Germany Launches €6 Billion Industrial Decarbonization Push
Germany has launched a €6 billion ($7 billion) program to help heavy industries reduce emissions, expanding its industrial decarbonization push and extending eligibility to carbon capture and storage (CCS).
The program offers 15-year climate protection contracts that reimburse firms for cleaner production costs. Winners will be chosen through a reverse auction, prioritizing the biggest emissions cuts at the lowest public cost. If approved, contracts could begin in 2026, solidifying Germany's role as one of Europe's industrial climate frontrunners.
Target sectors include steel, cement, chemicals, and glass, where low-carbon solutions are expensive or challenging. Firms must meet binding reduction milestones over the contract term to ensure measurable impact. The program's rollout hinges on EU state aid approval and upcoming EU guidance on CO2 transport and storage.
By December 1, around 2200 companies have submitted proposals for the program, led by Economics Minister Katherina Reiche. The first auction round is expected in mid-2026.
The €6 billion German government program, the first to formally include CCS in national climate contracts, has received overwhelming interest from industries. If successful, it could significantly reduce emissions in high-emission sectors, contributing to Germany's and Europe's climate change goals.
