Germany’s Energy & Climate Policy Under CDU: What To Predict

Germany’s election was won by the CDU and Friedrich Merz is likely to form a coalition government with the election’s big loser SDP. What does this mean for the climate? Mattias Goldmann describes the likely development in five points.
1. No German increased climate action – nor rollback
Germany’s previous coalition government could not agree on necessary measures to achieve the binding national 2030 climate targets and a number of political issues were left unresolved. But in the 2025 election, climate issues were not in focus – environment & climate only ranked fifth with 13% support compared to 22% in the 2021 election. A reduced climate focus can be seen as an explanation for the Greens' regression in the election, but the success of the right-wing populist AfD was not linked to their climate-skeptical agenda, and the German liberals in the FDP failed in their attempt to gain voter support for an agenda of reduced climatic ambitions.
Essentially, the election results support a continuation of the established climate policies, with CDU emphasizing that the goal of climate neutrality by 2045 remains, as well as the sub-goal of a 65% emissions reduction by 2030. The Climate Policy Council states that Germany is about to miss both national goals and the EU 2030 requirements, which means that new policies must be implemented quickly. A key priority for CDU is to increase carbon taxes, while SDP focuses on stimulating the transformation of the heating sector and transport – expect a mix of both.
2. Transport sector in focus – but scant industry support
It was almost irresistible for CDU to blame the German car industry's serious problems on the previous government, but Merz has not been particularly accommodating to the car industry's desire for increased long-term support for the transition. The CDU essentially wants to let the market prevail and rather stimulate e-fuels than reintroduce the abolished bonus for electric car despite the strong popular support it would enjoy.
A major investment in the railway also has strong popular support, including making permanent the Deutschland Ticket, which is currently decided year by year. But it is expensive, the treasury is in poor shape and the CDU has not raised this in its election manifesto.
3. Energy market: Promises of lower prices – but how?
Expensive electricity and gas for companies and households became an important election issue. CDU has promised that part of today’s climate support will go to reducing electricity costs, which, together with reduced electricity taxes and network charges, is to reduce the price to 0.05 euro per kWh. CDU is also expected to tear up the requirements that new heating must be comprised of at least 65% renewable energy, and that new heat pumps must be "hydrogen-ready", in favor of more flexible and cheaper solutions.
General stimulus instead of targeted investments is at the core of the CDU’s industrial policy, which is worrying for frontrunners such as Germany's steel giant Thyssenkrupp's plans for fossil-free steel, whose start date of 2027 is now postponed because of political ambiguities.
CDU wants to keep Germany’s ban on Russian fossil gas (which e.g. Sweden continues to allow), and to reduce the cost burden by accelerating the transition to green hydrogen – exactly how remains to be clarified. Germany, which uses the most coal of all EU countries, is to phase out coal power by 2038, which the CDU supports, but the policy on new energy sources is more unclear. Merz has called wind power a "transitional technology" and suggested that wind turbines should be phased out gradually because they do not look attractive; whether this will be government policy is unclear. Nuclear power can get a boost, with proposals from the CDU for small modular reactors but also the assessment that shut down reactors will not be restarted.
4. Climate adaptation – who will foot the bill?
Germany has been hit hard by climate-related floods, with deaths and enormous damage. The previous government introduced the first legally binding climate adaptation law and a strategy to protect people and infrastructure against increasingly severe weather events. But the issues of financing and responsibility were left for the new government to solve, with Germany’s federal structure promising difficult discussions ahead.