FACT SHEET

Environmental
Technologies inGermany
ISSUE 2021/2022

Germany is home to one of the most advanced environmental technologies markets worldwide, with new legislation creating new opportunities for investment.

The Industry in Numbers

With a global trade share of 14 percent in 2020, German
greentech products are especially sought after. In 2016, themarkets for environmentally friendly energy generation,energy efficiency, resource efficiency, sustainable mobility,
sustainable water management, waste management andrecycling accounted for 15 percent of German GDP. This is
expected to increase to 19 percent by 2025.
Growing Markets: Water and Recycling
The circular economy and the sustainable water industry
are expected to experience annual growth of more than five
percent and six percent respectively – reaching a joint market
volume of EUR 110 billion by 2030. Within the sustainable
water industry, water efficiency – with expected annual
growth rates of almost 40 percent until 2030 – represents thesegment with the highest growth. With an estimated annual
increase of almost 15 percent for the period 2016 to 2025, themarket for recycling technologies offers the fastest-growing
opportunities in the circular economy and waste management markets.
Environmental Technology Incentives
Incentives programs in Germany are designed to support awide range of business activities at different stages of theinvestment process. There are a number of programs available to strengthen the increasingly important environmental
technology market. At the federal level, the Umweltinnovationsprogramm (Environmental Innovation Program), forexample, promotes the implementation of pilot projects with
non-repayable grants of up to 30 percent of eligible costs. The
federal government "New Urban Agenda" initiative aims tofund measures in order to develop and test locally adapted
strategies for the sustainable development of urban regions
and to increase urban resilience.

14 percent

German greentech products
global trade share

EUR 110 billion
Circular economy and water industry
market volume by 2030

+15 percent
Recycling technologies annual
market growth 2016-2025

Germany's Environmental Technologies Markets
in EUR billion

7820202030

323924Circular Economy
Source: BMU and Roland Berger 2021

Sustainable Water Industry

MARKET OPPORTUNITIESWater Technologies
in Germany
Germany is home to Europe’s biggest sustainable watermanagement market. A commitment to sustainable
water innovation also makes it the continent’s leading
exporter of water treatment technologies as well as amajor provider of solutions that guarantee higher efficiency and water quality standards for water-intensive
industries around the world.
Sustainable Water Management Market
Germany is Europe’s largest exporter of water treatment
technologies, with an export volume of more than EUR 1
billion in water and wastewater technologies in 2018. The
German market for sustainable water management isEurope’s largest with EUR 39 billion volume in 2020. German
water protection policy sets the framework for development
and innovation in the water sector. The Federal Water Act andcorresponding legislation – including the Drinking Water
Ordinance and the Waste Water Ordinance as well as a number of local federal state provisions – create the legal basis fora transboundary and sustainable water management market.
Energy-saving Technologies
The German climate protection plan is premised upon an
increase in demand for energy-saving technologies. Thishas created significant market opportunities for providersof sustainable water technologies that optimize processes,
reduce wastewater levels, and augment water supply andwater management systems. According to the Federal
Environment Agency (UBA), water abstraction levels inGermany dropped perceptibly in the last 20 years. Moreefficient production processes and the reuse of water haveenabled the manufacturing sector to significantly cut costs.
Sewage Sludge Treatment and Phosphor Recovery
Some 34 percent of sewage sludge was used in agriculture
and landscaping in 2016. Germany’s sewage sludge ordinance(AbfKlärV) regulates the application of sewage sludge on
agriculturally and horticulturally used soils. The use of sewage
sludge for fertilization purposes is prohibited and phosphorand other nutrients should be recovered. No specific recovery
technologies have been defined. This will allow new market
players that provide innovative recovery procedures theopportunity to successfully enter the market.
Micropollutants and Microplastics
There is an acute need for cost-effective and energy-efficientsolutions to eliminate micropollutants, especially in municipal
waste water systems. In 2016, just eight percent of German
surface water and 64 percent of groundwater bodies achieved� 39 bn� 110 bn

Sustainable watertechnology market volumein Germany in 2020

Investment since 1990 –creating Europe’s biggest
sustainable watermanagement> 9,300< € 1 bn

Number of public
wastewater treatment
plants in Germany

Export volume forwater and wastewatertechnologies in 2018

Sources: BMU and Roland Berger 2021, BDEW 2017, VDMA 2019

"good status." The introduction of the “fourth purificationstage” within treatment plants is currently being tested;
applying technologies such as adsorption on active carbon,
nanofiltration, and reverse osmosis. Marine litter presents
another challenging issue, with several action programs tocounter the problem set up under German leadership. The“oceans without polluting waste” national action plan includes
efforts to reduce the discharge of microplastic particles.
Adapting to Climate Change
The minimum cost of not adapting to climate change inEurope has been estimated at EUR 100 billion a year in 2020,
rising to EUR 250 billion in 2050. In Germany, climate change
is creating increased demand for better monitoring of water
resources and aquatic systems as well as weather extremes.
According to the UBA, more than 90 percent of all major German cities are actively developing concepts and strategies
to deal with climate change. Companies offering respective
technologies should approach the market now to provide
solutions for the future resilient city. The German Strategyfor Adaptation to Climate Change sets out the optimalframework for projects and investments. Measures andsought-after technologies include optimized water resource
monitoring, flood protection (e.g. “sponge city” concepts),
rain water, and drinking water management solutions.

