The companies in Germany are driving the transformation towards climate neutrality forward with a great deal of own initiative. 90 percent of businesses have set themselves operational climate neutrality goals by 2045, and many businesses link these goals with specific business opportunities for their products and services, including for export.

The German Chamber of Commerce and Industry (DIHK) also fully supports the goal of climate neutrality and has launched numerous specific initiatives together with the Industrie- und Handelskammern (IHKs). These include:

• Energiemanager / -in (IHK) European EnergyManager (EUREM)
• Corporate network climate protection including the training of energy scouts
• Young Energy Europe including the training of energy scouts
• Renewable Energy Market Campaign jointly with the dena
• Export Initiative environmental protection
• Project UBi - Corporate Biological Diversity

Through the training of more than 7,000 energy managers, over 14,000 energy scouts and more than 1,600 energy scouts, alone these initiatives have saved over 2 million tons of CO₂ through their initial projects.

However, it is becoming clear that the current policies will not achieve the goal of climate neutrality. At least not without significant losses in value creation, jobs, and prosperity. The German economy does not want less climate protection but a different approach to climate protection – an approach where climate neutrality is achieved without overwhelming the wide range of businesses. The goal of the IHK organisation is to develop energy and climate policy further, so that Germany becomes climate-neutral, the competitiveness of companies remains secured, and societal support for the transformation is strengthened.

The current energy policy in Germany is characterized by governmental micromanagement, high costs, lengthy procedures, and uncertainties regarding the development of new infrastructures (such as for hydrogen or CO₂). Additionally, there is a lack of international coordination. These factors are pushing many businesses to their limits. The DIHK observes that energy-intensive companies, in particular, are already gradually shutting down their production, resulting in the loss of jobs.

Germany's industry as a whole is significantly impacted, with the trend continuing to rise. In 2022, one-fifth of businesses nationwide reported in the IHK Energy Transition Barometer that they were constraining production, relocating abroad, or planning such actions due to energy policy pressures. 2025, this had increased to more than a third. Among industrial enterprises with more than 500 employees, 60 percent now report production cutbacks or relocations, or corresponding plans. Other businesses across various sectors are increasingly burdened by rising energy costs and bureaucracy, as indicated by the first supplementary study on "New Approaches for the Energy Transition."

All of this hinders the energy transition, which requires a resilient and successful economy as its foundation. Only efficient companies can bear the significant investments needed to achieve climate neutrality.

The current course of energy policy causes permanently high costs for energy production, grids, and imports in Germany. A study published by the DIHK in September 2025 assumes that system costs totaling up to 5.4 trillion euros will occur by the year 2049. These are costs that are reflected in the various bills for electricity, gas, or petrol. These burdens reduce the competitiveness of companies at the Germany location and lead to a loss of value creation, jobs, and prosperity.

In addition, necessary individual investments for the transformation in the commercial economy, particularly in the areas of heat, transport, and industry, are required. The Association of Housing Industry (GdW) has analyzed that more than five trillion euros will have to be spent to achieve a climate-neutral housing stock in Germany by 2045 based on the current path. These investments tie up capital and also create further costs subsequently.

© Frontier Economics

Achieving climate neutrality without jeopardizing the economy and prosperity will only succeed if the energy transition becomes more technology-neutral, innovative, cost-effective, and straightforward. 

The aim is to realign the energy transition with more market-based principles and less government micromanagement. In Germany and the EU, emissions trading should therefore be at the heart of policy, as it effectively achieves climate protection through price signals and reduces emissions where it is most cost-effective. 

At the same time, climate protection urgently needs a stronger global perspective. Only through international coordination of climate protection policies can competitive disadvantages for companies be limited. Moreover, it is essential for the global CO₂ emissions to decrease. However, the current trend shows that reductions in CO₂ emissions in Germany are being more than offset by shifts in production or competitors elsewhere. 

Successful climate protection is characterized by setting goals — no further release of harmful greenhouse gases — that are not only theoretical but also achieved in practice. This necessarily requires a transitional phase in which the remaining CO₂ emission budget is judiciously used to attain climate neutrality.

Focusing on specific target years is often counterproductive. Annual precision in intermediate targets leads to cost increases, as companies are compelled to utilize avoidance technologies that are technologically underdeveloped and thus expensive. Similarly, the adaptation or construction of infrastructures becomes disproportionately expensive when constrained by tight schedules, realistically speeding up such processes only to a limited extent.

Moreover, innovation and efficiency gains typically occur in leaps rather than continuously. Therefore, a majority within the German Chamber of Commerce and Industry (IHK) supports a budget approach rather than precise annual targets. This ensures that transformation proceeds with the necessary pressure while allowing an adaptive system that aligns with technological developments and maturity levels. Ultimately, the same emissions savings are achieved over the same period. However, this approach significantly reduces costs for the economy.

Germany should continue to take a pioneering role in global climate protection. However, if the German economy takes the lead without others following, it will lose its competitiveness. Energy-intensive businesses are increasingly relocating production and jobs to countries with less stringent climate protection regulations – along with the CO₂ emissions. Consequently, Germany not only jeopardizes its economic position but also does a disservice to climate protection.

Climate protection, therefore, needs to be considered globally. The federal government must work with European partner countries to encourage other states to adopt quicker climate protection measures, for example, by linking emissions trading systems. This can help reduce competitive disadvantages for German companies, boost growth opportunities for cleantech companies, and decrease the costs of climate change globally.

International climate protection projects can also be a lever to effectively reduce emissions worldwide both ecologically and economically. Businesses could receive certificates from such projects, similar to free allocations in emissions trading or credits, which they can use for their own transformation or trade. This can activate additional private capital for international climate protection. Investments in international projects can spread technologies and know-how through exports and dissemination.