REACTION: Germany’s latest projections

The publication of Germany's latest emissions projections show the German government is slowing down the energy transition and moving further from its climate targets. As a result, Germany will remain dependent on expensive, unreliable imports of oil and fossil gas for longer.

The projections in the climate report presented by the Environment Minister on 12 March 2026, show Germany's 2030 climate target—a 65% reduction below 1990 levels—is drifting further out of reach than it was a year ago.

The assumed slower future expansion of offshore wind, longer lifetimes of fossil fuel heating systems and slower future sales of electric cars have led to a widening of the emissions gap from 25 to 30 MtCO₂e in 2030. The growing emissions gap also threatens to undermine Germany’s legally binding commitment to reaching climate neutrality by 2045.

The government’s climate policy package puts it at risk of facing legal action: the Climate Protection Act requires the government to submit a plan that ensures its climate targets are achieved. It has until 25 March 2026 to do so. The government also faces liabilities worth tens of billions of euros if it fails to meet the EU’s emissions target for buildings and transport. The cumulative emissions gap between Germany's policies and its targets in those sectors has widened by around 10% compared to the previous year (by 29 MtCO₂e to 255 MtCO₂e).

The real cause of the dilemma is a deliberate structural flaw: while responsibility for climate protection lies with the Environment Minister (Social Democrats), the power to implement policy measures lies with the Conservatives within the coalition government: the Minister for Economic Affairs, the Transport Minister, and the Agriculture Minister, all backed by Chancellor Merz, himself a Conservative.

Over the past year, the German government has mainly discussed and adopted measures that slow down the energy transition and, as a result, lead to higher, not lower, emissions. These measures have not yet been factored into the projections.

• The government supported the EU scrapping the rule to phase out internal combustion engine vehicles, meaning that vehicles with significant emissions may still be registered from 2035 onwards. The government also introduced new fossil fuel subsidies for agricultural diesel and aviation.
• The government presented key points for a new building modernisation law that allows for more newly installed oil and fossil gas heating systems than before.
• Uncertainty around the expansion of renewable energy has increased, which will slow buildout: solar subsidies are to be scaled back, while it is planned to no longer guarantee the purchase of electricity from new plants, but made dependent on grid capacity.
• The government is supporting fossil gas by reducing gas prices more than electricity prices (the gas storage levy is now paid for from general tax revenue, rather than being added to the gas price), planning more gas-fired power plants than before, and granting licences for new gas fields in Germany.
• The German government supported the EU to allow for the achievement of the 2040 target not only reductions of own emissions, but also to again allow the use of international carbon credits, undermining the EU's ability to reach net zero domestically.
• Chancellor Merz called into question the backbone of EU climate policy—the EU Emissions Trading Scheme—which promptly drove prices down, as market participants anticipated regulatory weakening.

“Germany has both the opportunity and the obligation to reverse recent climate policy rollbacks in its Climate Action Plan next week,” says Finn Hossfeld, CAT country expert for Germany. “Achieving Germany’s climate targets hinges on strengthened efforts to reduce emissions in the power, transport and buildings sector.”

“As it stands, the only planned policy with potential to reduce greenhouse gas emissions in Germany is the planned reinstatement of electric car subsidies, but this move is likely undermined by the EU’s proposed rollback of its vehicle emissions standards and combustion engine phase out.”

Greenhouse gas emissions in 2025 were marginally lower than in 2024, following a decline in industrial production that was mostly offset by rising emissions from transport and buildings. While emissions from the transport (+2.1 MtCO₂e) and buildings (+3.4 MtCO₂e) sectors rose again in 2025, the buffer for meeting the EU’s climate targets is shrinking.

“The introduction in the Climate Protection Act that one sector’s overperformance can compensate for the underperformance of another is proving to be a dangerous illusion that jeopardises Germany’s climate targets” says Jan-Luka Scheewel, CAT Germany country expert.

“Rather than pursuing targeted, ambitious reductions in all sectors, the German government is relying on advances in a few sectors to compensate for continued shortfalls,” continues Scheewel. “This approach is unsustainable. In 2025, the energy sector barely delivered additional reductions, and the latest projections suggest that its outsized contribution to economy-wide emission reductions will shrink through 2030.”

"The public does not benefit from the government’s policy approach. It is expensive, insecure and not future-oriented,” says Bill Hare, CEO of Climate Analytics.

“In 2023, Germany spent EUR 80 billion on importing fossil fuels. Due to the current high prices, the figure will be even higher this year, and the only beneficiaries of such a policy are the oil and gas companies. Even before the current energy crisis, the world’s 10 largest oil and gas companies are currently making a profit of around 1.5 billion USD a day. Every day of delay is worth hard cash to the oil and gas industry."