CO2 Law Passed by the Bundestag

CO2 emissions trading could raise prices significantly from 2027

Source: Patrick Reitler, Epoch Times (German)

In the middle of the hot phase of the election campaign, the parliamentary groups of the SPD, the Greens and the CDU/CSU passed a law in the Bundestag almost unnoticed that could meet with displeasure among millions of voters.

Specifically, it concerns the implementation of a 2023 EU directive on the emissions trading system (ETS-II). From 1 January 2027, the then mandatory European trading in CO₂ certificates is likely to cause the costs of heating and refuelling to rise significantly. Until then, the national rules for fuel emissions trading remain in force. The aim of the measure is to reduce CO2 emissions and so advance climate protection.

Accelerating the price spiral

According to the “Münchner Merkur”, the think tank Agora Energiewende predicted in October 2023 that the price of petrol could rise by 38 cents per litre if the price of CO2 certificates in EU emissions trading climbs to 200 euros per tonne. Current expert estimates vary between 100 and 300 euros per tonne.

The magazine “Cicero” considers prices above 200 euros per tonne realistic, since only then could the EU target of cutting net emissions by at least 55 percent compared with 1990 by 2030 be achieved. In the long term, the EU is aiming for net greenhouse gas neutrality by 2050. “Cicero” also expects a price increase of about 40 to 45 cents per litre of heating oil, petrol or diesel.

The Agora study warns of a jump in petrol prices once the transport sector enters EU emissions trading in 2027. Without additional climate protection measures, CO2 prices could rise to over 200 euros, which would drastically increase fuel costs.

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