Sector Deep dive

Overall system

To achieve climate neutrality in Germany in 2045, greenhouse gas emissions have to be reduced to such an extent that a balance between residual emissions and their sinks, e.g. carbon absorbtion by forests and soils, is reached: the so-called target of "net zero" emissions has to be achieved.

In 2020, almost 90% of Germany's greenhouse gas emissions were CO₂ emissions. Because the remaining 10% - mostly methane and nitrous oxide from agriculture - are particularly difficult to avoid, Germany needs to be almost completely CO₂-neutral already a few years before it achieves climate neutrality. This means that fossil fuels have to be phased-out nearly completely, as the options for CO₂ capture and storage in Germany are severely limited.

Core strategies for reducing CO₂ emissions are (1) decarbonization of the power system, (2) efficient use of energy, (3) electrification of end use, and (4) conversion to CO₂-free fuels.

The target is therefore a comprehensive and also rapid transformation of the entire German energy system: according to the Climate Protection Act (KSG), a reduction in greenhouse gas emissions of at least 65% compared with 1990 is already required by 2030, and a reduction of at least 88% by 2040.

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Total annual GHG emissions

66% too slow Compared to the scenario Technology Mix
One-off effect
Energy crisis

Total annual GHG emissions in Germany; these are mostly energy-related CO₂ emissions from combusting fossil fuels – primarily for electricity and heat generation – and from material use of fossils in industry.

The majority of greenhouse gas (GHG) emissions in Germany are CO₂ emissions, most of which are released during the conversion of fossil fuels into electrical or thermal energy (electricity or heat) and in industrial processes (together 88% of GHG emissions in 2020). In Germany, the energy sector is responsible for just under 35% of these energy- and process-related CO₂ emissions, followed by industry and the transport sector with over 20% each, private households (15%), trade and services (5%), and agriculture (1%) (in 2020; UBA 2023).

Key points

  1. Significant and rapid reductions in CO₂ emissions are essential for achieving the 2030 climate targets and climate neutrality in 2045.
  2. The pace of CO₂ savings must roughly double for Germany to meet its 2030 climate targets.
  3. This requires an acceleration of the expansion of renewable energies (e.g. solar and wind power plants), of the ramp-up of technologies for the direct use of renewable electricity (e.g. heat pumps and e-cars) and of the phase-out of fossil energies (e.g. by phasing-out oil and gas heating systems or combustion cars).

Share of renewables in final energy consumption

73% too slow Compared to the scenario Technology Mix

Share of renewables in total final energy consumption in Germany, mainly resulting from renewably generated electricity and district heating, but also from bioenergy, solar thermal energy, green hydrogen, and e-fuels.

The share of renewables in final energy consumption in Germany has been steadily rising since 1990, when it was only around 1%. The goal of the German government of increasing the share to at least 18% by 2020 has been achieved. So far, the expansion of renewables in electricity generation has been primarily responsible for this.

Key points

  1. Since 1990, the share of renewables in final energy has risen steadily to more than 20% today, mainly due to the expansion of wind energy and PV in the electricity sector.
  2. The trend of the last few years is not sufficient to achieve the share of about 40% in 2030 required according to the Ariadne target paths. The German government's target of 30% in 2030 would also be missed.
  3. The key to success is the accelerated expansion of renewables in power generation together with the expansion of electromobility and the use of heat pumps.

Share of electricity in final energy consumption

6.0% far too slow Compared to the scenario Technology Mix

Share of electricity as an energy source in total final energy consumption in Germany, e.g. for lighting and electrical appliances, the operation of heat pumps or for charging e-cars.

The path to climate neutrality is mainly driven by switching from fossil fuels to the direct use of electricity and simultaneously decarbonizing power generation. After the share of electricity in final energy consumption in Germany initially rose slightly since 1990, reaching 20% for the first time in 2004, the development has stagnated since then. In fact, an increase in the share of electricity to at least 30% by 2030 would be necessary for a successful transformation in all Ariadne target pathways.

Key points

  1. Together with the decarbonization of power generation, the increased use of electricity is an essential part of the energy transition.
  2. According to the target paths, an increase in the share of electricity in final energy to at least 30% by 2030 is necessary, whereas the actual share has stagnated at approximately 20% for over 15 years.
  3. The drivers of electrification should be electromobility and the growing use of heat pumps by 2030, followed by the conversion of production processes in industry.

