Dispute over gas and oil – how green does the KfW bank have to be?

Gas power plant in Hanover

The state development bank KfW could play a decisive role in the construction of new power plants.

(Photo: dpa)

Berlin, Frankfort The federal government is arguing about how sustainable the financing of the KfW Bank in the energy sector must be. While Chancellor Olaf Scholz (SPD) and Finance Minister Christian Lindner (FDP) would like the state development bank to temporarily get more involved in the financing of gas and oil projects, Economics Minister Robert Habeck (Greens) is slowing down with reference to the climate goals. The Handelsblatt learned this from government circles.

The background to the dispute is the need to invest billions in energy infrastructure: Germany needs gas-fired power plants or LNG terminals at least temporarily because of the energy transition. However, since these are uncertain investments in the long term due to the climate goals, there are hardly any private financiers. According to the ideas of the Chancellery and the Ministry of Finance, KfW should fill this gap.

This is exactly what Habeck and other green-led ministries are reluctant to do. The core of the conflict revolves around the question: How green can the state bank KfW be in view of the energy crisis?

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