HKI Online Logo

By now, everyone should have understood that we are heading for a serious ecological problem. 
For this reason, environmentally relevant laws and regulations are being enacted on an unprecedented scale and at an unprecedented speed. On the one hand, this is welcome, as it is high time that countermeasures are taken. On the other hand, it can be observed that many projects require improvements or should not be implemented as planned. It is the task of the associations to intervene here and to stand by politics as an expert partner in order to find solutions together that are both effective and realistic.    


Climate change has made the Green Deal to create a climate-neutral economy in 2050 necessary. But many EU policy targets were missed at the time of adoption and still attracted (efficiency, energy saving, renewable energy targets, etc). This raises questions: 


Will climate protection become more effective by means of more bureaucracy? Does better implementation of the measures make sense? Or is this an end in itself, designed to exhaust EU competences in favour of more centralism? A focus on negative side-effects of progress is recognisable, but not purposeful. These exist in all areas - even in the technologies that make climate neutrality possible. At the same time, the use of recycled materials and the replacement of fossil fuels massively increases energy demand. At the same time, the internal electricity market is still unfinished, the competition systems in energy matters differ in the member states and individual countries with a high level of actionism have reached an energy policy impasse. Implementation is full of hurdles and conflicting goals. In order to proceed expediently nevertheless, technological openness is a prerequisite. Moreover, this can provide relief from high energy prices.


Not only should the role of scientific truth be emphasised, but also that of the market. The progress we need now is only possible with the know-how of the market. There it has grown locally and will be handed down as long as interventions do not distort too much the effective coordination of such knowledge under ever-changing and unpredictable circumstances. The market is each individual and it is his or her knowledge that matters. Neither can policy appropriate such knowledge, nor can any regulation anticipate future markets. Progressive regulation depends on harnessing market forces. Today, however, technologies no longer have to prove themselves on the market and thus show that they can be produced cheaply and are accepted by customers. 


If industrial policy plays an overpowering role here by favouring or disadvantaging certain technologies, the winner in the competition of ideas on the market is anticipated. The market as a discovery process is ignored. Limit values can have drastic effects and are quickly increased. Different alternative technologies are hardly given time to develop. Such developments are aimed at the concrete design of a certain order in accordance with political ideas. But legislation should actually aim at "creating the conditions under which an order can form by itself".

ning by itself" (Friedrich A. Hayek, "Rechtsordnung und Handelnsordnung").
If the market can order itself, it would use the knowledge of all and serve many purposes and goals. Higher prices for CO2 as an extension of the Emissions Trading Scheme (ETS) instrument is a general rule for all and can avoid these developments. Therefore, such instruments are widely welcomed by industry. Openness to results remains guaranteed, which increases the diversity of ideas needed for the technological transformation of the energy, agriculture and mobility transition. Numerous new technologies are already available for climate neutrality. However, acceptance among the population or the introduction of necessary structures is encountering resistance because market processes are being circumvented.


Many technologies are not yet ready or even marketable - especially on an industrial scale. But they also need to be accepted in the market. Consumers must be better involved via the market, and the HKI mediates here on behalf of the manufacturers. If customer wishes, business models and policy are aligned in this way, the Green Deal can be a success for all. If only individual areas are promoted by industrial policy (certain means of transport, technologies, energy sources in the climate package, etc.), this distorts the other market areas, which have to include more and more CO2 costs in pricing. They are made artificially more attractive. And these distortions continue to increase. As pressure is high for industry to provide technical solutions and for policymakers to meet agreed targets, suddenly many compromises and even exceptions are possible, as is too easy to see with the multicolour hydrogen strategy (even dirty grey or turquoise?) or taxonomy. The credibility of the Green Deal is at stake. 


Citizens get less and less of a choice to decide for themselves, while dependence on government subsidies increases. Industrial policy is not open to technology. But policy alone cannot take into account as much knowledge as it can when coordinating millions of consumers and manufacturers in the market. This remains a free-market principle, which highlights how difficult it will be to implement the Green Deal. Confidence in technologies has not been built by this so far. On the contrary, the unease about progress and the moralisation that has arisen has tended to fuel mistrust and reservations about technological changes and innovations. Politics must not be allowed to short-sightedly hack in here and arrogate to itself the knowledge of what is the better technology. A climate-neutral economy must emerge from market processes, otherwise it will not function self-sustainingly and economic weakness would be the result. Limited and uneven distribution of knowledge makes coordination through the market necessary. For example, no one knows in advance the impact on raw material prices for the production of the necessary batteries. If we already knew all the facts and outcomes, we would never have needed the market. Only the market can guarantee the best solution. That is where the most effective knowledge management exists. Competition in the market must not be abolished. It is indispensable for progress. 
Regulation in the EU has created market concentrations and restricted competition. Competition is indeed a matter for the EU within the economy and the internal market is undoubtedly the highest good. However, directives regulations, decisions or the subsidisation of "European Champions" have exerted a strong influence on the economic order. For the EU, competition does not mean self-restraint of its competences in favour of an effective market order. The need for climate protection obviously authorises political action too much for that. More competition, however, is in the interest of the citizens and the green deal. The forces of the market must not be thwarted. As a driver of innovation beyond politics, the role of competition for progress and prosperity is not sufficiently appreciated. Competition shows what can be done better. It increases the incentive to adapt, otherwise a company falls behind its competitors. Changes in circumstances are unpredictable and the reactions to them are up to the market participants. Instead of pushing for an automatism of regulations, framework conditions must be set that promote this market process.


There is a lot of technical potential, both in the combustion of biomass and in a commercial kitchen, to meet the challenges of a climate-neutral economy. They have already done much to improve efficiency and optimise purpose. This potential must continue to be raised with economic success. 

Climate policy positions

Climate policy position HuK

Without the increased use of biomass, the ambitious climate targets cannot be achieved