reforestation, is subject to major uncertainties,” says Raddatz. She fears that certified and sold carbon removals will end up as emissions due to droughts and fires. A new sale of indulgences will not protect the climate.
Although Wölken supports the distinction between removal and avoidance, he also points out that emission reduction targets are defined in the Effort Sharing Regulation and the ETS, over which the CRCF has no influence. What companies are allowed to use the certificates for is currently being negotiated in the Green Claims Directive.
Peter Liese, climate policy spokesperson for the EPP, would have liked to go even further. He is calling for the inclusion of at least the technological extraction options such as DACCS in the ETS as soon as possible.
Carbon removals under the CRCF can be counted towards the EU climate targets (NDCs) deposited with the UN, meaning that double counting of certificates is also possible here. However, the EU legislators agreed that carbon removals certified in Europe may not be sold to other countries for their NDCs. This is to prevent the EU from offering other countries offset opportunities.
The trilogue compromise still needs to be formally confirmed by Parliament and the member states. The plenary is expected to vote in its last plenary session in April so that the law can be passed before the European elections in June.
Feb. 22, 4:30 p.m., Berlin
Discussion Energy security: How do we secure offshore infrastructure?
The Bundesverband Windenergie Offshore e. V. is organizing various inputs and a discussion on energy security and wind power infrastructure for the parliamentary evening at the British Embassy in Berlin. Info
Feb. 25- Mar. 1, Nairobi, Kenya
Summit meeting UN Environment Assembly 2024
The United Nations Environment Assembly meeting will address the question of how multilateralism can contribute to tackling the triple planetary crisis of climate change, loss of nature and biodiversity, and pollution and waste. Info
Feb. 27, 10:30 a.m. CET, Online
Webinar Facilitating green loans for a sustainable energy transition in Pakistan
Agora Energiewende and the Policy Research Institute for Equitable Development (PRIED) have collaborated on a study to examine tailored financing facilities aimed at boosting the expansion of distributed solar photovoltaics (DSPV) and EVs in Pakistan. This webinar will present the results. Info
Feb. 28, 2:30 p.m., Oxford/Online
Lecture Granular technologies to accelerate decarbonization
Granular energy technologies that scale through replication have smaller unit sizes and costs than lumpier large-scale alternatives. What potential do they have for decarbonization? This will be discussed in the lecture by Charlie Wilson from the Energy Program of the Environmental Change Institute at Oxford University. Info
Two years after the start of Russia’s war of aggression against Ukraine, a clear shift in German gas imports can be observed: Almost 55 percent of Germany’s natural gas imports came from Russia until 2022 and have now been replaced by other suppliers. Nevertheless, according to a study by the environmental organization Urgewald, Russian gas continues to flow to Germany and Europe – via detours.
According to official figures and own estimates, the study found that Germany’s largest gas supplier in 2023 was Norway with around 43 percent, followed by the Netherlands (26 percent) and Belgium (22 percent). In addition to raw materials from other importing countries, around seven percent of gas demand now also arrives at German LNG terminals as liquefied natural gas. Almost 80 percent of this volume comes from the USA.
Until October 2023, the Netherlands exported its own gas. Since then, the Netherlands and Belgium, in particular, have been transferring gas that arrives at their LNG terminals to Germany. According to the study, this also includes Russian LNG, which is not banned from being imported into the EU. The study estimates that around six to eleven percent of Belgian imports came from Russia in 2022, with a rising trend after that. Exact data is not available.
According to figures from the German Federal Network Agency, gas consumption in Germany declined by five percent overall from 2022 to 2023. Compared to the average of previous years, consumption even fell by 17.5 percent. The decline in imports is probably also partly due to the fact that Germany has transferred less natural gas to other countries. Citing environmental and human rights concerns, Urgewald demands that Europe phase out fossil gas entirely by 2035. bpo
According to Table.Media information, SPD politician Katrin Zschau will become the new chairwoman of the Bundestag Committee on Climate Action and Energy. The parliamentary groups have agreed to elect the Social Democrat to this position in March.
Zschau succeeds the former Left Party politician Klaus Ernst. He left the Left Party to join a newly founded political party. His position as chair of the Climate Committee became vacant because neither the Left Party nor his new party have parliamentary faction status and are therefore not entitled to chair a parliamentary committee. bpo
The EU’s CO2 fleet legislation, which mandates the end of combustion technology in new cars after 2035, is under pressure. The German Christian Democrats will enter the European elections with demands to revise the combustion engine ban. According to EU rules, the next Commission could propose revising the CO2 fleet legislation and revoking the ban on combustion engines in the process. Another possibility would be to allow manufacturers to count e-fuels towards the CO2 fleet legislation.
