Germany faces tough coalition talks, including climate and energy issues

About one month after the federal elections, exploratory talks have started on Wednesday (Oct. 18) to build a new governing coalition for Germany. The elections in September have led to an intricate situation as there is no possibility to form one of the classic coalitions. Despite having lost a significant number of votes, the conservative party of chancellor Angela Merkel has won the elections (see figure below) and is now forced to form a coalition with the liberal party FDP and the Green Party, named as the “Jamaica”-coalition due to the colours of the involved parties. The three parties now face difficult negotiations. Many controversial issues have to be resolved, including on climate and energy policy.

A new start in German climate and energy policy is urgently required. Germany is set to miss its 2020 climate target of reducing GHG emissions by 40 percent compared to 1990. According to the Federal Environment Ministry, emission reductions are projected to be of around 32 percent below 1990 levels. The gap is attributed inter alia to unexpected strong economic growth, population growth and immigration. But also the high emissions from coal-fired power plants play a role in this relation, as coal accounts for around 40 percent of the German electricity mix. In addition, Germany risks missing its renewable energy target under the EU Renewable Energy Directive, as Reuters reported.

Therefore, the new coalition government has to make headway on climate and energy policy. However, the involved parties have very different views when looking at their election programmes. Whereas the FDP demands an adjustment of the German climate targets to the European ones, the Green Party advocates for an upward adjustment, implemented in a climate law. The CDU/CSU remain committed to existing targets.

Considering energy policy, conservatives are satisfied with the status quo, after the latest revision of the renewable energy law that introduced tenders and expansion targets for renewable energies. Regarding coal power, the CDU/CSU refers to the need of a complete decarbonisation until the end of the century. But it also wants to implement the Climate Plan 2050, which was agreed upon in the last legislative period and which foresees an impartial commission on coal for a reasoned transition. On the contrary, the FDP campaigned for a market-based environmental protection. Thus, it is against any subsidies for renewable energies and wants to abolish the renewable energy law. Fossil fuels are seen as indispensable in the foreseeable future. Instead, the EU Emission Trading Scheme shall become the main steering instrument for climate policy. The Green Party contrasts this position, calling for the goal of 100 percent electricity from renewable energies and the phase out of coal power by 2030.

Also on transport, differences are quite significant. The Green Party demands a modal shift to public transportation and cycling as well as phasing out the sale of cars with internal combustion engines by 2030. The liberal party refuses any forced introduction of electric vehicles and the CDU/CSU rather see the diesel engine as a solution for climate mitigation.

Therefore, it will be difficult for the involved parties to come to an agreement on climate and energy. Tax policy as well as migration and security policy are considered to be substantial obstacles to be cleared out of the way. However, there are ways to find compromises. All parties are for instance committed to the Paris Agreement and a reform of the EU ETS with the introduction of a price floor might also be acceptable for all parties. Angela Merkel, often nicknamed as the “climate chancellor”, might also be crucial for pushing climate policy in the negotiations. Indeed, Merkel has promised that the new government will have to find ways to meet the country’s climate targets. But her position has been weakened by the poor election result of her party.

(Image: Dome of the Reichstag Building, Berlin. Photo credit: Nikky/Flickr)