→Please visit our website to find out more on
adaptation to climate change in Germany.
www.gtai.com/climatechangeWaste Management & Recyclingin Germany
Germany’s leading global recycling industry status has
its basis in progressive waste management legislationthat allows companies to thrive. The provisions of theGerman Waste Management Act are helping make thecountry’s circular economy market increasingly attractive for international investors.
Global Market Leader
In 2016, the German waste management and recycling markets totaled approximately EUR 20 billion – equivalent to16 percent of global market volume. The German circular
economy industry is expected to grow by 5.4 percent annually through 2025. In 2018, more than 417 million metric tonsof waste was generated in Germany, with a recycling rate ofjust 70 percent. Building and construction materials represent
the lion’s share of waste; thereby making it one of Germany’s
most attractive recycling technology markets.
Progressive Environmental Regulation
The Waste Management Act (KrWG) enshrines the notion ofproduct responsibility by defining responsibilities along theproduct life cycle and offering incentives to manufacture
durable products. The act’s goal is to turn a waste management culture into a resource management culture, minimizing
waste generation and maximizing reuse and recycling. The
five-step waste hierarchy – waste avoidance, re-use, recycling, energy recovery and disposal – is one of the key measures to achieve these goals. Based on this hierarchy, the law
ensures that precedence is given to the environmentally bestoption, namely prevention of waste, reuse and recycling.
Packaging Recycling
Demographic changes have led to a constant increase inpackaging waste. Domestic packaging waste volume reached
its peak in 2016 with 18 million tons – of which 70 percent
was recycled. In January 2019, Germany’s new Packaging Act
entered into force, stipulating higher recycling quotas forpackaging. The task is especially challenging for plastics, withthe recycling quota for plastic packing to be increased to 63
percent by 2022.
Plastics Recycling
According to the UBA, more than six million metric tons ofplastic waste were produced in Germany in 2017, of which
only 47 percent was recycled. While in the past a considerable
amount of plastic waste was exported abroad, the German
recycling industry now faces the challenge of raising domestic
capacity, inter alia, the ban of plastics waste imports toChina. According to the Federal Ministry for the Environment,
only 12 percent of plastics used in manufacturing in Germany

in 2017 were recycled materials. Germany's new Packaging
Act, effective since January 2019, aims at increasing this rateby rewarding producers that use recyclates. The ministry will
also establish an initiative to enhance the use of recycledplastics in the manufacturing industry. As the UBA emphasizes, recyclers can also boost the use of plastic recyclates in
the manufacturing industry by ensuring high quality of therecyclates. International companies with innovative technologies to recycle plastics waste and produce high-quality
recyclates find optimal conditions for entering the Germanmarket.

Minimum Recovery for Packaging Waste in Germany
as of 2019as of 2022

Plastic packaging

58%

63%

Aluminum80%

90%

Tinplate and ferrous metals

80%

90%

Paper and cardboard

85%

90%

Glass

80%

90%

Beverage carton

75%

80%

Source: Deutscher Bundestag, BMU 2019

Waste Type Volume and Recycling Quota (RQ) Levelsin Germany in 2018
in million tons

Recycling

RQ 88%

Other disposal methods(e. g. landfill, incineration,energetic recovery)

RQ 51%
56

RQ 68%RQ 3%
29
Organicwaste

3416
Municipalwaste

20054
Other waste**incl. production and manufacturing activities
Source: Federal Statistical Office 2021

28
Construction anddemolition waste

Circular Economy: Niche MarketOpportunities
Innovations and new technologies are changing the demand for resources worldwide. In Germany, the energy
transition, digitalization and growing sustainability
awareness among consumers has led to the developmentof a series of niche markets offering growing potential
for innovative companies in the circular economy. The
wind turbine and CFK recycling, electronics recycling,
electric car battery recycling, and circular fashion markets present particularly attractive opportunities.
Wind Rotor Blade Recycling
Germany was a first mover in the development of themodern wind energy industry and is now seeking to extend
its reputation by recycling as many wind power plant components as possible when they reach the end of their service
lives. Beginning in 2020, many of the financially supported
wind turbines will reach their maximum funding period of 20years. The Federal Ministry for Economic Affairs and Energy
observes that almost 12,000 onshore wind turbines – with acapacity of more than 14,000 MW – in total will be affected
between 2021 and 2025. This creates significant potential for
repowering and recycling. Where decommissioned parts suchas rotor blades, nacelles, towers and foundations cannot bereused, the German Waste Management Act (KrWG) requires
they be recycled and supplied to the secondary raw materials
market. Wind energy is already a clean alternative. If this canbe extended to the entire life cycle of all the components,
it will become cleaner still. The developments in Germany’s
renewable energy industries have created an attractive niche
for innovative recyclers and new potential for internationalcompanies.
Battery Recycling
The Federal Ministry for the Environment has calculated that,measured by vehicle weight, 89 percent of Germany’s end-oflife vehicles were recycled or reused in 2017. With e-mobilityon the rise, the CO2 emissions over a vehicle’s lifetime will bereduced considerably. However, the BMU notes that emissions made during the auto production and recycling process
will increase, thereby becoming the largest contributors to
the vehicle’s carbon footprint.
Environmentally friendly and efficient battery recycling is
an imperative for an emission-free transport system. It isbelieved that electric vehicle batteries need an upgrade after
seven years – creating huge recycling potential. The rising
popularity of e-bikes in Germany – with almost two million
e-bikes sold in 2020 alone and 39 percent of the overall
bicycle market – intensifies the need to develop improved
recycling methods for batteries.

