This report offers insights to support key German stakeholders on the implementation of an innovative and promising policy instrument for the decarbonization of the basic materials sectors: project-based Carbon Contracts for Difference (CCfDs).

It analyses selected socio-economic impacts of introducing this policy instrument in Germany. The reports accounts for the perspective of all relevant groups of stakeholders who emerged in the two project workshops and in other engagement activities during the project.

The analysis is structured in two parts. First, an assessment of design options and scale of funding for CCfDs based on case studies for specific materials industries in Germany. Second, a discussion on award mechanisms for CCfDs and potential to combine CCfDs with other instruments, such as the Innovation Fund.