The Climate Action Programme aims at implementing a structure that is both economically sustainable and socially equitable.
A particular emphasis will be placed on reducing Germany's GHG emissions by 55% by 2030, compared to 1990 levels, as well as new incentives to cut CO2 emissions and develop new relevant technologies.
CO2 pricing will be integrated to the transport and heating sectors as of 2021; it is already in place in the buildings and transport sectors.
The national emissions trading system will be launched in 2021. A fixed price per tonne CO2 will be specified in advance. Certificates will be sold to companies selling heating fuel and fuel for vehicles. The costs of the certificates will then be carried by the fuel trade. When a company sells heating oil, liquefied petroleum gas, natural gas, coal, petrol or diesel, it will need one certificate for every tonne CO2 emitted by the products they sell.
The fixed price will initially be EUR 10 per tonne CO2, and will rise to EUR 35 per tonne by 2025. This gives all stakeholders a reliable basis on which to plan. As of 2026, the market will set the price, within a fixed band. The total quantity of certificates issued throughout Germany will be in line with the imperatives of German and European climate targets.
Subsidies will be implemented to support a greater usage of energy efficiency, build more sustainable housing and replace outdated and polluting heating systems, and support more eco-friendly transport measures.
In the transport sector, the government will also discourage the usage of carbon-heavy transport means, such as short-flights, which will include a higher VAT for flights and a lower VAT for long-distance train tickets.