Design of a Green Gas Quota to Defossilize the Gas Sector

Germany is pursuing the goal of climate neutrality by 2045, as set out in the Federal Climate Protection Act. Gaseous energy sources play a central role in this, but they must increasingly be defossilized. A mandatory green gas quota is intended to ensure that fossil gases are replaced by climate-friendly alternatives such as hydrogen and biomethane in order to reduce CO₂ emissions.

As part of this project, frontier economic developed a concept for a green gas quota. This is intended to continuously increase the share of climate-friendly gases by 2045 and sustainably decarbonize the German gas market. The proposal for the green gas quota is based on principles such as making an effective contribution to climate neutrality, ensuring fair competition between green gases and safeguarding an affordable gas supply. At the same time, compliance with EU sustainability requirements is ensured in order to implement the energy transition in an efficient and targeted manner.

The concept envisages a quota path that will enable an ambitious but realistic increase in green gases from 2027 until 2045. This proposal takes into account existing potential estimates in order to achieve the ramp-up targets in a meaningful and practical way. In addition, it is proposed to use existing institutions and testing processes to minimize the administrative burden. The draft was developed in close collaboration with representatives from all sectors of the gas industry (production, storage, transport, end-users). We would like to thank all participants for their support in developing this concept.