For more than an entire night, the coalition has struggled for a climate package: late Thursday afternoon Union and SPD met in the Chancellery, only at half past two at noon on Friday there was a breakthrough. The result is a 22-page key paper, which should ensure compliance with the climate goals by 2030. Because, Chancellor Angela Merkel frankly admitted in the press conference: The goals for 2020 are no longer achievable because of the long inactivity of politics, which the coalitioners are not proud of.

That is one of the reasons why the Union and the SPD have now agreed on a mechanism for the annual review of the implementation of the new projects and that all three parties pledge to follow up if they lag behind. Chancellor Angela Merkel wants to use the multi-billion dollar package to promote greater commitment to climate protection at the UN summit in New York on Monday.

These are the main points:

CO2 price

It is a revolution: a CO2 price will be introduced - not only in the energy sector, where it already exists, but also for the first time in Germany in the building sector and in transport. For these areas, a nationwide trade in emission rights will be established. This means that anyone who uses CO2 here must have a polluting right for every ton.

The start will be "admittedly very slow" with ten euros per tonne of carbon dioxide, as Chancellor Merkel admitted. Specifically, prices of 10, 20, 25, 30 and 35 euros have been agreed for the years 2021 to 2025. Gasoline and diesel would be 2021 by 3 cents per liter more expensive, by 2026, the price would increase by 9 to 15 cents.

From 2026, auctioning of emission allowances will initially take place within a price range of between € 35 and € 60 per tonne of CO2. Then a maximum emission amount should be set, which will be lower annually. Whether there will still be maximum and minimum prices after 2027, the government leaves open.

The fact that CO2 emissions are now being made more expensive in the building and transport sector is a major step towards more climate protection. After all, emissions in the transport sector, for example, have actually increased in recent years. Step by step, the loopholes close, now only the agriculture is missing, in which there is no Co2 pricing.

Why is it only starting in 2021? The bureaucratic effort in the introduction of emissions trading is quite large, also anticipates the federal government with lawsuits. In the medium term, emissions trading makes sense only if it is integrated into the European trading system. This should be done from the middle of the 2020s.

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Expansion of the green energy

How divided the two major coalition partners are in terms of climate protection is exemplified in the expansion of renewable energies . Although the parties have set a goal in the coalition agreement to increase the green electricity share to 65 percent of electricity consumption by 2030, in the first half of 2019 it was only 44 percent. The coalition committee has now agreed that nothing should change in the expansion plans from the coalition agreement. After all, because there was tremendous resistance. For this reason, since last fall, the AG has been meeting with acceptance from SPD and Union representatives to support the expansion of wind and solar parks.

In particular, wind energy on land has collapsed, partly because in Bavaria, for example, the controversial 10-H regulation applies to wind farms: this means that the distance to the next residential building must be ten times the wind turbine height. A 150-meter-high windmill must therefore be 1.5 kilometers away from the next house. In Bavaria, therefore, not a single new wind turbine has been connected to the grid so far this year. The coalition has now agreed on a minimum distance of 1,000 meters, but federal states can also set smaller minimum distances. The Bavarian Prime Minister Markus Söder was pleased after the Climate Cabinet on Friday now that his special rule for Bavaria remains.

Municipalities should in the future receive a financial share in the operation of wind turbines and thus an incentive to approve such facilities.

The situation in the expansion of solar energy is similarly messed up. For larger plants, the German government has introduced a solar cover under the former Federal Environment Minister Peter Altmaier (CDU): If installed in Germany solar systems with a capacity of 52 gigawatts, the commitment to get a guaranteed subsidy from the Renewable Energy Act ends , Now, major coalition leaders have agreed to lift this cover and continue subsidies on larger installations. For Germany to achieve its green energy targets, the solar share in 2030 would have to be almost twice as high as it is today.

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Oil heating and building renovation

There was also a lot of dispute about another topic: A ban on oil heating , which demanded the SPD, will not give it to her, said CDU chief Annegret Kramp-Karrenbauer before the negotiating night. But the SPD was able to assert itself, at least in part: The installation of new oil heaters should be banned as early as 2026, at least in buildings in which, according to the key issues paper "a more climate-friendly heat generation is possible". Whoever replaces his old oil heater with a more climate-friendly model should be subsidized with up to 40 percent of the costs.

