Opportunities and Risks of Climate Protection Measures for the Saxon Economy

Tasks

The coalition agreement at the federal level between the SPD, Bündnis 90/Die Grünen and FDP of November 2021 adopted far-reaching measures to achieve climate neutrality. The Saxon state government also attaches great importance to climate protection in its coalition agreement. Targets and measures were set out in more detail in the Saxony 2021 energy and climate program. Often, the negatively connoted effects of climate protection measures on the economy, such as an increased need for investment or the loss of jobs, are used as counterarguments for climate protection. At the same time, however, investments in climate protection can also stimulate growth and create new jobs. Against this background,  in this project the Gesellschaft für Wirtschaftliche Strukturforschung (GWS) mbH and ifo Dresden analyze the opportunities and risks of climate protection measures for the Saxon economy.

Methods

The integrated analysis of overall economic and structural effects of climate protection measures for the Saxon economy by means of a macroeconomic model is carried out by the Gesellschaft für Wirtschaftliche Strukturforschung (GWS) mbH in Osnabrück. With its profound knowledge of the Saxon economy, ifo Dresden assists in making model assumptions, building model scenarios, interpreting the results, and then formulates recommendations for action for the Saxon state government. The process is accompanied by qualitative surveys of stakeholders in the Saxon economy. ifo Dresden is responsible for organizing and conducting expert interviews and workshops with stakeholders from companies and industry associations.

Results

Both the interviews and the workshops showed that companies often set their climate protection targets above and beyond political requirements. The companies emphasized the importance of maintaining the quality of the location and ensuring long-term planning security for the future.

ifo Dresden derived recommendations for action from this, which include the expansion of renewable energies, the promotion of green hydrogen and energy efficiency improvements through technological innovations. These recommendations aim to support structural change towards a sustainable economy and emphasize the importance of promoting sustainable sectors while not artificially preserving unsustainable business models.