Germany will provide up to €5 billion ($5.85 billion) in funding this year to help steel, cement and chemical companies reduce industrial carbon emissions. The support will be distributed through 15-year “carbon contracts for difference,” designed to cover the higher costs of low-emission production technologies.
The updated program gives companies more flexibility to meet climate targets. Firms will now have four years to cut emissions by 50%, compared to the previous requirement of three years for a 60% reduction. By the end of the program, projects must achieve an 85% emissions reduction target.
Germany has also expanded the program to include carbon capture and storage projects, particularly for hard-to-abate sectors such as cement and chemicals. The initiative aims to help industries remain competitive while accelerating the country’s transition toward low-carbon manufacturing.
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