2022 Federal Budget
The 2022 Federal budget was approved at the beginning of June 2022. The late approval of the budget was due to the change in the legislative period. Until it was finalized, provisional budget management was carried out.
The 2022 Federal budget includes the following significant developments for rail compared with the previous year:
- The Federal Government's Covid-19 compensation measures (2021 Integrated Report) will continue in 2022 (long-distance train-path price subsidies, dividends sacrificed for replacement capital expenditures as part of the Performance and Financing Agreement, funds for damage compensation).
- One-off increase in regionalization funds of an additional € 3.7 billion in 2022. The funds will be used to finance the 9-Euro-Tickets as part of the energy relief package (€ 2.5 billion) and to continue to finance half of the rescue fund for regional transport together with the Federal states.
- Funds for the development and construction of new Federal rail infrastructure will be increased from € 1.56 billion in 2021 to € 1.9 billion this year.
- Funds for noise remediation will rise from € 139 million to € 185 million.
- The facility price support for rail freight was reduced from € 80 million to € 40 million.
In view of the sharp rise in energy prices, the Federal Government has decided to ease the burden. This eliminates the surcharge under the Renewable Energy Sources Act (Erneuerbare-Energien-Gesetz; EEG) of July 1, 2022, which previously served to promote electricity generation from renewable energies. Funding to promote renewable energies under the EEG will be financed from the Federal budget from July 1, 2022, onwards.
In order to take the burden off German citizens, energy taxes on mineral oil were reduced for the months of June, July and August 2022, and a 9-Euro-Ticket was introduced for use on all regional passenger transport services. In order to finance the 9-Euro-Ticket, the German Regionalization Act was amended and the funds topped up by a one-off amount of € 2.5 billion.
In a further package of relief measures, the Federal Government is providing credit and guarantee schemes for companies affected by the war in Ukraine. Equity support can also be provided for “large companies in the real economy across all sectors.” Energy-intensive companies are to receive temporary grants due to the rise in energy prices. In this case, the price differential in excess of a doubling of the natural gas and electricity price is subsidized on a pro rata basis. This is based on the Temporary Crisis Framework of the European Commission. Energy companies trading on commodity futures exchanges are to receive liquidity support in order to be able to meet the security requirements of the energy exchanges.
New Immediate Climate Action Program
The coalition agreement of the Federal Government states that the Climate Change Act is to be consistently refined in 2022 and a new immediate climate action program is to be launched with all the necessary laws, regulations and measures.
As part of the Immediate Climate Action Program, a first amendment was passed to amend the EEG and other laws. The aims included:
- the massive expansion of renewable energies with a target proportion of 80% of electricity consumption by 2030,
- accelerated planning and approval procedures by giving priority to renewable energies in the assessment of protected goods, and
- the EEG surcharge is to be financed by the Federal budget and no longer by a surcharge in addition to the electricity price.
On July 13, 2022, the BMDV presented an Immediate Action Program for the Transport Sector in accordance with the requirements of the German Federal Climate Change Act. This was necessary as the transport sector exceeded the permitted annual emissions volume in 2021. The development and expansion of the refueling and charging infrastructure for passenger cars and commercial vehicles, the expansion of the promotion of efficient truck trailers, an expansion initiative for cycle infrastructure, an expansion and quality initiative in local public transport, the expansion of digital forms of work and the adjustment of the national greenhouse gas (GHG) reduction rate should ensure compliance with the climate targets in the transport sector in future.
The Federal Government is continuing to work on the cross-sectoral Immediate Climate Action Program. The aforementioned measures are to be integrated into this program.
Natural gas supply crisis
Against the backdrop of greatly reduced exports of Russian natural gas to the EU, the BMWK raised the alert level (second warning level) of the Gas Emergency Plan on June 23, 2022. In addition, numerous legislative changes have already been enacted to secure the energy supply. Under Germany’s Energy Industry Law, coal-fired power plants that had already been shut down, or that are planned to do so shortly, may now return to the electricity market. In addition, the consumption of natural gas for electricity may be limited. However, due to their great importance to the system as a whole, power plants for producing traction current are to be excluded from this. On the basis of the amended Energy Protection Act, natural gas suppliers may make extraordinary price adjustments in the event of a limited import situation. Finally, the Federal Government is authorized to introduce a new surcharge for the general financing of high gas costs. In order to avoid a crisis, the Federal Government is authorized to draw up a regulation on the rail-based transport of energy sources. This is intended to facilitate prioritized use of such transport services and to ensure that this is done in a legally compliant manner. The aim of the LNG Acceleration Act (LNG-Beschleunigungsgesetz) is to significantly accelerate the construction and operation of new terminals and lines for the import of liquefied natural gas (LNG) to Germany.
