Germany's Economy and Climate Minister Robert Habeck presenting plans for faster decarbonization on Jan. 11. The country needs to triple the speed of emissions cuts to hit climate targets, Habeck said. Source: Getty Images Europe/Getty Images News via Getty Images

As Germany squares up to the challenge of decarbonizing its economy by 2045, the new coalition government's Economy and Climate Minister Robert Habeck wants to step on the accelerator.

In one of his first moves in office, Habeck, who is co-leader of the Green Party, presented a package of energy and industrial measures Jan. 11 laying out a strategy for achieving net-zero.

"The previous climate protection measures are inadequate in all sectors. It is foreseeable that the climate targets for 2022 and 2023 will not be met," Habeck said. "But we are making every effort to make up for this. We have to triple the speed of our emissions reduction and do significantly more in less time."

With the Greens in control of energy and economy matters in the new so-called traffic light coalition government, which also includes the Social Democrats and the Free Democrats, Germany has committed to "ideally" phasing out the use of coal by 2030. Habeck's new "super ministry," which also covers climate issues, is aiming for 80% renewable electricity by 2030, up from around 45% today. Technology-specific auctions for wind and solar will be increased to achieve that aim, the minister pledged.

Habeck's ministry also wants to unshackle wind power to help achieve the goal. While onshore wind auctions have often been undersubscribed in recent years, the industry has bemoaned slow permitting processes and limited availability of land.

To get more onshore wind power approved, Habeck wants to broaden the land available to projects, in part by cutting distance requirements to flight signaling infrastructure and weather radars. This alone could unlock an additional 4 GW to 5 GW of capacity. By allowing construction closer to military locations, another 3 GW to 4 GW could become available, the ministry said. A new onshore wind law will make 2% of German land available while taking into account conservationist and military interests, it said.

This comes on top of a more ambitious offshore wind target, with Germany now aiming for 30 GW by the end of this decade, 40 GW by 2035 and 70 GW by 2045.

Solar energy will also gain momentum. The ministry's "solar accelerator package" will raise the threshold of auctions and open more areas for ground-mounted plants. Meanwhile, all suitable rooftops should have solar panels installed. "For commercial newbuilds this will be mandatory, for residential newbuilds it will be the norm," the ministry said. Including rooftop solar, the new government now targets 200 GW of capacity by 2030.

'Comeback of German leadership'

German electricity consumers will feel less of a burden from renewables in the future as the renewable energy levy is scrapped and responsibility to finance it moves to the federal purse.

"Electricity should become cheaper compared to fossil energy. This is how we will make heat pumps and electric mobility more attractive and advance sector coupling," the economy and climate ministry said.

But as Germany closes its coal chapter, there will be an increased reliance on gas-fired power generation in the transition, with gas providing baseload power to bridge a shortfall that is widened by a simultaneous exit from nuclear power. To aid the introduction of clean gases that may replace natural gas in the long term, Germany will also enable hydrogen production and imports. To that aim, the new government doubled its electrolyzer production capacity target to 10 GW by 2030.

The heating sector will also see a rising share of renewables, with the new government aiming to achieve 50% climate neutral heat by 2030. To facilitate that, the economy and climate ministry wants to accelerate renovations and decarbonize district heating systems. Alongside financial incentives from the government to homeowners and city neighborhoods, the ministry wants to see more private capital flow into the renovation sector. This could be achieved by coupling business models of clean energy supply and energy-efficient renovation.

Voices in the renewables industry welcomed the ideas. "Today's announcements mark the comeback of German leadership on renewables," Giles Dickson, CEO of industry organization WindEurope, said in a statement.

German utilities association BDEW said speedy, ambitious measures, as proposed by Habeck, are necessary given the challenges in meeting climate targets. "There is now a real chance to loosen the many shackles and brakes which in the past stifled the required renewables build-out," the group said, adding that measures to speed up permitting and designate more land for renewables will be most important.