Germany initiates green subsidies to support energy-intensive companies' transition
Germany initiated a subsidy tender aimed at helping energy-intensive industries transition to environmentally friendly production methods, with a total fund of EUR 4 billion announced by the economy ministry.
This is part of Germany's goal to achieve climate neutrality by 2045 and involves offering 15-year financial incentives to companies in the steel, glass, paper, and chemical sectors to decrease carbon emissions in their manufacturing processes.
The European Commission has greenlighted a scheme that selects participating companies through a competitive bidding process, focusing on those that propose the most cost-effective solutions for reducing emissions. These so-called climate protection contracts are designed to cover the additional costs associated with adopting green production technologies in industries where eco-friendly methods are not yet financially viable on their own.
Originally, Berlin had aimed to allocate a higher amount, potentially in the tens of billions of euros, for these subsidies. However, a decision by the constitutional court last year, which prohibited the government from financing climate protection projects with about EUR 60 billion in debt, jeopardized the scale of the funding program.
