Germany has planned a €6 billion industrial decarbonization program to reduce emissions in energy-intensive industries like steel, cement, glass, and chemicals. Carbon capture and storage (CCS) technology will be included in climate contracts for the first time, extending the government’s green industry assistance measures significantly.

Companies interested in participating in the scheme must apply by December 1, 2025, with auctions scheduled to commence in mid-2026, pending legislative budget clearance and European Union approval of state aid rules. The scheme expands on an earlier framework by using CCS, which absorbs CO2 and stores it underground, lowering industrial emissions.

Selected companies will be awarded 15-year contracts to help finance clean production technologies while protecting them from variable energy and carbon costs. Contracts will be awarded competitively, with consideration given to initiatives that have the lowest cost per tonne of CO2 saved. Firms must also fulfil strict emission reduction targets throughout the contract period.

Industry organisations have praised the initiative, stating that balancing climate action with economic stability is crucial in an era of high energy prices and low productivity. Experts believe the scheme will help Germany remain competitive while pursuing its climate goals.