Germany’s green rescue package points the way for Europe

The German government has unveiled a rescue package to help fight the worst economic shock in decades and transform the economy to make it greener and stronger. Under the plan, €2.2bn will be spent on incentivising electric cars and car fleets, supporting auto industry jobs and helping the sector to decarbonise. It also includes €7bn in hydrogen investments, €2.5bn for electric vehicle (EV) recharging infrastructure and battery manufacturing, €2bn for energy-efficient houses, €1.2bn for clean buses and trucks, and €5bn for the German railway company Deutsche Bahn. 

There had been intense pressure by carmakers to introduce a so-called scrappage scheme for diesel and petrol cars, but the €6,000 state-funded premium will be limited to electric models only.

‘This sets an important precedent for governments everywhere trying to support the car industry,’ according to environmental group Transport & Environment (T&E).

‘After France, now Germany is pointing the way forward with massive investments in electric cars, recharging infrastructure and railways. This is exactly what is needed to support jobs and help us emerge stronger and greener from the COVID crisis. The plan isn't perfect, but it should be a wake-up call for the [European] Commission and other European countries ahead of the all-important decision on the EU's €750bn recovery and resilience fund,’ comments Stef Cornelis, T&E Germany Director.

However, T&E says the plan to spend €1bn of taxpayers’ money on new aeroplanes is ‘misguided’, stating that airlines ‘should pay for them out of their own pockets’. It believes that Germany ‘should go all in on greener jet fuels, such as synthetic fuel, which actually have the potential to substantially reduce aviation emissions’.

T&E also welcomes the investment in shore-side charging for ships, but calls for the German government to re-think its support for LNG ship infrastructure. In addition, it says that no public money should be used for subsidising diesel trucks, noting that the German government intends to use EU recovery funds to provide up to €15,000 in subsidies for trading old diesel trucks for new EURO VI models.

Cornelis notes: ‘Germany is about to take over the presidency of the EU in three weeks’ time. It must use its leadership to make sure the Commission’s big recovery plan is used to strengthen and green the economies of countries like Spain and Italy.’