After 16 years of governing, Germany’s Chancellor, Angela Merkel, steps down to make way for a new government. We look back at the environmental and sustainable policies of the ”Merkel era” and what changes might come with new parties in charge. 

Very few chancellors in Germany’s post-war history have left such a mark as Angela Merkel. As the first woman in charge of Europe’s biggest economy, Merkel and her centre-conservative party, CDU, stood for 16 years of stability, pragmatism, and a solidified position for Germany on the political and economic world-stage. 

Amongst the many crises Merkel had to steer her country and the EU through was climate-change. As a consistently market friendly politician, she, her CDU party and her coalition partners – made up mostly from the Social Democratic Party (SPD), along with 4 years with the Free Democratic Party (FDP) – promised a fast transition into a greener future. 

So, what did Markel actually achieve with her climate-policies, and what will the future hold for the German industry in this regard?

Merkel’s Climate Change Goals and Results

Early in her role as leader of Germany, Merkel was given the nickname “die Klimakanzlerin”, the climate-chancellor. As one the original signatories of the Kyoto-Protocol, she formulated the ambitious goal of cutting global greenhouse gas emissions by 5.2 percent until 2012. Additionally, the Paris Climate Agreement from 2015 was signed during her term of office.

And truly, Germany was able to cut its overall emissions by 41% in 2019 when compared to the year 1990. However, this seemingly impressive achievement comes with an asterisk. 

In 2017, it didn’t appear that Germany would reach its ambitious goal, with a reduction of only 28%. And yet, the Covid-19 pandemic and the consequent lockdown would end up accelerating CO2-reduction unexpectedly. Also, Merkel’s planned coal phase-out has been heavily criticized nationally, as the termination date is set for 2038 and not earlier, along with her lax handling of Germany’s biggest greenhouse gas emitter, but also largest industry, the automotive sector.       

Even in her last Summer press conference the departing chancellor regretted not having done enough to fight climate change. 

A New German Government, A New Beginning?  

As for now, Germany will be getting a new government after election day on September 26th. The country has a parliamentary system, with not just one party in charge, requiring a coalition to be forged to achieve the needed majority in the Bundestag. 

The most likely coalition would consist of the Social Democrats, Green Party, and Free Democrats, making it the first social-environmental-market-liberal government in Germany’s history. All three parties have big ambitions and goals when it comes to fighting climate change:

The SPD, party of chancellor candidate Olaf Scholz, aims to make Germany climate neutral by 2045 with electric power supplied completely from renewable sources by 2040. Furthermore, the Social Democrats want to fund development of hydrogen technologies as well as the expansion of battery charging stations, make the housing and mobility sector more CO2 neutral, with lower prices for international train travel within Europe. A highly controversial goal of the SPD is the implementation of a speed limit of 130 km/h on the Autobahn, which has always been known for speed limit free sections that are quite popular with drivers and the automotive sector.

The Green Party seeks similar goals, though more far-reaching. By their plan, Germany shall reach climate neutrality and coal phase-out by 2030/2035, so-called “Green Jobs” shall be subsidized, climate-friendly households would get tax reliefs, and the mobility sector would undergo changes. Up to 100 billion Euros are supposed to finance further development of the railway system, the speed limit shall also be reduced to 130 km/h, and recharging stations for e-cars would become widely available in the countryside. One of the biggest goals of the Green Party is to make short-haul flights redundant by offering cheaper, faster train connections both nationally and Europe-wide.

As a liberal party, the FDP’s plan to fight climate change is mostly focused on new technologies and the free market. Also, the Free Democrats want to achieve their goals later than their potential partners, eyeing 2050 for total climate neutrality. To achieve this, the party wants to offer buyers premiums for e-cars, fund hydrogen technologies, and further develop public transport. Yet, there are major differences in the market-liberal approach. For example, the FDP is strictly against a speed limit and a ban on combustion engines vehicles, and the German rail traffic, currently run by the state-owned Bahn railway company, shall be privatised to create more competition.

Potentials for a new Green German Economy             

As of mid-October, 2021, it seems very likely that the so-called “traffic light coalition” (due to the three parties’ colors of red, yellow and green) will be governing Germany by the end of the year. In several rounds of negotiations, all three parties found some common ground and compromises for differences.

For example, the SPD and Green Party decided against a speed limit for now, yet the coal phase-out stays fixed for 2030. All the coalition partners come together though when it comes to climate change and enabling a German economy that is built upon sustainable technologies and energies.  

Nobody knows what the future will hold for Europe’s biggest economy after the relatively market-liberal chancellor Angela Merkel. But at the moment, the coming years under a new government promise more excitement than 16 years of stability. 

By Manuel Schellhardt