Protection of the environment is important to the citizens and is viewed as a precondition for prosperity and a good life. The German target of reducing CO2-emissions by 40% until 2020 and by 80-95% until 2050 compared to 1990 requires the transformation of our energy system as well as efforts in all relevant sectors. With the so-called Energiewende, Germany moves away from fossil fuels and transitions towards renewable energy and energy efficiency. It is a central building block of German climate policy. Distortions to the detriment of sustainable energy and climate technologies must be avoided. With the climate action programme 2020, the government agreed to review existing subsidies and look into their environmental sustainability, including a review of whether existing subsidies have a climate-damaging effect. Germany also engages at European and international level for the phasing-out of climate-damaging subsidies, for example, the ESMAP’s Energy Subsidies Reform Facility is supported with funds from the German government. Furthermore, Germany and the other G20 member states agreed to commit themselves at the G20 Summit in Pittsburg 2009 and 2013 in Saint Petersburg to phase-out inefficient subsidies on fossil fuels over the medium term.