Germany Votes To Increase Its Carbon Price By 50%

Germany Votes To Increase Its Carbon Price By 50% - Carbon Herald
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On Friday, Germany approved the plan to increase the country’s price on carbon dioxide emissions by more than agreed on previously. 

At the moment, Germany has a levy on CO2 emissions from fuel of 30 euros (~$32.70) per ton of CO2. 

Initially, the German government had planned to increase the price to 40 euros (~$34.70), but as of last week, the price is set to jump to 45 euros (~$49) starting next month, representing a 50% hike from its current amount. 

The new carbon price set by Germany is part of a deal designed to help mitigate a budget crisis, caused by a recent ruling of the country’s highest court, in which the government’s decision to repurpose 60 billion euros (~$65 billion) to help Germany recover from the effects of the COVID-19 pandemic was annulled.

As a result, the nation now finds itself having to plug a 17 billion-euro (~$18.5 billion) hole in its 2024 budget, part of which has strongly impacted the “climate and transformation fund”.

Relevant: Industry In Germany Urges Govt To Speed Up Carbon Capture And Storage Strategy

The new levy on carbon emissions will affect prices on gasoline, diesel, heating oil, and natural gas, and will directly help fund the “climate and transformation fund”.

Other measures also meant to solve the budget crisis are yet to be introduced, officials said. 

These will include the reduction of subsidies that may result in climate damage, as well as the slight reduction of spending on certain ministries. 

Read more: Canadians Want Carbon Tax To Be Removed From Home Heating Bills

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