_ Yuri Kofner, Economist, MIWI Institute. Munich, 7 March 2024.
Summary
- With implicit abatement costs of 354 to 425 euros per tonne of CO2, Germany’s current planned economy, anti-technology and anti-environmental climate policy is extremely harmful.
- Germany must abandon any climate policy that provides for a ban or a price on CO2 emissions. Climate policy must be technology-neutral and compatible with the market, liberty and the environment.
- For coalition negotiations, the AfD should understand its potential for compromise in the area of climate policy.
- Afforestation as a natural form of carbon capture and storage/utilisation (CCSU) is the only climate policy that the AfD can agree to. It is feasible in terms of land requirements, it is cost-effective and it is good for the environment.
- In order to achieve the current CO2 reduction targets, Germany would have to make two per cent of its land available for reforestation by 2045 (instead of two per cent of its land for wind farms) and plant a forest the cumulative size of Texas by 2200, i.e. worldwide. In return, Berlin could completely abolish the forced decarbonisation of the economy. That would be Germany’s special approach (“Sonderweg”) to climate policy.
- At just 17.60 euros per tonne of CO2, this reforestation-climate policy would cost German taxpayers less than the annual beer tax (0.6 billion euros or 6.50 euros per person per year) by 2045 and only half of the annual tobacco tax (6.8 billion euros or 80 euros per year) between 2045 and 2200.
- With a basic land use rent of 800 euros per hectare and year, afforestation would be more economically attractive for farmers than arable farming, biogas and even ground-mounted photovoltaics without EEG subsidies.
- As part of an innovative national programme, the state could buy land abroad relatively cheaply as a commercial forestry operation and give it to German families for every newborn. This would combine carbon storage with a prosperity-enhancing, birth-friendly policy and would be an investment in the developing economies of the global South.
- Reforestation is a deeply conservative policy in keeping with the Germanic spirit.
Economic, social and ecological damage caused by Germany’s current climate policy
As part of the climate agenda[1] tirelessly promoted by the green financial lobby, the German government has set itself the goal of reducing annual domestic CO2 emissions by 65 per cent by 2030 (compared to 1990) and becoming “climate neutral” by 2045.
In 2023, Germany emitted 673 million tonnes of CO2. According to the German government’s self-imposed obligations, these emissions are to fall to 440 million tonnes of CO2 in 2030 within seven years. This corresponds to a necessary overall reduction of 233 million tonnes of CO2. To achieve this target, Germany would have to save 33.3 million tonnes of CO2 every year by then. By 2045, the German economy should become completely “climate neutral”, i.e. it should no longer emit any CO2 at all. This would require a further total saving of 440 million tonnes of CO2 or an annual reduction of 29.3 million tonnes of CO2 per year[2].
This self-imposed goal of reducing emissions and alleged “climate neutrality” is associated with massive costs for the German economy and society and is leading to unprecedented deindustrialisation and social tensions. For example, between 2013 and 2022, net capital flight from Germany totalled €636 billion, which well describes the extent of the exodus of German industry caused by the national climate policy.[3] From 2020 to 2023, energy poverty, i.e. when a household has to spend more than a tenth of its income on heating, electricity, hot water and fuel, doubled from 13.6 percent to over 40 percent of German households.[4]
What is even more worrying is that the so-called “green transformation” is characterised by a gradual shift away from a free society and market economy towards a planned economy characterised by the enforcement of bans and prohibitions, quotas and a general atmosphere of “eco-fanaticism”. The nuclear phase-out, the coal phase-out, the forced switch from gas to hydrogen, the forced replacement of fossil-fuelled heating systems, the ban on combustion engines, the solar roof obligation, the one-sided focus on electric cars and heating pumps – these are just the most striking examples of the green ban policy.
In addition to these regulatory restrictions, CO2 pricing has been chosen as the most important fiscal policy instrument for reducing CO2 emissions. At the beginning of 2024, the CO2 levy for heating and transport regulated in the Fuel Emissions Trading Act (BEHG) will amount to 45 euros per tonne of CO2. The certificates in the EU Emissions Trading System (ETS), which covers energy generation and industrial production, currently cost €63.58 per tonne of CO2.[5] Together with the EU’s gradually introduced CO2 border adjustment, CO2 pricing will cost the German economy €32.2 billion per year by 2030, which corresponds to a financial burden of just under €400 per person per year.
