Social climate protection: Five targeted measures that would help us all

An electricity cost subsidy of 120 euros per year for households with little income and four other measures could significantly relieve the burden on citizens and at the same time advance climate protection. This is shown by a study by the Ecological-Social Market Economy Forum (FÖS) on behalf of Greenpeace and Green Planet Energy with the support of the General Parity Association.

The Paritätische represents more than 10,000 organizations from the social and healthcare sectors. The costs for the measures would be significantly lower than those for climate-damaging subsidies and the reduction in electricity taxes for everyone announced by Chancellor Friedrich Merz (CDU).

“Oil and gas are increasingly becoming a cost trap,” says Mira Jäger, energy expert at Greenpeace. “The federal government should help people to free themselves from this expensive dependency on fossil fuels – especially those with little money.” The measures are about combining climate protection and social compatibility.

The state should automatically pay the electricity cost subsidy of 120 euros to low-income citizens via the planned direct payment mechanism. According to the study, that is around 18.4 million households. This includes childless households with a taxable income of up to 30,000 euros. If there are children in the household, the limit should rise to 40,000 euros. In addition, there are recipients of basic security or housing benefit. The costs for the state would be around 2.2 billion euros annually. A reduction in electricity tax for everyone would probably cost more than 5 billion euros.

The organizations are also calling for a social leasing program for heat pumps. Installing electricity-powered alternatives to fossil fuel heaters is expensive. The idea: Service providers cover the costs and guarantee for three years that the heating costs are lower than those for oil or gas heating. Remaining costs will be paid in installments. The state supports this with, among other things, income-dependent subsidies. That would cost between 1.1 and 2.2 billion euros.

Rents should only be allowed to be increased if an energy-efficient renovation has taken place beforehand. That wouldn't cost the state anything. “Adjustments to tenancy law, verifiable efficiency criteria and a reform of the modernization levy are required so that energy-efficient renovations remain rent-neutral,” says the study.

The Germany ticket should be cheaper for people with little money. A social ticket worth 19 euros for around 1.2 million social welfare recipients would cost the state 500 to 550 million euros. According to the organizations, e-car funding should also have a stronger social and climate policy focus and exclude hybrid vehicles.

The total funding amount of 3 billion euros planned until 2029 will remain in place, but the income limit for recipients will be reduced to 60,000 euros in annual income. The purchase of used e-cars and e-bikes should also be encouraged. A scrapping bonus is provided for very old combustion cars.

All in all, it would cost the state 3.8 billion to 5 billion euros annually - little compared to the existing environmentally harmful subsidies: According to the Federal Environment Agency, climate-damaging subsidies accounted for 65 billion euros in 2021, and the trend is rising. The fuel discount alone, part of which goes to the oil companies, is costing the state 4.1 billion euros this year. “This shows that so far the federal government has been providing billions in subsidies that are heading in the wrong direction,” the study authors summarize. “If it undertakes reforms to reduce subsidies, revenue can be generated to finance the proposed measures.”