Germany is becoming ground zero for the challenges of deep decarbonization

During a Greenpeace action, a CO-2 sign stands in front of the Brandenburg Gate with flames coming out of it. Two demonstrators hold a banner with the words "Before you go Mrs Merkel: Secure the future". With the action, activists of the environmental protection organization call on the German government to further reduce CO-2 emissions in Germany and to ensure compliance with the goals of the world climate summit in Paris.

Global climate politics in 2021 is focused on generating more ambitious climate pledges from member countries of the Paris Agreement before the Conference of the Parties meeting in November. With the addition of the United States, about two-thirds of greenhouse gas (GHG) emissions come from countries that have committed to reach net-zero emissions by mid-century. These countries must now adopt policies to deliver those emissions reductions; a complete reworking of the of the world’s energy system in just three decades. With a recent court ruling, Germany has become ground zero for this challenge, as German law will now require an extremely ambitious schedule for change.

Climate as an issue of intergenerational equity

For most of history, successive generations have been better off than those that preceded them. The march of technology has provided benefits to humanity, giving people more goods to choose from, conveniences, and options in living and working.

But climate change threatens to change that. The Earth’s climate is changing faster than anytime in human history, and we may soon be living in a vastly different environment. Some of the strongest voices in today’s climate movement come from youth, who claim that the changing climate is robbing them of their future.

For years, governments have tended to “kick the can” on climate policy, putting off action while the concentration of GHGs in the atmosphere continues to climb. Climate is exactly the kind of problem that humans are terrible at dealing with — a tragedy of the commons that pits future generations against the present and developing countries against the wealthy world. Nevertheless, the costs of inaction are becoming clearer, and in recent years many countries have become more serious about cutting greenhouse gas emissions.

German high court’s landmark ruling

Against this backdrop, on April 29, 2021, the German Federal Constitutional Court made history, ruling that Germany’s Climate Action Law does not sufficiently protect the freedoms of the youth and future generations. The 2019 law obliged Germany to cut GHG emissions 55% by 2030, compared to 1990 levels. It also set out annual limits for emissions from sectors including energy, transport, buildings, and agriculture.

The court’s decision is based on a 1994 amendment to Article 20 of the German Basic Law, which added protection of the environment to the fundamental principles of constitutional order (democracy, federalism, rule of law, etc.) It states: “Mindful also of its responsibility toward future generations, the state shall protect the natural bases of life by legislation…” The German constitutional lawyer Christian Calliess commented that the court’s ruling had “kissed awake” Article 20 and turned it into a benchmark for judging the sufficiency of legislative action. The court argued: “One generation must not be allowed to consume large portions of the CO2 budget while bearing a relatively minor share of the reduction effort if this would involve leaving subsequent generations with a drastic reduction burden and expose their lives to comprehensive losses of freedom.” Essentially, the ruling relies on the carbon budget theory of emissions, which states that spending too much of the budget now will leave an insufficient budget for the future, causing undue hardship.

The ruling opens new ground about intergenerational equity in climate law. This finding goes further than a case decided in the Netherlands in late 2019, which was the first to order a state to reduce its greenhouse gas emissions, on the basis that inadequate action on climate change can violate human rights. However, this case did not involve goals after 2020 and did not focus on the issue of intergenerational equity. Likewise, the current climate court cases in the United States focus on companies that produce fossil fuels rather than on government response to the climate challenge.

The Merkel government responds with ambitious pledge

German politicians are now playing a blame game. The various parties are blaming each other that the 2019 law did not go further, in a country that cares deeply about the climate with federal elections coming up in late September. However, there is some revisionist history here. The law was a delicate compromise achieved after months of debate that split the ruling coalition of the Christian Democratic Union and Christian Social Union (CDU/CSU) and the Social Democratic Party (SPD). The environment minister, a member of the SPD, pushed hard for a stringent law with sector-specific emissions reductions. Members of the more conservative CDU/CSU complained during the negotiations that the sector-specific provisions aimed to harm industries overseen by ministries under their parties’ control. The opposition Green Party leader in the parliament complained that the law didn’t go further, saying that, “You have failed in humanity’s task of protecting the climate.” Ever the pragmatist, Chancellor Angela Merkel noted, “Politics is what is possible.”

Just two weeks after the ruling, Merkel’s government approved an update to the Climate Action Law that aims for a 65% reduction in GHG emissions by 2030 and net-zero emissions by 2045, five years earlier than the previous goal. If approved by the parliament, these would be among the world’s most ambitious goals, with only the U.K. aiming for greater reductions — 68% by 2030 and 78% by 2035, on the way to net-zero by 2050.

There may be no example of a government legally bound to achieve a more difficult task. Americans like to compare reducing GHG emissions to the moon landing. President John F. Kennedy announced in September 1962 that the United States would put a man on the moon within the decade and that goal was achieved in July 1969. However, the task that Germany is taking on is far more difficult, involving changing the basis of the entire German economy within a decade rather than a Herculean effort by a group of engineers. Plus, the moonshot goal was not legally binding.

A victory for climate action, but the devil is in the details

Ambitious goals are one thing, but achieving those goals is another. Germany has a long history of investing in renewable power as part of its “Energiewende,” literally meaning “energy transition or turnaround.” However, the Energiewende also includes a phase-out of German nuclear power, with the last nuclear plants scheduled to close at the end of 2022. The German public also opposes carbon capture and storage. These two technologies are expected to be important in U.S. efforts to decarbonize but are largely off the table in Germany. In conversations over the past months, government, industry, and NGO representatives alike have focused on renewable power and green hydrogen (produced from renewable power) as the path forward. These are great technologies, but the timeframe for implementing them at scale is longer than the court ruling and the updated Climate Action Law allow, especially in the important German steel, chemical, and transportation industries.

What if Germany misses its goals? In that case, the federal government must buy emissions allowances from other countries, the responsible ministry must establish an emergency program to reach future targets, and the government will then establish remedial measures. The remedial measures needed to achieve such ambitious goals could be very harsh indeed. Will German politicians be able to implement them? Will the German public accept them? European governments generally have more ambitious climate policies than those in the United States, but we have seen backlash when they affect citizens’ everyday lives — the yellow vest protests that erupted in France in late 2018 after a fuel tax increase provide a good example. Policies to achieve Germany’s climate goals will likely test the resolve of German society.

The climate ruling could affect other equity issues as well. A rapid transition to a zero-carbon economy will require vast investment in buildings, transportation infrastructure, and industrial processes. Government support will be needed for some of these processes. For example, the German steel industry intends to transition to using hydrogen in its process. This change will be expensive and will require government support for both capital and operating expenditures, even though today’s steel production faces a European carbon price of more than €50 per ton. Large government expenditures will require debt financing, which also has implications for future generations. Germany has a “debt brake” in its Constitution that caps the federal government’s borrowing at 0.35% of GDP. The debt brake can be suspended in times of crisis, but will investing in decarbonization be considered a crisis? Or will the concept of intergenerational equity in the recent court ruling work against such investments, as it will leave future generations saddled with more debt? There are no easy answers to these questions.

Scientists and activists pushing for very fast emissions reductions are running headfirst into the reality of how difficult this task can be, especially once the easier emissions reductions in the power and light transportation sector are achieved. The climate ruling makes Germany a key test case in the transition, with very rapid reductions now enshrined in law. Godspeed and good luck.