German cabinet agrees CO2 price of 25 euro per ton from January 2021

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Germany’s cabinet agreed on changes to the climate package launched last September, and it is now certain that from January 2021, a price of €25 per tonne of CO2 will apply to the heat and transport sectors in Germany, Euractiv reports.

Originally, the German government’s proposal had envisioned an entry price of €10 per tonne, which was to rise to €35 by 2025. According to the new regulation, the price in 2025 will now be €55. From the following year, emission certificates with a price corridor of €55-65 per unit will be auctioned off.

The cabinet confirmed an agreement from a working group of the mediation committee between the two chambers of the German legislature, the Bundesrat and the Bundestag. The last points of the climate package were discussed there in December, especially regarding tax issues.

In fact, the part of the law regulating the CO2 price had already passed through the Bundestag and Bundesrat. However, under pressure from the Greens, who had demanded a considerably higher price, a political compromise was reached and the price was raised afterwards.

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