This decision is important, because who descends in Germany's boiler room, goes on a journey through time: half of the oil heaters is more than 20 years old, many even older than 30 years. They are the most climate-damaging and inefficient way to heat. However, many homeowners have no choice, especially in southern Germany, not all households have a gas connection and heating oil is still relatively cheap. The Federal Government is already offering financial subsidies to switch over, but the Kreditanstalt für Wiederaufbau (KfW) is also continuing to promote the switch to oil heating - albeit to more modern ones.

Because poorly insulated buildings also lead to waste of energy, the Federal Government wants to promote restructuring measures for tax purposes. "If you replace old windows with modern heat protection windows, for example, you can reduce your tax debt - spread over three years - by 20 percent," says the paper.

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Innovations in traffic

Rail travel should be cheaper, some flights, however, more expensive. The grand coalition wants to cut VAT on long-distance rail tickets from 19 to 7 percent. This makes rail travel cheaper by ten percent, say the coalition. In addition, the railway is to receive a billion euros additional by 2030 from the federal government, in order to expand and modernize the rail network. The air traffic tax will be raised on 1 January 2020. The amount is not yet fixed, but it would probably go to a doubling, it was said from coalition circles. Currently, the tax for domestic flights is 7.38.

Driving a car will be more expensive anyway because of the CO2 emissions trading decided upon. In the future, however, cars that consume a particularly high amount of fuel should also be even more heavily loaded. For example, the vehicle tax for new vehicles should be more closely aligned with CO2 emissions as of a key date. Electric cars will be exempted from the motor vehicle tax until 2025. The purchase premiums for environmentally friendly vehicles should also be raised.

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Social compensation

In principle, all additional revenues from the CO2 pricing should either flow into climate protection measures or be returned to the citizens.

For example, the coalition wants to raise the commuter tax . In this way, it should be avoided that people in the countryside, who often have to drive to work by car, are overburdened by the CO2 price. It was agreed to increase the commuter rate from 2021 from the 21st kilometer onwards until 31.12.2026 by 5 cents per kilometer. Per distance kilometer can therefore be deducted 35 instead of 30 cents from the tax. Green Party chief Robert Habeck criticized this: "This is really nonsense, because it is rewarded so to travel long distances," said Habeck the world .

Housing benefit recipients are to be supported by higher housing allowance with rising heating costs. The higher energy costs should also be taken into account in state services such as the Hartz IV payments.

In addition, the EEG surcharge to promote green electricity from 2021 should be lowered. In 2022, the relief is 0.5 cents per kilowatt hour. This should be relieved especially families and small SMEs.

A climate premium, ie a lump sum of 70 to 100 euros, which is regularly paid to citizens, could not prevail in the negotiations.

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According to Finance Minister Olaf Scholz (SPD), spending on the climate protection package adds up to 54 billion euros over the next four years. But where do they take it from? The climate package is not yet funded in the current federal budget.

The coalition has agreed that no new debt should be made, the black zero should be kept. Federal Finance Minister Olaf Scholz had already referred in advance to the Energy and Climate Fund. He manages the special assets since 2011, in which now lie about 4.5 billion euros.

On the other hand, the climate bond proposed by Minister of Economics Peter Altmaier (CDU), in which citizens lend money to the state and in return receive a guaranteed interest rate of two percent, should not exist. The construct was highly controversial, finally it opens up another bureaucratic shadow budget. In addition, the interest that would have to pay the state, higher than if he would get the money simply on loans in the market.

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Control of climate projects

For transport, industry, agriculture, buildings and other sectors, annual CO2 budgets are enshrined in a law based on the goals already agreed in the Climate Change Plan 2050. The Climate Cabinet of the Federal Government is to become a permanent institution and to examine the impact and efficiency of climate protection measures on an annual basis.

An external expert council will also accompany this work. If an area fails to achieve its goals, the federal minister responsible should submit an "emergency program for follow-up" to the Climate Cabinet within three months after the CO2 emissions data have been confirmed by the experts. On this basis, the Climate Cabinet will then decide how the Climate Protection Program 2030 will be adapted. It should then be checked whether the annual budgets are adjusted - then the federal government should decide. But the consequences of non-action remains unclear: penalties for ministries that do not achieve their goals, as the SPD wanted, should not exist.

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