Creation of high-performance network
On June 22, 2022, Federal Transport Minister Volker Wissing and Dr. Richard Lutz announced the development of a high-performance network at a joint press conference.
Master Plan For Rail Transport and Germany in Sync
As a result of the work of the Rail Future Alliance, the BMDV published the Master Plan for Rail Transport in 2020. The key element of this is the Germany in sync (Deutschland-Takt). In August 2021, the BMDV announced its positive economic assessment of a range of measures for Germany in sync. Some 180 measures have since become urgent priorities in the Rail Requirement Plan. This is linked to a basic ability to finance the measures under the Requirement Plan. The assessment is based on the target schedule 2030+ drafted by independent Federal Government experts, for whom the final report was submitted in September 2021. On June 24, 2022, the first regional conference on Germany in sync was held in Mainz. In this context, Federal Transport Minister Volker Wissing informed about the Germany in sync and the planned expansion measures in the south-west.
The Germany in sync management support unit was established at the BMDV on July 1, 2022. Its goals are internal and external bundling, transparent communication and the visibility of all activities of the BMDV regarding Germany in sync.
Rail Acceleration Commission
The first meeting of the Rail Acceleration Commission was held on June 29, 2022, under the direction of the BMDV. By late 2022, the commission is to submit recommendations for action to speed up planning, approval and construction processes in rail transport as well as to review and further develop financing processes. Industry associations and DB Group are both involved in the process.
Telecommunictions signal supply throughout rail routes
The focus is currently on implementing the supply requirements from the 5G auction in 2019. These requirements include a better supply throughout rail routes. As per the auction conditions, the railways are asked to cooperate. To fulfill this obligation to cooperate, DB Group has initiated the project Rail Connectivity Master Plan in order to make this a reality. In consultation with telecommunication companies,
the project is identifying central areas where cooperation is needed and reaching agreements on calling for cooperation. DB broadband GmbH is also contributing to the collaboration, with its extensive offer of fiber-optic capacity along the rail routes, and is thus supporting the Federal Government’s aim of ensuring a comprehensive supply via fiber-optic cables by 2030. In its gigabit strategy, the Federal Government is laying the foundations required for this and is supporting a synergistic mobile network expansion along the tracks with the 5G On Track (5G am Gleis) initiative. The amendment to the Telecommunications Act (Telekommunikationsgesetz), which was passed in 2021, regulates the conditions governing the use of rail infrastructure and provides for a new objective, frequency regulation, to ensure uninterrupted connectivity along transport routes by 2026 if possible.
In 2021, we have reached an agreement with Deutsche Telekom and, in the first half of 2022, also with Vodafone to exceed the 2019 coverage requirements. It was agreed that the two telecommunications companies will expand their network on DB rail routes by 2026, close existing gaps and significantly increase the performance of their networks. Together, we are investing more than € 100 million.
Master Plan 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 Federal program, the Future of Rail Freight Transport, provides the basis for the pro rata funding of projects in the areas of digitalization, automation and vehicle technology. After the first-time funding from the Federal program in the 2020 Federal budget of € 30 million and its continuation in 2021, the funding was increased to just under € 40 million in 2022. As a further measure to strengthen rail freight transport, facility price support has been assigned in the Federal budget since 2020. The amount granted in 2022 was € 40 million. The Funding Guidelines for sidings were evaluated and published with new funding opportunities in March 2021, with € 18 million allocated in 2022. Train-path price support, which also results from the Master Plan, totals € 350 million per year. It currently has a fixed term lasting until 2023, but is expected to be extended after an evaluation. The Funding Guidelines are currently being revised.
The Combined Transport Funding Directive is currently being evaluated and the new Guidelines are to be published before the end of this year.