I. Title of the Best Practice

II. Overview of the Best Practice

The ecological reform of tax and state pension contributions represents another key aspect of climate protection. On the initiative of the German Government and coalition factions, a law was adopted at the start of the ecological tax reform introducing a mineral oil tax on fuels, heating oil and gas, and an energy tax on electricity consumption. A moderate, step-by-step increase in energy prices - planned in calculable intervals - will provide incentives for exploiting the potential for energy conservation and to develop energy saving and resource efficient products and production processes. This is requisite particularly in view of the liberalisation of the energy market.

The clear route being pursued by the German Government creates security in both legal and planning terms, providing a basis for a calculated switch to alternative energies. Furthermore, the ecological reform of taxes and state pension contributions provides a link between the project "energy change" and the creation of new jobs. In order to ease the burden of employment as a production factor, the German Government intends to lower the social insurance contributions to below the 40% mark. Thus the law introducing the ecological tax reform represents a first step towards a change in both ecological and social structure.