At the same time, the total costs of the “green transformation” to achieve so-called “climate neutrality” are astronomically high. The consensus forecast of various research efforts amounts to total costs of 5-6 trillion euros by 2045, which corresponds to transformation costs of 262 to 285 billion euros per year, i.e. between approx. 6.8 and 7.4 per cent of German GDP. With anticipated savings of 673 million tonnes of CO2 by 2045, this corresponds to a CO2 price of 354 to 425 euros per tonne of CO2 per year![6]
Apart from the anti-freedom methods and the exorbitant financial costs, the forced German energy transition based on the climate narrative is also extremely damaging to the local natural environment. By 2023, over 1,100 hectares of German forest, equivalent to 1,540 football pitches, will have been permanently (!) cleared to make room for over 2,373 wind turbines.[7] According to official plans by the German government, two per cent of Germany’s land area is to be used for wind power by 2030. If the proportion of “wind in the forest” remains the same, this would mean that a further 2,750 hectares of German forests would have to be cleared forever by 2030, the equivalent of 3,850 football pitches[8].
The AfD and its stance on climate policy
Both established climate economists and right-wing political forces such as the AfD reject the current official climate policy of the West, and Germany in particular, for four main reasons. Three of these have already been addressed above: 1. current climate policy is far too costly (or cost-inefficient), it leads to deindustrialisation and impoverishes citizens; 2. it undermines free society, (technological) competition and the social market economy; and, 3. it destroys the environment. In addition, the core claims of the green financial lobby that, 4.a., anthropological carbon emissions are supposedly the main cause of global warming and, 4.b., that humanity is supposedly facing a “climate catastrophe” are being questioned[9].
The AfD is therefore right to call for the immediate end to all CO2 pricing, technology bans and CO2 emission quotas in Germany. With the exception of the demands for adaptation measures to the effects of possible global warming, e.g. better flood protection and innovative irrigation systems for agricultural land, the blue party programme is diametrically opposed to the climate positions of all other established German parties in this respect[10].
At the same time, the AfD is expected to become by far the strongest political force in the 2024 state elections in Thuringia, Saxony and Brandenburg. It could also emerge victorious in the 2025 federal elections. However, in a multi-party system such as the German one, even a majority of 30 to 34 per cent in eastern Germany and strong poll ratings of 20+ per cent at federal level are not enough to guarantee a sole government.[11] Therefore, not only one’s own power, but also the perceived “coalition capability” is an important factor that determines future government responsibility. For example, on issues such as migration policy, the AfD’s positions are both supported by an overwhelming majority of the population and already adopted by the so-called conservative and liberal system parties such as the CDU/CSU, FW and FDP.[12] Both of these factors reinforce the AfD’s perceived “coalition capability” on this issue, as its positions are (formally) in line with those of the popular majority as well as those of potential coalition partners.
However, both factors – consensus of the party programme with public opinion and common ground with potential coalition partners – are only present to a very limited extent when it comes to climate policy, as already mentioned. At the same time, surveys show that the majority of Germans are concerned about climate change, believe that it is caused by humans and want the government to do something about it[13].
When the time comes for possible coalition negotiations, the AfD must therefore know its negotiating options in the area of climate policy: what concessions it can offer here in return for the implementation of its own demands in other areas (migration, identity policy, etc.), and where the red lines run. Other major right-wing populist parties, such as the Lega and the Rassemblement National, have already successfully demonstrated a similar ability to shape policy with the aim of increasing their own ability to govern without, of course, abandoning their own fundamental convictions[14].
What could an AfD compromise look like as a coalition partner in the area of climate policy? What “climate protection” measures could it agree to? Well, as indicated above, these measures should fulfil at least three main principles: 1. they should not place a financial burden on the economy and citizens and should be cost-effective. 2. they should in no way be contrary to the freedom of citizens, (technological) competition and the market economy 3. they should be good for the environment, preferably locally.
In the mainstream economic literature, emissions trading is usually seen as the most cost-effective and technologically neutral climate policy measure[15], but this is wrong. Carbon trading is not technology neutral, as it inherently makes technologies that emit CO2 more expensive, and it may well be costly, as is the case in Germany, where carbon pricing is the highest in the world[16].
It is obvious that none of the above-mentioned measures such as CO2 pricing, technology bans, emission quotas, etc. correspond to the principles of non-pollution, freedom and environmental protection also mentioned above. In other words, the AfD could and should never agree to such measures.
It should be reiterated that a distinction must be made between measures to supposedly prevent climate change, i.e. measures to reduce CO2 emissions, and measures to adapt to a changing climate. As mentioned above, the AfD is in favour of the latter and is extremely sceptical about the former.
