How climate clash is key to Germany's power struggle

Major compromises will be needed for a coalition deal between Greens and liberals

Green party supporters greet co-leader Annalena Baerbock in Berlin. AFP

Germany’s Greens may not have won the election, but climate change will be at the heart of the power struggle to succeed Angela Merkel as chancellor.

The two rival candidates, Olaf Scholz and Armin Laschet, are both courting the Greens as coalition partners in what could be a protracted post-election negotiation.

Any such deal would also require the support of the Free Democrats (FDP), a pro-business party, which is hardly a natural fit for the Greens.

Although both potential kingmaker parties called for modernisation and were popular among young voters, they were often at odds over how to tackle the climate crisis.

The Greens have big spending plans, while the FDP stresses low taxes. While the former has a reputation for wanting to ban things, the latter wants to tackle climate change with “more joy in inventing things”.

And while the liberal FDP is a traditional ally of Mr Laschet’s party, the Greens have made clear that they prefer Mr Scholz.

Tricky coalition maths

Sunday's election gave no party more than the 25.7 per cent of votes that went to Mr Scholz's Social Democrats (SPD). Mr Laschet's centre-right bloc won 24.1 per cent.

Neither is close to a majority alone, and would need to bring in both the smaller parties to get there. The Greens were third on 14.8 per cent, with the FDP fourth on 11.5 per cent.

Acknowledging the gap that needs bridging, the Greens and FDP began exploratory talks this week before approaching either potential chancellor. Negotiators described a positive atmosphere.

Arne Jungjohann, an energy policy expert and former Green party aide, said parties had good reasons to make climate policy a key part of the negotiations.

“All parties who want to join the government emphasise that climate will play a crucial role for the next government,” he told The National.

“For one, in terms of substance, they expect that. But in terms of tactics, these parties have done this kind of signalling because they want to have a coalition with the Green party.”

Tax and spending

A key plank of the Green agenda is investing billions of euros in railways, cycle lanes, charging stations, renewable energy and refurbishing buildings.

The party wants to raise money for this by increasing the tax rate on top earners, cutting subsidies for roads and fossil fuels, and exempting some investments from constitutional debt limits.

Mr Scholz’s Social Democrats (SPD), the preferred partners of the Greens, also want to squeeze more money from the rich.

The FDP, by contrast, is known as a low-tax party. It opposes higher tax rates and rejects any changes to the debt brake.

But it concedes that investment is necessary to modernise Germany’s infrastructure, although it would like to see more money raised privately.

Petrol cars

The FDP wants to tackle climate change by unleashing innovation in green technologies. One of its favourite slogans during the campaign was: “More joy in inventing than in banning things”.

One example of this is in Germany's flagship car industry. While the Greens want to ban petrol cars by 2030, the FDP rejects a hard cut-off and says the market will naturally favour electric vehicles.

Asked about polluting cars, Mr Scholz said during the campaign that he was “not a fan of banning things if you can do without it”.

But he acknowledged that the decision may fall out of Germany’s hands. The EU has proposed a ban by 2035 as part of a Europe-wide green overhaul.

Coal exit

Germany is due to switch off coal power by 2038. Mr Scholz and Mr Laschet’s parties regard this as a done deal, while the Greens campaigned on bringing it forward by nearly a decade to 2030.

The FDP accepts that the 2038 exit is a reality, although it has described the process as expensive and raised concerns about energy shortages.

Mr Jungjohann suggested that a compromise could be to aim for a faster phase-out without writing the new target into law.

The FDP says Germany can become carbon-neutral by 2050 by expanding an emissions trading system which the Greens also support.

Both parties support the expansion of hydrogen fuel. The Greens are more enthusiastic than the FDP about solar and wind, planning to put a solar panel on every new roof and cover 2 per cent of Germany’s land with wind turbines.

Motorway speed limit

Germany’s autobahns are famous for not having a general speed limit, but calls to introduce one have become a contentious subject.

The Greens want a limit of 130 kilometres per hour, on the grounds of road safety as much as carbon-neutrality.

The SPD made the same promise, but the FDP rejects such a limit. Mr Laschet’s Christian Democrats (CDU) side with the FDP.

“It’s a highly symbolic issue,” said Mr Jungjohann. “It also has substance, but for the FDP it’s somewhat like an identity issue.

“It would cost a lot of political capital for the Greens to make the liberals agree on a speed limit.

“I would expect an earlier coal phase-out is much more likely than, let’s say, a speed limit.”

Ministerial roles

The two parties have young, ambitious leaders. Annalena Baerbock, 40, sought the chancellorship for the Greens. Mr Lindner, 42, is a slick former investor.

Even if the parties can reach compromises on the issues, further talks will be needed to thrash out the shape of the new cabinet.

Mr Lindner has said openly that he would like to be finance minister, the role which Mr Scholz would vacate if he becomes chancellor.

But the Greens, as the larger partner, might have the first shout. Party co-leader Robert Habeck has been tipped as a possible finance minister and vice chancellor.

The Greens want to create a new climate ministry that could veto proposals from other departments if they do not conform to the Paris Agreement.

Junior coalition partners also tend to be in line for the foreign ministry. The Greens ran foreign affairs from 1998 to 2005 and the FDP from 2009 to 2013.