The EU’s Emissions Trading System for Heating and Transport (ETS 2), set to take effect in 2027, could lead to significant cost increases for many consumers by 2030, with some facing additional expenses of over 1,000 euros per year. This is according to calculations by the comparison portal Verivox, reported by the Funke Media Group’s newspapers.
Dirk Messner, President of the German Environment Agency, believes that consumers are not adequately prepared for the price increases and is calling for a social cushioning of rising CO2 prices.
Verivox has calculated, based on three scenarios by the Potsdam Institute for Climate Impact Research, how much consumers might pay for a kilowatt-hour of gas, a liter of heating oil and a liter of gasoline in 2030.
The PIK scenarios assume different strong accompanying climate protection measures. In the scenario with the strongest measures, the model calculations predict a price of 71 euros per ton of CO2 in 2030. In the middle scenario, the price would be 160 euros per ton and in the scenario with the weakest measures, it would be 261 euros per ton.
For consumers, this could mean significant additional costs. For example, a single person living in a 50-square-meter apartment heated with gas and using 5,000 kilowatt-hours per year would pay an additional 77 euros, 173 euros, or 282 euros per year, depending on the scenario.
A four-person family living in a 180-square-meter single-family home and using 20,000 kilowatt-hours of gas per year would currently pay 237 euros in CO2 costs per year. By 2030, the costs could be 307 euros, 691 euros, or 1,127 euros, depending on the scenario.
Higher costs for mobility will also affect those who drive cars with combustion engines: currently, the CO2 price for a liter of gasoline is 15.67 cents. By 2030, it could be 20.23 cents, 45.59 cents, or 74.36 cents per liter, depending on the scenario. Diesel and heating oil would be even more expensive, at 22.61 cents, 50.96 cents, or 83.12 cents, according to these calculations.
Messner, the Environment Agency’s president, also expects the price pressure to be “very high.” He believes that consumers are not adequately prepared, citing surveys that show many people lack a sufficient understanding of the effects of CO2 pricing. “This is crucial, as only then can the prospectively rising prices be taken into account in investment and consumption decisions” he said.
The Environment Agency is also advocating for the social cushioning of rising CO2 prices, with Messner stating, “This point is very important to us.” His agency is proposing a socially differentiated climate fund, combined with a safety net for low and middle-income earners and targeted support programs for particularly affected households.
Specifically, the costs of the rising CO2 price could be alleviated through “income-dependent subsidies, low-interest loans and targeted support programs” for renters and homeowners, Messner said.