From January 1, 2021 the government will charge 25 euros ($30) per tonne of carbon dioxide emissions released by the transport and heating sectors.
The pricetag was raised from the government’s initially proposed 10 euros per tonne — a number widely slammed as too low by Germany’s Green party, environmentalists and scientists.
The price will increase to 55 euros by 2025, and will be decided at auction from 2026.
Germans will feel the difference at the pump with diesel and petrol set to become more expensive, while heating buildings will also cost more.
The government expects to raise 56.2 billion euros from companies buying the new carbon certificates or “pollution rights” over the next four years.
Germany aims to cut its greenhouse gas emissions by 55 percent from 1990 levels by 2030, and derive 65 percent of its electricity from renewables by then.
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