If Germany wants to get on the climate path in the next two decades, experts say it will need huge amounts of money. Only a fraction of the investments go to the state. But the amount is not as large as it seems at first glance.
According to a study, in order to achieve the climate target for 2045, around six trillion euros would have to be invested in Germany, i.e. 6,000 billion euros. This is the result of a study by the Prognos research institute on behalf of the KfW development bank. This would mean that previous expenditure would have to more than double. The majority of the investments would have to come from consumers and companies, with the state only accounting for twelve percent.
When looking at the numbers, however, it is important to note that, according to the study, only just under half of all investments would be additional because Germany would also spend money if it continued to rely on fossil fuels such as coal, oil and gas.
“The amount is put into perspective by the fact that Germany would have to invest heavily even if it sticks to fossil technologies,” explained KfW CEO Stefan Wintels. Of the investments of around 290 billion euros per year necessary to achieve the target, around 145 billion euros remained net. This is the part that would be added by switching to more climate protection. By 2045, Germany wants to be climate-neutral, i.e. not emit more greenhouse gases than can be stored again. This is enshrined in law.
The largest chunk of spending goes to the transport sector, which accounts for almost half. This is primarily about purchasing cars with more climate-friendly drives; investments would have to increase enormously. But since cars are being bought anyway and the price difference between electric cars and cars with combustion engines is shrinking, net investments would only have to increase by just under a fifth.
A quarter of the six trillion comes from the energy sector. The net investments are particularly large here because the energy system would have to be completely rebuilt if electricity from wind and solar played a larger role. Money must then flow particularly into the power grids. A particularly large amount of government investment is needed here.
The building sector makes up around a fifth, primarily residential buildings. According to the study, this is where the most extra investments are needed, i.e. expenses that would not be incurred without more climate protection.
Almost a tenth of the necessary investments up to 2045 will fall on industry - but this still entails high burdens, according to the authors. The investments were concentrated on a few, particularly energy-intensive companies. "This often involves drastic changes to production processes and the business model. Individual companies have to invest very large sums in new production facilities."
Many of these companies also face international competition and cannot always pass on higher costs to their customers through rising product prices. Production costs could also rise as we move away from fossil fuels such as coal and gas.
Investments in climate protection and corresponding technologies not only cost money, they can also save money. “Turning away from fossil energy imports saves costs and reduces dependencies,” emphasize the authors. Most recently, fossil fuels with an average value of around 81 billion euros per year were imported into Germany. "This amount flows permanently abroad, and its amount depends on prices over which Germany has little influence." There are also costs if Germany emits more greenhouse gases than agreed within the EU.
Climate-friendly technologies that rely on electricity, such as heat pumps and electric cars, also use energy particularly efficiently; they require significantly less of it for the same performance. According to the study, together with energy-saving measures, energy consumption could be reduced by 26 to 35 percent by 2045, depending on the scenario. And climate change also causes economic costs, as the hot summer showed.
And finally, the switch to a more climate-friendly economy opens up new business opportunities. "The global market for clean technologies has recently grown by a remarkable 9.6 percent per year - and would therefore double in less than 10 years," calculate the authors. Germany's starting position is still good here with 13 percent of the global export volume.
The authors look at the period 2025 to 2045 because 2024 was the last year for which reliable investment figures were available. Prognos worked with several scenarios; the numbers determined are average values.
