The country intends to reach an agreement with the European Commission

Germany will insist that the EU soften its emissions reduction rules for the country’s industrial sectors, which are the biggest polluters, due to higher energy costs, Bloomberg reports.

Next year, the rules of the EU Emissions Trading System (EU ETS) are to be tightened, the free allocation of carbon certificates to the aviation sector is to be discontinued, and gradually phased out for all industries by 2034.

As German Economy Minister Katerina Reiche noted at a reception organized by energy company RWE AG, the country must find a solution with the European Commission for companies that cannot meet the bloc’s carbon emission reduction targets.

«We must expand the free allocation of quotas. Otherwise, we will lose vital industries in our country,» she explained.

In August, ThyssenKrupp AG called for a slower phase-out of free quotas, while the IGBCE mining, chemical, and energy union said the rules risked killing their business.

The EC will also propose rules to expand the range of products covered by the CBAM and to combat circumvention by trading partners.

Germany is still struggling to overcome a prolonged economic downturn amid US tariffs and rising energy prices. In particular, the country’s chemical plants operated at only 72% capacity in the second quarter, the lowest level in more than 30 years.

It should be recalled that the Polish government has proposed expanding the possibilities for importing international CO2 emission quotas in order to ease the pressure of rising energy and heating prices. Warsaw believes that the current number of permits available in the EU will be insufficient in the coming years, which will inevitably lead to further price increases.