Dirk Messner, president of the UBA, said: “The significant reduction in emissions in the energy sector is a major step towards achieving our climate protection targets. This is primarily due to the expansion of renewable energies and the decline in coal-fired power generation. Emissions trading has played an important role in this. In the industrial sector, on the other hand, the fall in emissions is primarily due to the decline in production as a result of the effects of the Russian war of aggression in Ukraine. We must therefore focus on a consistent transformation strategy for our industry that combines economic competitiveness with ambitious climate protection.”
Jürgen Landgrebe, Head of Department V ”Climate Protection, Energy, German Emissions Trading Authority” at the UBA, adds: “Last year's resolutions on the realignment of European climate policy are centred on an ambitious reform of emissions trading. The fact that the emissions caps on emissions trading have already been significantly lowered this year is particularly crucial for this. This sets clear guidelines for the transition to a climate-neutral economy and way of life. This transformation process is significantly supported by the auction proceeds from emissions trading. In 2023, we recorded record revenues of over 18 billion euros, all of which was channelled into the German government's Climate and Transformation Fund. In order to ensure compensation for private households, politicians should now swiftly introduce the climate money agreed in the coalition agreement combined with specific support programmes for vulnerable households. In this way, emissions trading can combine ambitious climate protection and social compatibility – even if carbon prices continue to rise.”
Energy: Emissions from energy supply fell by 22 per cent to 188 million tonnes of CO2-eq in 2023, the lowest level since the EU ETS 1 was launched in 2005. This is primarily due to the sharp fall in demand for energy from industry and private households, a significant increase in the share of renewable energies and the associated decline in fossil fuel energy generation. Compared to the previous year, the gross electricity generation of brown coal-fired power plants fell by around 25 per cent, that of hard coal-fired power plants by around 36 per cent and that of natural gas-fired power plants by around 2 per cent (according to the Working Group on Energy Balances – AGEB). As a result, the carbon intensity of electricity production in Germany also declined.
Industry: Emissions from energy-intensive industry fell by 10 percent year-on-year to 101 million tonnes of CO2-eq, the lowest level since 2013. This was due to cyclical declines in production in all sectors, particularly as a result of the effects of Russia's war of aggression against Ukraine. The largest decline in emissions was in non-ferrous metals (19 per cent), followed by the “other mineral processing industry” with 18 per cent. Emissions from the chemical industry, refineries, industrial and construction lime production, cement clinker production and the paper and pulp industry fell by between 9 and 17 per cent. Emissions from the iron and steel industry, on the other hand, remained virtually unchanged at minus 2 per cent.
Air transport: Emissions from German-administered aircraft operators were about 7.6 million metric tons of CO2-eq in 2023. This corresponds to an increase of around 4.5 per cent compared to the previous year. However, emissions remained below the level before the Covid-19 pandemic.
Germany and Europe: Emissions from all installations participating in the EU ETS 1 (in the 27 EU Member States along with Iceland, Liechtenstein and Norway) also fell significantly in 2023: According to the European Commission, emissions fell by 17 percent to around 1.09 billion tonnes of CO2-eq in 2023. The Europe-wide reduction in emissions in the EU ETS 1 is around 48 per cent compared to the first year of emissions trading in 2005. Emissions have therefore almost halved since then. At 44 per cent, emissions from plants in Germany declined to a slightly lesser extent.
Emissions trading and total emissions: The UBA estimate from March 2024 shows a projected 10 per cent decline in total emissions from all sectors. This development represents the sharpest decline in greenhouse gas emissions in Germany since 1990. The reduction in the EU ETS 1 was therefore significantly disproportionate compared to the development of total emissions. The share of the EU ETS 1 in total German emissions is around 46 per cent.
Further information:
German Emissions Trading Authority (DEHSt): The DEHSt at the German Environment Agency is responsible for implementing the EU ETS 1, the national emissions trading scheme for fuels (nEHS) and the European emissions trading scheme for fuels (EU ETS 2). It is also responsible for the implementation of project-based mechanisms and the payment of subsidies for electricity-intensive companies to compensate for indirect CO2 costs (electricity price compensation). As the national authority, the DEHSt has also been responsible for the new carbon border adjustment mechanism (CBAM) since the end of 2023.
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