Textile & Clothing Recycling
Action needs to be taken to reduce the environmental impactof the textile industry along the whole supply chain. According to the UBA, measures range from environmental relief(by promoting the cultivation of organic cotton) to the use ofrecycling technologies for the production of chemical fibers
or the recycling of purified process water and the utilizationof waste heat during the textile finishing process. The opportunities in Germany – one of the largest clothing markets in
Europe – are manifold for textile and clothing recyclers andcircular fashion companies. The market is expected to groweven further, with sustainable fashion becoming an increasingly important market segment.
According to the Slow Fashion Monitor 2016, sustainability isimportant or even very important when making a purchasing decision for more than 73 percent of consumers. Amongwomen, 53 percent are willing to pay more for environmentally friendly, sustainable, and fair-trade clothes. This offers
new opportunities for the development, production, and saleof sustainable textiles and clothing recycling in Germany.

New Recycling Potential: Opportunities for Innovative
Companies

2 million e-bikes sold in Germany in 2020

1 million tons of used textile waste
generated each year in Germany

12,000 onshore wind turbines in Germany reach endof funding period in 2025400 GWh electric vehicle battery
demand in Europe by 2028
Sources: BVSE, ZIV 2021, BMWi, European Battery Alliance 2019

INVESTMENT CLIMATESupporting Innovation
Innovation is key to Germany’s leading role in theglobal environmental technologies market. Attractive
government support, a highly skilled workforce, and adiverse research landscape offer optimal conditions forinternational companies planning the set-up of researchand development facilities in Germany. World-renowned
research facilities, institutions and universities represent
potential partners for successful research collaborations.

marine and polar research, climate commodities, energy andresources, biodiversity, land, and soil. Some EUR 4 billion will
be invested in the renewal of the program for the period2020 to 2025. The program especially welcomes “fundingnewcomers” under the umbrella of the “KMU-Innovativ”
FONA initiative. Since its launch in 2007, more than EUR 1.2
billion has been granted to 1,700 projects involving a total of
2,900 SMEs.

Research and development (R&D) activities in the area ofenvironmental technologies are supported by a number ofgovernment programs within Germany’s overarching HighTech Strategy which seeks to provide innovative technological solutions to global challenges.

The UFORDAT database (doku.uba.de) lists more than 120,000
research projects of more than 10,000 institutions conducting research in the fields of water, soil, air, nature, noise andenergy as well as climate change, biodiversity, resource efficiency, and sustainability.

To date, the Federal Ministry of Education and Research has
invested approximately EUR 100 million in sustainability
research. Within the framework of the “Research for Sustainability” (FONA) program, numerous cooperation networks
focus on areas including sustainable water management,

Whichever way you choose to bring your innovation toGermany, GTAI can support you.
Contact us at invest@gtai.com

Fraunhofer Institutes

Environmental Technology
R&D Institutions

1Fraunhofer Water Systems Alliance

2 Fraunhofer Institute for Environmental, Safety,		

31→and Energy Technology
3 Fraunhofer Institute for Process Engineering

SchleswigHolstein		MecklenburgVorpommern

4Hamburg
1and Packinging IVV
4 Fraunhofer Institute for Structural Durability		Bremenand System Reliability LBF

Helmholtz Centres

Niedersachsen

Berlin112		Brandenburg
North Rhine-Westphalia

Alfred Wegener Institute, Helmholtz Centre for
Polar and Marine Research

2 Karlsruhe Institute of Technology

Saxony-Anhalt

3 GEOMAR Helmholtz Centre for Ocean Research Kiel

24 Climate Service Center Germany (GERICS)

HessenThuringia
1

SaxonyLeibniz Institutes
14Potsdam Institute for Climate Impact Research

2 Leibniz Institute of Freshwater Ecology and Inland		

Rhineland-Palatinate
Saarland

Fisheries (IGB)

Max Planck Institutes
Bavaria22

BadenWürttemberg

31Max Planck Institute for Marine Microbiology

OthersDefiTechno: Deutsch-Französisches Institut fürUmwelttechnik, Environmental Processes

Sources: DFG, Research Explorer – the German Research Directory, GTAI Research 2018

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Nicolas Brahami
Environmental Technologies
nicolas.brahami@gtai.com

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