Climate Protection Who's Footing the Bill?

While German Chancellor Angela Merkel lets herself be celebrated as the savior of the world's climate, her cabinet is embroiled in a tense struggle over a planned program to help reduce the greenhouse effect. Under the program, Germany's homeowners, renters and drivers could face billions in additional costs.

By and

A worker maintains solar panels on the roof of a warehouse in Germany. The country has set itself ambitious targets for reducing its CO2 emissions, but how much will it cost?
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A worker maintains solar panels on the roof of a warehouse in Germany. The country has set itself ambitious targets for reducing its CO2 emissions, but how much will it cost?

No journey is too far for Angela Merkel when it comes to saving the world's climate. At the Cape of Good Hope, Merkel listened to scientists explain the effects of global warming on species diversity. Addressing the United Nations General Assembly in New York, she called upon the assembled heads of state to take decisive action. In Greenland, enveloped in a bright red parka, she observed the melting of Arctic glaciers firsthand.

The chancellor flies around the globe on an almost weekly basis to bolster her image as a determined crusader against the greenhouse effect. "Climate change threatens the very basis of human existence," she preaches. "And we can only succeed if we stick together and act in unison."

There is one thing Merkel doesn't like to talk about on her ventures into the wide world of climate diplomacy: That the public and political debate over what she calls a "top issue" is decidedly less dignified at home in Germany. Senior government officials at the ministries of economics and environmental affairs meet almost weekly to iron out the details of the so-called Integrated Energy and Climate Program, the framework Merkel wants to establish to implement her ambitious goals. But the news that reaches the chancellor from these sessions doesn't exactly bode well for her plans.

Instead of efficiently implementing the program's key elements, the ministries in Berlin have become entangled in a series of debilitating skirmishes over heating, taxation and rent regulations. Progress has been so painstakingly slow that insiders fear key issues will remain unresolved or not fully addressed by the early December target date. Merkel has piled on the pressure, both for herself and her government. By 2020, she wants to see Germany reduce its CO2 emissions by 40 percent over 1990 levels and increase the share of renewable energy in the energy mix to 20 percent from the current level of 12 percent.

Merkel is hoping to make Germany a global paradigm when it comes to climate protection, to coincide with the United Nations climate summit in Bali, scheduled for early December. To achieve that goal, her administration is seeking to issue a whole new set of regulations that would require the installation of new heating systems in apartment buildings and additional power cables for wind turbines, as well as the production of cars with reduced emissions. There are two sides to the battle. One is represented by Environment Minister Sigmar Gabriel, a member of the Social Democrats (SPD) who, with the support of environmental organizations, hopes to implement drastic changes in regulations, controls and penalties. Gabriel and the environmentalists face off against Economics Minister Michael Glos, a member of Merkel's Christian Democrats (CDU), and Transport Minister Wolfgang Tiefensee (SPD) who, to the applause of industry and tenants rights groups, want to limit government intervention as much as possible.

Keeping the Citizens in the Dark

When it comes to the climate controversy, the conflicting camps within the ruling Grand Coalition are agreed on only one objective: To keep citizens in the dark as much as possible about how much Germany's pioneering role in limiting CO2 emissions will eventually cost them. The chancellor consistently claims that climate protection will pay off in the end. But the truth is that the measures she proposes will lead to billions in additional expenditures for many years to come.

Merkel's cabinet ministers disagree on almost every element of the project. Take heat insulation in buildings, for example. Millions upon millions of tons of CO2 are still being unnecessarily pumped into the atmosphere from German homes and buildings, because many heating systems are outdated and walls, roofs and windows are poorly insulated. Implementing energy-saving measures in buildings across the board could prevent a large share of harmful emissions.

German Greenhouse Gas Emissions

German Greenhouse Gas Emissions

Gabriel wants to impose drastic new rules on homeowners and landlord, rules his counterparts at both the Transport and Economics Ministries oppose. Under his plan, all newly constructed buildings and renovations of existing structures would be required to be heated, at least in part, with environmentally friendly technologies like solar cells, biogas systems and heat pumps. Gabriel also wants to see the energy standards for buildings become far more stringent and an increased emphasis on power production in so-called cogeneration plants, which generate both heat and electricity from the same primary fuel source. He also envisions a system of fines and penalties for violators of these tighter regulations. For example, renters could deduct a portion of their rent if their landlords failed to live up to the new environmental standards.

The plan would pay off in the long term, says Gabriel. Homeowners, for example, would eventually recoup the costs of solar panels and additional insulation through future savings in their heating bills. They would also qualify for government subsidies to help pay for the initial costs of renovations.

Gabriel glosses over the fact that most people do not think in terms of the decades it would take to recoup much of the cost, but are more likely to plan ahead for a few years at best. The project would cost money, a lot of money, for homeowners and renters alike. For example, the cost of installing a new, high-efficiency furnace in a small terraced house can run upwards of €6,000.

Under the current laws, landlords can add the costs of modernization to rent. But this is easier said than done. A landlord who wants to install high-efficiency systems has to obtain the consent of all tenants, and tenants have the right to pay reduced rent during the renovation work. If one tenant moves out, the landlord must find a new tenant willing to rent the same apartment at a new, higher rate.


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