Economic stimulus package of the Federal Government
In June 2020, the Federal Government reached an agreement on comprehensive measures on the topic of “Tackling the Covid-19 Impact, Securing Prosperity, Strengthening Readiness for the Future.” These include a number of general relief measures for the German economy, while simultaneously providing industry-specific stimuli in 2020 and 2021. The following developments took place in the first half of 2021, particularly with regard to the measures relevant to rail:
- In the 2020 supplementary Federal budget, an increase of DB AG’s equity by € 5 billion was planned to compensate in part for losses as a result of the Covid-19 pandemic. This amount was transferred to 2021 as part of the 2021 Federal budget because it was not possible to conclude an agreement under state aid law with the European Commission in 2020. Based on the advanced state of negotiations with the European Commission regarding the measures, the funds previously earmarked in full as an equity capital increase were reduced by just under € 3.1 billion and reallocated in the same amount as part of the supplementary budget 2021 adopted by the Upper House of Parliament (Bundesrat) in April 2021. Federal funds to maintain Federal railways were increased by € 650 million as compensation for the non-payment of a dividend by DB AG in 2021 and expenditures to support train-path prices in rail freight transport were increased by € 600 million. Just under € 1.8 billion has been allocated in the Federal budget to support train-path prices in long-distance rail passenger transport. An agreement under state aid law with the European Commission has not yet been concluded in the first half of 2021.
- The Act on Accompanying Measures for the Implementation of the Economic Stimulus and Crisis Management Package implemented the additional, one-time increase of € 2.5 billion in regionalization funds in 2020, with the Federal Government participating in the rescue fund for public passenger transport. For 2021, the Federal Government intends to make a further contribution of € 1 billion to continue the rescue fund. As in 2020 the Federal states want to contribute the same amount.
Further information on the economic stimulus package of the Federal Government: 2020 Integrated Report.
Implementation of the Climate Action Program 2030
On the basis of the Federal Governmentʼs Climate Action Program 2030, additional Federal funds totaling € 11 billion will be made available by 2030 to strengthen the rail system. At the end of January 2020, the Federal Ministry of Finance (Bundesministerium der Finanzen; BMF) and the Federal Ministry of Transport and Digital Infrastructure (Bundesministerium für Verkehr und digitale Infrastruktur; BMVI), as well as DB AG,DB Netz AG,DB Station&Service AG and DB Energie GmbH, had agreed on the inflow and use of the funds in a joint letter of intent. The funds will be used exclusively for infrastructure; half of it will be paid as equity and half as grants to DB Netz AG and DB Station&Service AG. In terms of content, the funds will be used in the categories of robust network, digital rail, attractive stations and economically self-reliant infrastructure measures. The funds that are to be used to increase equity are subject to an agreement with the European Commission in line with state aid law, which was not concluded in 2020. Therefore the respective funds for 2020 were transferred to the Federal budget 2021.
Amendment to the German Federal Climate Protection Act
On April 28, 2021, the Federal Constitutional Court published a resolution on the Climate Protection Act, which confirms the admissibility of the fixing of targets for reducing greenhouse gas and emissions limits. At the same time, it calls for the targets to be made more ambitious and the requirements for the period after 2030 to be made more specific. In compliance with this requirement, the German Parliament has passed an amendment to the law. The targets for national greenhouse gas reduction for 2030 will be increased from –55% to –65%. At –88% a specific target for 2040 was set for the first time. Germany’s target year for climate neutrality is being brought forward from 2050 to 2045. For transport, the annual maximum amount of greenhouse gas emissions will be reduced from its previous level of 95 million to 85 million tons of CO₂ equivalents in 2030. Emissions must therefore fall by 48% instead of the previous 42%. A year-by-year national reduction path to 2040 was included. The new targets will require additional climate protection measures, including those to strengthen rail transport.
National Platform Future of Mobility
In the German Federal Governmentʼs National Platform Future of Mobility (NPM), DB Group is represented in the steering committee, as well as in the working groups for climate protection in transport as well as digitalization for the mobility sector. In June 2021, the working group for climate protection in transport presented a report on how the measures already taken under the Climate Protection Program 2030 can be further accelerated and expanded in order to meet the requirements for climate protection in transport. As part of the work of the other working groups, more in-depth work was prepared on specific issues. DB Group is a project member of RealLab Hamburg, which researches the requirements and demands of intermodal and autonomous mobility, among other things.
