Contextualising And Conceptualising The Reform Of Environmentally Harmful Subsidies In Germany

While the reform of environmentally harmful subsidies has often been identified as a potential means to simultaneously realise environmental, economic and fiscal benefits, little guidance is available on designing possible paths for subsidy reform. This paper aims to better conceptualise a reform process for Germany. It argues that there is room for designing a broader framework for reform moving beyond isolated and, sometimes, inefficient steps at an environmentally oriented subsidy reform. To do so, the broader policy context is described, characteristics and underlying problem structures are identified and obstacles to policy reform are mentioned. As a result, a number of critical requirements for a potentially successful reform process can be formulated. Using available impact analyses as a "tool box", we draw on experiences with Strategic Environmental Assessments (SEA) as a useful and sufficiently flexible organisational and procedural framework for subsidy reform. Based on SEA concepts, the paper treats various important linkages, steps and actor constellations that the reform process is likely to encounter. Finally, the critical link between assessment and decision-making is addressed and some suggestions on a follow-up for the assessment process are made.