Germany’s constitutional court this week in one stroke crushed much of the government’s climate policy and energy transition financing for the coming years and may even have endangered Chancellor Olaf Scholz’s already strained three-way coalition.

The court ruled on Wednesday that redirecting €60bn ($65bn) of unused credit authorisations originally destined for emergency measures to fight the Covid-19 pandemic and its economic fallout into a climate and transformation fund was unconstitutional.