If the ban on combustion engines is overturned, this would have consequences for the EU’s climate targets. It would mean more vehicles with combustion engines being registered than planned and, thus, higher CO2 emissions in traffic. Unless cars with combustion engines are fueled exclusively with climate-neutral e-fuels after 2035. The CO2 fleet legislation is part of the Green Deal and ensures that the EU reduces carbon emissions by 55 percent by 2035 compared to 1990. The EU Commission aims to cut carbon emissions by 90 percent by 2040 and reach net zero by 2050 at the latest.
Ulf Neuling, Project Manager for Fuels at Agora Energiewende, believes that it does not make sense to rely on large-scale e-fuels use for road traffic. E-fuels remain “less energy-efficient, expensive and, in all likelihood, only available to a very limited extent in the coming decades.” By 2030, e-fuels could probably cover less than ten percent of European fuel consumption in aviation and maritime transport – which is why they should be used in a targeted manner, says Neuling.
It is clear that EVs are better for the climate than e-fuels: Over their entire life cycle, EVs emit 53 percent less CO2 equivalents than a combustion engine powered 100 percent by e-fuels. In addition, with an efficiency of 70 to 80 percent, EVs are significantly more efficient than e-fuel-powered combustion engines. Their efficiency is only 20 to 30 percent. mgr/kul
The EU invested 407 billion euros in climate action in 2022. This is an increase of nine percent compared to the previous year – but only half of what would be needed annually to achieve the EU’s 2030 climate targets: 813 billion. This is according to a report by the French Institut de l’Économie pour le Climat (I4CE) published on February 21. To put this into perspective: The EU provided 290 billion euros in fossil fuel subsidies in 2022.
Every year of underinvestment increases the absolute investment deficit. This makes it harder for the EU states to meet their targets of reducing greenhouse gas emissions by 55 percent by 2030. The biggest investment deficit is in the area of wind power. There is a shortfall of 74 billion euros of the required annual investment here. In the solar energy sector, the gap is eight billion euros. According to an IEA forecast, investment in wind and solar power could decline further by 2030. Only investments in hydropower (two billion euros plus) and battery storage (0.5 billion euros plus) are above the target value.
According to the report, investments are needed, for example, to keep Europe competitive as a business location, to reduce electricity prices and to ensure a reliable energy supply. To this end, the institute examined private and public investments in 22 sectors, including energy, buildings, and transportation. No data was available for other areas such as climate adaptation, industry and agriculture.
To date, the EU has not conducted a standardized assessment of climate investments. The report aims to close this gap. The authors recommend transparent and comprehensive annual EU monitoring and a long-term climate investment plan. The report further recommends reconsidering the budget rules. Germany, in particular, pushes for a strict austerity policy, which is likely to make climate investments even more difficult. lb
Drought, heat, strong winds: Current weather conditions in central Chile create ideal conditions for forest fires. However, there is currently no scientifically sound answer to whether climate change has amplified the fire weather. This is the result of a quick analysis by the World Weather Attribution Group (WWA). It regularly examines to what extent global warming increases the risk of extreme weather such as heatwaves, cold spells, heavy rainfall and droughts.
Despite the unclear correlation, the study is relevant to climate policy for two reasons:
In their analysis, the research group focuses on a coastal region of central Chile, where the cities of Valparaíso and Viña del Mar are located. The region is one of the few in the world where average annual temperatures have decreased slightly due to climate change. This could be why the local weather is not hotter, drier and windier despite global warming. However, this could change as climate change progresses – especially further inland.
Forest fires are not uncommon in Chile. But this year’s fires have been particularly destructive. The fires that broke out near Viña del Mar in early February destroyed more than 29,000 hectares of land and more than 7,000 homes, killing at least 130 people and leaving dozens still missing. The fires still rage on: As of the middle of this week, the authorities counted more than 160 fires on almost 17,000 hectares of land.
Fires are also raging in other regions of South America, for example, near the Colombian capital Bogotá. Researchers warn that the fires could soon spread to the rainforests on Colombia’s Pacific coast and the Amazon region. ae