Forestry as the AfD’s ideal climate policy: feasible, cost-effective, market-compatible, environmentally friendly and conservative
After careful consideration, the only political CO2 reduction measure that AfD voters and party members could agree to is (re)afforestation, i.e. the planting of trees: the cost of this is minimal and could even yield a small return. It is not harmful to civil liberties, but could even serve to increase the private property wealth of German citizens. And it is obviously good for nature.
Unlike other approaches that aim to reduce carbon emissions domestically, (re)afforestation removes already emitted CO2 directly from the atmosphere and stores it in biomass and the ground, making it a natural form of carbon capture and storage (CCS).
Afforestation policy offsets GHG emissions that have already been created, rather than banning them. Since it enables industrial development and civil liberties while benefiting the environment, it is obvious why the global green finance lobby not only does not consider it a viable climate policy measure, but actively discredits it[17] because there is no redistribution of taxpayers’ money to the “green” corporations, no socialist dictatorship of billionaires is established and the environment is not destroyed.
Reforestation is therefore a conservative, environmentally friendly and market-orientated approach, which is also the only acceptable “climate protection” measure that the AfD could opt for in the context of a possible governing coalition[18].
Feasible land requirements as a German special path in climate policy
According to a response from the Bavarian state government to a written question from MP Gerd Mannes (AfD), one hectare of German forest stores an average of 485 tonnes of CO2 equivalents in its above-ground ecosystem and a further 470 tonnes of CO2 equivalents in the forest floor in the long term, i.e. a total of 995 tonnes of CO2 equivalents per hectare of forest[19].
In order to achieve the German government’s CO2 reduction targets by 2030 (233 million tonnes of CO2), a total of 2,440 square kilometres of trees would have to be planted, which corresponds to the area of the Saarland or just 0.7 percent of the area of Germany. The annual reforestation would have to be less than 350 square kilometres, comparable to the size of Dresden.
In order to offset the additional 440 million tonnes of CO2 by 2045, as is the declared goal of the German government, a further 307 square kilometres of trees would have to be planted by 2045, which would mean an annual requirement for new forest the size of the district of Fürth. The reforestation target for the period between 2030 and 2045 would be 4,607 square kilometres of German forest, i.e. an area twice the size of the Hanover region.
In order to achieve the German government’s final CO2 reduction target, a total of around 7,000 square kilometres of new forest would have to be created by 2045, which corresponds to around twice the area of the district of Rostock or just under 2 percent of the land area of the Federal Republic of Germany[20].
The “climate” target would therefore be two per cent of the land area for natural German forest instead of technogenic wind farms.
It should be noted: This is the forest area needed to store the equivalent of one year of Germany’s average CO2 emissions in the long term (673 million tonnes of CO2, reference year 2023). But how much forest area would be needed in total to compensate for all of Germany’s average CO2 emissions each year?
According to the Bavarian state government, one hectare of temperate or boreal forest stores an average of 11 tonnes of CO2 per year.[21] In order to offset the annual emissions of 700 million tonnes of CO2, i.e. the amount that Germany emitted in 2019,[22] a forest the size of France or Texas would have to be planted (637,000 square kilometres or 86 times the above-mentioned “2 percent target”).
To achieve this goal, a forest the size of the district of Vorpommern-Greifswald (4,058 square kilometres) would have to be planted worldwide every year and it would take until the year 2200 to reach the planned total area of 637,000 square kilometres.
This is of course a highly ambitious goal and would not be possible within Germany’s borders. Nevertheless, it is an achievable and thoroughly cost-effective long-term goal instead of the current, prohibitively expensive and freedom-hostile climate policy of the traffic light government. It would be realisable and cost-effective in the long term if it were implemented globally and chosen as a “German special path” in climate policy, i.e. instead of the current CO2 pricing, emission quotas, green bans and forced transformation.
And the total forest area required would of course be less if Germany were to emit fewer greenhouse gases each year through other voluntary (!) CO2 reduction measures, such as the large-scale return to nuclear energy, as an AfD federal government would do, as well as through other CO2 reduction measures that could be market-driven and without any state coercion: increased electrification of the economy, a growing share of PV, wind and bioenergy, steadily increasing energy efficiency and so on.
Economic upturn at the price of cost-effective carbon sequestration
According to the Bavarian state government, afforestation in Germany would only cost 17.60 euros per tonne of CO2,[23] which is three-fifths cheaper than the current CO2 levy in Germany (45 euros per tonne of CO2), almost three-quarters cheaper than the current price of EU emission allowances (63.58 euros per tonne of CO2) and 20 or 24 times cheaper than the implicit CO2 price for the green transformation (354 to 425 euros per tonne of CO2).
