European Green Deal: the role of the state and companies in the ecological transformation Panel I of the “Designing climate policies” series of events hosted jointly by the Deutsche Bundesbank, the Center for Liberal Modernity and the Potsdam Institute for Climate Impact Research
The framework for business decisions is undergoing dynamic change, not least in response to climate policy and regulatory requirements. Society has become significantly more supportive of climate protection over recent years, with political parties organising their manifestos around this topic. Furthermore, the Federal Constitutional Court has judged that some parts of the Federal Climate Change Act (Klimaschutzgesetz) from 2019 were unconstitutional, prompting the Federal Government to fast-track amendments to this legislation in May 2021 and raise the emission reduction target for 2030 to 65%. The goal is for Germany to achieve climate neutrality in 2045, rather than in 2050. Implementation of these objectives will be supported by the European Green Deal, for which the EU will be presenting further implementation concepts this summer.
Businesses and the general public face considerable challenges: to achieve climate neutrality by 2045, it will be necessary to step up the pace at which reductions are achieved. Germany managed to reduce emissions by 40% between 1990 and 2020, but according to the current objectives, the reduction will need to be half as big again over the next 25 years. While renewable energy accounts for half of the electricity generated, it represents only 20% of total final energy consumption. This means that 80% of the path still needs to be taken in terms of energy. Sectors such as the building stock account for a large share (just under 40%) of total emissions, but low or zero carbon retrofits are anything but easy. In energy-intensive sectors such as the chemicals and steel industries, climate neutrality can only be achieved by embracing fundamental process innovations that will call for enormous investment.
This first panel in the series of events addresses key issues in the debate surrounding the implementation of climate targets: How can government measures and private sector action best be balanced? Who should bear the risks and costs of the transformation? Which policy instruments are suited to correcting market failures in the field of climate protection?
Panel I – online event on 29 June 2021, 17:00-19:00 (CEST)
Event language: German
“European Green Deal: the role of the state and companies in the ecological transformation”
Dr. Sabine Mauderer
Founder and Managing Director of the Center for Liberal Modernity
Dr. Patrick Herhold
Professor Dr. Monika Schnitzer