ADAC warns of significant fuel price increases as the European emissions trading scheme for transportation is set to launch in 2027. Anticipated hikes include up to 3 cents in 2026 and potentially 19 cents per liter thereafter. To address rising energy costs, the German government is discussing climate money and reforms to support emissions trading. However, uncertainties about CO2 certificate pricing may pose challenges for energy suppliers and consumers, necessitating effective relief measures for those most affected.
Impending Fuel Price Surge: What to Expect
The ADAC has issued a cautionary note regarding a notable rise in gasoline and diesel prices as the European emissions trading scheme for transportation is set to launch in two years. It is essential for consumers to be aware and prepared for these changes.
According to ADAC President Christian Reinicke, drivers should brace themselves for steep increases in fuel costs beginning in 2027. He indicated that the CO2 price is anticipated to escalate more dramatically than in the current and upcoming years. “In 2026, we expect a price hike of up to 3 cents for gasoline and 3.1 cents for diesel,” he stated.
Looking ahead to 2027 and beyond, the automobile club predicts further increases that could reach up to 19 cents per liter for both gasoline and diesel, influenced by the pace of climate protection efforts.
Climate Measures and Government Response
To mitigate the impact of rising energy prices, the introduction of climate money is proposed, although its rollout has faced delays. This initiative is part of a broader reform of the emissions trading system, which is currently under discussion in the Federal Council following approval by the Bundestag to align with EU regulations.
Germany aims to achieve climate neutrality by 2045, necessitating substantial reductions in CO2 emissions to meet international climate commitments and alleviate the severe consequences of global warming. The intention behind the CO2 price is to encourage efficiency and promote a shift toward eco-friendly technologies, including electric vehicles and sustainable heating systems.
As of January 1, the CO2 price has risen from 45 to 55 euros per ton. The Fuel Emissions Trading Act establishes a price corridor for 2026, with a minimum of 55 euros and a maximum of 65 euros per emissions certificate. Starting in 2027, a new CO2 emissions trading system will encompass building heating and transportation across the EU, replacing the existing German system.
While the European emissions trading scheme is expected to provide significant incentives for low-emission transportation, ADAC President Reinicke emphasizes that many individuals still lack viable alternatives to traditional vehicles. Therefore, it is crucial for policymakers to implement reliable measures to alleviate the financial burden of the increasing CO2 price from 2027 onward.
Reinicke stresses that the new federal government must promptly decide on relief strategies to maintain public support for climate initiatives. A portion of the revenue generated from the CO2 price should be returned to consumers, particularly those with lower incomes, through climate money. Additionally, the commuter allowance should be permanently increased to support those most affected.
As fuel prices at German gas stations have surged at the start of the year, it becomes critical for the federal government to ensure that the proceeds from emissions trading are allocated effectively to assist impacted consumers. Kerstin Andreae, chair of the main management of the Federal Association of Energy and Water Management, highlights the importance of using these funds for targeted relief measures, such as climate money and renovation subsidies.
However, uncertainty looms over the pricing of European CO2 certificates starting in 2027, creating potential economic challenges for energy suppliers who must account for emissions trading costs separately on their bills. This unpredictability complicates their ability to negotiate contracts for 2027 and 2028.