So in order to store 33.3 million tonnes of CO2 per year between 2024 and 2030 through reforestation and 29.3 million tonnes of CO2 per year between 2030 and 2045, which would be necessary to implement the current “climate protection targets”, it would only cost the German taxpayer 0.6 or 0.5 billion euros per year (6.50 euros per person per year), which would be 476 to 518 times cheaper than the current climate policy!
This alternative reforestation and climate policy of a possible AfD federal government would therefore cost no more than the annual state revenue from the beer tax.[24] “Saving the climate as easy and affordable as drinking a beer” could therefore be the new motto.
Planting enough trees to compensate for Germany’s annual CO2 emissions, e.g. with total emissions of 700 million tonnes of CO2 per year and a compensation forest area the size of Texas required by 2200, would cost German taxpayers around 6.8 billion euros per year from 2045 (80 euros per person per year). This is of course more than the above-mentioned 0.6 billion euros per year, but still 38 to 42 times cheaper than the current climate policy and less than half the annual state revenue from tobacco tax. The slogan here could be: “Half a fag for the climate”.
Market-economically interesting in rural areas
As you can see, afforestation is both feasible in terms of land requirements and cost-effective for German taxpayers. But would it really be interesting for German landowners to dedicate part of their land to afforestation?
According to the above-mentioned answer from the Bavarian state government, a landowner would receive a one-off payment of 16,800 euros for each new hectare of forest. With a term of 21 years (2024-2045), this would correspond to an income of 800 euros per hectare per year.
This would be 6 times the average gross income of a farmer (approx. 200 euros per hectare and year), double or roughly the same as the average agricultural land use would generate for biogas plants (420 to 820 euros per hectare and year),[25] but around three times less than the average lease of a PV-free land plant generates (2,500 euros per hectare and year).[26] However, the gross solar yield is only so high because it is immensely subsidised: In 2022, PV electricity received a RE tariff of 27 cents per kWh.[27] An AfD government would gradually reduce this market-distorting subsidy to zero. Without the RE tariff, the generation costs of ground-mounted PV are 7 cents per kWh,[28] which means that the gross revenue of ground-mounted PV would be closer to €648 per hectare per year. For farmers, afforestation would therefore be a lucrative option. In addition, large forest enterprises earn an additional gross income of around 181 euros per hectare per year.
National reforestation programme to build prosperity and stimulate births
Moreover, reforestation programmes abroad, especially in Africa, South East Asia and South America, would be even cheaper. In Gabon, for example, sequestering carbon dioxide through afforestation would only cost 2.70 euros per tonne of CO2, as the land use costs for one hectare of farmland are only 121 euros per hectare[29] and the purchase of farmland in the central countries of Africa would cost an average of only 12,300 euros per hectare[30].
The German state could even develop a national programme in which it buys land abroad for reforestation and gives it to German families for every newborn child. These plots of land could be used as forestry operations and house a holiday home. Such a programme would be beneficial in several aspects at the same time: as a climate protection measure, as a pro-natal population and wealth creation policy and as an outward investment in the economies of developing countries.
Conclusion
To summarise, reforestation would be the ideal solution to the climate policy issue on the right: it is feasible, it is cheap and cost-effective (max. 80 euros per person per year), it is liberal and in line with the market, it is one, if not the only “climate protection measure” that the party could be prepared to take in coalition negotiations. It is good for the environment because new trees are planted instead of being cleared, e.g. for wind turbines. Reforestation policy gives a potential AfD government moral permission to “do its bit” as part of the climate narrative, but without planned economy green CO2 pricing, quota requirements, technology bans, deindustrialisation, impoverishment, etc. And as just mentioned, the reforestation programme can be designed in such a way that it would have a positive impact on the wealth creation and population growth of German citizens, as well as on Germany’s foreign trade relations with developing countries. Last but not least, the afforestation of forests is a deeply conservative political measure and unconsciously an essential part of the Germanic spirit[31].
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[23] Die Kosten für eine Erstaufforstung (Pflanzung/Saat, Nachbesserung, Schutzmaßnahmen) betragen insgesamt ca. 16.700 Euro pro Hektar. Bei einer langfristigen Speicherung von 955 Tonnen CO2 pro Hektar beträgt der Preis pro Tonne CO2 somit 17,60 Euro.
[24] BMF (2023). Steuereinnahmen nach Steuerarten 2000 – 2022. URL: https://shorturl.at/qELM2
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