The German Ministry of Economy (BMWK) has launched a bidding process for subsidies to support energy-intensive companies switching to greener production. The first round of the project will provide €4bn in funding. Germany plans to provide subsidies to companies in the steel, glass, paper, and chemicals sectors. The assistance will be provided for 15 years in exchange for reducing emissions during production.
Companies applying for tenders must provide emission reduction programs at their facilities. Through ‘climate contracts’, firms will be compensated for the additional costs of "climate-friendly" production in industries where climate-friendly production processes cannot currently be competitive.
In total, emissions amounting to about 350 MtCO2 are expected to be avoided over the duration of the funding program until 2045. This corresponds to reductions of up to 20 MtCO2eq/year, about a third of Germany’s sector target for industry for 2030.
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