DW -- The ammortization account - New German fiscal engineering for infrastructure spending?
Germany’s obsession with avoiding fresh debt has led to doubts about its energy transition. Now, a novel mechanism for its hydrogen strategy could become a blueprint for future infrastructure spending.
This is a story I came across while reporting on Germany’s Ruhr area switching from coal to hydrogen. To make the move, the country needs a set of pipelines to transport H2 from A to B.
But infrastructure investments are tricky in Germany, given strict fiscal rules of the Schuldenbremse, a constitutional law that restricts how much the federal government can borrow. To make the hydrogen move happen, a new financial mechanism was voted into law and it could become a blueprint for similar large scale investments in the future.
I was happy to get the chance to write about some inner workings of German fiscal policy. And I do actually think this is an interesting story to watch as we head into an election year, while every party seems to look for spending options around the debt break. Let’s see when this mechanism shows up in court for the first time.