UBA’s President Dirk Messner said: “The renewed increase in emissions in 2021, the second year of the pandemic, was expected though not to the degree that it occurred. Our figures show that emissions have almost returned to 2019 levels. The trend towards strong emission declines in German ETS plants observed before the start of the pandemic seems to have halted for the time being. We must take decisive countermeasures here and push ahead with a faster shift away from fossil fuels. This is even more true in the wake of the Russian war of aggression on Ukraine. After all, ambitious climate action will also help us to reduce our energy dependence on Russia. Reform in the emissions trading system can provide significant impetus in this regard.”
Jürgen Landgrebe, Head of Division V Climate Protection, Energy, German Emissions Trading Authority at UBA said: “The Council and the European Parliament must now focus on an ambitious reform of emissions trading as part of ongoing negotiations on the reorientation of European climate policy. To do this, they must lower the emission caps in the EU ETS significantly. Sharply increased auction revenues from the EU ETS will also create considerable financial leeway in the EU. These funds must be used for targeted support and to cushion societal efforts aimed at decarbonisation. Emissions trading thus remains a central cornerstone of European climate policy.”
Energy: In 2021, German power station emissions increased for the first time since 2013 – by about 14 percent over the previous year, reaching 235 million tonnes CO2. The main factors behind the upswing were the increase in demand for power in the course of the economic recovery and higher emissions from the firing of hard coal and lignite. The latter was due to the significantly lower feed-in of wind power plants and the disproportionate price increase for natural gas, which despite high CO₂ prices, made it more economical to use hard coal and lignite-fired power plants than natural gas plants.
Industry: Emissions from energy-intensive industry in Germany rose by 5% compared to the previous year (to 120 million tonnes CO₂-eq). The rise to almost pre-pandemic levels comes after two years of decline prompted by slower economic activity during the pandemic. The largest increases occurred in the iron and steel industry (+ 13%), followed by industrial and building lime (+ 9%). Pandemic-related emission reductions in 2020 were also highest in the two sectors. In the chemical industry, cement clinker production and the pulp and paper industry, emissions increased by 2% to 3%. By contrast, emissions from refineries fell slightly (- 2%). Emissions from the non-ferrous metals industry continued at about the same level.
Aviation emissions: Emissions from Germany’s aircraft operators amounted to approx. 4.6 million tonnes CO2 in 2021, a 20% increase over the previous year. The main cause is the recovery in the aviation sector after the pandemic.
Germany and Europe: Emissions from all installations participating in the EU ETS (in the 27 EU Member States, Iceland, Liechtenstein, Norway) rose in 2021 to a lesser extent than in Germany. The European Commission reports that 2021 emissions increased by 7% compared to the previous year (to around 1.31 billion tonnes of CO₂-eq). As in Germany, this development was caused by a recovering economy in year two of the pandemic, which meant a rise in emissions from power production (+ 8%) and industrial plant emissions (+ 5%) over 2020. Compared to 2005, ETS emissions across Europe fell (- 38%) more sharply than in Germany (- 31%). The current emission level in the EU ETS is thus already close to the currently applicable target for 2030 (- 43%), which highlights the large scope for an ambitious increase in the EU ETS.
Emissions trading and total emissions: The relative growth of emissions in the emissions trading sector is greater than the increase in total German greenhouse gas emissions. UBA's March estimate for the previous year shows an increase of some 33 million tonnes CO₂-eq (+ 4.5%).
Further information
The German Emissions Trading Authority (DEHSt) is the national authority entrusted with the implementation of the EU emissions trading scheme. Its mandate includes allocation and issuance of free emission allowances, reviewing emissions reports and monitoring plans, and administration of accounts in the EU emissions trading registry. DEHSt operates auctioning and informs the public and market participants of its results. It is in charge of the administration of the project-based mechanisms Joint Implementation and Clean Development Mechanism. DEHSt also acts as the national licensing authority for the payment of state aid for electricity-intensive companies to offset indirect CO2 cost (electricity price compensation). DEHSt is also responsible for implementing the national emissions trading scheme for fuels launched in 2021.
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