Federation of German Industries (BDI)

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Berlin , Germany

Climate Lobbying Overview: The Federation of German Industries (BDI) is strategically engaged on climate change policy in the EU and Germany. The organization's top-line statements on climate policy have improved since 2018, but it appears to remain negatively engaged on key strands of EU climate policy, such as the Carbon Border Adjustment Mechanism (CBAM), the reform of the EU Emissions Trading Scheme (ETS), and CO2 Standards for Light Duty Vehicles. The association has extensively promoted fossil gas in the energy mix.

Top-line Messaging on Climate Policy: BDI's top-line messaging on climate policy is mixed. In a May 2022 policy paper, the association supported carbon-neutrality by the ‘mid-century’ in line with IPCC timelines, as well as advocating for government policy like carbon pricing and a global carbon price floor to reach those targets. In a May 2021 consultation response, BDI did not support increasing the ambition of Germany's climate neutrality to 2045, questioning its feasibility and arguing that it would lessen ambition among other European nations. However, in a November 2021 briefing, the association appeared to accept the new target. In a March 2021 position paper on the EU Fit for 55 package, BDI maintained that competitiveness and carbon leakage protection should be incorporated in future climate policy. It also did not support the ‘Fit for 55’ package proposals in a November 2021 briefing, describing them as “massively price-increasing” without carbon leakage protections. The association has communicated support for the Paris Agreement goals and implementing NDC commitments in June 2022, and criticized the lack of progress made at COP26 in a Handelsblatt article in November 2021.

Engagement with Climate-Related Regulations: BDI’s overall engagement with climate-related regulations in the EU appears to be mostly negative. The association did not seem to support the EU’s 2030 GHG emissions reduction target in a September 2021 joint statement. In November 2021 in response to an EU public consultation, BDI opposed the EU's carbon border adjustment mechanism (CBAM), describing the proposal as "premature" and stating its position as "generally skeptical to the unilateral introduction of CBAMs", advocating for the continuation of the free allocation of emissions allowances in the EU ETS until 2030 and supporting participation in the CBAM on a voluntary basis. Additionally, in an EU public consultation response in November 2021, BDI appeared to take a negative position on the reform of the EU ETS, emphasizing the threat of carbon leakage and advocating for the continuation of protection measures such as indirect cost compensation.

In a September 2021 position paper BDI also appeared to not support the expansion of the EU ETS to cover international aviation. Furthermore, in November 2021 in response to an EU public consultation, BDI opposed the proposed zero emission standard within the EU CO2 Standards for Light Duty Vehicles, stating that “German industry rejects a de facto ban on vehicles with internal combustion engines” and advocating for a 90% reduction target instead in a June 2022 press release.

The association supports incentives for energy efficiency, however appears to oppose stronger regulation. In a September 2021 briefing BDI supported tax subsidies for energy efficiency in Germany, but argued that regulation should be considered a “last resort” in an October 2021 briefing. In a November 2021 report, the association did not support proposed reforms to the EU Energy Efficiency Directive, advocating for a review of the definition of "energy efficiency", and arguing that the proposed energy savings target of 1.5% was "unrealistic."

Positioning on Energy Transition: BDI has been highly supportive of an increased role for fossil gas in Germany and Europe. In a January 2022 press release, BDI President Siegfried Russwurm supported "massive" fossil gas expansion in Germany without placing conditions on the need for CCS. The association subsequently supported the inclusion of fossil gas in the EU Sustainable Finance Taxonomy in a February 2022 press release. This follows a November 2021 report in which the association did not support the proposed change of taxation for fossil gas in the Energy Taxation Directive, stating that it would "jeopardize the competitiveness of energy intensive industry."

Following the Russian invasion of Ukraine, Siegfried Russwurm was quoted in a February 2022 Handelsblatt interview questioning the feasibility of bringing forward the phase-out of coal without endangering security of energy supply and since then BDI repeatedly advocated for increasing the use of Germany’s coal infrastructure, including in a July 2022 press release. However, in a March 2022 briefing the association supported the decarbonization of industry, advocating for carbon contracts for difference to aid industrial decarbonization in steel, cement and chemical products. In a December 2021 press release, BDI supported the decarbonization of transport via rail and the transition to a low-carbon energy sector via renewable hydrogen, although it advocated for "pragmatic" regulations on what hydrogen is considered sustainable.

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