Woidke to Support Companies with Climate Funds - Germany’s bold push to reform EU CO₂ trading sparks industry debate
Brandenburg’s Minister-President Dietmar Woidke is pushing for major changes to the EU’s CO₂ emissions trading system. His proposal aims to cut greenhouse gases more effectively while providing stronger financial support for industries facing high costs. The German Steel Federation and chemical industry leaders have now backed his call for reform.
Germany has set a target to become climate-neutral by 2045, meaning no net carbon emissions by that year. To help achieve this, the current CO₂ pricing system charges high-energy companies and power plants, encouraging them to adopt greener technologies. The revenue from these charges flows into the Climate and Transformation Fund, which funds measures like heat pumps and energy-efficient buildings.
Dietmar Woidke argues that this money should instead be returned directly to businesses. He believes this would ease financial pressure while still driving climate progress. His proposal has gained support from the German Steel Federation, which sees it as a way to balance environmental goals with industrial stability.
Meanwhile, the German Chemical Industry Association (VCI) and the industrial union IG BCE are also demanding urgent reforms. They want the free allocation of CO₂ certificates to remain at 2025 levels and the reduction in certificates to slow down until 2050. Without these changes, VCI managing director Wolfgang Große Entrup warns that the current system could force production stops and plant closures. The industry already faces over €200 million in extra annual costs due to recent adjustments.
The debate over the EU emissions trading system highlights the tension between climate targets and industrial survival. If reforms go ahead, businesses could receive more direct funding to offset CO₂ costs. The outcome will shape how Germany meets its 2045 climate-neutral goal while keeping key industries competitive.
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