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The Germany on 2045

The Germany on 2045

When Chancellor Angela Merkel announced that Germany will aim to reach net-zero emissions by 2045, Frank Peter was surprised. His think tank, Agora Energiewende, had only a week before published an in-depth report laying out a path to accomplishing that ambitious goal—but they didn’t think Merkel would actually set it. 

The document remains the only systems-level analysis of what exactly Europe’s largest economy would need to do to eliminate its greenhouse gases in the next 25 years, and has been widely cited by experts and the media. “It wasn’t planned at all for us to play a big a role in creating such benchmark figures,” said Peter.

Agora concluded Germany would have to phase out coal by the end of the decade—eight years earlier than planned—while boosting renewables to 70% of the country’s energy mix. Sales of new petrol and diesel cars will have to end by 2032. The amount of electricity generated will have to double as more of it is consumed by vehicles and used to create vast amounts of clean hydrogen.

Germany will also have to do something it’s resisted in the past: deploy carbon-capture technology on a large scale. The industrial powerhouse will have to bury as much as 73 million tons of carbon dioxide annually by 2045, from approximately zero today. Attempts over the past decade to implement the technology, which involves capturing emissions from power plants or factories or even the air, have faced fierce opposition from critics worried about the risks of injecting CO₂ deep underground.

“Everybody left the debate with bloody noses,” said Peter. The technology is expensive to deploy, especially when the carbon price is low, as it was in the mid 2010s in Europe. Commercial injection of CO₂ has been going on for more than 50 years at millions of tons every year, without any serious accidents.

Germany’s industrial sector could be coming around. It may be possible to meet net-zero goals without the use of carbon capture, but adding the technology to the mix of solutions can lower the total cost of cutting emissions drastically. While the upfront cost of carbon capture is high, it is still cheaper than some of the alternatives such as inventing hydrogen planes or emissions-free steel. 

With carbon prices hovering above 50 euros ($61) a ton, Peter said German industry appears willing to support climate action. In April, the Federation of German Industries published a paper on how the economics of carbon capture in polluting sectors such as steel and cement could work, though it ultimately concluded that “the use of carbon capture stands or falls with social and political acceptance.”

Political support may come before widespread public approval. The Greens party has moved ahead of Merkel’s Christian Democratic Union-led bloc in some polls ahead of elections in September. There’s a real chance the party will have a strong presence in the next coalition or even take the chancellery for the first time, both scenarios which could fundamentally reshape Germany’s climate policy. That doesn’t mean the Greens plan to reverse their opposition to nuclear power that dates back to the party’s founding, though they may have little choice but to embrace carbon capture technology by overcoming residents’ opposition to locating sites in their neighborhood.

The Greens have been the junior member in coalition governments in the past and have shown that they can change their minds on big issues. Pacificism, for example, was a core element of the party, until the German government engaged in a military mission in Kosovo in 1999 alongside NATO allies.

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“The Greens have come a long way,” said Jana Puglierin, head of Berlin office of the European Council on Foreign Relations. “The pragmatists in the party are now dominating over the fundamentalists.”

Clean hydrogen is also something Germany will have to scale essentially from zero, which will be easier as the fuel doesn’t face the same social or political opposition that carbon capture does. Beyond ideologies, however, the thing that may hold most sway on whether or not crucial technologies are adopted is the cost of the transition.

Germany’s previous net-zero by 2050 goal would have required annual investments between 1% and 2% of the country’s gross domestic product. Agora estimates that upgrading its 2030 emissions goal means an additional investment of as much as 250 billion euros over the next decade. It’s a big number, but likely to be less 1% of GDP over that period.

“Germans are very positive toward protecting the environment,” said Puglierin. “I’m not so sure about the consensus on costs.”

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