Annual final energy demand

145% on track Compared to the scenario Technology Mix

Annual energy demand in end-use sectors, mainly transport, industry, commerce, and households. Primary energy use in the energy industry sector is not included.

In addition to the switch to renewables, the more efficient use of energy is an essential step toward achieving climate neutrality. Total final energy demand can provide an indication of whether efficiency gains are being achieved.

Key points

  1. In addition to switching to renewables, CO₂ savings can be achieved through more efficient energy use.
  2. A significant decline in final energy demand - which would suggest efficiency gains - has not been discernible in Germany since 1990.
  3. By 2030, necessary efficiency gains can be achieved in particular in the building sector by switching to heat pumps and refurbishment, and in the transport sector by expanding electromobility.

Annual primary energy demand for natural gas

594% on track Compared to the scenario Technology Mix
One-off effect
Energy crisis

Annual demand for natural gas as a primary energy source in Germany, particularly for power generation, heating, and process heat in industry.

In contrast to other conventional primary energy sources, especially coal and mineral oil, demand for natural gas has not declined from 2015 to 2021, but increased. While the phasing-out of coal use by 2038 at the latest is regulated by law, natural gas is still the preferred energy source for heating and is used extensively to generate heat in industry. Natural gas is also seen as a "bridge" to CO₂-neutral processes based on green hydrogen. Nevertheless, climate neutrality can only be achieved by phasing out natural gas use as well.

Key points

  1. Climate neutrality also requires phasing-out the use of natural gas.
  2. A decline in natural gas demand was observed for the first time during the energy crisis in 2022 - the sustainability of this effect remains to be seen.
  3. To achieve the goal, gas heating systems in particular have to be replaced by more climate-friendly heating systems, such as heat pumps, and industrial use for process heat has to be reduced.

Annual primary energy demand for lignite and hard coal

−14% step back Compared to the scenario Technology Mix
One-off effect
Energy crisis

Annual primary energy demand for lignite and hard coal in Germany, e.g. as an energy source as well as feedstocks in industry or for power generation in power plants.

In Germany, lignite is used almost exclusively for power generation, while the share of hard coal was around 60% in 2018. Most of the remaining hard coal is used in steel production.

Key points

  1. The use of coal for power generation has been declining for years.
  2. With the further expansion of renewable power generation and the ongoing phase-out of coal-fired power generation, this trend is likely to continue.
  3. In the medium to long term, steel production will also have to be converted from coke- or coal-based processes to hydrogen-based direct reduction processes.

Annual primary energy demand for oil

133% on track Compared to the scenario Technology Mix
One-off effect
Pandemic

Annual demand for oil in Germany, primarily for the production of fuels, for use as heating oil and in the petrochemical industry.

In terms of demand in 2018, the most important mineral oil products in Germany are diesel and gasoline used in transport, followed by petroleum gasoline in the petrochemical industry, light heating oil for heat generation, kerosene as aircraft fuel, and heavy heating oil used in industry.

Key points

  1. After a decline in petroleum demand in the 1990s due to the replacement of oil heating with gas heating, consumption has stagnated in recent years.
  2. According to the Ariadne target paths, mineral oil demand has to decrease significantly from 2025 at the latest, which has to be achieved primarily through the rapid ramp-up of electromobility in the transport sector.

Annual primary energy demand for fossil fuels

100% on track Compared to the scenario Technology Mix
One-off effects
Energy crisisPandemic

Annual demand for fossil fuels in Germany, i.e. natural gas, lignite, hard coal and crude oil.

To achieve climate neutrality in 2045, CO₂ emissions have to be almost completely stopped a few years earlier, as opportunities for CO₂ extraction and storage in Germany are severely limited. Due to CO₂ emissions generated in particular by the conversion of fossil energy into electricity, heat and fuels, this is tantamount to almost completely phasing out fossil fuels.

Key points

  1. Achieving climate neutrality requires a far-reaching phase-out of the use of fossil fuels.
  2. The use of fossil fuels in Germany has been declining since 1990, and based on the Ariadne scenarios, the trend has to continue at an accelerated pace until 2030.
  3. The expansion of electromobility and the ramp-up of heat pumps are the means of choice in the coming years.