Master Plan for Rail Transport and Rail Pact of the Rail Future Alliance
As a result of the Rail Future Alliance, the BMVI published the Master Plan for Rail Transport in June 2020, which is broadly supported by the industry. Implementation of the plan as a whole and of key elements is the subject of ongoing committee work under the management of the Federal Government and with the participation of DB Group. At the Federal Governmentʼs annual rail summits, what we have achieved and the challenges facing us will be discussed in a public forum. On May 17, 2021, the third rail summit focusing on European transport took place at the BMVI. Several EU countries signed a letter of intent for TransEuropExpress (TEE) 2.0 for cross-border high-speed and night transport by rail. This is expected to become part of a networked and synchronized European schedule.
Railway regulation law
With the cabinet resolution of January 20, 2021, the parliamentary proceedings were initiated with the government draft of an amendment to the Railway Regulation Act (Eisenbahnregulierungsgesetz, ERegG). This was concluded as part of a second consultation with the Upper House of Parliament (Bundesrat) on May 28, 2021. The amendment to the ERegG adapts the national legal framework to developments in EU law and provides the basis for new models for capacity allocation and schedule preparation, including for the Germany in sync plan.
Railway Law Reform Act
With the Federal cabinet resolution of January 13, 2021, the draft amendment of regulations in the railway sector, known as the Railway Law Reform Act (Eisenbahnrechtsbereinigungsgesetz, EbRbG) was passed. The changes, that are mainly affecting the General Railways Act (Allgemeines Eisenbahngesetz, AEG) were passed by the plenum of the Upper House of Parliament (Bundesrat) in the second consultation on May 28, 2021. In addition to editorial adjustments, the EbRbG is fundamentally a reorganization of the laws relating to sidings, among other things, and the creation of new regulations on vegetation control, particularly with regard to threats to safe railway operations originating from third-party land.
Master Plan for Rail Freight Transport
The implementation of the Master Plan for Rail Freight Transport will continue as per the procedure thus far in order to supplement the work of the Rail Future Alliance. Important issues from the Master Plan for Rail Freight Transport are also included in the Master Plan for Rail Transport. The Future Rail Freight Transport program of the Federal Government provides the basis for helping to partly fund projects in the areas of digitalization, automation and vehicle technology. Following the initial funding of the program in the 2020 Federal budget in the amount of € 30 million, the program will continue with the same financial backing in 2021. As a further measure to strengthen rail freight transport, facility price support of € 40 million was assigned in the 2020 Federal budget for the first time, which increased to € 80 million in 2021. The funding guidelines for sidings were evaluated and published with new funding opportunities in March 2021, with € 34 million allocated in 2021. The evaluation of the combined transport funding guidelines is currently taking place; the new directive is expected to be published in early 2022.
Implementation of the national Rail Noise Protection Act
Since the schedule change in 2020/2021, the Rail Noise Protection Act has generally prohibited the use of noisy freight cars on the German rail network. DB Netz AG has updated its rail network terms and conditions of use in implementing the law. In a formal notice to the Federal Government, the European Commission expressed its opinion that the Rail Noise Protection Act contradicts EU law and that it considers the act to be in breach of interoperability requirements. The initiated procedure has not yet been completed.
Telecommunications signal supply throughout rail routes
The focus is currently on implementing the supply requirements from the 5G auction in 2019. As per the auction conditions, the railways are asked to cooperate with respect to the provision of coverage along the rail tracks. To fulfill this obligation to cooperate, DB Group has initiated the project master plan Connectivity Rail in order to make this a reality. In exchange with the mobile phone companies, central cooperation requirements were disclosed in the project and agreements were reached on the request for cooperation services. DB broadband GmbH is also contributing to the collaboration, with its extensive offer of fiber-optic capacity along the rail routes. The amendment to the Telecommunications Act (Telekommunikationsgesetz), which was passed with the approval of the Upper House of Parliament (Bundesrat) on May 7, 2021, which largely complies with the previous regulations, contains regulations on the shared use of rail infrastructure. A new addition was made with the objective of frequency regulation to ensure uninterrupted connectivity along transport routes by 2026 if possible. The competencies of the Federal Network Agency (Bundesnetzagentur; BNetzA) to enforce the supply requirements were also expanded.
We have reached an agreement with Deutsche Telekom on an overachievement of the supply requirements 2019. It was agreed that Deutsche Telekom would expand its mobile network on DB rail lines as quickly as possible, close existing gaps and significantly increase the performance of the network. By 2026 at the latest, there are to be no more supply gaps along the long-distance and regional rail lines. Together, both companies are investing a three-digit million euro amount.